Customer Focus, Expectations and Loyalty

While troubles with a tank are not a typical customer problem, organizations like Red River, a winner of the 1995 President’s Quality Improvement Prototype Award, go out of their way to make it easy for customers to complain. They organize to respond rapidly when their customers have a problem. These organizations understand what their customers need and expect. The best-in-business organizations practice the following.

Encourage Customer Complaints

One public agency found that three quarters of its customers had no idea who to talk to if they had a problem. Many customers think it’s simply not worth the hassle to complain. They are skeptical that the organization will do anything or they may even fear retribution.

Best-in-business organizations actively encourage customer complaints. Some companies even refer to what they do to encourage complaints as „marketing“ their complaint system. Companies make consumer service cards available at the place of business. Many solicit feedback wherever they post or publish customer service standards, on all correspondence, on bills, and in the telephone directory. Some offer discount coupons to encourage customer feedback. Many publish information on how they can be contacted in more than one language. They publish 1-800 and other numbers for the company where consumers are most likely to see them, e.g., on the product packaging. Companies also market their complaint handling systems during conferences and meetings, in annual reports, newspapers, association circulars, videos, audio tapes, letters, press releases, speeches, training sessions and via electronic mail.

Seek to Delight Their Customers

The benchmarking partners often use the phrase „delight the customer“ and go out of their way to exceed expectations. Often this means a compassionate ear. An insurance company has a special team that deals with the needs of grieving spouses. Companies give front-line employees the authority to award customers who have complaints with products, coupons, or even cash when it is necessary to resolve a complaint. Even public sector employees are able to give certain products and services to customers with complaints. For example, the U.S. Postal Service can give up to $20 in stamps when it is appropriate. One service company sets no limits on the front-line employees‘ authority but tracks company norms for what it takes to resolve particular types of problems. Team leaders look at and discuss variances from these norms. Additionally, employees share ideas for ways to resolve complaints creatively within or below company norms.

Understand Customer Expectations

These organizations demonstrate a commitment to understanding the customer’s perspective. Most of the benchmarking partners send surveys to customers who have complained recently to see how satisfied they were with how the complaint was handled. Some call the customers to determine satisfaction. One organization surveys every fourth customer with a complaint. Another described complaints as „free information“ about their customers needs and expectations.

These organizations supplement surveys of people who complain with routine and often extensive data collection tools in order to understand their customers. Customers are surveyed to determine their level of satisfaction with existing services. Surveys are sent with questions, often in a Likert Scale format where the customer can select the degree of satisfaction on a scale, e.g., from one to five.

These surveys assess customer satisfaction with existing services, delivery of services, helpfulness of employees, and overall performance of the organization. Some companies add a few short questions to the end of customer calls or correspondence. Companies also survey their front-line employees for their attitudes as well as for their ideas for improved service, asking their employees to take the customer’s perspective. After the nearby community complained about noise levels, the Red River Army Depot changed the times they detonated ammunition and put „listeners“ (members of the community) at check-points throughout the surrounding area to monitor noise levels.

The partners focus on clear customer target groups. One company that serves a wide variety of customers decided to focus on its high-volume business customers. Three months after a high-volume business customer has complained, the company follows up to find out whether they are still using their services and, if not, the reasons for dissatisfaction. In addition, the company routinely solicits feedback before, during, and after service. It conducts focus groups and has established a Customer Advisory Council to drive decisions related to this key target group.

Manage Customer Expectations

These organizations do not wait for complaints to come in the door. They try to anticipate the needs and problems of customers and to set realistic expectations through customer education and communication strategies. Research shows that 40 percent of complaints come from customers having inadequate information about a product or a service.(5) Using customer feedback to understand customer expectations and needs, organizations educate their customers and/or the public on what they can expect from their products and services and what obligations and responsibilities their customers have. For example, one enforcement/ regulatory partner has extensive education on the requirements and reasons for utilizing their services.

Know How to Say No

Both companies and government agencies, especially regulatory agencies, need to draw limits. When it is not possible to give the customer what they would like, it is still possible for a customer to feel that he or she has been heard and has been treated fairly. A number of techniques convey concern–calling customers and telling them the company understands; giving the customer the best explanation they can; and being open and honest with customers concerning laws and policies of the organization. Being professional and considerate of customers enhances their view of the organization–even when the customer may be disappointed with the outcome. A recent taxpayer letter to the Internal Revenue Service shows that the techniques cited above really work:

„For the first time in a long time, a communication from IRS is clear, concise, informative and user friendly. . . The attached–while I’d preferred not to have made the mistake–points out exactly what happened and what needed to be done.“

In a small percentage of cases, it will be necessary to close a complaint when it is felt that the company or agency has done everything that can be done. Recognizing that it is not always possible to satisfy a customer, having procedures and trained staff to handle these cases, is part of an effective complaint handling system.

Keep the Human Touch

One company found that it made a major mistake when it introduced enhanced information technology. Employees lost eye contact with their customers. Keep the human touch–don’t let automation get between the front-line employee and the customer. Eye-to-eye contact may be lost with computers.

Lessons Learned

• Customer education is key to managing customer expectations.
• Know how to say no.
• Exceeding customer expectations for customers who have problems improves loyalty.
• Make it easy to complain.
• Understand what customers want.
• Maintain a one-on-one relationship with customers

How Does Your Organization Measure Up?

• How do you delight customers who have problems?
• What access do customers have to your organization so that it is easy for them to complain?
• How do you make sure that you understand what your customers want?
• How do you manage the expectations of your customers?
• How do you train and prepare the people who work for your organization to say „no“?
• What do you do to make sure that information technology doesn’t stand between your front-line employees and customers who have a problem?

Table of Contents

1. Executive Summary
2. Overview
3. Leadership Strategies for Satisfying Customers
4. Information and Analysis
5. Planning
6. Human Resource Development and Management
7. Managing Customer Expectations and Satisfaction
8. Complaint Process Management
9. Business Results
10. Appendix I: Reinventing Complaint Resolution
11. Footnotes
12. Entire Guide