I managed a team of four customer service agents that support clients that use my company’s internet service. This team of four agents supports customers that are closed by the sales team of two personnel managed by another manager. In the past year, we have been having an unpreceded increase in the churning of customers. To understand the problem and make a decision I applied the systematic process of Analysis of Business Problems
I defined the problem; I saw that the current state is that we are having a reduction in the number of customers on monthly basis. The consequences of the problem are loss of revenue and ultimately loss for the business from the statement of profit/loss every month.
The areas where this is happening are the support system for customers which are the four units that directly and indirectly support customers, I took a look at each of them and the personnel involved.
| Customer Support | Technical Support | Field Support | Sales Team |
| Teniola: Number of years in the Company and the role | Matthew Number of years in the Company and the role – 3 | Bassey Number of years in the Company and the role – 1.5 | Daniel & Ekati: The number of years in the Company and the role. Ekati Onoriode – 4 Daniel Onyema – 2 |
| Number of cases reported in the past three years – 2540 Number of cases closed: Teniola Sobayo 740, Kolawole Damilola 1800 | Number of cases handled in three years – 1025 Number of cases closed in three years – 978 | Number of site visits – 525 Number of cases closed – 505 | Number of new Prospects: Ekati Onoriode – 152 Daniel Onyema – 380 Number of closed sales Ekati Onoriode – 60 Daniel Onyema – 205 |
I checked the cases reported by the customers and handled by each staff in the past four years. 95% of the reported cases are resolved. The cases that are not closed are very small. For the cases that are not closed, I check the number of customers that churned. Only 5% of the customers that churned are with cases that are not closed.
I checked which set of customers and which period this happened. I noticed that it is mainly customers that subscribed in the past two and half years. They churn three months after their first subscription. Customers older than 3 years remain in the network and do not stop using the service.
I check the service offered to both the old and new customers in the past four years, there is no changes in the service. However, the churn started two years ago for about 70% of new customers. The new customers usually stop using the service after their initial three months payment for the service. They do not renew their subscription and ultimately stop using the service.
We checked the cases reported to customers in the past four years, 50% of them are not technical cases that require site visits hence the lower technical support and field support cases compared to the customer support cases. The cases are mostly service price and service expectation cases in which customer support directs the customer back to the sales team.
The cases are mostly from new customers closed by Daniel, the new salesperson who has more than 75% closed sales compare to Ekati the old staff who has less than 50% closed sales lesser number of churned customers. On critical look at the churned customers and the record of complaints for the Daniel customers, we discovered it is about service expectation and price. Daniel does not take time to explain how the service work to the customers, so after the customers make the mandatory payments of three months, they discover that what they were told is not what they are getting.
The customer support team also wants to focus on the technical issues of customer and do not take their time to understand the products, whenever the customer complains about service as related to price, they direct them to Daniel. Daniel who is focused on meeting his target does not take time to give the customer the right information from the beginning and also does not have the time to address their problem after the customer has been enrolled because his focus is getting new customers to meet the sales target.
The core issue is the service description. All the internet service plans are tagged “Unlimited” for different internet speeds. The word unlimited to customers is that there is no download limit, however, there are limits based on utilization but the customers are not suspended as they use the service. Their download speed reduces with utilization.
For example, for the first plan, Unlimited 25Mbps, the customer starts with 25Mbps from day 1. The speed reduces to 10Mbps when the customer has downloaded up to 20Gb of data. It further reduces to 5Mbps when 30Gb of data has been downloaded. The speed reduces to 1Mbps when 40Gb of the data is downloaded. The low speed of 1Mbps is maintained till the 30th day when the service stop working if not renewed. This is how all the other services are designed but with different starting speeds and speed reductions in the month based on utilization.
Ekati takes his time to explain the underlying conditions to his new and old customers. They keep using the service as they understood how it works and so he has the least churn rate for his new and old customers. Daniel does not explain the conditions under the plans to his customers. Customers excited to get an unlimited plan without download restrictions quickly subscribe. When their speed slows down to 1Mbps they start complaining. Their opinion is that they are not getting what they paid for, and after their first three months they stopped using the service and looks for another service provider.
The underlying driver of the problem is that customers do not have all the information about the service they are going into. No clearly defined onboarding process allows customers to go through a FAQ about the service. If the salesperson does not take provide this clarity from the beginning it affects the customer’s perception of the service and ultimately makes them stop using the service.
