• Illustration: Blueprint for a Regional CSS Service Center

An ambitious customer service effort is reshaping Microsoft's Customer Services and Support (CSS) division, which handles both technical and nontechnical queries from the company's customers. The new Customer Services strategy, in development since 2004, is an effort to apply service standards developed for the company's technical support to nontechnical interactions with customers. Among other things, the company believes that new processes and standards for customer service can improve Microsoft's image and generate new revenue for the company's other businesses. However, the multiyear project is likely to require significant cultural and organizational changes at the company.

Changing Ideas

The most visible sign of change at the unit formerly known as Product Support Services (PSS) was the fall 2004 decision to combine it with a Customer Service unit and rename the combination Customer Service and Support (CSS), a change that gives customers more prominence than products.

Several factors, including the following, influenced the decision to change the name and strategy:

• Significantly higher customer satisfaction in enterprise accounts that have a technical account manager, who personally ensures that the customer's queries get answered and problems get resolved
• The ongoing effort to develop subscription revenue, particularly in small business and consumer segments, to compensate for longer product release cycles and lower upgrade rates

But the new strategy, which has been under way since mid-2004 and should be completed by 2007, is also driven by major internal imperatives. Most significant is the CSS team's belief that, rather than being viewed as a cost center for product groups, it has the potential to drive new business for Microsoft, since it is one of the few units at Microsoft that deals directly with end customers, and it has a worldwide network capable of not only taking inbound customer calls but also of proactively marketing products and providing services.

Examples of how current processes could be turned from costly overhead into business opportunities include the following:

Linking customer service to business opportunities. Customer services, such as presales support, product information, subscription purchases, and general customer assistance can be better linked to product marketing or services: a customer looking for information about a specific product on the company's Web site could be notified about a promotion for the product, if that information was readily available to the customer service agent. Similarly, although Microsoft does not today provide technical support for beta software, that may be a missed business opportunity: beta users are most likely to be early adopters of a new product and are prime prospects for future sales.

Better analysis of customer data. Microsoft's business units keep various independent customer databases that collect different information, often related to the same customers. The result is considerable duplication of data with little integration. This causes problems for customers, who might have been contacted by several groups at Microsoft to upgrade various parts of their infrastructure or may not have taken advantage of services to which they are entitled. By integrating information from databases across the company, CSS can minimize the amount of information customers must repeatedly supply during service interactions, identify good prospects for upgrade campaigns, minimize duplication in marketing, quickly spot market or usage trends that inform new marketing efforts, and manage costly outbound calling campaigns through networks and call centers that CSS already has in place.

Strategic Pillars

The new CSS strategy has five major elements: improve customer satisfaction, deliver support services more efficiently, better train frontline support personnel, ensure that Microsoft business units support and take advantage of the new strategy, and make better use of technology to reduce costs and improve performance.

Improve CPE

By focusing on all customer interactions with the company, rather than only transactions such as support incidents, CSS hopes to improve the "customer and partner experience" (widely known in Microsoft by the acronym CPE).

In the past, only basic details about a nontechnical customer interaction might be preserved, leaving Microsoft with only vague ideas about why customers were calling. Much valuable data was not collected or was collected inconsistently, making it difficult to aggregate information about customer concerns across the company.

In addition, standards for response times were not consistent and many customers were discouraged from contacting the company, particularly because phone numbers and e-mail addresses were not readily available: one of the most common searches on support.microsoft.com is for a Microsoft telephone number.

To solve these problems, CSS has developed a common taxonomy for all customer contacts and customer segments and is asserting "accountability" guidelines that ensure customers don't fall between the cracks. With cleaner and more complete customer data, CSS will be better positioned to guarantee that every customer contact is handled or resolved satisfactorily and that customers know who at Microsoft will respond to their issue.

A new "Contact Us" approach, most visible on support Web sites, provides customers better information about how they can contact the company for support.

Optimizing Services Delivery

In an effort to create more efficient and consistent services, CSS has created an organizational template and standard processes that can be used in every subsidiary. These processes can be used to identify customers and their issues, handle calls and escalate technical and nontechnical incidents, and measure response through specific metrics, such as the amount of time taken to answer calls.

The company has also reduced the number of locations that customers contact. Excluding calls to MSN properties such as Hotmail, Microsoft receives more than 20 million customer service calls a year. Before CSS was formed, responding to those contacts was the responsibility of more than 60 different units inside Microsoft, all of which had their own customer contact centers. CSS has since consolidated regional operations and reduced the number of support outsourcing contractors.

Todd Parsons, general manager for Customer Service in the Americas and also its global strategy lead, describes this as a shift from a decentralized, subsidiary-managed approach to a system with centralized accountability, but with local and regional presences. For example, two call centers, one for Spanish-language support, another for Portuguese-language support, have replaced 17 subsidiary-managed call centers in Latin America. (For more details on how these support centers are set up, see the illustration "Blueprint for a Regional CSS Service Center".)

Better classification of customer contacts lets Microsoft aggregate contact information into "Top 10 Issues" lists, worldwide or regionally, that identify issues that need urgent attention from executives or product groups.

Better Training

The new strategy places a significant burden on CSS staff to be familiar with higher service standards, the taxonomies used to categorize customers and issues, new routes for escalation, and the company's Knowledge Base for troubleshooting.

To ensure worldwide consistency for customer service, the company has developed a comprehensive training program and is delivering it to both its own staff and to outsourced service providers. One piece of this puzzle is a new "agent desktop" being rolled out worldwide in summer 2005. This interface for customer service agents ensures that customers and the subject of each call are properly and consistently identified; that the category of contact—a product order or a troubleshooting incident, for example—is properly assigned; and that any back-end systems, such as a fulfillment system for product orders, gets all the information needed to process the transaction. The agent also records how the contact was handled or routed. Microsoft will refine the agent over time, one goal being to increase the number of calls that are resolved by the initial Microsoft contact.

Buy-In Across the Company

As CSS broadens the range of services it provides, develops tighter processes for resolving customer problems, and assumes roles such as telesales that have been the province of other parts of Microsoft, it will blur many of the company's traditional boundaries. To accomplish this, CSS must cement stronger relationships with other parts of the company.

Lori Moore, vice president of CSS, says Microsoft executives have endorsed the new strategy, and business groups will provide "subject matter experts" (SMEs) to whom difficult customer service questions can be referred.

The flip side of this relationship is that business units will be encouraged to use Microsoft's customer service infrastructure to act on information gleaned from customer service information, such as promoting new services offered by the business units.

Using Technology

As a global company whose customers and technical resources are spread around the globe, Microsoft could not achieve its new strategy for CSS without improving its technology. Customer service agents and support personnel need access to the support Knowledge Base to resolve problems, some way to quickly and accurately categorize problems so that they provide useful data to Microsoft, and the ability to escalate problems along the most likely route for a solution without personally knowing where that solution might reside.

In addition, the company is plugging partners, who provide support for their own customers, into the Knowledge Base and the escalation process. Not only will this reduce the load on Microsoft's own support resources, but it will also let partners offer better service to and increase the likelihood that customers will get the same result whether they call a partner or Microsoft. A response-management tool for partners, developed in early 2005, lets Certified and Gold Certified partners escalate Microsoft-related customer and partner issues directly to Microsoft.

OEMs constitute one of the major partner groups affected by the change. Although they are officially responsible for supporting Microsoft software that ships with their PCs, Microsoft ends up with many calls from customers related to configuration or use of their OEM version of Windows. Rather than viewing such contacts as being outside the official OEM-run support channels, Microsoft is working more closely with OEMs to give them access to the Knowledge Base, the ability to log their customer support incidents in Microsoft's support system (so that Microsoft's worldwide statistics on support include incidents resolved by OEMs), and to escalate problems to Microsoft if they cannot be resolved by the OEM.

Microsoft must also ensure that customers can use technology to solve their own problems, and, if necessary, that they can reach the company through resources (such as e-mail or Internet chat) that are cheaper than taking telephone calls. For instance, Windows' built-in troubleshooting technology, the Dr. Watson utility, will evolve to better lead customers to solutions on one of the company's Web sites.

To meet these goals, the company has significantly revamped its support Web site to improve the odds that customers will find answers to their problems on the Web, such as through improved frequently-asked-questions (FAQ) documents. If they don't find answers there, CSS wants to ensure that customers can easily see alternative support resources, such as e-mail and chat, that can reduce the number of phone calls to CSS.

Implementing the Strategy

Given its complexity and scope, implementing and refining the new CSS model will take several years and Microsoft will be implementing the new operations in phases, giving it time to improve and streamline the model.

Implementation Timeline

CSS started the process in 2004, during which it focused primarily on gathering data, defining standards, refining the delivery systems, rationalizing its call centers and outsourced support vendors, and creating processes to implement the strategy.

During 2005 the company is rolling out the new agent desktop, training people to use the system, and monitoring the systems to make sure that barriers to use are quickly removed.

In 2006 and 2007, the company expects to further refine the system. As the system delivers more consistent data to the company, business intelligence and data analysis are expected to give the company a better handle on customers' needs and new business opportunities.

Segmented Audience Delivery

Web-based support is already being refined for all customer segments, but telephone, e-mail, and other types of support will be rolled out at different times to different customer segments. In addition, the company will stage the rollout to different regions and subsidiaries over time, as the necessary technical systems, languages, and training are incorporated into customer contact systems.

An important goal of the program is to shift from customer service oriented around functions, such as license fulfillment, to providing all the services needed by a particular audience. For example, instead of calling one place to check on their certification level and another to get presales technical support, partners will call a partner service center that can answer all of those questions.

Enterprise customers and partners are likely to see the new approach first, followed by small and midmarket customers, developers, and consumers.

Developing Services

Beyond improving the efficiency of what it now provides, CSS believes it can offer new services based on its capabilities.

Moore says the company sees a future for subscription services that small business and consumers can employ not only to resolve problems but also to get advice on how they can use technology better.

"Today many customers get two incidents [support calls] and they use them up and then spend hours on the Web trying to solve the next problem. We don't [want to] differentiate between tech support and other forms of service. We will move away from 'don't call unless you have a problem' to 'call us when you need help.' "

Prospects for Success

To the extent that the new CSS strategy resolves current shortcomings in Microsoft's customer relationships, the project is likely to be a success. The more ambitious reach of the project is less certain, however, primarily because it requires enthusiasm from people who haven't been involved with Microsoft's customer service organization in the past. For example, business groups that have seen CSS primarily as a cost center that provides basic, necessary services may take some time before they see CSS as a resource for delivering their own programs to customers.

Some partners may also perceive CSS as competing with their own businesses as it expands the range of advisory services it provides.

Most partners make little or no money from the sale of Microsoft product licenses; nearly all of their Microsoft-related revenue comes from giving customers advice, and from installing, configuring, and managing their systems. Although Microsoft's future service offerings are not concrete, and the company goes to great pains to emphasize that partners will be able to deliver these services, partner protests stalled earlier efforts by the company to move more aggressively and broadly into services.

Resources

The CSS organization was reviewed in "Understanding Microsoft's Worldwide Support Organization" on page 31 of the Oct. 2004 Update.

Current support offerings from Microsoft were covered in "Microsoft's Varied Support Offerings" on page 26 of the Nov. 2004 Update.

Improvements to Microsoft's support-related Web site were described in "Support, Licensing Web Sites Updated" on page 31 of the Dec. 2004 Update.