The mystery of mystery shopping: Why culture and listening to staff beats covert monitoring

18th Nov 2010

Matt Lynch probes the problems with mystery shopping, and how turning it on its head can produce better results.

When we start working with a client, one of the first things we do is talk to the customer-facing staff, and get a feel for how they operate. We do it openly, to find out what’s working well and what can be improved, direct from the people who deliver services to customers.
One conversation we had with a salesperson was particularly memorable, and shed some light on the impact of the business practice of ‘mystery shopping’. It had become known that mystery shopping took place on the last week of each month. Our salesperson proudly explained: "I don’t serve any customers for the last week of the month. That way I can’t get it wrong and it won’t be me that gets fired for bad service!"
While I can understand his logic, I’m sure that this wasn’t quite what head office was trying to achieve from its programme. It certainly highlights some of the issues that the mystery shopping process can create with those employees that are being monitored.
Turning the process on its head
Every major sector, from the leisure industry to the NHS, retailers to local authorities, uses mystery shoppers to test whether promotions are being run as planned, products sold as expected, or information and services provided as required. If the programme is run against very tightly defined objectives, designed to avoid subjectivity, and used in a constructive manner - then mystery shoppers can have a role to play in the improvement of customer service.
But done badly, they are demoralising and can make a bad situation worse, not better. All too often, mystery shopper exercises are run by central head office as spying missions, designed to catch out a staff member not following the ‘hello, my name is X, how can I help you today’ script that was written by a marketing executive who’s never actually set foot inside the shop/fast food outlet/travel agency involved. Run like this, the exercise becomes a stick to beat employees with, rather than a way to improve the customer experience.
It is worth considering turning the process on its head and, like Pret A Manger has done, reward great ideas or good-service with on-the-spot rewards. This is much more motivating than an MI5-style spying operation for staff, who are likely to feel more valued and deliver better service as a result.
There is always a core group of people at the centre of an organisation from whom ideas and management originate. This creates an ‘inside, out’ structure - where ideas and initiatives - including those designed to improve customer experience - are pushed out to the employees on the outside - the frontline - of the organisation to be implemented. Often the frontline staff are the lowest paid, with the highest churn rate, and are the most disengaged from the business. And yet they are the most directly responsible for creating a positive customer experience, and so have the most potential to influence the success of the business.
They are also probably more in touch with customers than the management at the centre of the organisation (who will often be detached from the frontline by a complex reporting structure underneath them).
It is by turning this structure on its head that we get the most interesting results. Creating an ‘outside, in’ culture takes as its core principle that frontline staff are intrinsic to the generation of ideas and initiatives that improve the business.
An 'outside-in' structure
The outside of the business, or the boundary - the place where the business and its customers interact - is often the most interesting part of the organisation to look at. Not by doing spot checks, or mystery shopper exercises, but by using the staff who know the customers to generate practical ideas for improvement. This has the advantage of getting frontline staff involved in their own future, improving their working environment and motivating them to deliver better service.
Creating an ‘outside-in’ structure works best when management receives feedback from the frontline that can be used to improve the business – and empowers the frontline to make the necessary ongoing changes. Too often, organisations rely solely on metrics to measure success, which tell you the ‘what’, but not the ‘why’. What you really need to know is why something has or hasn’t succeeded. The best way to do this is to understand what’s happening at the point of interaction between the customer and frontline staff.
Getting this right means starting from a position where management believes that those who deal with customers are a source of practical intelligence, innovation and ideas. This can be a fundamental shift for some companies, who are used to ‘cascading’ or ‘disseminating’ information, implying that all ideas come from the top of the organisation, and then checking they’re being implemented through mystery shoppers. Ideas should be gathered at the frontline and then absorbed inwards.
Listening to frontline staff and improving the business by taking new ideas on board can require a huge shift in attitude and culture, which is probably why so many companies stick to the traditional ‘inside, out’ approach. But if a business relies on the quality of its people, particularly those who deal with customers, then the managers of the business must be engaged with more junior staff that does much of the work.
This change has to be lead from the top of the organisation, which often presents its own challenges. Personality issues can get in the way of the necessary culture change. Business managers tend to be ‘A’ type personalities – bright and active, but also controlling and sometimes with a tendency to bully. They are less likely to listen to frontline staff that they see as inferior. It takes a pretty strong business leader to listen to ideas for change, and hear criticism of existing processes and management, from employees they see as junior staff. But change can only come from the top. We’re not talking about decision by committee, or woolly leadership, but about decisive action taken by the management of a business, based on listening to and understanding the issues faced by staff at all levels of the organisation.
Questions to ask
The questions a business should ask itself before embarking on a mystery shopping exercise are:
  1. How do you position your mystery shopping programme with frontline staff? Is it a carrot or stick?
  2. Do you involve frontline staff in the design and implementation of your programme?
  3. How do you formally enable staff to contribute ideas about practical business improvement (not just a suggestions box)?
  4. How do ideas from the frontline get fed back to head office?
  5. Do link your mystery shopping programme to coaching and development for frontline staff?
So ultimately, improving the staff experience leads to a more motivated workforce, which leads to an improved customer experience, making a positive impact on the bottom line. Listening properly to those employees who deal with staff can reduce churn, improve the customer experience, engender loyalty from both employees and customers, and – most importantly - create practical and innovative improvement programmes to the business.
Matt Lynch is a partner at Insight Exchange.

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