The promise of automated self-servicewhether through an employee-benefits intranet, a Web-based customer-support site or an airline kioskhas become so well-established that some analysts know success-story numbers by heart: $3.9 million saved by Polaroid Corp. after implementing a Web-based customer-service center; $3 million saved each year at American Airlines after it automated two HR functions; $936,000 saved annually by Big Planet, a provider of network services to small and individual businesses, since it added a self-service application to customer service; $500,000 saved by the U.S. Army through online new-recruit applications; $300,000 saved by Whirlpool Corp. simply by automating its password-reset function. Analysts continue to tally actual global savings, though all agree on one thing: the savings are huge. Forrester Research Inc., for example, notes that a self-service approach can slash the cost of a customer interaction from as much as $35 on the phone to $0.75 onlinea potential savings of 98 percent on just one transaction.
Savings like these remain the heavenly shimmer of self-service applications, but the last few years have seen a pileup of disaster stories, too. In fact, getting self-service wrong can dissolve those promised savings so fast that it'll make your head spin. Plus, if you're not careful, you can put off customers for good. In a recent study of self-service applications, Jupiter Research noted that 91 percent of high-value customers surveyed (those who had spent more than $500 online in the previous six months) could be turned off by a bad experience, never to return.
Consider the case of the major financial-services provider that spent more than $100 million rolling out self-service for its consumers. The intent: Save man-hours by redirecting customers from the phone to the Web. Unfortunately, the Web pages proved confusing, so customers resorted to calling the company just the same as beforeonly now, they called to complain about the Web pages. This self-service push resulted in $100 million worth of digital rot.
Certain sectors have been quicker to embrace self-service than others. The travel industry, for example, among the hardest hit by the economic downturn, has relied heavily on self-service to offset both lost revenues, and the rising overhead costs associated with providing better security. For other industries, however, self-service isn't so much a necessity brought on by high overhead; rather, self-service is what most of their customers are coming to expect. According to the February 2003 UCLA Internet Report, the average user spent 11.1 hours a week online and used the Internet as a primary tool for customer information and product research. Of those customers, almost half made a purchase online.
So how do you cultivate more self-service opportunities without squandering time, money and hard-won customer relationships? Most industry experts agree that the biggest misstep comes from neglecting the user's point of view. "A lot of folks think that if they put everything up there, it will work," says Michele Hudnall, senior research analyst at META Group Inc. "But not everything is suited for self-service."
Another common mistake is to imagine that once your self-service application is up and running, your work is done. "Self-service takes service" is Robert Wenig's motto. Wenig is the cofounder and CTO of TeaLeaf Technology Inc., a San Francisco-based firm that specializes in managing Web applications. Most companies, Wenig says, do a poor job of quality assurance on their Web programs, and, in fact, a 2003 survey commissioned by Network World Magazine found that 72.6 percent of performance problems are alerted via end-user calls, and not by the (often pricey) network-monitoring tools put in place to detect such errors.
Other self-service gurus stress simplicity and with good reason: An April 2004 study of online customers, conducted by the Bellevue, Wash.-based Customer Respect Group Inc., reported that 54 percent of those who had abandoned a Web site during the study's three-month period cited "lack of simplicity" as the motive; 70 percent said that they'd go to a rival site if it were easier to use.
"The key to self-service is to get people in, and get momentum," says Phil Terry, CEO of Creative Good Inc., a New York-based Web-services company that helps clients understand why their Web sites aren't effective. On the Web, Terry says, it's important to "use language that's easy and appropriate. And always start [questionnaires] with things that are easy to answer."
Beyond those first principlesappropriate tasks, user satisfaction and simplicityif you're serious about advancing your self-service agenda, then we have one further bit of advice: Read the profiles of breakthrough initiatives that follow.
Laura Rich writes an interview column for The New York Times' SundayBusiness section. She is the author of The Accidental Zillionaire, a biography of Microsoft cofounder Paul Allen. She lives in New York City.
This article was originally published on 06-01-2004
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