From $20 to $500 Million: A Turnaround Success Strategy

Sue Miller used a customer service focused strategy to turnaround a struggling company

Sue Miller used a customer service focused strategy to turnaround a struggling company

When Sue Miller walked into her new job as President of computer products vendor, Softsel, she knew it had problems.

While it’s US parent company was successful, the subsidiary she would be leading had not yet turned a profit in its 5 year history. It had a puny market share and a reputation as “box movers” versus the high-end competitors who were knows as product pros. Sales stood at about $20 million.

By the time she was done with it, sales were up to $500 million and the company ranked #1 in the industry vendor listings.

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Where To Start a Turnaround

She started by meeting one on one with the CEOs of her company’s largest clients. She wanted to understand their business concerns first, and only secondarily how her company could help. She made a startling discovery from those meetings: although the company carried thousands of products, “it became very clear to me that we were a service company,” she explains in today’s podcast. Broadening her research to include the masses of next-tier customers, she realized that the competition’s image as product experts wasn’t actually all that important to customers; what they wanted was to get their products quickly and reliably. Being the “box movers” wasn’t such a bad thing, if they did it supremely well.

Customer Service Recovery Strategy

Like Johnny Russo, E-Commerce & Digital Marketing Director at Bentley Leathers (hear that interview here), she had to reach out to the unhappy customers and find ways to convince them that things had really changed. One thing she and Russo both discovered is that if you fix a problem quickly sometimes the customer becomes even more loyal that one who never had a problem in the first place. 

Key Elements of the Customer Service Turnaround Strategy

  • Priority Support For Big Buyers. While it was done in a way that wasn’t obvious to customers, they set up their systems so that service calls from big customers automatically jumped to the front of the queue.
  • Front Line Freedom – To A Point. Front line customer service staff wanted to be able to help customers, but they also worried about being pressured into giving unreasonable compensation. So they were happy to have a dollar limit above which they would have to consult with a supervisor.
  • Demonstrate Trust. Rather than wait for a customer to return a defective product, they would credit them and ship a new one right away, trusting customers to eventually return the old one. The customer shouldn’t have to wait longer for a working product when the problem was not their fault. And showing trust builds goodwill. (As one of my early bosses taught me, 2% of your customers will find a way around your rules no matter how carefully you try to protect yourself. So design things for the other 98%.)
  • Automated Escalation. Fast resolution is key to recovering from a service delivery problem, but often customer complaints can fall through the cracks. They set up an automated system so that every 24 hours the problem got bumped up to the next level automatically if it had not yet been resolved. Nothing could go longer than 5 days; by that point it would reach the CEO’s desk.
  • Regular Process Reviews. Every quarter the top two levels of management would meet to analyze what had gone wrong in the previous quarter and set priorities for what would be fixed in the coming quarter. Each issue would have a champion responsible for assembling a cross-silo team to fix the broken process.
  • Outside Opinions. Surveying their own customers was certainly important, but that doesn’t tell you about the views of people who are not yet customers. Their industry had a publication that regularly rated all the vendors. During Sue’s time at the helm, her company went from a “distant 8th” to number 1.

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Also In This Interview

We also discussed:

  • The challenges of buying a much larger company with a very different culture, and how they handled that.
  • The difficulty of controlling hours and caring for yourself when you are at the CEO.
  • How she went from accounting to leading a sizable computer products company while still in her mid-30s.
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