Interview: Dick Hunter, VP of Customer Experience at Dell

This is part 1 (of 3) of my interview with Richard “Dick” Hunter, Vice President of Consumer Customer Experience and Support at Dell. Basically, he runs the company’s customer service efforts.

This is a great interview and provides a lot of information about how Dell is working to improve their customer service and customer relations. It’s definitely a must read if you are interested in how large companies work to turn around their customer service and fix previous mistakes.

This part of the interview talks about why Dell’s customer service worse, who made the decisions that caused Dell’s customer service to worsen, and talks about Dell’s current position with outsourcing and offshoring. It also talks about how Dell comes up with its customer satisfaction numbers.

Question: For a while, it seemed like Dell’s customer service was declining a lot. HP was bragging that their numbers were going up while Dell’s were going down. What was the cause of this?
Answer: Over the last six months, our numbers have been going up. They went down very significantly until September of last year. At that point, we started turning things around. We’re reaching levels that are similar to where we were 3 years ago.

To give you a little bit of information about where I get the data from: We do three types of surveys: one is very in depth – about 80 questions long that we send out to 100,000 people. We get about 5 or 6% return rate. We call that the loyalty survey. Each week we send out about 100,000 email surveys that are typically about 20 questions long. The return rate is roughly the same return rate – about 7% return rate. We just started a short IVR survey, which is right after a call with a customer. It’s a telephone voice survey that is typically 3-5 questions. We are getting about a 10% take rate on that. We take all of those surveys and the numbers show us that we are doing better. We have a long ways to go still, though.

The reason for the satisfaction to drop so significantly last year was because of a variety of what I might call stupid decisions. We did things like cutting the warranty period, cutback on our support boundaries (what we were going to support – basically we weren’t going to support operating systems). We even went as far as taking our 800 number for tech support off the web site. All of those were done somewhat early last year and we’ve reversed all of those decisions by this year. Our reversing those decisions started to really go after turning around the bad customer experience we were causing as a result of those things. Those things that hurt us were various cost cutting moves; that was probably the cause.

I got into this job about a year ago and was challenged by Michael [Dell, CEO] to turn the customer experience around. To that end, we’ve gone up in core tech support about 10 points. We’ve gone up in our XPS support about 15 points. We’ve gone up in about 10 points in our “Dell on Call” service area. In those areas, we’re making progress. A lot of that has been brute force and yet we are no where we should go or where Michael is challenging me to go. His challenge is for us to get to 90% customer satisfaction in tech support. At this time, for XPS, we’re running around 75%. We were at 60% – we went to 75%.

Question: Who made those decisions that Dell eventually ended up regretting?
Answer: They were all done at the executive level. If you ask Michael, he was part of all of that. Let me put it in context of what was going on: The people running those areas at the time (I suppose I could talk about it, because I wasn’t one of them) thought they could do these things and not affect the customer experience. Or it might go down, but only slightly. The reality of it, though, was it went down very fast and very significantly. Nobody at Dell, Michael included, would make a decision to really screw up our customer experience by doing these things. It was “We think we can cut costs and do these things and not impact customer experience.” Well, the reverse ended up happening. That’s when Michael and others came back and said we’ve invested $150 million to turn that around. Yeah, I spent that money and we have turned it around. The ongoing issues are how do we keep the progress going – what are the next steps and so on.

Question: Where is Dell with outsourcing? What is the likelihood of an average consumer calling Dell with a question about his or her computer and talking to someone in America versus in India?
Answer: Let me just give you a view of our network first – it’s not all India. We have people in India, Manila, the Philippines, El Salvador, Canada, and the United States. The consumer support network is in all of those areas.

We used to outsource a fairly significant amount of our workload, which we’ve cut by about 40% so far. We’ll reduce that by another 15% or so this year. In other words, the overall amount of outsource will be cut in half this year. We will reduce the number of partners by about 75% and the total number of FTEs outsourced by about 50%. That reverses some trends where we were outsourcing a fair amount of our workload to partners. Some of competition outsources most everything. We don’t think that’s the right strategy – we think Dell people should answer the call primarily. We will be at 80% or more “Dell badged” [Dell employees] by the end of the year.

To your question of where will you go, we’re thinking about for a particular product line like XPS where we may offer exclusively North American support. I wouldn’t say US, but between the US and Canada.

Today, if a call comes it, it could go anywhere in the network. It could go the US, it could go Canada, it could go El Salvador, or India. In the core tech support area, a little over half of our network would be in India today. A customer would have a little bit more than a 50% chance of getting to India. They could get to El Salvador, they could get to the Philippines, they could get to Canada too.

We’re thinking about offering a premium service to a select group of people. We’d maybe have the option of buying into a service. For example, if you fly American Airlines coach all the time, you can still buy your way into the Admiral’s Club. If you fly First Class, you always get it. The point is we’re thinking about letting you buy your way into exclusively North American support.

7 Responses to “Interview: Dick Hunter, VP of Customer Experience at Dell”

  1. Bill Gammell said:

    May 15, 07 at 3:18 pm

    This is a very interesting interview. I think this first interview crystallizes they way many of companies were thinking over the last few years- “What can we cut in order to get more money?” It seems that many of the “bad” decisions were due to this “Jenga” way of brand management – what will be the last thing we can take away before the brand tumbles?

    Now, it seems with the introduction of the “premium service”, the thinking is -“What can we add that is of value to our customers that will bring in more revenue?” As long as the premium services are not seen as a bare necessity, I think this way of thinking will add value to the brand.

  2. Service Untitled » Dick Hunter, VP of Customer Experience at Dell - customer service and customer service experience blog said:

    May 15, 07 at 5:07 pm

    […] Part 1 – LinkThis part of the interview talks about why Dell’s customer service worse, who made the decisions that caused Dell’s customer service to worsen, and talks about Dell’s current position with outsourcing and offshoring. It also talks about how Dell comes up with its customer satisfaction numbers. Technorati tags: Dell, Dick Hunter, Interview, Customer Service « Interview: Dick Hunter, VP of Customer Experience at Dell   […]

  3. decloned - » Something Smells at Dell said:

    May 15, 07 at 9:41 pm

    […] John and I began a discussion about customer service in the comments on that post and then pointed me to a post that is an […]

  4. Bart Knopik said:

    May 16, 07 at 8:40 am

    Giving the customer the option to choose a level of service puts the consumer back in-charge and allows them to assume some responsibility. We at http://www.saturnsys.com have seen this trend for a long time now. It’s a matter of communicating risk & reward for the level of service. The issue is there is an assumption that if you choose the American option it’s a lot more expensive. I would like to hear what Dell is doing to lower its “High Quality” Dell badged America support. You can get the best of worlds, high quality & low cost by using rural locations. Here’s an example http://www.saturnsys.com/rural_outsourcing.html Saturn is 30-50% less expensive than metro based companies.

  5. Natacha said:

    Apr 10, 08 at 11:52 am

    I think the strategy to stratify customer service levels will eventually backfire. Because it doesn’t matter what “level” you choose customers will still expect quality service and tech support. And so I think the strategy to offer customers to buy-in to a service plan to which they are entitled as stakeholders and possible loyalists is going to backfire eventually. Dell needs to find a better way to streamline and raise profit margins and NOT do it at the expense of frustrating its customers.

  6. Senthilkumar said:

    Jun 23, 08 at 9:19 am

    Hello,

    I am expereincing bad support from Dell India.

    You can’t send email request from theier website. If you try, it will show you a form to fill out and you filled and click submit, there will be an error “The Dell Email Server Currently Unavailable”.

    If you try by Online Chat, always there are all Representatives Are Busy”.

    If you try phone, if you wait for more than an hour in their IVR System, they will attend if you have a luck.

    The Dell India Support people, know only how to speak with the customer, how to avoid the customer. But they don’t worry about the customer’s situation.

    I am trying to speak with the Dell India Support Rep. for last 15 days, but no luuck. It’s only luck to speak with Dell Support, problem solving is next thing.

    As per me, I am expert user, i know what’s the problem. I only wanted to log a complaint to send a Service Engineer.

    My Service Tag is 3RC7S1S, still in warrenty.

    In thier IVR System, you can hear frequently, “Prevension is better than Cure”. but they will produce diffected product and you call them they never send the Doctor.

    I had good thought about and I recommeneded many to buy dell products. But this time, I am very much disappointed.

    I am trying to get support from Dell India from last 10 days. Even I can’t speak with them clearly.

    Senthilkumar D.

  7. Senthilkumar said:

    Jun 23, 08 at 9:22 am

    Also I am posted a thread on DellCommunity.com @ http://www.dellcommunity.com/supportforums/board/message?board.id=Tech_Talk_XPS_Laptop&message.id=19620#M19620

    But No Issue…