Join Stefan Michel for an in-depth discussion in this video What do customers want?, part of Service Innovation.
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- One of the most important, yet most difficult questions to answer when innovating your services, what do customers really want? A common mistake in answering this question is to go through all the elements of your current service and ask where you can improve them. Don't get me wrong, I'm not against improving the service, but in order to breakthrough innovations we need to do more than just improve single elements or attributes. Unfortunately, most of the customer surveys we see today are trying to just that, evaluate customer satisfaction based on current attributes.
Henry Ford, a pioneer in the automotive industry once said, "If I had asked people what they wanted, "they would have said, 'a faster horse'." think about this in relation to a tax accountant as a professional service provider. What do customers want from a tax accountant? Very rarely would someone say, I want to pay more taxes. No, some may say I want to pay fewer taxes, and some would even say, I want to pay no tax without going to prison.
Being from Switzerland myself, I don't want to elaborate on that question, but what is it that we want from a tax accountant? Maybe it's peace of mind, or maybe it's predictability, or for many of us, maybe it's saving time. In order to successfully innovate service, we need a very clear and systematic understanding of what we do and how the customer benefits from it. This relationship is at the core of any successful innovation. For example, if the bank offers a drive-through ATM, which is an attribute, the benefit to the customer might be that the bank helps them to save time.
If the bank stays open until 10pm, they are meeting the customer's need for convenient hours of service. What about the phone company? If they offer a better mobile network coverage it increases accessibility for the customers. In air travel, the flat beds in business class allow the customers to arrive more relaxed. The famous keep the change campaign by Bank of America allowed customers to save money without any effort. Similarly, in the business-to-business setting, if the machine manufacturer offers training to its clients the clients benefit is higher productivity.
Please note that there are often more than one relationship between the attributes and the benefits. For example, a drive through ATM may not only offer time savings, but also safety, or it increases personal mobility and freedom for handicapped customers who cannot walk to the bank. When you meet with customers to find out what they really want, it is helpful to take notes, separating attributes on the left side and the benefits on the right side.
When you see that your customers mention many attributes but no benefits, you need to ask them, why is this important to you? For example, why is the drive-through ATM important to you? A parent my answer that it offers a huge convenience when he or she is driving somewhere with the kids in the car. Getting the kids out of the car to withdraw $40 can be quite a project. In the opposite, when the customers mention benefits, you need to ask how these benefits are chief.
A business traveler is telling you she likes to take the red eye flight from New York to Zurich and then go straight to a meeting. If you ask her how the carrier helps her to do that, she might refer to the arrival lounge where she can take a shower and eat breakfast. To conclude, successful service innovations are based on a deeper understanding of what customers really want. Entrepreneurs and executives need to think about the attributes of the product or service in conjunction with the benefits the customer wants.
Once you understand service innovation in its different forms, you can design and implement your own innovations. Each chapter combines real-world case studies with a methodological framework to help you become a better "idea hunter" for service innovation. After you identify an innovative model, you will learn how to align and execute your innovation by applying the customer star model and by embedding your innovation approach in your overall business strategy.
- What is service innovation?
- Innovating by relieving and enabling customers
- Linking attributes, benefits, and values
- Innovating value constellations
- Innovating outside your firm
- Designing around the customer's need with customer stars