Customer Satisfaction Improvement
Introduction
A large IT managed service provider (MSP) needed to improve customer satisfaction with their largest client, a major insurance company. Two years into the contract, the client’s senior leadership team distrusted the MSP, and the relationship was severely strained as a result. In less than six months, they witnessed an amazing reversal, turning the MSP into a highly trusted business partner.
Background
The MSP acquired a major competitor to diversify its portfolio and increase profitability in an increasingly competitive market. However, the acquisition was not without its challenges. The acquired company's executive team exited too soon, leaving behind managers who lacked faith in the new leadership. Additionally, the acquired company had a long history of focusing on electronic equipment procurement and struggled to meet contractual requirements in its newly acquired services business.
With its largest client, the MSP was losing money on the procurement business due to its inability to deliver within the timeframes outlined in the service level agreement (SLA). This led to frustration and distrust on the part of the client. Despite hoping to improve customer satisfaction through better communication, the MSP felt that the SLAs were unattainable and that its best option was to renegotiate them when it came time to renew the agreement.
Challenge
The MSP faced several specific challenges that contributed to its customer satisfaction problems. Purchased products sat in a large on-site warehouse, awaiting deskside delivery and installation. Tickets were not processed promptly, and there was no real inventory system, making it difficult to track the location and status of products. A team of technicians sat idle most of the day, waiting for direction. Lacking a defined process, the client had learned that getting anything installed required an escalation. This was understandably frustrating for the client, and the MSP created a role specifically to manage and report on those escalations, which was expensive.
Response
To gain a better understanding of the current state, I had the team perform a physical inventory of the warehouse, while I combined the request tickets, invoices, and shipping manifests into a list. This revealed that less than 20% of the items requested in the last two years had actually been installed and established a baseline for the number of escalations.
Next, I split the outstanding tickets among the technicians and instructed them to begin scheduling appointments for installation. The team was surprisingly grateful to be given this massive amount of work. However, it quickly became apparent that some types of installations took many days or could not be completed at all with the existing technology. Several team members had experience in developing systems to automate complex installation and configuration steps, and they began to work on a solution, taking frequent breaks to fulfill low-configuration orders from the backlog.
Within days, we had cleared enough shelf space in the warehouse to build a configuration center and an impressive automation system that eliminated countless hours of configuration. New orders were moved to a hold status until the equipment arrived on site. While this was not strictly permitted in the original contract, the client appreciated the progress that we had made and agreed to an amendment in good faith. After several weeks, the inventory began to dwindle as the technicians installed equipment and processed the backlog faster than new requests were submitted. New orders bypassed the warehouse altogether and were installed on the day of receipt.
Result
The new order process resulted in a greatly improved customer satisfaction score. It also had three unforeseeable side effects:
Since orders were now installed on the day the equipment arrived, the team was regularly meeting the SLA that was previously considered unattainable.
In the rare cases where the requestor was unavailable for installation on the day of arrival, the equipment was stored in a small secured location, eliminating the need for the warehouse altogether.
The role for managing and reporting on escalations was no longer required.
The client's senior leadership team was impressed with the MSP's quick turnaround and demonstrated commitment to improving the relationship, making the engagement an unexpected success for both companies. Additionally, the MSP removed enough costs to transform its biggest account from perpetual loss into a very profitable business that was a model for future pursuits.