Customer Service for the SME

Duncan Baker, a Director of the Institute of Customer Service explains why customer service excellence is imperative for the SME, and gives his top tips of achieving it.

Institute research shows that companies with a reputation for service excellence and committed frontline staff have a 24% higher net profit margin than rivals who do not enjoy similar standing, and can achieve 71% more profit per employee.

Good customer service is often what sets SMEs apart from their larger counterparts. Twice yearly the Institute runs the UK Customer Satisfaction Index, with 26,000 consumers rating the organisations which give them the best customer service. Historically, it is the small, local businesses which come out on top as they are naturally closer to the customer.

Customer care doesn’t have to be expensive. Making the customer feel special by understanding exactly what they want and delivering it to them is the key.

It is also about getting it right every time – consistency is essential. Putting customers at the heart of your business improves employee performance, increasing business performance and making you more competitive.

Customers may visit several businesses before deciding to buy – make sure yours is memorable for more than just what they buy.

Top tips to achieve customer service excellence

1. Recruit and train the right people

People with the right attitude are essential – “hire for attitude, train for skills” should be the maxim. Once in place, consider formal qualifications for staff, such as the Institute of Customer Service professional awards.

2. Keep staff happy

Staff retention is crucial. Efforts should be directed at recognition and development programmes to determine potential, and build career plan structures.

3. Lead by example

Getting customer service right, and continually improving it, is a long-term commitment that must be made by those at the top. Recognise its importance, believe in the strategy, and lead by example.

4. Welcome complaints- and act on them

Complaints are free market research and should be welcomed. Ensure you hear them all; resolve the ones you get well; stop them being repeated. Your organisation becomes more efficient a result, as you spend less time handling complaints and more time on the business.

5. Build a good reputation

Research shows that organisations should concentrate on four key issues – going the extra mile, treating people as individuals, keeping promises and handling queries and complaints professionally.

6. Tell the world

…as long as you really are great! Customers can see through marketing hype related to service much easier than they often can with products.

7. Measure performance

Measure the right things, not the easiest things. Measure what is important to your customer, not what you think is important to them. Understand the expectations your customers have. Without that information how can you hope to satisfy their requirements?

8. Benchmark your company

Looking at what other businesses do and how they handle dissatisfied customers can give you pointers. Get out there and learn from other firms.

9. Communicate

Customer service can depend greatly on your organisation’s communications skills. A reputation for great service can be easily lost by a poor telephone manner or a confusing website.

10. Recognise the importance of customer loyalty

It is essential to keep the good customers you already have and gain their loyalty. A two percent increase in customer retention has the same effect on profits as a 10 per cent cut in costs.

Duncan Baker, Institute of Customer Service

About the Institute of Customer Service

The Institute of Customer Service is the professional body for customer service and is the first port of call on all aspects of customer service, delivering tangible benefits to organisations and individuals. Our aim is to ensure that our customers can improve their business performance and their customers’ experience.

The Institute is a membership body with a community of more than 350 organisational members – from the private, public and third sectors – and around 7,000 individual members.

For more information about the Institute of Customer Service go to