Andy Polaine - Why Customers Leave Even When Products Are Great

In this episode of From Noise to Sound, Andy Polaine discusses the growing importance of service design and why it has become a critical capability for modern organizations. He defines service design as the creation of a coherent experience across all customer touchpoints, both visible and invisible. This includes everything customers interact with, such as websites, apps, stores, and support channels, as well as the backstage systems and processes that make these experiences possible. 

Using examples from Apple and Airbnb, Andi explains how great service design makes interactions feel effortless, while poor service design creates friction, confusion, and frustration. Many service failures occur not because individual touchpoints are bad, but because departments operate in silos, creating gaps between channels and stages of the customer journey. These disconnects damage trust, increase support costs, and ultimately affect brand perception. 

The conversation also explores the role of AI in service design. While AI can automate repetitive processes and improve efficiency, Andi argues that it cannot replace genuine human understanding, empathy, and judgment. Successful organizations will use AI to support services rather than disguise automation as human interaction. He highlights IKEA as an example of a company that used AI to handle routine support while retraining employees for higher value customer interactions. 

Andi also introduces the Service Design Master's program, which combines human centered design methods, business strategy, and systems thinking. The program attracts professionals from diverse backgrounds including UX, product design, architecture, marketing, and brand strategy. He believes that as organizations struggle with fragmented experiences and increasing complexity, service designers will become even more valuable because they can connect business goals, technology, and human needs into a seamless whole. 

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Transcript

00:00:00 Speaker: Hello and welcome. This is a podcast from noise to sound. And as I mentioned before in social media, we'll have two back to back podcast episodes regarding, you know, new, uh, versions of masters that actually give you a little bit of upskilling and reskilling possibilities. So one of these two is service design. And actually considering that the market has sixty to eighty percent, uh, services, actually that's becomes a very relevant asset and knowledge to have. And today I have with me, Andi, who is actually teaching here at the house and will give us a little bit more insight on what is actually service design, what's the definition of it? Okay, so the, the sort of one liner of a couple of sentences definition is the design of touch points. If anyone's wondering, is my dog is here. Yeah, we have the first, the first thing, um, it's the design of all the different touch points that make up a service. So those will be digital physical front stage. So we have this front stage backstage metaphor. So all the things that the customer experiences is front stage and all the systems and enterprise stuff that has to actually support that service and to deliver it is backstage the design of that as a coherent whole. It's easiest to understand an example. So if you've ever had the experience, it's often with a telco or insurance or healthcare or something where you have had a problem and you look on the website and can't work it out, you look on the app and it's got different language. Maybe you phone up if you can find a phone number, speak to someone or speak to a chatbot and then speak to a human being, or you go into a store. It's sometimes as if you're dealing with five different companies, and service design is there to try and make that a coherent whole. And like I said, both front stage, but also then to consider how does that get delivered backstage and why isn't it happening already? Yeah, well, there's the companies doing it wrong. I mean, we all have been to a bad service. I mean, we usually remember the worst ones, the best ones you usually should not remember because it was natural. Yeah. So I'm a little bit intrigued to understand a little bit from your perspective, what is. I mean, give us some examples of a great or a bad service design. You know, I hate invoking Apple, but Apple do the whole physical digital thing really well. If you imagine when you go into an Apple Store, for example, and you've maybe looked at stuff online, you go in and you, you can pick up an item in the Apple store, you can scan it with their app and walk out the store. Right? And so in that moment, Apple, the Apple Store turns from the Apple Store as a retail experience to your store room where you go, I need a thing and I get it. And I just go the logistics to make that happen really, really complex and to make it a seamless experience and all the other things around the Apple Store, the way everything is there to, you know, to touch and to use and so forth, you know, it's sort of become commonplace at the beginning, everyone thought, well, that's never going to work. So and they rehearsed that. There's a whole, you know, they pre-build mock ups of Apple stores on their campus to go through all of it. Those nice wooden tables that they have that seem very basic underneath. There's a whole load of stuff going on, a whole load of hidden compartments and things, plus all the digital stuff happening backstage. And Airbnb is another good example of it. It's generally pretty seamless to, to, to book a room and, and it all just works. And that's that thing, right? If it all just seems to just work, you often don't notice it. What you notice is when all the cracks start opening up and I call them, um, sort of experience crevasses where they're often not that big and you could jump over it, but if you fall down one and you're on hold for two hours or something, and you can't get hold of a human being and you know, you've got this problem, it's a real nightmare. Yeah. But you know, we've seen it. I don't think, you know, organizations nowadays are, you know, aware of how bad can influence, you know, bad service design. I mean, and you mentioned Properly. I mean, the brand is very much connected to the service. I mean, we think I mean, you have a big brand and everything is going to be fine, especially if the service is not the best because the brand is strong or, you know, has a legacy of one hundred years. It doesn't matter if one year doesn't go very well. But as you mentioned here, the impact on the brand is huge and you don't and you see it at the end. That's the problem. I mean, if you ship out a service which is not that good and this will have an impact to the brand, but you will notice it a lot later. Yeah, I mean, insurance is the classic one for that, right? Because it's time shifted. You know, if you buy a suit or you buy, you know, a phone or whatever, you can hold the thing in your hand and you look at the quality of it and I can go, oh, this feels a bit sort of cheaply made or, you know, the buttons falling off. With insurance, you don't know until the various worst moment whether it's any good or not. And, and only then do you discover it's awful. and if you have an awful experience, you will immediately quit that insurance company. In the digital world, this is obviously a real problem. So all of the digital products are actually services. So, you know, Slack, uh, air BNB is a physical digital one, but, um, but all of the cloud services, all the SaaS things that we use, you know, it's so easy then just to kind of switch because it's just a click away. Um, with those other big services are mobility. So any kind of transport finance. So banking, insurance, that kind of thing. Um, healthcare, uh, welfare, government services and things like that. They are major services that will be around, you know, they were around before we were born and we were around afterwards, big and complex. But the thing about them is there's also not that much competition. So the dating pool, if you like, is quite small. If you want to switch telcos, there's like three I think in Switzerland. Major telcos. right? Apart from the subbrands, supermarkets are similar. Um, if you have a bad experience, you are you get excluded from that dating pool for a very long time. Until usually what happens is all the others are just as bad. Um, and so there's this often this idea of like, we're going to focus on each part. The reason why it happens is usually because different departments focus on each touchpoint. And each touchpoint can be kind of okay itself, but it's often the gaps and transitions between them. So that's from one channel to another. So from physical to digital or something like that, often one step in the journey to the next. And what tends to happen is one department is responsible for that bit, another department is responsible for that bit. And there's this little gap, that's that crevasse where everyone thinks it's the other department's responsibility or, you know, each bit you look at one thing and say, oh, that's yeah, that's just an edge case. That's a minor thing. But as a customer, when you experience that as a full three hundred sixty experience, you experience the whole. It's not just one clunky bit, it's several clunky bits. And. And as a customer, you go, you know, this company doesn't have its act together. I hate using this. It's really clunky. Now, for some things, you might not have an option. Government services are one of them. But it costs money. Support costs money. And even in the even or especially perhaps in the age of AI, support costs money. And, you know, if you start getting that wrong, then it really starts to cost companies as well as the brand damage as well. You know, I was, um, it just popped out in my mind. I was watching an interview from the CEO of Ryanair. Yes. It's a very specific, isn't he, I think. Yeah. This is a very interesting perspective. I have never heard that before, to be honest. I mean, based on your example, there are two some sectors that cannot afford it. I mean the luxury sector cannot afford clunkiness in these amounts. Yeah. And then it comes a Ryanair. And the guy said, uh, quote unquote. He mentioned, I don't want to be first in customer satisfaction. If I see our name, the first customer satisfaction or whatever, then I know we do a bad job because if we're not the best, then I can make services so cheap that people can fly, you know, with one two pounds or dollars or whatever. And I thought for some points, well, that makes in a first in the first level sense, but does it make sense in the service service? I mean, this is it's funny because labyrinth is lovely. Who's one of the co-authors of the book? He and I spoke about this years ago when we wrote the first one ten years ago, and he said, you know, actually Ryanair is good service design because your expectations are set really low. And that's what they meet, right? So it's the bus of the sky. It's the coach of the sky. Yeah. And in some respects, so you go in knowing it's going to be terrible. And you know that the trade off is I pay a cheap price for this thing. Um, and therefore, you know, I put up with it. What a lot of airlines do is they offer actually pretty clunky services too, but they're still trapped in that marketing of, you know, air travel is this kind of luxury thing. And, you know, the sort of Pan AM days of air travel, which just hasn't existed for a very long time, and hotels did the same. Right. And hotels generally just lost any kind of brand differentiation. If I was to put you, I think Seth Godin talked about this. I was to put you in a blindfold you, and put you in a hotel room, four seasons, Marriott, Hilton, any of the kind of big chains and, you know, take the blindfold off, you probably wouldn't be able to tell which one it is. And it used to be like, oh, we're staying in a hotel tonight, you know, and now it's like, oh, I'm staying in a hotel tonight. And that's what Airbnb did. They just I mean, Airbnb are not without their problems obviously as well. But, you know, they realized that hotels have become this awful kind of processing experience, which is again, fine if you're a budget hotel, like sort of an ibis or something like that or motel one. And it's very clear this is the deal. And often they provide a more seamless experience than the bigger chains. And it's partly that expectation differential that's gone wrong. Yeah. Now, you said before, I mean, now we are in a completely different times and AI is here to stay. And it will change, of course, the way we perceive services and of course, our expectations as well. So how from your perspective, AI is going to change this service design or the way digital services are offered? So I mean, I talked before about there's this idea or this sort of concept of service design. There's two major things, right? One is this idea of the front stage backstage. I said all the things that a customer experiences and that's everything. Everything from print and marketing material through to the apps and products and buildings and, and people. And then there's the backstage stuff of how does it all actually get delivered and hang together? And what are the employees dealing with? Sure. So a lot of the reason you have terrible customer experiences with insurance companies because of the tools that the employees are using. Really awful. So AI has a few things. One is obviously it's pretty good. It's not seamless. A lot of the logistical stuff, if you've got something that's a process and it can, it's a fairly repeatable process. Generally it's quite good for those kinds of things. Um, the dream that it's going to replace personal customer service, I think is misguided. And it's because humans are very hardwired to personal interactions and understanding relationships. You know, that whole idea of the uncanny valley where it has to be slightly off and you're like, oh, you get kind of ick about it. Every time I see a LinkedIn post that's got that kind of style of writing in it. Oh, this is an LLM has written this. It's a real turn off for me. And I just kind of screen it out. And so posing as being personal when it's not is a real problem. If you pose as you know, here's our AI is going to try and help you. Um, then I think it's a different thing because you're setting expectations. Ikea are kind of famous one, right? So they, they, um, and they did a really good thing as well. They, I can't remember how much. It's quite a lot of money. It's like one and a half billion or something. They invested in AI to, um, take on board a lot of their customer support queries. And they would have meant that they would have made a whole bunch of people redundant. Um, but actually they found that, you know, it could handle about, I can't remember what the number is, about seventy or eighty percent of them, all the other ones were around. How do I style my home stuff that the AI couldn't answer. And so they retrained all of those people to be interior designers and to then those people actually then help customers with, you know, I don't because it's all questions like, I don't really know what I want. And if you don't really know what you want, AI can suggest some stuff to you. But, but actually you need that back and forth, right? Until you don't know if you really like it. Because, I mean, AI doesn't know you personally so much, but it's it's a fair point. What I wanted to ask you, you know, I mean, service design, of course it has it has its own value, its intrinsic value in every in every company, as you mentioned. So now you guys, you have Steven Masters on that. So what do the students or the people who are coming in, I mean, guide us a little bit on these masters. What are you offering and say as a knowledge package and what kind of people are joining there? So it's pretty broad. And service design is quite broad in the sense that it's always it's actually a multidisciplinary practice. So you, you can't have one person designing absolutely everything. And really the, a part of it is, is about orchestrating all of those things and taking these different zoom levels. So what happens on a very detailed level? How does that affect the big picture and vice versa? And, you know, I always find it really hard to find examples of this. One I used to use was it's called Mikey. It's the it's the kind of touch, you know, it's the travel card in um, in Melbourne, in Australia. And there's a few different sort of broken touch points and just slightly laggy card readers, a few other things. And it was just a disaster. And their budget ballooned from, I think three hundred and fifty million to one and a half billion, which at the time was like the the value of the Ford Motor Company in Australia, a lot of money and it's public money. Um, Covid showed us how small changes absolutely make a difference. They ripple up hugely or, you know, or a shift above like a government says, okay, these are the rules changes everything else. So it's a really good example of that kind of relationship between the kind of detail to the big picture and the skill of service designers, is to be able to mentally zoom in and out in that way, um, and then to be able to articulate it to. And so that's one of the things we're teaching is obviously there are certain specific methods to service design. Some of them are straightforward, human centered design methods. Some of them are specific to search service design, but it's also getting them thinking around the kind of business model or the strategic aspect of things. And so that they're pretty versatile and they can work with those different disciplines. And some students, they'll do a very specific kind of digital heavy project. Other students will do a thing that's much more around the kind of physical space or an experience. And we get people who have studied some something digital at UX or human centered design or product, physical product design. Um, people come in from other areas like architecture or marketing or they don't have to really have, you know, a service design background. No technical, no, it doesn't get taught much. A bachelor's level design management is a really common one. Yeah. So those people often really get it. Some people from brand, particularly brand strategy, get it because they get that sort of whole ecosystem thing that everything reinforces the whole brand. So those are the kind of people who who come in, but they don't need to be service designers. Where they go is, you know, I'm seeing a lot of a lot more service design jobs at the moment because of this siloed nature of digital product design. We've got kind of feature teams working on different bits. Or the thing I said before, where you've got different departments working in different parts, and there's a recognition that we need to try and glue this together. You know, Airbnb had this famously a couple of years ago. Brian Chesky said, you know, we've got all these feature factories, these product factories humming away, and they've all got their own KPIs and metrics. But I don't really understand how it all hangs together. Which meant I, as the CEO, don't understand how my company hangs together. And so service design is really one of the things. It's often the case of making that stuff visible. A lot of the jobs in service design aren't advertised as service design. Yeah. I mean, you have to come into that. But but I understand let's say you don't have to have this background. And I mean, you're anyway, this is a skill as I It's obvious and it's clear that you can always apply whatever the business is. I mean, it's not very specific. Only on healthcare, only on that. Only on this. Yeah. But, uh, what I want a little bit to, to dig a little bit deeper is, um, now the market is not ideal, let's say job market wise. Why is this relevant? I mean, and, you know, people will naturally ask, you know, well, well, I will study that Masters. I will put my energy and, and everything. And in six months the new LLM will come out from ChatGPT and I will be obsolete or this knowledge will be obsolete. Yeah. This is one of the things that I'm skeptical about. Um, and not just in my area. You know, I mentioned the thing about kind of people, however much AI is in a system, there are always humans at either end. So the entire infrastructure of Amazon, for example, is really there to facilitate an interaction between, say, me as a customer and the person or even the robot in the warehouse. Well, let's say, you know, the author of a book and and the customer who buys it to facilitate that transfer of that physical item, you know, and also some transfer of money into Jeff Bezos's pockets, obviously. And so people are always there somewhere. People are always there. And understanding that's really important. It's vitally important in government services where they have to work for everyone. It's also important in commercial services because if you get it wrong, if you if you lose the trust of people, it's it takes a long time to, to get it back, like in private life. Yeah. It's everything. It's exactly like that. And, you know, we have I'm a big believer that humans anthropomorphize everything, including lambs. Um, and we do the same with companies and organizations. We, we get upset when they treat us in a way that seems unfair or that a human being wouldn't treat us. And so understanding that and people's needs and how they think and what they're really trying to achieve is central to it, regardless of what technology you're shoving in there. And I would argue even more so. I don't think those skills of one of the things that AI is really bad at is discernment. So in design, people have been talking about kind of taste quite a lot, and taste is going to save the day. I would say discernment because it's a bit of a mix of it's a little bit of taste, but it's about what's the most appropriate thing given this context. Um, and, and AI is good at seeming as if it understands that, but it obviously doesn't really understand anything. Um, and it's, um, and actually it's one of those things that with experience, you see the difference. And if you, if you think of design as just kind of making interface, right, then. Yeah, sure. But that's never really what design has been. It's always been much more about what's the right question to be asking. And you need that question before you can incorporate any AI. That sounds very creative, though. And I think with. By the time we will. A lot of. We are becoming very digital or we are just, you know, outsourcing our brains to, you know, a social media AI, whatever it is. This creative process that becomes, you know, obsolete more and more in organizations, but also in humans. I have a feeling it is there intrinsically, but somehow it goes in a hypnosis. I mean, there's definitely a kind of degradation that goes on. I think, you know, if anyone is um, but that's, that's less to do. I mean, anyone's going to waste hours of time on Instagram or something that's less to do with, um, the tool itself, uh, and creative tools, you know, you can, what it does is it raises, raises the base level of quality so you can make something mediocre fairly quickly. And that's not a new thing. You could make a mediocre dance track in GarageBand using the existing loops and you know, it will get you to that that bottom level quite quickly. What it doesn't create is a hit and it doesn't create things that connect with people. And this goes this has been true all the way back through to desktop publishing in the eighties. Yeah. You know, those tools came out. A whole bunch of people started creating some leaflets and pamphlets with, you know, forty different fonts in them because there were forty different fonts in the system. And at some point, you know, people go, oh my God, that's really ugly. So for, for commercial work, for stuff that you really want to connect with people, you still need a designer to really work on that stuff or, you know, whoever, not just designers, other people, you know, working on those things for, uh, you know, a poster in the office that says, you know, please turn off this tap and wash up your carbs. You know, it's printed out in Comic Sans and it's kind of centered text and, you know, that'll do the, the danger is that there is a mediocre is quite often better than what a lot of organizations already have. They're often just pretty substandard. But the danger is kind of everyone settles on mediocre. And that's that then is if everyone is doing. You have to remember, if everyone is doing it, then how do you differentiate. Yeah, true. And it's already happening. You're seeing things that are made by humans, you know, and you're already getting quite a lot of backlash to that. And Gen Z are kind of famous for being the most adverse to AI. Yeah. But now give me another follow up now, because service design becomes much more relevant in our times than it was before. To my, to my experience and the way I feel. Because if you see the generational gaps, yes, Z millennials, boomers and so on and so forth, this is not only XS, XS. Yeah, we're the forgotten generation. Yeah, everyone always forgets. I'm sorry Andy. Um, so the thing is, so, uh, the gaps is not only ages. This is. Miles. Yeah. Um, so the Gen Z is miles away from millennials and XS. Mhm. It's not. But between millennials and Zs and boomers, it's not that big of a gap as is Gen Z to the previous generation millennials, for example. In terms of what kind of gap do you mean? Expectations, the way they perceive society, their new goals. Um, they feel more comfortable in these terms. I would say sometimes kind of. So you cannot approach them the same. No, no. I think, you know, anyway, when you talk about those generations, it's obviously massive nuances between there's people at the top end of the economic spectrum and the bottom end and everything to, you know, arguably the biggest problem at the moment for like, for everything in the world is wealth inequality, because the for environment, economic, social problem, they're almost all of it boils down to that. Yeah. Um, I think that there's a, there's definitely a sort of backlash from millennials who are feeling that, um, you know, we were the, we were a generation and Gen Z, you've kind of ruined our childhood. You've ruined and the things aren't there. There's a load of nostalgia for the eighties at the moment, because it was like a time pre pre-internet and everything. Yeah. Um, so I think there's definitely that. I think it's more a to do with the bubble, right. So you and I hang out too much probably on LinkedIn and see all the hype about AI. There's a social contagion that's happened and we've seen it, particularly with AI of CEOs investing massively heavily in AI, starting to realize now some of them that that investment is actually going to cost them more than all the staff they fired and all the knowledge they lost. And, um, but they did it because there was like, well, everyone else is doing it. And so I can do it. And for whatever reasons, a lot of the time it's because you can bump the stock, you know, and fifty years ago, if you were to fire, you know, thousands from your workforce, the market would punish you really badly because they think something is wrong. And now because you've got this disconnect between the markets and actually what's what companies create. Um, you haven't had that. And so there's been, you know, we can get away with it. Um, so I think there is a lot of hostility to, there's a real kind of backlash to big tech at the moment because, you know, people are saying, well, hang on these these organisations and the CEOs of these are sucking up so much money to very few people. Um, and it's creating a lot of problems. Now tech has a really outsized shadow on the rest of the world. And, you know, you see in design, there's been lots of layoffs in design, engineering, product managers and all those people. Um, but tech is not just the only field of design. If you look at everything in it, there's a bunch of tech in here, but, but this physical stuff, there's clothes, there's furniture, there's lighting, there's all those design is a much, much broader field because everything in here hasn't just popped into existence, right? Someone has designed it. And so I think you're seeing this very skewed vision of what the world might be. Or at least what, you know, Sam Altman really desperately wants it to be because otherwise he owes a lot of people a lot of money. Um, versus the reality of how people live their lives. And I think of my mother, she's eighty five, you know, has an iPhone, can barely use half the things in it. Yeah, sure. And because, and part of it is because every time she used to be able to use it, and then there's been so many multiple OS updates, now it's all foreign to her again. And there's a whole swathe of people. And I would suggest, I think the stats bear this out, who don't really care about AI at all. They just want their stuff to work. So I think that, you know, putting the little sparkle of AI on your on your product is a bit like the Intel inside sticker on laptops, which is that no one cares if AI helps you provide a greater and better and seamless service, then great. But be aware that if it. If it doesn't and it makes it worse, people are going to hate you more than they did in the first place. Oh, that's that's a very nice point to say. So, Andy, thank you very much for being here and giving you some insights about service design and what guys you guys do. So if you really want things to just work, I think this is something you need to visit, you know, in these masters because I think, um, it will become more and more relevant by the time. So thank you really very much. Thank you so much for being here and giving us this insights. Thank you. So also from your side, let's stay in touch. Give me also your feedback. And also, uh, don't hesitate to, to visit the website in the link down on YouTube, but also in LinkedIn. And looking forward to, uh, catch up with you in the next session. Thank you very much. Thank you. Okay. So.