Investing in capability building to enable a customer focused transformation

Challenge

This energy company struggled with low customer satisfaction, sometimes ranking at or near the bottom in industry surveys. To bolster its competitiveness, the firm determined that it needed a completely new approach to customer care, from mindset to capabilities, in order to deliver high-quality customer experiences. It called upon McKinsey to help it achieve that transformation, setting an aggressive goal of becoming the leader in customer satisfaction within two years.

Discovery

At the core of the transformation program was a commitment to engage the whole organization in a collaborative effort to improve customer satisfaction. The client-McKinsey team agreed to build the customer capability based on four pillars:

• Identifying 'passionate individuals' throughout the organization to serve as 'customer advocates' (CAs) to drive the transformation. More than 60 of these change agents were named the first year. The customer advocates were chosen from all levels of the organization, having been recommended by colleagues or volunteered. Their ultimate selection, however, followed a rigorous skills assessment, case study discussion, and interview. They serve as full-time coaches as the transformation program is rolled out to every function in the organization.
• Strong focus on capability building including technical, communication, and leadership/management skills. The curriculum for the 60+ customer advocates encompassed a multi-week training program emphasizing the core principles of lean leadership, and an intensive four-day boot camp. It included 50 modules or 90 hours of training to prepare them to drive the mini-transformations and coach the managers and employees about the "new ways of working." Overall, some 1,600 employees were "touched" by the transformation in the first year.
• Codified customer service and lean management knowledge and methodology in easy to use 'how to' guides for managers and employees.
• Continuous training and coaching of managers. This included a 6-week tailored program incorporating lean leadership fundamentals and the principles of centered leadership.

How it worked

The customer advocates were deployed in the different functional areas where they worked together with the management team to do a 'mini-transformation.' First they diagnosed the current state of the individual area and then designed the future state and an implementation plan.

One key finding was a high variability in how the customers were handled—and this was addressed by 'standardizing' (or codifying) the processes of how best to serve the customer in specific circumstances. Then employees’ skills were developed through training and 1-2-1 coaching. A structured approach was put into place to track progress as they became more adept at managing customer situations in the improved, consistent way.

McKinsey brought unique resources to develop and execute this immersive capability building strategy and program. These included a cadre of operational transformation experts, external facilitators and coaches, and experts in customer contact and customer experience. Finally, a center of excellence was established to ensure sustainability and continuous improvement of superior customer care and a training curriculum helped institutionalize the new approaches throughout the company.

Impact

The transformation is continuing; the capability change team engaged customer-facing functions first before moving to internal functions such as HR and finance. The investment is paying off for the company with significant improvements across both efficiency and customer and employee satisfaction. Within the first year of the program launch:

• productivity or capacity of customer-care employees increased on average by 15 to 25% (although some functional areas have experienced improvements of several hundred percentage points)
• more than 50% of the employees say they understand and are excited by what the organization does, where it is heading, and what this means for their role
• the percentage of employees who agree they have appropriate training has tripled
• customer satisfaction improved by more than 15 percentage points for one of the key customer 'journeys' or experiences

All of these impacts have been achieved while lowering the cost base significantly (about 15% to date).