Customer Centric – best practice examples
Tesco – First Direct – LV= – FEDEX
Tesco
Tesco is the UK number one in supermarket and has a substantial presence globally. It has some
quarter of a million staff worldwide and is the UK's largest private sector employer. Whilst it
came from relatively small beginnings, it is now a highly customer focused and prosperous
organisation. Its success has been achieved through this attention to the customer focus and its
single-minded determination to deliver excellent service for the customer. It grew as a result of a
strategy targeting five areas: clarifying its core purpose, improving marketing, carrying out
thorough market research, stepping up its innovation and investment, and taking care of staff.
Top management commitment is evident: senior management walk the talk of a business tuned
in to customer needs. It keeps a close eye on performance through its performance measures
which it communicates and monitors through a balanced scorecard performance wheel.
The company puts its success in being regularly voted the UK’s ‘most admired company’ by the
business community down to innovation and constant improvement in serving the customer. In
a recent job advertisement it proclaimed: ‘Our culture is free of bureaucracy, hierarchy and red
tape …we’ll encourage you to think outside the box, accept accountability and bring new, fresh
and original thinking’.
Tesco mission and values
On the company website it says “Our core purpose is to create value for customers to earn their
lifetime loyalty.”
Tesco sees success depends on people: the people who shop with us and the people who work
with us. It proclaims” No-one tries harder for customers.” It does this by understanding its
customers and working as a team across the organisation. It undertakes employee attitude
surveys.
It makes its processes streamlined for the customer. Its annual report says "We use simple
processes so that shopping is Better for customers, Simpler for staff and Cheaper for Tesco.”
Performance measurement
The Tesco balanced scorecard, the steering wheel, is rigorously used at strategic and store level.
It has four areas of focus: financial, customer, operations, and employee performance. Tesco has
now added a fifth dimension, community, to encourage employees to be good citizens.
Training and development
Training and development in customer service has become increasingly refined. For example,
Tesco encourages staff to take NVQ Level 3 in Customer Service. This assesses members of staff
against 16 components of competence which include maintaining reliable customer service,
communicating with customers, developing positive working relationships, solving problems,
initiating and evaluating change to improve service. Most training is delivered in-house or instore by training or personnel managers.
First Direct
First direct has consistently won customer satisfaction awards and has occupied a firm niche in
banking retail banking. The online and telephone banking service deliberately broke away from
outdated British banking practices. Its research suggested that customers complained that old
style banking left the bank too much in control and treated them as an anonymous number. In
response it aimed to
Leave the customer in control
Treat the customer on an equal basis
Build up customer confidence
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The result has been an outstanding success. New recruits are selected on customer-friendly
attitudes, not prior banking skills, which can be trained in. A lengthy induction follows- six
weeks-before new employees are considered ready for customer contact.
It regularly carries out customer satisfaction surveys to keep in touch with the customer and
employee surveys to assess employee attitudes and issues.
Organisational vision and values put into practice
First Direct successfully translates its vision and values into solid practice:
 Giving staff the discretion to take decisions on behalf of the customer in any
interaction.
 Respecting employees as valued contributors, through a network of team leaders as
‘people people’.
 Asking employees for ideas and improvements.
 Building staff skill and self-confidence via coaching and development.
 Thinking carefully about staff needs, for example over working hours, benefits and any
concerns, such as walking alone to staff car parks at night.
L V=
Over a three year period, mutual insurance and financial services group L V= set out to
substantially improve its customer satisfaction and business processes through introducing lean
processes and consciously strengthening engagement with its employees, and it has extensively
involved all employees with this in mind. There has been effective and integrated use of
communication, setting out clear customer oriented values, initiating special events and widescale employee involvement in working groups and with ’champions’, all supported by
measurement. LV= has closely built its initiatives on achieving the organisation′s goals and, for
full effect, has extensively overhauled its organisation’s culture and practices. According to its
annual report of 2010, LV= has made three commitments in support of its business strategy:
1.Being easy to do business with
Timely, clear and accurate information and advice. They can contact us quickly and easily
and we have the details they need at our fingertips.
2. Giving great value
Affordable products and the highest quality service.
3. Leaving people feeling good
Treating everyone with respect and empathy.
It has benefited from its employee and customer centric initiatives in the following ways: customer
satisfaction has significantly improved; better processes have meant life is easier for the customer;
through engagement and empowerment, LV= has developed a culture that has improved job satisf
and customer service; lastly, reducing wasteful processes has helped in winning new business.
FEDEX
Express delivery-corporation FedEx is a global business and was the founder of overnight
delivery. It sees the roots of its distinctiveness in its core PSP philosophy, People, Service, Profit
in that order. All employees are reminded that what FedEx is selling is peace of mind, and that
the person who knocks on the door is FedEx in the eyes of the customer. The Purple Promise is a
public mantra--to make every customer experience outstanding. Simply having strong people
values and sound HR policies does not automatically produce business benefits. Attitudes and
behaviours are translated into customer relations; respect within the organisation has
encouraged respect for customers.
FedEx monitors its processes and performance rigorously, and it shows this to its customers by
displaying a visible tracking system to locate the progress of their goods. The company’s servicequality indicator (SQI) is used to improve services and circumvent complaints and dissatisfaction.
Providing unrivalled customer experience is at the core of the corporate philosophy. As a part of
its customer experience strategy, the company has established a dedicated customer experience
organisation headed by a member of senior management. Its objective is to consider FedEx
services across all functions and levels from the customers’ viewpoint so as to achieve a better
understanding of customer wishes and requirements, and to keep building on its existing high
level of customer satisfaction. FedEx declares it “has embedded a customer-centric approach in
its corporate DNA”. As a result, for example, FedEx has introduced a one-stop-shop model,
which ensures that customers are served by only one FedEx employee from start to finish for
each inquiry. FedEx puts stress on self managed teams. Employees are rewarded and recognised
in providing excellent customer service through annual Courier of the Year awards.