In a 2005 Bain and Company survey of 362 companies, a huge gap was identified between what customers experience versus what companies thought they were delivering.
The gap was not just huge, it was staggering! Only 8% of customers in this survey described their service experience as “superior” while 80% of the companies described the service they provide as “superior.”
Tom Peters calls this the 8/80 chasm!
I have experienced this 8/80 chasm on a few engineering projects over the years.
An engineering contract typically has a ton of detail built into it. Because of this, it is really easy to fall into the trap of “working to fulfill the contract” instead of working to understand exactly what the customer needs before you are too far down the design road to make adjustments.
When a project manager falls into this trap of managing to the contract, it is inevitable that they will encounter a customer who is not happy with the finished product. Usually, when this happens, the project is so far down the design path that the effort to get realigned with the customer’s expectations is extremely painful for both the project manager and the customer!
So what can businesses do to bridge this chasm or avoid it altogether?
Closing the 8/80 Chasm
The Bain and Company study recommended taking a 3D approach to closing this massive customer service gap.
- Design – Firstly, integrate the customer into focus groups that can help with product and service design.
- Delivery – Secondly, every customer interaction is a precious resource. Set up cross-functional teams within your business to ensure that all aspects of the business is meeting client expectations.
- Developing Capabilities – Thirdly, build processes to maintain a real dialog with your customers.
I would suggest that these 3Ds can be summarized simply as COMMUNICATION.
Communicating with your customers is critical to ensure that you are meeting their needs and closing the 8/80 chasm. Among many things, communication with your customers must be:
- Continuous – Communication is not a one-time event. It must be ongoing.
- Multichannel – Use as many avenues for communication as possible. Focus groups, online feedback portals, product ratings, social media, newsletters, etc.
- Two way – A great communicator spends the majority of their time listening. Don’t just broadcast but truly listen to your customers.
- Relevant – Deal with hot topics and issues that are on your customers’ minds.
- Timely – Deal with hot topics and problems quickly. Don’t sit on them and hope the “fire goes out.” As Jack Welch has said, where you see smoke, you must assume there is a fire and deal with it quickly.
- Candid – Deal with the issues and topics that arise. Do not gloss over problems. Hit them head on and deal with them openly.
Communication failures, and hence the 8/80 chasm, fall squarely on the shoulders of the business leader.
Is there an 8/80 chasm in your business? What is causing it and what can you do to close this chasm?
Decide on the actions that you need to take to better meet your customers’ expectations and kick off an action plan to get there. If appropriate, build a cross-functional team to implement these actions and to hold the whole company accountable for meeting the customers’ expectations.
Finally, review these posts for more communication ideas:
- How Your People are the Key to Sustaining Success
- Why Business Dynasties Fail and How to Avoid it
- How to Avoid a Marketing Apocalypse in Your Business
- 6 Simple Steps to Align Your Staff with Business Objectives
- Your Success is Determined by Your Leadership Ability
“The problem with communication is the illusion that it has been accomplished.” – William H. Whyte
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