Tag: strategic planning

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Telephone Answering Service

Match AI Technology with Answering Service Strategy

AI Answering Service Strategy

Embrace Artificial Intelligence to Help You Meet Your Goals More Effectively

By Peter Lyle DeHaan, PhD

Many people worry about how artificial intelligence (AI) might impact our world, including their telephone answering service (TAS) business. They fear AI will emerge as a disruptive force that fundamentally changes their day-to-day operations. It probably will.

Author Peter Lyle DeHaan, PhD

But there’s no need to fear AI. Instead embrace it. The key is to align the promise of AI with your business strategy. Tap this burgeoning technology to better accomplish your goals for your TAS operation.

Here are some scenarios to consider.

Basic Service

Some clients are on a budget. They know voicemail won’t cut it, but they only need the basics of name, number, and message. They view anything more as frivolous. AI can come to the rescue. This will first be in supplementing the work of your staff, with an eventual potential to replace much of their work, but not all.

Low-Cost Service

If your answering service strategy is to be a low-cost provider, AI will be a great tool to help you save on labor costs, while still providing the level of service your clients want and expect and pay for.

But don’t expect AI to replace your staff. Instead view it as a tool to help your agents do more in less time and to do it better with greater ease.

The result is that AI will help you maintain your low-cost paradigm and maximize it for your clients’ benefit.

Premium Service

A third consideration is the value-added approach. Your goal is to offer more than your competition. In the past, the premium service strategy drove up payroll, not only in needing more staff but also in paying them more.

In offering premium service, however, there comes a point of diminishing returns. At some level, clients will balk at paying more for the extra value. They’ll decide it’s not worth a higher bill, no matter how much better your service is.

In this instance, you can tap AI to handle supplemental activities that increase the value of your service without growing your payroll. This can be on both the front end and the back end. Use your imagination. Get creative.

Summary

These three examples show how AI can help you achieve your answering service strategy in a cost-effective way. But these are just the starting points. Develop your ideal service strategy, and then look at how AI can help you better achieve it, not the other way around.

Learn more in Peter Lyle DeHaan’s book, How to Start a Telephone Answering Service.

Peter Lyle DeHaan, PhD, is the publisher and editor-in-chief of TAS Trader, covering the telephone answering service industry. Check out his books How to Start a Telephone Answering Service and Sticky Customer Service.

Categories
Healthcare Call Centers

Finish This Year Strong

How We Conclude One Year Prepares Us for the Next

By Peter Lyle DeHaan, PhD

How has this year been in your healthcare call center? I suspect you’re ready for it to end. Though you may feel that way every year, the magnitude may be more pronounced this year.

Author Peter Lyle DeHaan, PhD

All the rapid changes and stressors in the healthcare industry pile on additional burdens on the call centers that support them. Practitioners expect you to do more, and patients want you to do it better.

You’re stuck in the middle. In addition, there are staffing issues, employee compensation expectations, and budget constraints.

In situations like these the tenancy is often to merely hold on for the rest of the year and enjoy whatever holiday respite you can squeeze out. You won’t think about—or worry about—next year until the time comes.

But I encourage you to do just the opposite.

Strive to finish this year strong. Though you may feel like coasting, don’t. Continue the momentum you have behind you to make the most of this year’s remaining days. This will best set you up for success next year. Doesn’t everyone want that?

Here are some ideas to help you finish this year strong:

Enjoy This Season

Though your work is important, it’s not everything. At least it shouldn’t be. Take time to enjoy this holiday season in your nonwork moments. And whenever you have the opportunity, enjoy the holidays at work too.

Remember the adage about all work and no play. Don’t be that person.

Thank Your Staff

Just because Thanksgiving in the United States has passed, doesn’t mean the time of being thankful is behind us. Take the time to thank your staff. Be intentional.

In a job that is short on appreciation and too often focused on criticism, a heartfelt thank you can go a long way to let your staff know you care.

Smile whenever you can. Do this even when you don’t feel like it—especially if you don’t feel like it. Smiles are contagious. Never forget that. Let your countenance communicate your thankfulness throughout the day, even when you don’t say the words.

Celebrate Your Stakeholders

Remember why you do the work you do. It’s to help others in better addressing their healthcare needs and making their life better. Without them you wouldn’t have a job. Don’t forget to celebrate them.

The patients and callers who contact you every day are your biggest group of stakeholders.

Yes, they may be crabby at times and occasionally critical. But use this as a reminder to know how important the services you provide are to them and their lives. After all, if what you did for them didn’t matter, they wouldn’t care how you did it.

Your stakeholders also include your boss, your employer, and your organization—be it a for profit business or a nonprofit entity. These are all stakeholders in your call center operation. Celebrate them, all of them.

Wrap Up What You Can

As you go about these initiatives, look at your project list. Surely you won’t be able to finish them all this year but resist the urge to let them all carry forward to next.

Each thing you can knock off this year is one less thing on your plate for next. And won’t that be a relief knowing that it won’t be hanging over your head in the coming twelve months?

Conclusion

To finish this year strong, remember to first enjoy the season. As you do, thank your staff, and celebrate your stakeholders. Last wrap up whatever pending projects you can so that they don’t dog you into next year.

When you take these steps, you’ll be poised to finish this year strong, paving the way for success next year.

Read more in Peter Lyle DeHaan’s Healthcare Call Center Essentials, available in hardcover, paperback, and e-book.

Peter Lyle DeHaan, PhD, is the publisher and editor-in-chief of AnswerStat and Medical Call Center News covering the healthcare call center industry. Read his latest book, Sticky Customer Service.

Categories
Telephone Answering Service

Does Your TAS Do More Than Take Calls?

Answering Services Should Seek to Diversify Their Service Offerings

By Peter Lyle DeHaan, PhD

I’ve often encouraged telephone answering services to expand their service offerings. One option is to become a multichannel provider. A wise approach that aligns with the core mission of facilitating client communications is to handle additional channels.

This can include email processing, text services, web-based chat interaction, and social media monitoring.

Some answering services have moved in this direction with varying degrees of success. Others have contemplated it but are yet to act.

Another camp is those that have resisted offering other communication channels. I get that. Pursuing what is different presents challenges and is scary.

Yet it’s important for any business—including answering services—to diversify their service offerings to better prepare for the future. Whatever your perspective of this multichannel strategy, here are some ideas to help you move forward and realize success.

Select One Channel

Don’t pursue a multichannel strategy by diving into every opportunity at once. Strategically select one option and resist the urge—no matter how tempting—to let another channel distract your attention.

Which channel are you most comfortable pursuing? Though this is a good place to start your deliberation, don’t stop at this point.

Next, evaluate the strength of your existing staff. Which channel best connects with their inherent skill set?

Third, check with your vendor to see which option they can best and most easily provide through your current system. You’ll want to integrate this new channel in with your existing answering service platform.

A last step, which could also be your first one, is to check with your existing client base and gauge their interest for each channel option.

Ideally, you should select the channel that your existing staff has the skills to address, will work on your current platform, and you can market to your established client base.

Proceed With Care

Once you’ve selected a second communication channel to pursue, plan carefully before you proceed. Don’t announce this new service and solicit customers expecting to figure it out as you go. Train your staff. Test your platform. Anticipate potential problems and adjust as needed.

Do all this before you sign your first client to this new channel.

Market the Channel

Once you’ve done all the needed preparation, now is the time to promote this new service. Start with your existing client base. Perhaps even handpick clients who will be predisposed to work with you and help you fine tune your offering.

After you’ve added the service to all your existing clients who are interested in it, begin a proactive sales and marketing campaign to solicit new business specifically for this channel. As a bonus, you can cross sell them on your voice channel.

Master This Channel

As you gain success in the second channel, resist the urge to add another one too quickly. Excel at this channel before you consider diversifying further into a third one. Don’t rush it. But don’t coast either.

Repeat When Ready

Once you’ve achieved operational and financial success on your second channel, you’re ready to replicate the process with a third one. You may desire to expand quickly and repeat your success.

But it may also be wise to take a strategic pause to settle into a new rhythm of offering two channels before you proceed to add a third. Just be sure not to remain there too long.

Multichannel Success

Keep moving forward to diversify your service offerings and become a multichannel provider. Your future will thank you.

Learn more in Peter Lyle DeHaan’s book, How to Start a Telephone Answering Service.

Peter Lyle DeHaan, PhD, is the publisher and editor-in-chief of TAS Trader, covering the telephone answering service industry. Check out his books How to Start a Telephone Answering Service and Sticky Customer Service.

Categories
Telephone Answering Service

Conduct a Year-End Review

To Know Where You’re Headed You Must First Determine Where You Are

By Peter Lyle DeHaan, PhD

Author Peter Lyle DeHaan, PhD

Year end is an especially busy time at most telephone answering services, but that’s not an excuse to focus strictly on the present and stop thinking about the future. In fact, December is an ideal time to give some thought to where you are and to what lies ahead so that you can prepare for next year. It starts when you conduct a year end review.

If you don’t know where you are, it’s impossible to get to where you want to be. Take some time now to evaluate your current situation. This will form the basis to move forward with intentionality next year. Here are some things to assess.

Staff

Let’s start your year end review with a look at the backbone of your answering service, your employees. They make you shine, but they can also produce problems, affecting your clients, the schedule, and overall profitability. In short, they can make or break your business. Here are some questions to ask:

  • Telephone Staff: Do you have enough frontline employees to answer phone calls? Don’t worry (too much) if your answer is no; you’re in good company. This fact, however, provides you with an opportunity for improvement.
  • Staffing Model: Do you have a centralized workforce, a distributed one, or a hybrid plan? What elements of this works for you? Which ones do not? What needs to change?
  • Turnover Rate: Do you struggle to achieve an acceptable turnover rate? Regardless of where you’re at now, what steps do you need to take to lower it?
  • Operator Quality: Are you producing the quality service you aspire to offer and that your clients expect? Can you quantify your answer, or is it wishful thinking?
  • Non-Operations Staff: Do you have adequate management and support personnel? In addition to operations, look at accounting, sales, marketing, and technical roles, as well as administration. Consider your strongest areas and weakest. How can you keep your top employees? How can you best help those who struggle?
  • Yourself: Do you have adequate time to address what’s most essential for your answering service’s long-term viability? Or do you spend too much time putting out fires and handling day-to-day minutia? What steps can you take to be the leader your answering service needs?

Vendors

Your software and equipment provider is a critical element of your operation’s success. Leading vendors strive to enhance their offerings every year, providing new capabilities and value-added opportunities.

Look at your annual expenses to use their products. This includes one-time charges, ongoing costs, and leases. Is the vendor easy to work with? Do they provide you with what you need to achieve your goals? How is their tech support?

And if your vendor isn’t providing what you need or keeping pace with the industry, consider what you can do to help them achieve the results you want. Work with them, not against them. Changing vendors is the last thing anyone wants to do, so your first goal should be to make the best of what you have.

Industry Developments

Here are some common answering service industry trends to consider:

  • Consolidation: The industry continues to consolidate. This produces an opportunity to sell. It also provides niche markets that nimble, smaller players can capture.
  • Competition: At the same time, the remaining operations encounter increased competition in a national and even international marketplace. How can you make your service stand out?
  • Labor Market: Coupled with these two items is that most services have recently experienced an unprecedented challenge in hiring qualified employees and keeping them. Successfully addressing this dilemma could provide the biggest boost to your operation.
  • Technology: The next consideration is technology, which allows you to do more and to do it more easily, but it comes at the cost of a greater investment, coupled with increased configuration complexities.

What else would you add to this list of industry trends?

Marketplace Opportunities

You compete in a national market, but you exist in a local one. What can you do to rise above other providers around the country? What can you do to distinguish yourself in your local marketplace?

Financial Situation

For the final element of your year end review, look at the money side of your answering service. Two common items to address are increasing the money coming in and decreasing the money going out. Another item is access to capital, along with building up reserve fund.

Moving Forward

Don’t attempt to tackle this lengthy list of a year end review all at once. Work on it over time, adding to it and fine-tuning it as you go. As you move toward the completion of this effort, a strategy to move forward will emerge.

Use this as your plan for next year. May it be your best one yet.

Learn more in Peter Lyle DeHaan’s book, How to Start a Telephone Answering Service.

Peter Lyle DeHaan, PhD, is the publisher and editor-in-chief of TAS Trader, covering the telephone answering service industry. Check out his books How to Start a Telephone Answering Service and Sticky Customer Service.

Categories
Telephone Answering Service

Is It Time to Rethink Your TAS for the Long Term?

Apply Your Experiences of the Past Year to Chart Your Future Course

By Peter Lyle DeHaan, PhD

Author Peter Lyle DeHaan, PhD

Throughout my career, at both the businesses I’ve managed and the ones I’ve owned, I’ve sought incremental improvements, making small ongoing tweaks on a regular basis. By fine-tuning processes and paradigms over time, I made the operation better without subjecting employees to deal with substantial change.

Yet there are times that require significant correction. As an industry, we are at one of those crossroads. Here are four areas that warrant strategic contemplation.

Location

Since its inception, nearly a century ago, the telephone answering service industry has operated out of a singular location. Although the concept of remote operator has been an option since the late 80s, only within the past decade has the promise of a distributed workforce become a viable consideration.

With few exceptions, answering service owners and managers hold a firm perspective on which setting—centrally located or geographically dispersed—is the best. Most, understandably, prefer a centralized workforce.

Now, however, is an ideal time to push aside this proven, preferred way of doing business to at least consider the alternative. This distributed model can work out of dispersed offices, from employ’s homes, or a combination of both. The centralized location, and all its associated cost, can become relegated to history.

Platform

For the past decade or so, answering services have had two platform configurations to choose from: on premise or offsite, also known as SaaS (software as a service). Both have their advantages, as well as their drawbacks. There is no one universally right answer, but there is a right answer for your service and what you want to accomplish.

Take a serious look at the strengths and weaknesses of your current platform configuration. Contrast this to the opposite situation and see which one is the better strategic move for the long-term. Consider stability, flexibility, cost, and future potential. There is much to contemplate.

Staffing

Relating to location and platform type is the staffing paradigm you want to pursue. Many managers desire to see their staff at work each day, or at least be able to work some of their shifts at the main answering service location. This requires all employees to live within driving distance of the service.

This requirement, however, limits your labor pool. What if agents could do all their work remotely? What if you could fully train them at a distance? Then your potential labor pool expands geographically, as well as allowing you to consider nontraditional workers, such as the homebound but otherwise qualified employee.

Management

Make no mistake, it’s hard for most to manage a distributed workforce. What worked well in person seldom translates to a dispersed team working from multiple locations. This may be the hardest transition of the four to make. It requires learning, implementing, and mastering the ability to manage from a distance. Most will find it challenging, but it may prove a necessary pursuit.

Conclusion

The last year has given us significant glimpses or actual experience that touches on each of these four areas. With this as the historical background and an unknown future ahead, now is the time to think strategically and make these wide-ranging, future-facilitating changes to your telephone answering service.

Prepare now to better deal with whatever the future throws at us. Regardless of what happens tomorrow, you’ll be glad you planned for it today.

Learn more in Peter Lyle DeHaan’s book, How to Start a Telephone Answering Service.

Peter Lyle DeHaan, PhD, is the publisher and editor-in-chief of TAS Trader, covering the telephone answering service industry. Check out his books How to Start a Telephone Answering Service and Sticky Customer Service.

Categories
Business

Let’s Watch a Movie

By Peter Lyle DeHaan, PhD

When someone says, “Let’s watch a movie,” what’s the first thing that comes to mind? Do you immediately think of a group outing to go watch the latest flick? Perhaps your preferred viewing venue is the more cozy environment of your living room couch. Could it be that watching a movie is a solitary experience for you, one you enjoy parked in front of your laptop computer?

Whatever it may be, there are a multitude of options for watching a movie—and a diverse list of business enterprises that support those variations.

Consider the Following Options for Watching a Movie:

  • Drive-in Movie Theaters: This is not likely where you would start your list, but, yes, drive-in movie theaters still exist—and there is a resurgence of interest. According to drive-ins.com, there are 520 drive-ins operating in the United States today.
  • Single-Screen Theaters: The traditional theater with a solitary screen is also waning in popularity and in numbers, but it is not a thing of the past either. Close to where I live is a one-screen theater that has been making a go of it—and attendance is increasing.
  • Multiplex Theaters: The multiscreen theater is the premier venue for the off-site (that is, away from home) movie-viewing experience. These theaters offer multiple titles and varied viewing times. For major openings, they can show films simultaneously on multiple screens and with staggered starting times.
  • Network TV: This is the least costly option for those willing to wait to watch a particular movie. With an antenna, viewing is essentially free, sans the electricity to operate the TV. If you have cable or satellite, the effective cost goes up, but still, there is no incremental per movie charge.
  • Movie Channels: Some movie channels are included as part of a cable/satellite subscriber package, whereas others require a monthly subscription. These are great ways to watch current and classic movies—and everything in between—providing you are willing to scrutinize the programming schedule for desired titles.
  • Pay-per-View: This is generally available on cable/satellite systems, allowing for the viewing of movies (limited to what is offered and when it is showing); there is a charge for each viewing. Essentially this model combines the scheduling and admission elements of a theater with the comfort of home viewing.
  • Video-on-Demand: On-demand is pay-per-view without the schedule. Start a movie at any time, on any day.
  • Local Video Rental Store: Video rental stores function as a library for movies—except that there is a cost for each rental. Most stores are fairly limited in their titles and may stock a few copies.
  • Mail Rental: Netflix (90,000 titles) led the way with this option, with Blockbuster (80,000 titles) and others following. This service allows customers to order a movie online and have it mailed to their home, often by the next day. Watch the movie and mail it back—with free mailing. Although advance planning is required, it is less hassle than driving to a video rental—twice—and there are many more titles and copies available.
  • Download Rental and Streaming Video: This is much like the video-on-demand option, but it utilizes the Internet for distribution (think YouTube, with high quality, for movies). Currently Netflix and Movielink (acquired by Blockbuster).

What does all this mean? Plenty—and it can apply to any industry or business.

The movie distribution business is highly fragmented with many competing variations. Each of the options listed has a threatened existence. Some of them are arguably obsolete, requiring innovation and determination to remain viable. Many are feeling competitive pressures that endanger their existence. For those on the leading edge, technological advances could render them obsolete in an incredibly short time.

Let’s revisit the list again, with these issues in mind:

  • Drive-in Movie Theaters: This is an obsolete option. Those that have survived have adjusted their business model and reinvented themselves to make it work. Over 500 have done just that.
  • Single-Screen Theater: This option is one step removed from the drive-in. Those that have stayed open have figured out how to market themselves and fit into a desirable, sustainable niche.
  • Multiplex Theater: The leader among off-site movie viewing, and the conventional business model, the multiplex is facing increased and intense pressure from the remaining options on the list (except for network TV).
  • Network TV: This is the last distribution node to obtain a movie after its release; therefore, it is typically the last option we consider. How would you like to be the least preferred option and garnering decreased interest? Enough said.
  • Movie Channels: An option for many, but increasingly viewed as limited in comparison to the next five options.
  • Pay-per-View: You get to see movies closer to their release date than the preceding options, but the titles are quite limited in selection and somewhat restricted by schedule.
  • Video-on-Demand: This solves the scheduling restriction of pay-per-view, but still suffers from limited titles.
  • Local Video Rental Store: Who wants the hassle of going to a video store to rent a movie, especially without knowing if your title will be available? Succinctly put, this model is rapidly approaching obsolesce. This is precisely why Blockbuster ventured into rental via mail.
  • Mail Rental: Netflix changed how we rent movies, but this model will quickly fade. Downloading movies will soon make this option passé.
  • Download Rental and Streaming Video: This remaining option seemingly has no immediate threats, but it is a technology-based solution, and technology changes rapidly. As such, a pervasive threat to this business model could erupt at any moment and with little or no warning.

Fragmented Industries

Many industries are likewise fragmented. Some businesses are stuck in the past. These companies, mired in obsolescence, are still in business because they have done what the drive-ins and single-screen theaters have done: somehow they reinvented themselves, found a niche, and marketed effectively.

Then there are organizations that are trapped in their business plan, traveling down a narrowing road. Perhaps their distinctive advantage is their staff, but they can’t hire enough qualified employees. Maybe they have staked their future on an uncertain and questionable strategy. Others are loaded with technology, but the next competitive technological innovation could render all that they have as something that no one wants.

This analysis is not unique to movie distribution. It exists in every business, in every industry, and in every economy. Some will survive and some won’t.

The key is taking what you have and using it to your advantage, perhaps in a way that no one else has thought of. It could be your location, your staff, your technology, your niche, your management team, your leadership, or something else.

If you have none of these options, then perhaps it’s time to morph into another line of business, be it within or apart from the industry in which you are currently a part of.

Regardless of your situation, with determination and innovation, there’s always the opportunity to reinvent your business. The one solution that won’t work is to do nothing at all.

Read more in Peter Lyle DeHaan’s Sticky Series books, including Sticky Customer Service, Sticky Sales and Marketing, and Sticky Leadership and Management featuring his compelling story-driven insights and tips.

Peter Lyle DeHaan is an entrepreneur and businessman who has managed, owned, and started multiple businesses over his career. Common themes at every turn have included customer service, sales and marketing, and leadership and management.

He shares his lifetime of business experience and personal insights through his books to encourage, inspire, and occasionally entertain.

Categories
Business

We’re on a Mission

By Peter Lyle DeHaan, PhD

For years, a reoccurring line from the movie Blues Brothers has puzzled me. I’m not sure if I should be offended or amused with the protagonist’s assertion, “We’re on a mission from God.”

The “mission” of this critically disparaged, yet once popular film, might be to simply levy mayhem upon Chicago. However, the epiphany of Jake and Elwood is to “put the band back together.”

As mission statements go, this one lacks sophistication. Yet it possesses eloquence and empowers.

Author Peter Lyle DeHaan, PhD

When most organizations develop a mission statement, they spend months or even years creating the perfect blend of sentiment, intention, and promise, often presenting it with polished prose.

The result is added to the employee handbook, printed on marketing pieces, and hung on a plaque in the lobby. In reality, many of these are not mission statements at all, but often amount to nothing more than thinly disguised marketing.

An effective mission statement has several important characteristics:

  • It needs to be readily understood by those it applies to.
  • It needs to provide direction and guidance in everyday decision making.
  • It needs to be concise, allowing all stakeholders to learn it, follow it, and internalize it.

Unfortunately, most organizations’ mission statements do not fit any of these criteria. The Blues Brothers’ mission does. Each time they share it, everyone understands it; it provides direction, and it is easily learned, followed, and internalized.

Still their mission seems trivial. This is because behind every mission, there is a supporting vision. The vision of the Blues Brothers is to raise money to save the orphanage that raised them and has now fallen on hard times. This vision is why their mission is so important. The mission is not the end, but rather a means to the end: saving the orphanage.

Mission and vision, however, aren’t enough. Just as the mission is supported by a vision, the vision is deployed through goals. The goals of the Blues Brothers are simple: contact former and prospective band members, get them to join the group, hold a benefit concert, and give the money to the orphanage.

Therefore, the Blues Brothers’ business plan looks like this:

Mission: Put the band back together

Vision: Save the orphanage

Goals:

  • Contact musicians
  • Form group
  • Hold concert
  • Give proceeds to orphanage

Now it’s time for some introspection. Does your organization have a mission? A vision? What are your goals? If you don’t have a mission statement, now is the time to develop one. Start today; don’t delay.

Make sure your staff is supported by and directed through a practical mission statement; don’t let them flounder. Remember the wise saying, “Where there is no vision, the people perish.”

If you already have a mission statement, is it the hang-on-the-wall, marketing-ploy type or the succinctly worded axiom that directs daily actions and guides decisions?

Maybe your stated purpose is a real mission statement. If so, is it short enough for your staff to learn, follow, and internalize? Is it readily understood? Does it serve as a guide for daily decisions and actions?

The conventional wisdom is that creating a mission and forming a vision is a group activity, something done by a committee, with input and review throughout the organization. This is done to get the buy-in of all stakeholders.

Yet the reality is that when a mission is developed this way, it becomes less relevant as turnover occurs. After a few years, the statement becomes increasingly meaningless; then a new committee meets to create a different declaration.

This approach is the wrong. Yes, you do need to have the support of the rank and file for your mission, but its origin must be from leadership. The mission must come from the top. Then it needs to be communicated, not once, not from time-to-time, but frequently and repeatedly.

Over time it will be embraced by those it’s intended to support. In due time, it will become understood and internalized. Coming from leadership and supported by management, it will begin to permeate the entire organization, directing actions and guiding decisions.

With this as the expected outcome, make your mission statement your top priority; your future may be at stake.

What’s your mission?

Read more in Peter Lyle DeHaan’s Sticky Series books, including Sticky Customer Service, Sticky Sales and Marketing, and Sticky Leadership and Management featuring his compelling story-driven insights and tips.

Peter Lyle DeHaan is an entrepreneur and businessman who has managed, owned, and started multiple businesses over his career. Common themes at every turn have included customer service, sales and marketing, and leadership and management.

He shares his lifetime of business experience and personal insights through his books to encourage, inspire, and occasionally entertain.

Categories
Business

The Future is Now: Learning from Netflix

By Peter Lyle DeHaan, PhD

Go back with me a few years. Internet-centric companies were the next big thing. It was purported that they would change how business was done, render traditional commerce models obsolete, and usher in a new way of valuating companies—at historically unfathomable and untenable levels.

They were the dotcoms! Their basic premise was insightful, if not somewhat simplistic and naïve. With the pull of the ubiquitous Internet and the support of massive server farms, their business models (that is, their technological infrastructure) would be infinitely scalable, while customer service would be strictly self-service. This would keep costs down and the employee count even lower. Page hits and profitability would be the inescapable conclusion. Unabashed euphoria was everywhere.

The problem was that most people were not ready for and did not embrace self-service via the Internet. Not surprisingly, the dotcom bubble burst. Stock prices plummeted, bankruptcies ensued, and computer hardware was peddled for pennies on the dollar. Most dotcoms dematerialized even quicker than they had materialized. Some companies tried to retool, admirably adhering to the faltering dotcom mantra; it was an effort in futility.

A few insightful innovators listened to their customers and changed their paradigms, wisely supplementing their limited and lacking self-service Websites with full-service human beings. Call centers were built and staff was hired. The clamoring dim of the masses was largely satiated and these adaptable entities survived. Some even thrived, having found the perfect mix of massive computer technology and the personal touch.

But what about Netflix? Born in the dotcom era, Netflix embodies the highly scalable, self-serve model that had failed most. Not only has it succeeded, it has done so exponentially and most effectively. For the uninitiated, Netflix is an Internet-based DVD movie rental service. Members log into the Netflix Website, browse a selection of 70,000 titles, putting requested titles into their personal queue, where they prioritize their preferred delivery order. The first movie generally arrives via mail the next day. There are no due dates, no late fees, and no shipping charges. Once viewed, the DVD is returned via a prepaid self-mailer. Upon receipt, Netflix automatically sends the next movie in queue. Netflix’s 42 regional shipping centers manage 42 million DVDs and ship 1.4 million a day.

Their website includes movie write-ups, reviews, member ratings (1.5 billion of them), and recommendations for titles similar to what has been enjoyed by that member. Interestingly, Netflix customer service is 100% self-serve. [Netflix does have a toll-free number for prospective customers and an email address for media queries—which is how I found out about the toll-free number; I never did find it on their Website.]

With Netflix, there are no call center agents, no email support, and no text chat options. Its Website does have a help section; it is actually helpful. Its list of FAQs are truly questions that one might want to ask (I did); there is also context specific hints, instructions, and explanations. The site is quite intuitive and easy to use.

Given all this, is Netflix an anomaly or an indication of what is to come? Although it is currently atypical, it is also a model on how to effectively and successfully design a Website, support customers, and engage visitors. It is, or at least it should be, a peek into the future.

Although wide-scale defections from full-service options to self-service Websites is not an eminent threat, it is one, nonetheless. Businesses are therefore advised to pursue a two-prong strategy. The short-term—and continuously ongoing—initiative should be to look for ways to differentiate oneself from the competition. Make your company and services stand out; do what others don’t—or can’t; position yourself to be indispensable.

Long-term, be aware that commerce, in general, and customer service, specifically, will migrate to the Web. What can your business do to capitalize on this? The answer may have little to do with the business you currently run, but it will have everything to do with your long-term viability. Fortunately, there is time to consider, study, and plan for these eventualities, but preparation is requisite because this is a threat that won’t go away; ignoring it will be to your peril.

Read more in Peter Lyle DeHaan’s Sticky Series books, including Sticky Customer Service, Sticky Sales and Marketing, and Sticky Leadership and Management featuring his compelling story-driven insights and tips.

Peter Lyle DeHaan is an entrepreneur and businessman who has managed, owned, and started multiple businesses over his career. Common themes at every turn have included customer service, sales and marketing, and leadership and management.

He shares his lifetime of business experience and personal insights through his books to encourage, inspire, and occasionally entertain.