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FMI Quarterly/June 2013/June 1, 2013

Six Keys to Customer Service

getty_emptypromises_imageIn pursuit of a winning edge in today’s hypercompetitive construction markets, contractors have trimmed margins, slashed overhead and burned the midnight oil. Still, many construction firms are struggling to maintain success. Providing superior customer service is an oft-forgotten strategy for separating yourself from the competition. It is a strategy that takes years of dedication and culture engineering. But you have to start somewhere. Here are six tips for building superior customer service.

WIN THE WAR, NOT THE BATTLE

Look for long-term solutions to short-term conflicts and disagreements.
Contractors are proud people, sometimes too proud for their own good. Some would rather lose money, in certain situations, than admit wrong or let clients think that they were right. Pride is not legal tender. Even if it were, it would be cents on the dollar to customer satisfaction.

Anyone with a spouse or significant other will tell you that certain arguments are not worth fighting. He or she cares more about the relationship than potentially “winning” the argument. Most of us will not end up marrying our clients. However, if we truly value the relationship that we have with them, we should take great strides to avoid conflict and aim to reach long-term solutions. Contractors are in business to make money. Why let petty arguments preclude profits?

BE FIRM, BUT FAIR

Do not be afraid to push back when feeling abused by your clients.
This advice may seem to contradict the first assertion. To clarify, you do not have to lose every battle. Just know that it is OK if you do not win them all. There is a thin line between being firm and destroying relationships, between acquiescing to small disagreements and becoming a pushover. The secret to the balancing act does not lie within these paragraphs. Years of negotiating experience and fundamental communication skills are required to disagree tactfully with clients.

Nevertheless, it behooves you to be assertive, when appropriate. Your clients will respect you for being firm, as long as you go about it in a civil manner and provide reason. This practice establishes that you are knowledgeable and represent the client’s best interests.

EDUCATE THE CUSTOMER

You are the expert. Share your knowledge.
Sometimes clients do not want or care to know how the sausage is made. Many trade contractors know the frustrations of this all too well. Mastering the assembly of complex circuitries may be the lifelong passion of an electrician, but this level of detail does not resonate with most clients. The key is not to become numb to your clients’ indifferences. They still want to know things, just maybe not the stuff that gets you out of bed in the morning.

Your customer’s attention is focused most when you fail to deliver on the promises you made to them. Customers care when schedules run long and budgets soar high. Yet, when the customer is most interested, many contractors provide excuses, rather than education and solutions. It is natural to get defensive when the customer’s watchdog barks at you. Stay calm. Failures are the most effective facilitators of learning (and teaching). When you perceive that you are in a crisis with a client, you may actually be in a unique position to sell honesty, integrity, knowledge and, most importantly, a solution.

CREATE BUY-IN

Customers appreciate being part of the solution.
Contractors often sell one solution to a problem, and one solution only. After all, they are the subject-matter experts. They know what is best for the client. However, clients prefer to be part of a solution, rather than prescribed to one. One-track solutions paint the client into a corner, where animal instinct can override logic and rationale. Clients may become defensive, dig in their heels and argue positions out of principle, even if they have lost faith in their arguments.

Providing choice to clients is very useful for creating buy-in. Options allow the client to be part of the process. Moreover, if both parties have their fingerprints on the decision-making process, there is less blame to apportion if, or when, things go awry. The mere presence of choice demonstrates to the client that you have devoted considerable time to working through an issue. Ultimately, you will probably arrive at the same conclusion. But the path of least resistance is through choice.

DELIVER BAD NEWS EARLY

Problems may be difficult to confront today, but sweeping them under the rug will not make them go away … they will get worse!
The sooner you address problems head-on and notify the client, the more likely an equitable solution can be reached. Pestering the client with every single issue is not recommended either. Always go the client with a set of solutions, not a bag of problems.

Generally, clients want contractors to notify them of an issue if it has a material impact on the budget or schedule. In concert with the client, define “material impact” and use that threshold consistently to determine when it is necessary to include the client in resolving a problem. This level of collaboration and open communication will build trust and further your relationship with the customer.

Additionally, contractors must have internal controls to ensure that the customer’s point of contact is aware of project issues immediately. For example, if your project managers are kept in the dark, your client is liable to be uninformed as well. A jobsite foreman may reason, “I was supposed to tell the project manager about that issue, but I told purchasing, and it should have told the PM.” This example illustrates a typical communication lapse that costs contractors time and money, and ultimately frustrates customers.

An internal escalation hierarchy is a good start. It may seem like common sense, but you would be surprised how few contractors actually have this mapped out. Define: Who is supposed to notify whom of what issues, and when, from foreman to superintendent, superintendent to project manager, project manager to customer. This will eliminate finger-pointing and prevent issues from slipping through the cracks. Leverage this structure by creating a sense of urgency among all project team members from the start of the job. Waiting until there is a crisis is too late to build consensus.

TAKE RESPONSIBILITY FOR MINIMIZING THE OVERALL RISK TO THE PROJECT

Even though the specifications might prove you were right, the negative impact on the success of the project will incur a cost on everyone.
Contractors have an ethical obligation to mitigate project costs and reduce risks. Depending on the state(s) in which you operate, this obligation may or may not be a legally binding fiduciary duty. Regardless, acting in the best interest of your clients pays huge dividends in the end.

Be a project leader, not a project witness. That is, be proactive in leading the resources on the job while communicating regularly with the subcontractors and the customer. Many project headaches and customer frustrations can be avoided or lessened through proper planning.

Contracting firms will say that they are great at customer service. “We do whatever it takes to make the customer happy.” Unfortunately, for some, “whatever it takes” means throwing a bunch of resources on a project that is behind schedule. That is not great customer service, but rather inefficiency symptomatic of poor planning. Planning is crucial. Being prepared for unforeseeable project challenges will protect you and your customers from unnecessary loss.

Competing on costs and differentiating on price is a strategy that has left many contractors in a tight spot. As contractors seek alternative differentiation strategies, building superior customer service rings true as a low-cost, low-risk strategy for creating value. Which customer service concepts will you implement in your organization to gain a competitive edge?


Tyler Pare is a consultant with FMI Corporation. You can reach him at 813.636.1266 or via email at tpare@fminet.com.

 

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