Australian businesses need to increase service standards to compete globally
30 per cent of Australian businesses will need to increase their customer service standards if they want to succeed in the coming decade, according to the first Asia-Pacific focused 'megatrend' to be released from BDO's Service 2020 report.
'Megatrend 1' - Global competition will drive up service standards - explores how customer service will be used as a competitive differentiator in order to challenge the increasingly global marketplace.
BDO Executive Director Cameron MacMillan said that, with 30 per cent of firms regarding their customer service as either 'average' or 'below average', businesses still have a lot of work to do in order to compete in an increasingly competitive marketplace.
"Customer service has never been as important to business as it is now, with exceptional service set to become a key competitive differentiator over the coming decade," Mr MacMillan said.
"Average customer service is simply not going to cut it in a global marketplace," he said.
Mr MacMillan said that, while an increase in globalisation does provided significant new opportunities through new consumer markets, it also exposes firms to aggressive new international competition.
"Increased global competition will mean that having the right products at the right price is no longer a guarantee of success," Mr MacMillan said.
Mr MacMillan said, in order to compete in the new global environment, firms must develop service that stands out from the crowd.
"Companies need to work hard to develop service levels that will become a differentiator for them in their industry," Mr MacMillan said.
"Firms within the Asia Pacific region need to deliver targeted - and superior - service that truly stands out.
"The challenge for businesses in Australia will be to secure - and retain - the right people, develop a clear strategy for emerging markets and understand the role of outsourcing to deliver more specific services," Mr MacMillan said.
"While outsourcing to countries like India and China to lower wage costs might be a tempting strategy, companies may need to consider the impact on their customers and their perceptions that Australian jobs are being lost to overseas countries.
"If the pendulum swings too far, Australian consumers may choose to be more locally discerning," he said.
Service 2020: Megatrends for the decade ahead isa BDO Global report written by the Economist Intelligence Unit capturing the views of 479 business leaders world-wide.
BDO Australia National Chairman Tony Schiffmann said the Service 2020 report provided a valuable blueprint for the prioritisation of service development opportunities over the coming decade.
"The Service 2020 report explores how successful organisations have built - and sustained - excellent client service, and outlines eight predictions on how customer service will change in the coming decade," Mr Schiffmann said.
The research findings fall into eight 'megatrends' which will define service in the coming decade. The eight trends are:
- Global competition will drive up service standards;
- Companies must maintain service standards in the face of 'the need for speed';
- Firms must learn to use the increased transparency brought by social media to their advantage;
- Companies must use new sources and types of data to rethink the way they track and personalise their service;
- Good employees will remain fundamental to good service but with technology as an enabler;
- More firms will outsource aspects of customer service to new kinds of specialists;
- The rise of the mass affluent and other customer segments will force companies to find new product or service niches; and
- Customer expectations, including the purpose of the store, are evolving with new technology.
The study drills down to the Asia Pacific detail on each of these eight megatrends, which will be released separately by BDO over the coming months.
The full report is available now free of charge here or by emailing service2020@bdo.com.au.