The Institute of Customer Services issues employers with the stark warning that a ‘slash and burn' approach to training could damage relationships with customers at a time when competition has never been so fierce, as employers struggle to get out of recession.
The institute found 30% of organisations surveyed have cut investment in customer service training and 21% have laid off customer-facing staff in 2009.
That is despite the institute's research finding companies with a reputation for service excellence and committed frontline staff have a 24% higher net profit margin than same-sector rivals who do not enjoy similar standing, and can achieve 71% more profit per employee.
Jo Causon, the institute's chief executive, believes it is dangerous to see training as the place to cut costs because in the current climate there is more competition for customers than ever.
She said: "Investing in your people is a key differentiator in business today. An organisation that emphasises customer service, through training and development, goes a long way to retaining staff - which motivates them to satisfy customers."
But the poll also reveals one in five organisations increased investment in customer service and a fifth said the recession had no effect on their business plans.
The news comes as Tesco announced it is to invest over £3 million to develop their senior managers and directors through the Tesco Academy during the next 12 months.
Peta Hay, director of the Tesco Academy, said: "We believe it is more important than ever to invest in our people as Tesco continues to expand both geographically and into new business sectors. Tesco has a proven track record of both nurturing internal talent and successfully attracting external senior executives.
"Our investment in leadership development represents the largest investment of its kind in the retail sector and the Tesco Academy aims to develop leaders who have a vision that they can align the business behind and who live our values. This will ensure that, as the business continues to expand, our leaders have the capability to deliver the stretching targets set."