In reviewing the 11th annual shippers choice awards in the current issue of Canadian Transportation & Logistics, I noted with interest that of the hundreds of carriers rated in the survey, only 57 were able to surpass the Benchmark of Excellence. The magazine presents a number of KPIs (Key Performance Indicators) and lists the scores of the top ranked carriers, by sector (e.g. LTL, truckload etc.), along with the Benchmark scores.
Unfortunately, too many trucking companies are viewed as commodities and don’t measure up. Being less positively viewed by shippers can make it difficult to achieve satisfactory pricing levels and as a by-product, satisfactory operating ratios. The data highlights the importance of customer engagement, of being superior at meeting shippers’ needs.
Many companies bring their leadership and management teams together on a quarterly or annual basis to craft/update their budgets, strategies and business plans for the coming year. In a recent McKinsey Quarterly report, prepared by consultants Tom French, Laura LaBerge and Paul Magill of McKinsey & Company, the writers suggest that many companies are fragmented in their approach to customer interaction and engagement. The consultants offer a six step plan for superior customer engagement.
1. Hold a Customer Engagement Summit
They suggest that the leadership teams in companies should hold a “customer engagement summit”. They argue that senior managers, from all departments of the company, should look beyond the basic interactions that customers have with various departments. The meeting should focus on developing strategies to motivate customers to invest in a continuing relationship with the company and its services. In other words, companies should implement strategies that move shippers along the customer loyalty continuum.
2. Focus on Three Factors
The writers outline three factors that should be addressed in formulating a customer engagement strategy. First the company should construct a vision for how it wishes to build relationships with its customers. Second, the company should craft an integrated and consistent strategy for interacting with customers across its various departments. For a trucking company, the customer interactions with Sales, Customer Service, Dispatch and Claims should be in harmony. Third there should be agreement on the components of the company’s customer engagement system that will be undertaken in-house or via its partners (e.g. beyond carriers, carrier partners, pick-up and delivery agents etc.).
3. Create a Customer Engagement Council
The consultants suggest that there is value in creating a continuing in-house forum to discuss and co-ordinate customer engagement throughout the organization. Of course, for those companies that truly wish to meet their customers’ needs, there is the option of creating a mechanism to obtain first hand input from their clients. This can be via a focus group, customer survey or a similar research tool to measure the impact of a company’s customer engagement strategies on its customers. The research results can be compared to other objective measurements such as Canadian Transportation & Logistics Annual (Canadian) Shipper’s Choice Awards Survey or Logistics Management’s (American) Quest for Quality Survey.
The authors write that “when conceived, constructed and operated correctly, these customer-engagement councils play a critical role in breaking the ‘silo’ mindset that diminishes the effectiveness of customer engagement in many organizations”.
4. Name a chief content officer
It is important to control the message that is sent to prospects and customers. The consultants suggest that the content made available to customers should be sophisticated and interactive. Since many trucking companies are still in their infancy in embracing social media, the appointment of a chief content officer, as a full time position, would be a bit of a stretch at this point in time. Nevertheless, there is value in creating a “go to” person for all customer communication to ensure it is consistent and meets the requirements of customers.
5. Create a Listening Centre
Being an effective listener is a key element of a sound customer engagement strategy. It is important to obtain and share information from the various “touch points” where customers interact with a company. At the same time, there is a requirement to at least monitor the relevant social media where a trucking company’s services, policies, and employees are discussed. While many trucking companies are still new to participating in social media, there is value in connecting to the most relevant blogs, forums and LinkedIn groups where trucking company issues are debated. Active listening allows companies to become aware of and address concerns, perceptions and problems articulated by prospects and customers.
6. Adjust your budget
The consultants suggest that companies often perceive the costs of performing these activities as an additional expense and unaffordable. They argue that the money to do these things is available but it is allocated to less productive efforts (e.g. trade journal or buyers’ guide advertisements).
Companies that actively engage their customers have the opportunity to differentiate their services and their brand. Improved customer engagement can lead to improved customer loyalty and revenue retention. Is your trucking company taking the necessary steps to top the list in the 12th annual Shipper’s Choice Awards Survey next year?