Automation is transforming customer care and call centre landscape

08 November 2016 Consultancy.uk

The customer-care journey is changing as new customer expectations are met with automation and digitalised solutions. One effect will be a decrease in the number of customer-care workers, with more focus on quality over quantity, while low-value transactional interactions will be transformed to self-service or automated. According to a new report, for customer-care representatives this means more focus on skills, including technical proficiencies, while for companies it means more investment in new technologies and changes to their global footprints.

Good customer care can mean the difference between a long and short term relationship with customers, and may have considerable impact on the bottom line and long-term viability of a company. Getting it right remains a priority for businesses across a range of sectors, as new technologies create increasing transparency for customers about the quality of goods and services. Customer expectations around customer-care are also changing – immediacy, personalisation, and convenience are, according to a new report, the new normal for companies seeking to keep up with their peers.

The report from McKinsey & Company, titled ‘Winning the expectations game in customer care’, explores the changing landscape of customer care, not merely in terms of the expectations but also the way in which expectations are impacted by a range of automation technologies, self-service and high-skilled human interactions transforming the way in which customers are serviced.

Expected shift in talent required at call centre and automation

According to the firm, as the proliferation of additional channels through which customers can interact with businesses continues – in-person visits, telephone calls, web contacts, and mobile platforms – the customers are “demanding seamless and consistent service in all of them, not to mention human interaction and security for personal information.”

McKinsey notes, however, that new customer expectations, as well as new digital channels, are creating a host of strategic and HR issues for customer care unit managers surveyed – 94% of whom believe that they will need to hire new highly skilled agents or train current agents with new skills. Just 4% of respondents believe that new technology will reduce the need for skills, while 2% says that there will be no change.

The skills that may be required to successfully operate over the coming five years include exceptional customer-engagement skills (26%), ability to conduct services and sales (21%), problem solving (13%) and technical skills (4%) – 34% of respondents say that all of these skills are deemed important.

Changing global footprint in line with changing needs

The research also notes that the number of inbound calls is projected to fall dramatically over the coming decades, three out of five respondents say that it will decrease over the coming five years, while 40% say that they will receive few, if any, inbound calls within a decade.

The reduction of inbound calls stems from a number of factors. New digital channels allow companies to funnel low-value calls to more automated and online – do it yourself – operators. One of the firm’s previous surveys found that digitalcare channels (such as web chat, social media, and email) had a 30% share of customer-care interactions, by 2020 this is set to increase to 48% according to the respondents. Low-value interactions, particularly those of a transactional nature, are set to be increasingly fielded by online chat or bots.

Automation is another area that is likely to cut into the number of customer care representatives, with respondents suggesting that, besides reducing the need for transactional human interactions, around 25% of ‘exceptional customer-engagement agents’ will be replaced. More and more customers are also likely to be rooted directly to second line technicians rather than customer-care agents, increasing the need for skilled technical support personnel.

The changing trends around the kinds of skills and the level of service required to meet customer expectations means that more and more companies are also reconsidering their outsourcing relationships. 53% of respondents say that their footprint profile will change in the coming five years, 13% say the changes stem from socio-demographic changes, 17% result from changes to talent requirements, while 23% cite ‘other’ reasons. In terms of planning around offshoring services, 55% say that they are not planning to make changes to current arrangements, 28% say that they are planning to increase the practice while 17% say that they will decrease their reliance on foreign workers.

Investing in new technologies is a top priority for almost half of customer-care leaders

Executives are investing in new technologies to meet the market changes and new technological potentials. The report notes that while many companies remain in a state of strategic uncertainty around priorities for their respective operation over the coming five years, for the majority of respondents (57%) reducing call demand and increase self-service is a priority. 47% of respondents say investing in ‘new technologies’ is important, while 38% would like to leverage customer-care to improve revenue-generating activities.

The firm concludes, “As customer care moves from a one-size-fits-all approach to ever more customisation, the stakes for managing this rapid change are rising. Companies that balance the evolving value and complexity of transactions with the right levels of human interaction and automation stand to gain a durable competitive advantage.”

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Four ways digitalisation is transforming car brands and dealers

16 April 2019 Consultancy.uk

From changing expectations from the customer to new stakeholders entering the industry, the digital transformation of global automotive industry means it is facing the wholesale transformation of its business model. In a new white paper, global consulting partnership Cordence Worldwide has highlighted four major digital trends that are transforming the relationships between car brands and dealers with consumers.

With digital transformation drives booming across the industrial spectrum, automotive groups are no different in having commenced large digital transformation programmes to improve productivity, efficiency, and ultimately profitability. Falling sales figures mean the automotive sector is facing an increasingly difficult road ahead, something which means companies in the market are even more hard pressed to find new ways to improve their bottom lines.

While it offers major opportunities, the industry’s move to digitalise is not without complications. It has triggered a series of major internal changes, which have presented automotive entities with the challenge of becoming a “customer-oriented” industry. A new report from Cordence Worldwide – a global management consulting partnership present in more than 20 countries – has explored how automotive companies are navigating the rapidly changing nature of digital business.

New business models

The level of change likely to be wrought on the automotive industry by digitalisation is hard to overstate. Automation could well lead to significant reductions in the number of accidents, higher vehicle utilisation and lower pollution levels, while leading to a $2.1 trillion change in traditional revenues, with up to $4.3 trillion in new revenue openings arising by 2030.

As a result of this colossal opportunity, it is easy to see why almost all automotive groups now have digital departments, with generally strong communication within the digital transformation and the customer approach. The changes to society which this may have are potentially distracting automotive firms from the change it is leading to in its own companies though, according to Cordence’s paper.

The automotive market is dead, long live the mobility market

Because of this, the sector’s business model is set to transform over the coming decades. With digitalisation speeding up the appearance of concepts such as car-sharing, a subscription package model will likely become more palatable. At the same time, car and ride-sharing models will cater to the sustainability criteria of millennials, who will rapidly become one of the automotive market’s leading consumer demographics in the coming years.

Antoine Glutron – a Managing Consultant with Cordence member Oresys, and the report’s author – said of the situation, “These ‘old school industries’ are now working on creating new opportunities, but in so-doing are facing challenges and threats: new jobs, new technologies, new ecosystem of partners, necessary reorganisation, different relationship with customers, and even new businesses. The customer approach topic is in fact a real challenge for car companies as it implies changing their business model and adjusting their mind-set to address the customer 4.0: from product-centric to customer-centric, from car manufacturer to service provider.”

Digital customer experience

In the hyper-competitive age of the internet, even top companies face an uphill challenge when it comes to holding onto customers through brand loyalty. Digital disruption has resulted in changes to consumer behaviour, which is forcing a range of marketing strategists to reconsider their old, possibly out-dated strategies. As modern customers wield an increasingly impressive array of digital tools and online databases, they and are now able to quickly and conveniently compare prices, check availability and read product reviews.

The automotive sector is no exception to this trend, according to the study. In order to adapt to the needs of the so-called ‘customer 4.0’, car companies will increasingly need to change their business model and move away from product-centric companies to customer-centric ones, from car manufacturers to service providers.

Glutron explained, “As an automotive company, you can no longer expect customer loyalty simply with good products; you must conquer and re-conquer a customer that “consumes” your service. The offer now has to be global, digital and personalised. Your offer has to be adapted to this customer’s needs at any given moment. A key issue related to data control is to build customer loyalty by creating a customer experience 'tailored' throughout the cycle of use of the 'car product': purchase, driving, maintenance and trade-in of the vehicle.”

One way in which the sector may be able to benefit from this desire for a tailored experience is via connectivity. Consumers are generally positive about new connective features for automobiles, and many are even willing to pay upfront for infotainment, emergency and maintenance services. Chinese consumers, where the connected car market is set to hit $216 billion, are already particularly interested in paying a little more for navigation and diagnostic features in their future new car. This can also enable automotive companies to exploit a rich vein of customer data, enabling them to rapidly tailor their offerings to consumer behaviour.

New automotive segments

Digital transformation has also brought with it the rise of completely new application areas. As mentioned earlier, the most well-known example is the autonomous or self-driving car, where the last steps forward were not taken by major automotive groups but by technology companies such as Tesla. While this may have given such firms the edge in the market briefly, a number of keystone automotive names will soon be set to take the plunge into the market themselves, leveraging their car manufacturing prowess and huge production capacities to their advantage.

Before companies rush to invest in this market, however, it is worth their while to remember that the readiness and uptake for such vehicles differs greatly geographically. For example, following a study published in 2018, 92% of Chinese would be ready to buy an autonomous car, compared with only around 35% of drivers in France, Germany and US. Meanwhile, the infrastructure of different nations will also be significantly less accommodating of the new technology.

Use digital for steering thr activity

Elsewhere, Cordence’s analysis has suggested that hooking the cars of tomorrow into the Internet of Things is also likely to see a rapid change in the business model for car maintenance, providing real-time diagnostics for problems. This presents chances for partnerships to improve the connectivity of cars, especially with tech companies; for example, PSA partnered with IBM for a global agreement on services in their vehicle. Meanwhile, data could also be sold to other parties with an interest in this data, such as the government, which could use it to manage traffic levels, or ensure that only adequately maintained vehicles take to the road.

Glutron added, “With the increase in the amount of client data and connected opportunities, the recommendation is to set up data-centric approaches. The value is now in the customer data. The general prerequisites are to rework the data model and the Enterprise Architecture and generally build up a data lake including data from all sources (internal and external, structured and unstructured).”

From automotive to mobility

Relating further to the idea of connectivity, the report claimed that automotive firms must now adjust their models in line with the provision of end-to-end mobility, rather than treating the sale of a car as an end point in their relationship with the customer. In order to realise this transformation, transformations are likely to become more and more important.

A network of partner companies means automotive firms can provide a global mobility experience. As the vehicle is increasingly connected to its environment, new partners can also be cities, governments, and other service providers within the global mobility services industry in which the car brands want to take part.

According to the study, the target is clear. Companies must look to a holistic transport service, offering to move customers from A to B in a unique and pleasant way – otherwise they might as well take public transport. At the same time, they should extend the services reachable “on-board” (especially the enhancement of the connectivity between the car and smartphones or other connected devices), and reach high standards in terms of user experience (online sales, online payment, customised experience during and after the use of the car).

Concluding the report, Glutron stated, “These mobility market transformations could be considered a threat for the car manufacturers. Quite the opposite: if they take up the challenge and review their business model so that they become the service provider – communicating no longer to a driver but to a ‘mobility customer’ – they can then take advantage of their expertise and their position as a historical player. The most convenient means of transport are cars, and building a car is highly-skilled work.”