17: Service Recovery

The author opens with an anecdote about a pharmacist who was a bit overloaded and was unable to turn around a prescription when promised. Overhearing the customer complaining, he called out to his clerk and told him to make amends: apologize to the customer and tell her it would take a little longer, but would be free today. The clerk almost got it right - he told the customer, "It's free, but it's really not our fault." Except for that last bit, this could have been a flawless service recovery.

How to Lose a Good Customer

In his work, the author has discovered that many employees believe that it's their duty to protect the financial interests of their employer from unscrupulous customers, and that many front-line managers also put this higher on their list of concerns than serving the good customers. And as a result many operations sacrifice good customers to defend bad policies.

The ultimate example is merchandise returns: where a store has failed the customer by selling them something that was defective, substandard, and unsatisfactory. The purpose of returns is to make amends and retain customers who are disappointed. But in practice, stores force customers to prove that they are owed a refund, with a general air of suspicion and distrust. Granted, there are dishonest individuals, who look to take advantage of returns policy, but they tend to be in the minority - and if you stack up the dollars lost by treating "good" customers poorly, it far outweighs the losses you'd take from a few dishonest individuals.

The author outlines four basic principles for service recovery:

From the Top

Some customers seek redress from the top - it's not unusual for them to send a letter to the CEO of a company, or the owner of a smaller establishment. The guidance the author gives is that a sincere apology goes a long way to repair a broken relationship. Any other form of response - a litany of excuses, a retort, a form letter, or a brush-off - may cause more damage. And in either case, word will spread, as a person who receives a response from a CEO feels that it's something significant, worth mentioning to others.

(EN: The author doesn't mention the Internet. It's not uncommon for a person who's received a communication from a senior executive to post it online, for the world to see. A sincere and professional response does much for the image of your company - a poor response does even more to harm it, given the level of attention given to conflict, misbehavior, and mocking the establishment.)