Building a customer centric organization - Australia's Telstra

In September I had the priviledge to attend a conference to hear from business leaders from around the world. Of particular interest to me was Telstra and their journey from a Government telco to a customer centric business.

I have been a customer of Telstra for decades and had experienced the poor customer service that this organisation was renown for. Even three years ago when I was moving house I was told to call seperate numbers to arrange connection and disconnection of my various services. But recently this has changed when I spoke to Telstra to bundle all of my services in one. From a small $80 per month bill for a landline and mobile, Telstra now has a new mobile service and my Pay TV bundled with my other services, increasing my spend to $280 per month, but also giving me more services for less than I was paying to others prior. Talk about increasing your share of wallet and stickiness to the brand.

So I was interested to hear the Telstra story of how it became customer centric. The CEO of Telstra, David Thodey and Change Leader Robert Nason spoke about this journey that is continuing.

Background on Telstra & David Thodey

• Top ASX 100 company
• Telstra is the #1 Telco in Australia today
• They take over 300,000 calls into the call centres every day!
• Thodey is an anthropologist by trade, part of a growing group of CEO's in Australia today as they understand the social needs of communities and employees...great people to lead change in organisations
• CEO since 2009

The Journey

• The journey has only just started
• The exec team must be right behind the transformational change, partnership across the business
• Driven from the top down, major focus from the CEO and even his presence at the conference shows that this is crucial to this business turnaround, in essence their competitive advantage
• Businesses need systemic change to improve customer service, it’s not just about changing the culture

The Strategy

• Put the customer at the centre of everything we do
• To be customer centric = culture programs & business processes
• The focus is on deep seeded business outcomes
• The big question that they asked themselves is how do you allow your staff to make a difference
• This is especially difficult when customer needs are changing. iPhone 5 sales much bigger than previous models since launch
• You need to deal with both external & internal change

The Process

• Telstra have found that if they create great leaders they can drive the change
• They conducted a culture survey - was poor, non responsive, shifted responsibility, inconsistent, not innovative. This was from the people from 2010
• Wanted to become customer driven, winning, collaboration & innovation from customer satisfaction, good, functional & conservative
• Weren't driven from the outside in, but from the inside out, needed to change this on its head
• What they did : alignment & shared goals...was very important as a leadership team
• In 2012 he showed that the organization had moved and shifted to their goals - are seeing a positive shift
• Looking at a cultural change...changing the way our people talk about Telstra. Drive advocacy, grow as leaders, strengthen talent bench, drive collaboration for performance, improve the way we work & operation rhythm
• Need to learn how to adapt

• Identified the cost of poor service. Significantly change customer service & to create a step change
• Productivity improvement would drive up customer service by focussing on it through the eyes of the customer
• Ran the change out of corporate, not in the line. 35 projects in total.
• Had an exec team as the steering committee with head of HR, CEO, CFO & Robert
• Business should own the process with HR support, not HR owing, give it to the line managers
• Service was driving down market share. 12 months planning, 9 months to embed & 2012 to deliver
• At the same time frame make operating changes, then culture change, then deliver service performance
• Invested in advocacy, measurement tool is customer service. So developed a project with Board approval. Investment, define deliverables, reporting, target setting, helps to get finance sign off & board. If I deliver those outcomes what will be the investment & pay off for the business
• Use NPS to measure it
• End to end improvement under 3 headings - prepare, serve, support
• Need to decide when to finish the project & to embed continuous improvement. Empowering the line is the next stage
• Are getting the results. 21% down in consumer calls; 26% down in complaints; 10% better in service; increased market share; lower customer churn. Issue now is to keep the momentum going
• Employees relate to customer advocacy

- Resistance? There was none from either the leaders or the line. It was embraced.Needed to get engagement from the leadership team, collaboration & compromise, mutual respect

- 40% of at risk salary for execs is based on customer service metrics

- advocacy gives staff the ability to treat customers how they would like to be treated...it's hard to do & risky

- You need to believe in the change & communicate this in everything out do. It's about behaviour

- Offshore? It doesn't matter; it is all about the customer service experience. Being a big company, they can't do it all, so need to outsource. 20,000 contractors, treat them as their own & immersion into the change process. Providers must buy into this.