According to this article, a company can differentiate itself from competitors in one of two key ways: by providing a superior customer experience or by offering the lowest prices. “For companies that prefer the former, digital channels are, far and away, the most cost-effective way of reaching out to their clients. The explosive growth of mobile devices means that you can be engaged with your customers whether they are at home, at work, in your store or anywhere else,” the author says.
Measuring customer satisfaction has been a key performance indicator (KPI) for outsourcing agreements. However, we have learned over the past that simple customer satisfaction measurement doesn’t always provide a true picture of the relationship. We have come to learn about the “watermelon effect” where the service indicators are “green” on the outside while internally customers are “red” or dissatisfied.
In the digital age, where transactions are short-lived, this becomes even more crucial and we have to look at satisfaction measures differently. This article references a term called the “Experience Index” introduced by Adobe as a way to measure the effectiveness of the service response based on a consumer expectations survey. In outsourcing, we have to explore this further and adopt new ways of gauging customer satisfaction as a KPI for outsourcing agreements.
Research by the authors has found that firms should not pursue CSR simply for benefits like greater productivity. “If employees think their company is using CSR initiatives instrumentally — trying to engage in prosocial activities only to benefit from it — then they’ll react negatively and put in less efforts,” according to the article. In other words, while these initiatives will benefit society, they will backfire for companies if people think they’re being used for the wrong reasons, the story says.
This is an interesting article and research study about CSR and its impact on corporate profile and productivity. In outsourcing, we have been studying and promoting CSR as a valued element of doing business. We have had case studies (and OWS presentations) where socially responsible outsourcing providers have improved society where they operate and, at the same time, became viable competitors in the marketplace. In those instances, CSR has not been promoted as the sole reason for the business strategy.
This article clearly points out that when customers promote CSR objectives in their service acquisition, they do not achieve the same results and improved business productivity. So, let’s make sure to look at the true cost and benefit of CSR in the outsourcing practice.
Jag Dalal is IAOP’s Chief Advisor, Thought Leadership. He is a world-renowned authority and coveted speaker on management strategies, technology, and outsourcing. His deep experience as a business executive who contracted for these services as well as his leadership experience in establishing outsourcing practice for some of the world’s largest professional services companies; allow him to bring a unique perspective to consulting. JDalal Associates, LLC specializes in consulting in the field of Information Technology, Change strategies and Business Process outsourcing. His clients range from Fortune 100 companies to small “startup” companies from around the globe.