Telixo Consulting (Pty) Ltd. Copy for Vusi Thembekwayo Proposal for Ackermans Ltd. Ackermans contact persons: Ms Louise Hamman Marketing Director Telixo Consulting contact person: Mr Thami Xango Chief Executive txango@telixo. co. za 071-879-6201 18 January 2013 Statement of Confidentiality and Non-disclosure. This document contains proprietary and confidential information. All data and information submitted to Vusi Thembekwayo, and any of his representatives, is provided in reliance upon his consent not to use or disclose any information contained herein except in the context of dealings with Mr T.
C. Xango and/or Telixo Consulting (Pty) Ltd. The recipient of this document agrees to inform his employees and partners who view or have access to the document’s contents of its confidential nature. The recipient agrees to inform each employee that they must not disclose any information concerning this document to others except to the extent that such matters are generally known to, and are available for use by, the public. The recipient also agrees not to duplicate or distribute or permit others to duplicate or distribute any material contained herein without T.
C. Xango’s express written consent. T. C. Xango retains all title, ownership and intellectual property rights to the material contained herein. BY ACCEPTANCE OF THIS DOCUMENT, THE RECIPIENT AGREES TO BE BOUND BY THE AFOREMENTIONED STATEMENT. Table of contents 1. Introduction 2. Problem background 3. 1. Client & industry analysis 3. 2. Conventional consulting back draws 3. 3. Customer experience survey 3. 4. Problem statement 3. Proposed solution 4. 5. Services description 4. 6. Audit process 4. Costs 5. Conclusion Appendix – Surveillance equipment 1. Introduction Telixo Consulting (Pty) Ltd. hereinafter referred to as Telixo Consulting, Telixo and ‘we’; is a provider of Efficiency, Customer Experience and and Integrity Auditing services. The company was established in 2011 as a result of the efforts of Mr Thamsanqa C. Xango. The goal of this proposal is to present the range and value of Telixo’s service to Ackermans Ltd. Hereinafter referred to as Ackermans, the client and the business; and this document is one step in the process.
It also serves to indicate the the high value of Telixo’s services to businesses that depend on happy customers and for referrals and return business, and happy, efficient workers for high productivity. With the increase of people entering the middle-income group in South Africa, it’s deemed important to keep customer service high to stay competitive. Price sensitivity is ever-increasing, therefore businesses cannot afford to give customers more reasons to move to cheaper competitors. Tom Peters, international author & speaker on business management practices quoted: “What causes customers to move from one store to another? 4% because of price. 15% because of quality. 71% because of lousy service” 2. Problem background Businesses with daily human interaction understand that consumer satisfaction (during & post service) is of high importance to create and maintain a loyal customer base, and to boost referral rates. An unhappy customer can cause serious damage to a business’s image via word of mouth. Management therefore, needs a clear and accurate picture on where they stand concerning customer service quality. It needs to know how its staff deals with customers during different scenarios that could result in an unhappy customer.
Customer relationship management systems already being utilized by businesses aren’t as efficient as necessary when dealing with people. No system, in any organization, for any reason, is ever efficient if team members(HR) are not fully trained, on-board and have an understanding of what the systems in place need to accomplish. The importance of people (internal/external) to any organization is a notion that all businesses agree with, but fail to invest enough in. Telixo bases all its functions around mastering the minds of people, workers and customers alike, by means of observation and documentation.
The core goal being to identify and eliminate sources of poor service, habits of staff slacking, low team morale and productivity weaknesses within our clients’ businesses. 2. 1. Ackermans & Retail industry analysis. Due to population growth, wealth distribution and economic growth in South Africa; the retail industry will continue to be the big industry it is. The SA market is not as crowded as that of bigger economies. Smaller, cheaper competitors are slowly eating up the lower-to-middle income market, meaning bigger retailers will not always be able to compete on price.
Therefore customer experience coming up as important to maintaining or increasing competitiveness. All the retailers have some or other customer experience management system in place; but the problem with these systems is that they show results from the retailer’s point of view. They never get the opinion and experience of their 81 year old customer from rural KZN, their 19 year old customer in Johannesburg who’s still to enter a hogher income group. They don’t know of their 47 year old single mother of 4 in rural EC, or even their high-income 37 year old professional who isn’t price sensitive but just wants great service.
Many factors within the retail industry could cause an unhappy customer. Poor service could include: slow service speed in stores, empty tills during paydays, empty shelves, incorrect price marking, staff chatting while assisting customers, lack of product understanding by staff, language barriers, bad attitude from staff, etc. Customer services is as important as price and accessibility in determining competitiveness. Management needs to get into their customers’ and workers’ shoes, this will provide the kind of intel that will assist in making strategic changes that can maximize customer service and staff efficiency levels.
Ackermans is an industry leader when it comes to customer satisfaction and customer experience management. With a range of services and products that offer high convenience to its customers. Their store layouts also contribute to their high customer service ratings. Ackermans is truely a customer-centric retailer. With the increased use of social media sites, news of bad customer service travel faster then ever. Websites such as Hellopeter. com and Twitter have been recently used as a platform to ‘warn’ others of bad service from certain businesses.
This means that the grievances of a customer need to be effectively addressed before the customer can log on again; that should be the national standard of all businesses. No business can totally eliminate complaints from its business, but businesses that try are definitely ideal for customers. 2. 2. Conventional consulting, CRM and CEM systems backdraws. Every business would rather employ personnel that are assets, instead of liabilities. Personnel that cause service complaints are liabilities. A 100% staff efficiency rate is impossible, but high staff efficiency is possible.
The problem with conventional methods of dealing with customer service and staff efficiency concerns is that all the work is done on a computer, in an office. If any customer interaction takes place, it’s always by means of a simple survey that most people answer in a hurry, with little or no concentration and directed to a small, segregated group of people that doesn’t sufficiently represent the businesses’ actual customers. Management consultants check past statistics and international trends as a point of reference. They don’t focus on the most important point, direct people.
Executive coaches never get accurate information as people aren’t naturally honest; especially with people hired to ‘fix’ the wrong people. This means that management can only effectively get information by observing their staff without their knowledge. Conventional consulting has proved successful with finance management, turn around strategies, marketing, etc. People are too different and unpredictable for this method of consulting. Client relationship management (CRM) and customer experience management (CEM) systems are software-based and don’t interact with the customer himself.
They have no provision for cultural, age and circumstantial differences in people. Thus a CEM system should be geographically and culturally tailored; a feat only possible after relevant understanding of different people. 2. 3. Customer experience survey. Telixo Consulting conducted a survey from 4th – 26th August 2012 in Johannesburg, Pretoria, Bloemfontein and East London. 1855 adults who regularly shop at retailers were surveyed. The survey revealed the following: – Only 39. 03% (724) of the people were happy with their current retailer of choice. – Only 19. 3%(353) people knew how to use alternative self-service channels(online shopping). – When asked if bad customer service from a retailer is enough reason to change to the competition, 100% (1855) agreed, but only 41. 19% (764) had actually moved or were planning to move because of it. When offered to change anything about their in-store experience: Customer service levels40. 97% (760) Queues (length, speed, tills)20. 97% (389) Operating hours20% (371) Store communication(signage,etc)12. 022% (223) Other6. 038% (112) Only 130 (7. 008%) people know who to generally contact should they experience oor service from their store. 2. 4. Problem statement. Based on the aforementioned information, it’s deduced that: As Ackermans is a customer intensive business that benefits from return business and referrals, good customer service is of great importance to its operations. Even with a dedicated customer care (services) division to deal with customer complaints and such, there is room for improvement. The aggression of low price competitors means that when Ackermans cannot compete on price, it needs to give customers another reason not to jump ship; which can only be world-class service.
All the retailers have weaknesses in their service quality as over 41% of the survey group had already or intended to change stores because of it. That number could be a loss to competitors and gain to Ackermans, or the other way around. According to the survey, improvements are needed for customer service, queuing systems, tilling, operating hours, and in-store communication. CEM systems in place need to be improved to bring executive management closer to branch operations. Team morale being a common source of poor service, needs to have its sources identified and eliminated.
HR should endeavour to maximize the efficiency of its frontline staff, as they are the people responsible for upholding the company’s brand image. Executive management should regularly get into its customers’ and staff’s shoes. Every business should work at minimizing the probability of the occurrence of incidents that could affect the business’s market image and productivity negatively. Incidents concerning customers, internal conflict and poor internal communication. After all, prevention is better (and cheaper) then cure. 3. Proposed solution 3. 1.
Services description. Telixo has a number of inter-related services, but only those with relevance to Ackermans will be discussed. 3. 1. 1. Customer Experience Audit (CEA): ‘Mystery customers’ with Spy Cameras are sent to stores to pretend to be authentic customers. Telixo selects, trains and sends its auditors to make real requests. *(All scenarios will be planned and approved by client and Telixo). Observances at stores will include: – Speed of assistance. – Professionalism practiced. (Neatness, speech fluency, attention to queries) – Frontline staff competency. Knowledge of product and service offers) – Staff attitudes. (Facial expressions, tone of voice) – Preferential assistance. (Senior citizens, handicapped) – Complaint management. (Reaction times, manager) – Overall store functionality. (Signage, accessibility, till points, etc) The entire audit process is performed with covert surveillance equipment (appendix). This is to allow the client to observe the current state of customer services. The footage will also be used to compare with new footage of customer service quality when Telixo Consulting has completed its services.
The customer services channels (telephone & email) and department will be contacted with different complaints to asses their efficiency as well. All the results of the CEA are then used to formulate recommendations on how the weaknesses in customer experience can be addressed. This part is addressed with relevant consultation partners and the final recommendations will be included in the Final Audit Report (FAR). The benefits of the CEA lie in that it’s used to minimize negative incidents involving customers; and to put systems in place that will effectively manage incidents that do occur.
The service is directed at maximizing customer service quality, a process that can only yield a positive response from customers, prevent subscriber loss and increase referrals. It is conclusively aimed at maximizing: In-store customer experience, customer service, digital customer service, customer dispute resolution, customer retention and customer referrals. 3. 1. 2. Operational Efficiency Audit (OEA): The OEA is more of an internal audit then the CEA. It is a company introspection. This audit uses ‘ghost workers’ (from Telixo/internal) to check the workflow and where it lacks.
All the workers that aren’t from Ackermans will be given administrative/cleaning jobs for the duration of the audit. They will also be equipped with covert surveillance equipment.. The auditors will be observing: – Team morale. – Work delegation efficiency. – Slacking habits. – Workroom policy adherence. – Internal communication efficiency. This audit is rather more observant than the CEA. The auditors don’t initiate major scenarios, they just have a non-suspicious presence at all the areas of concern and observe while recording.
The results of the audit will be in a Final Audit Report (FAR). The OEA is used to identify problems of inefficient staff and sources of the inefficiency. It is effective to assist the busisiness in developing new HR policies and control measures to maximize the efficiency of its staff. Increased efficiency equals increased productivity. 3. 1. 3. Recommended Strategy Activation (RSA): The RSA service is a project management based service. This is an additional service where the client can commission Telixo to manage the implementation(activation) of the strategies recommended in the FAR.
Telixo Consulting has trade agreements with a group of service providers ranging from HR & Management consultants; to Team Building, Communication and PR companies. Our trade agreements & partnerships allow Telixo to source quality services at discount prices (up to 40% discount). Though ultimately optional, Telixo recommends being commissioned for the RSA as it is quicker to activate the strategies due to our ongoing partnerships and trade agreements. The activation will be more precise and effective as Acurrent facilitation and project management systems within Telixo guarantee more hands on control from Telixo management.
Another advantage of Telixo’s RSA is that after the strategy activation is complete, Telixo performs a 1 Day audit to assess the efficiency of the RSA for free. The RSA includes: – Training of staff to deliver world class service. – Procurement of necessary services. – Negotiation of discounted prices. – Full-time facilitation of service providers. – Quality management of services. – Project management of entire strategy activation. – Assessment (via CEA/OEA) of RSA. 3. 2. Audit (services) process: This section describes the steps involved in performing our services. 3. 2. 1. Customer experience audit: 1.
Telixo and Ackermans will identify stores that have experienced high complaint rates, poor performance or simply stores of interest/importance. 2. Telixo will send field auditors (mystery customers) disguised as ordinary civilians and wearing covert video surveillance equipment, to the contact areas to pretend to be real customers. 3. The auditors will engage in various pre-determined scenarios (seeking assistance, complaining about service) to assess the customer service quality. 4. The auditors will then spend an unsuspicious amount of time in the stores observing and recording all relevant occurances. 5.
Steps 2-4 are performed 3 times per audit day(3,5 or 14 days), using different auditors and scenarios. 6. During the audit Telixo will call the customer care dedicated line with complaints from store scenarios, in order to assess their efficiency as well. 7. At the end of the audit period, the auditors report back to Telixo with the findings of the audit. No opinions will be taken, just recordings and report of observations. 8. A Final Audit Report (FAR) is compiled for the client. It includes identified problems in customer services, sources of the problems and recommendations on how the problems can be addressed.
The report will also include a detailed process log, sources section, copies of the recordings, auditors report and analyst details. *After this audit, the client has the option of commissioning Telixo Consulting to perform the RSA; or implementing and managing the recommendations themselves. 3. 2. 2. Operational Efficiency Audit (OEA): The OEA process is similar to the CEA, only differing in that the OEA is observatory. Telixo’s ghost workers only record the happenings, they don’t instigate certain scenarios. It also ends with the compilation of an FAR. . 2. 3. Recommended Strategy Activation (RSA): 1. Telixo uses the FAR to set up a list of service providers for required services. 2. Telixo will hold negotiations with the service providers to get the best prices possible. 3. Telixo will then commission the service providers in order of necessity to perform their service. We will provide some information from the FAR so that providers can tailor their services to the client’s specific needs. 4. Telixo’s management will be on-site through all the services to facilitate and record everything.
Quality management will be set up against Telixo Consulting and client standards. 5. All consultation with service providers will be handled by Telixo on behalf of the client. 6. On completion of all the service providers’ services, the seperate invoices will be forwarded to the client for payment. The client has the option of paying them individually, or include the total into Telixo’s invoice and we’ll pay the service providers. 7. Once the services are completed, Telixo will perform a 1 day audit ao assess the effectiveness of the RSA. 8.
After the 1 day, Telixo will compile an Activation Audit Report (AAR). This report will include the entire RSA log, details of service providers, list & proof of services rendered and recordings of the 1 day audit. 4. Costs The prices of Telixo Consulting’s services are based on: – HR intensity of the specific audit. – Size of contact area. – Travelling costs of all analysts. – Insurance of all analysts. – Insurance of surveillance equipment. – Insurance of footage (should footage be lost, audit is repeated for free). – Insurance of all rental vehicles. Individual training of analysts (new analysts for every audit). – Wages. – Food and accomodation (audits outside Gauteng, for all analysts). – Courier costs (audits outside Gauteng). – External consulting costs. – Value of the service. The different prices are as follows: 1. Customer Experience Audit (CEA): *per store This service has three(3) optional audit periods. The longer the audit, the more accurate the audit results. Gauteng: 3 Day = R20,999 5 Day = R34,999 10 Day = R69,999 Other province: 3 Day = R26,999 5 Day = R42,999 10 Day = R84,999 Flat 1 day rate: R7600 Gauteng. R8500 Other.
Average rate of R8050 is used for quotation purposes. 2. Operational Efficiency Audit OEA: Head Office: 5 Day = Available on request. Division(department)/Regional Office: Available on request. 3. Recommended Strategy Activation (RSA): This service lasts as long as it takes to activate all the strategies. Head Office: R49,999 + (*services invoice) Stores: Gauteng: 1-3 stores = R24,999 + (*) 4-7 stores = R39,999 + (*) 8-10 stores = R54,999 + (*) 11+ stores = AoR. Others: 1-3 stores = R29,999 + (*) 4-7 stores = R49,999 + (*) 8-10 stores = R69,999 + (*) 11+ stores = AoR. Banking Details:
Standard Bank Acc name: Telixo Consulting (Pty) Ltd. Acc no: 032-301-596 Branch: Hatfield Branch code: 1545 5. Conclusion. Ackermans’ stores are perfectly positioned to maximize the results of Telixo’s services. The results can be used to make internal changes, changes that will make Ackermans’ frontline staff superior to its competitive counterparts. The frontline staff of any organization are responsible for over 50% of the actual business. They are responsible for dealing with customers daily, and can give customers good reason to refer friends and family, or move to another provider.
Management therefore needs to maximize the efficiency of its frontline staff, and the customer service quality of all staff that interact with customers. Telixo Consulting is a specialized firm that works hand in hand with management to create systems that can only yield posititve response from customers. We work to understand our client’s customers and staff, fixing all weaknesses within the organization that affect the customers’ perception of the business. Telixo Consulting’s services are superior to all others. Appendix
