Customer Service Innovation

For most companies, customer service is the name of the game. Some essential service providers with little competition-think about your last call to your electric or cable company-can still rake in profits even while inconveniencing those they serve. But if you are in any other business and you neglect your customers, you probably will not be around much longer. These days, there is just too much competition, the majority of which has now leveraged new technologies that help make the customer/company interaction easier than ever before.

As innovation further improves and companies increasingly embrace the efficiency of social media and other Web 2.0 tools, those still operating under the outdated assumption that the customers will keep showing up regardless, risk being left behind. Companies like Dell have leapfrogged others in their industry by embracing client-centric operations while others such as Sprint have plummeted in overall customer satisfaction ratings.

BusinessWeek's recent list of "Customer Service Champs" reflects this. The Freeport, Maine-based retailer L.L. Bean ranked first, largely based on its adoption of online-based initiatives to improve how shoppers can buy products on the web. Long famous for its liberal return policy, L.L. Bean has added instant messaging and email communication options for its customers, who can now also submit product ratings and reviews on the company website-something that many businesses have been hesitant to do since they have no control over what people will write.

The San Antonio-based financial services provider USAA's number-two ranking is due in part to its new service that allows clients to make deposits by simply taking photos of their checks on their mobile phones and instantly emailing them in. The retailer Nordstrom came in sixth, largely for revamping its inventory system to give web purchasers much greater access to products in any of its stores. Bookseller Barnes & Noble ranked ninth by going in the reverse direction-instead of bringing its stores online, it has brought online to its stores by offering free wi-fi in all of its more than 700 locations. Other companies with advanced online strategies in BusinessWeek's top 25 predictably include firms like Apple, Amazon and Dell.

Ultimately, no company can be successful if its underlying products and services are not top-notch. But increasingly, that is not enough. Today, it is so easy to treat customers well-and address their needs in near real time-that those companies that are not adapting and using new tech tools to do so are beginning to look like dinosaurs. And when was the last time you saw a tyrannosaurus?