Focus on Your Customer’s Customer
One of the things that makes operating a business exciting these days is answering the following question: “Who is our customer?” In the past, companies had much greater clarity on this topic, and it was typically the person paying the bill. This is not the case in many businesses today. Innovations in technology, business models, and even business theory have an impact on the answer to this question. The most successful companies today embrace these concepts, and their culture reflects the impacts of new business models.
One thing that has not changed in business is the concept of scarce resources. Even a company with the luxury of excess capital is constrained in the short term on the ability to deploy it due to the scarcest resource of all – time. It requires time to hire people, onboard an outsourcer, or apply technology or re-engineering. An efficient business is faced with tradeoffs every day. Creating a culture of “customer focus” is not particularly useful if it is not clear who the customer is.
One approach that can help manage in this environment is to always put your customer’s customer first. If you establish a culture around this, good things will usually happen. Conversely, if you ignore your customer’s customer, you will certainly find yourself in hot water in short order. It takes courage and leadership to actively invest in capabilities to serve your customer’s customer, as it will come at the expense of other things.
One of our business segments focuses on TPAs (Third Party Administrators) as our clients. Accordingly, our salespeople work hard to land new TPAs and service the TPA clients that we have. Let’s just say that we like happy TPAs. However, in deciding how to deploy our resources and what kind of culture to build, we must look down that chain a bit. Our TPAs serve Plan Sponsors, who in turn serve retirement plan Participants. All of them are important, and critical to our success.
Potential clients often ask us if we support direct interaction with Plan Sponsors, to which we always respond, “Of course we do.” We also have a tiered service process for escalations. A client, Plan Sponsor or Participant could have a unique issue that might make it all the way to one of our C-level executives, especially if it involves a unique technical issue related to a retirement plan.
At the same time, PenChecks actively invests in capabilities to serve plan Participants. It’s easy to see the investments we make in our contact center, starting with the technologies and tools we use to give more efficient and effective service.sWe also invest in detailed training programs for our customer service agents. We invest in building a knowledge base. And, we invest in a team of agents specifically focused on plan Participants.
We have found that we must not only support direct interface with Plan Sponsors and Participants, but we must encourage it as well. We must make real investments to provide excellent service to all three levels in this chain, not just one. In doing so, we know that we can never go wrong by putting the Participant first, which is why we actively manage our response times, resolution rates and customer service at the Participant level. Not everyone in our industry believes in this approach. Many will not even take a call from a Participant. At PenChecks, we don’t believe that is a winning strategy. It runs counter to our culture.
Time for A New Business Narrative
One way to think about this approach is that if you put your customer’s customer first, the benefits will accrue in reverse. Happy Participants make for happy Plan Sponsors who make for happy TPAs. It makes everyone feel like part of a team rather than individual cogs in a wheel, and that’s how we all win.
We no longer operate in a world where people are solely motivated by revenue growth or profits. Conscious capitalism is a concept that has taken hold, and we agree that changing the narrative about the role of business in our society is an idea whose time has come. We find that focusing on what is best for the Participant not only gives us a greater purpose as a business, it is also just good business sense.