Mechanical Components Blog

The cost of poor customer service is by it's very nature is the loss of a customer. This can have a cascade effect that is other than desireable.

Every business is different. In my trade, I have fired more than one customer, and I am planning to fire another in the near future. Sometimes there are unreasonable expectations from your customer, he will never be a satisfied customer. I know this sounds harsh, but you all know someone like this. I was married to one of them.

In this circumstance, the benefit of good customer service is zero, and the cost of poor customer service is, in truth, zero. I am better off if he goes elsewhere.

Firing as customer is an isolated case. I agree with the generalization that your customers are the lifeblood of every enterprise and should be treated with care. But you don't have to get every order that you quote. This is, I believe, the mantra of management that can drive employees to offer low prices, thus lower margins, thus lower wages/bennies/bonuses, thus moral sucks, thus customers see this employee apathy and begin to drift away.

First of all, stop marrying your customers. You're setting yourself up for failure. Just because the first door installation went flawlessly, doesn't mean they all will. If things are going to get physical, stick with employees..............they have to listen. If they complain, you can hide in a corn field.

Kidding aside, I fired a customer last week myself. Some people won't be satisfied until they are positive that you are losing money on the deal. They need to be recognized and kicked to the curb ASAP.

The customer is not worth treating right if:

My competitors are treating them just as badly

I effectively have no competitors

The customer I am serving is not the customer who makes the purchase decision

I am sure more examples will come to your minds

You said: the customer is not worth treating right if: 1) My competitors are treating them just as badly, 2) The customer I am serving is not the customer who makes the purchase decision.

Are you sure about your statements?

1) Business is made up of many small and large components to the decision-making process and if one expects to be in business for the long haul you don't want to miss any of the opportunities to serve and treat the customer properly. Just because the competition is treating people badly doesn't justify poor behavior on my part. With the ever-changing business environment there may be a new competitor come into play and if we have treated people badly they then have another option and we will lose their business.

2) Maybe the person I am currently interacting with isn't the final decision-maker but we may not know how much the decision-maker will be influenced by that person. Or, the person may become the decision-maker in the future. Zig Ziglar says to "never burn your bridges, you don't know whom you may need to do business with in the future."

How to Win Friends and Influence People by Dale Carnegie is a great book to look at for the dynamics of treating people well. That doesn't just apply for what you may get out of the business arrangement in the immediate, but treating people well, as a matter of habit for best results in the long term.

We have a home-based business (for 12 years) of distributing fresh fruit for an orchard and we have seen it time and again where people may be contrary at a particular time but if you treat them right they keep coming back. We may not know what a person has going on in their life that may be affecting them and causing poor behavior or judgement on their part so it is incumbent on us to treat them with respect anyway.

Even when there is a great deal at stake it behooves us to treat people properly. There are times though like has been said on previous Posts that there may be a time when the customers expectation is unrealistic and the cost of doing business with them financially and emotionally is higher than what we want to pay so we "cut them loose/fire them". When that is done it needs to be very clear why their expectations can't be met, i.e. time, cost, performance, quality, etc. Maybe that communication will help them in the future. It may not, but at least I will have done my part.

I liked your post.

facilitiesmgr

My statement was intended to point to the vast parts of our economy where the money was disconnected from the customer, as opposed to your business where your customer has choices; lets take the airlines:

The majority of airline passengers have no choice to fly or not fly - they fly on business. The majority work for companies that have travel departments that mandate their travel. Even the optional flyers have few options when Airline A is going to treat them largely like Airline B at the gate next door.

More to the point - what people forget is the terminal is run by the city, so the majority of your misery is both common to all the airlines and provided by an entity you never interface with. Now there is an additional layer of misery of security that is also common to all carriers.

So for the airline whose vast customer base is swayed by a $5 cheaper ticket, the key is to not let your Public Perception drop below the airline next door - not actually driven by a reward for providing excellent service.

Once upon a time I worked customer service for a manufacturer that supplied the parts that went into an aircraft. They were high visibility parts as opposed to nuts and bolts. We provided excellent customer service to both the aircraft maker as well as the folks who maintained the aircraft. We answered the phone at all hours, we did training for free on using our products effectively as well as maintaining them, the pilots and maintainers loved us and we probably did contribute to the perception of quality and service associated with those aircraft.

But note - none of those people even have a voice in the purchase.

So to make a Business Case defending your department's expenditures in pursuit of excellence is tough. You can point to years of awards by AOPA for service, but you cannot quantify that in contracts won or sales. Your purchasing decision isn't made by someone who is even aware of these awards. So to justify your performance based on I spent this much and I brought in this much is not possible.

And so we were downscoped.

And kept the contracts, and our customer's loved us more because we still answered the phone and they could see us struggling, and worked longer hours for the same pay and gave up pay raises.

And so we were downscoped again.

See where this is going?

So I went out contracting and I always keep my money tied directly to my customer's perception of value so I don't get caught in that again.

You said: the customer is not worth treating right if: 1) ..., 2) The customer I am serving is not the customer who makes the purchase decision.

I normally have far more "NO" power than "yes" power. It's been that way for 20+ years and 3 jobs. Giving good service to the "only involved in making another yes decision" person can be a sales problem if the people with day to day responsibilities (including generating profits) have a reason to voice a strong "NO".

While I will confess to a certain amount of devils advocate in my remarks, I haven't heard an effective corporate level response to my remarks.

So someone make me a business case for excellent service.

No more personal preferences, or moral chest beating. Did you pick the last airline you flew with based on customer service? I know what I feel too and don't disagree with what anyone has said.

How about the last bag of frozen vegetables you bought - great customer service?

I will stick to my position that there are many cases where customer service is not a deciding factor.

Placing orders with machine shops, sheet metal shops, PCB assembly houses, cable harness shops and even vendors of COTS products all, at least in private industry, are influenced by how easy or difficult the shop/vendor is to deal with. Low bids that we don't have confidence in will not get the job unless upper management friendships override the judgment of the people responsible for getting a good quality product out the door. Someone I don't like might still get the job. Someone who won't work with me when there is a problem will cause me to voice a "NO" the next time we place orders. Sometimes the "no" is ignored but at other times it causes large orders to be redirected.

Also, when something pops up a good memory often inspires a quick call where a bad memory inspires a Google search for other shops/vendors.

Government jobs might be a strict low bid only system. Funny, the low bid system typically costs a lot more money than a system run by people that use both cost and judgment.

Well put and very true.

Can't disagree

I don't buy anything with intel on it since they started their illegal sales campaign against AMD in 1999.....systems I build for friends don't get intel either.....

Sony video cameras support don't answer any questions about the usage of their cameras, so they get no money from me anymore. I sent many emails, all ignored.

There are several other German companies that have poor or no support that never see any money from me anymore......1&1 are a prime example.

If more people did the same, support structures in many companies would have to be turned on their head or the company would go to the wall.

I worked myself in Tech Support for many, many years, I know its not an easy job, but it sets the tone for the whole company to customer relationship.....

I would argue that the kind of folks that stay in support roles frequently feel they are trying to save the company in spite of itself.

Customer service came very naturally to me (like many engineers) because frequently you are explaining something technical to people whose expertise is elsewhere.

I loved the job.

I also absolutely felt like I fought my later management every step of the way.

Not every decision made is based upon customer service. Many times you purchase because of convenience or whatever the need. But a large percentage of them are based on how you are treated. Many businesses survive in these tough economic times because of how their customers are treated and they place high priority on that aspect of business in order to retain those customers.

When a customer is receiving high value for what they are paying for, they will be more prone to telling other potential customers about your business and will pay more for goods and services if they feel like they are valued as a customer.

Regarding airlines, etc. where there may not be many choices; you're correct in that you have to take what is available. Even if one doesn't have a wide variety of choices and you're stuck with your options doesn't mean you give your customers bad service.

One area of commerce that is changing and feeling the pinch of poor customer service is the postal service. It used to be they were the only "game in town" and you were stuck. With UPS, Fed-Ex, etc. coming into the market the postal service is now hurting because of that perception and sense of poor service. Like I said in an earlier Post, business dynamics and environments change and the only thing that remains constant is the customer, who will vote with their feet and their money; going to the business they best feels serves and values them.

Regarding airlines, etc. where there may not be many choices; you're correct in that you have to take what is available. Even if one doesn't have a wide variety of choices and you're stuck with your options doesn't mean you give your customers bad service. To a large degree we are in agreement with a couple of fine points, because the devil is always in the details: Have we correctly identified the customer? What threshold are we going to set for 'good' service? Several have already identified cases where disagreements over acceptable 'good' service have made customers non-viable, usually defined in dollars but some defined in headache value. And then a common problem is correctly identifying the customer.

Poor customer service isn't really just 'customer service', its also the customer's family and friends service. How many of us have made the statement "I'll never go back there again" because we were poorly treated. Usually the customer can explain what something is doing wrong, at least to them. Because they do not possess your knowledge of the product their explaination may seem to be out of reason, but please listen to them and you may actually hear what they are trying to tell you. I learned my lesson many years ago when my wife told me that our new car "sounded funny", I didn't hear anything, nor did the dealer she took it to. I had left for an extended period of time (Viet Nam) and she kept returning the car to the dealer for repair, and of course was always told that " nothing is wrong". The day I returned the engine in the car blew. The dealership replaced it and no more "funny noises" were heard. Now I listen.

It is very difficult to satisfy customers in the field of engineering,medicine or IT fields. they will never be satisfied and expect a component or product to do magic.

Customer service, properly handled, is a good way to keep customers and gain more.

What can go wrong are a sales force out of control and giving away "freebies" at the cost of customer support, without consulting them. Particularly when the "freebie" has no positive function for the customer and costs Customer Support an "arm and a leg" to keep going........

The very worst companies with regard to customer service are the companies that outsource everything....as many have found out when they went under, Sun Micro being a good (bad?) "large" example....But they are not alone.....

Good customer service will please both sides of the equation......the trick is keeping a sensible balance......

The cost, as posted previously, is usually the loss of the customer unless you are lucky enough to be the only or best option. Sometimes this is a good thing, as some customers cost more than the business they bring. But I would rather this be me (also as posted previously) deciding to stop doing business with them, not because I failed in delivering my part.

I'm afraid the prevalence of poor customer service, and poor customer behavior, is a growing societal issue. Culturally both sides, customer and provider, (employer/employee, etc.) are losing the ability to empathize. Without empathy, how can anyone consistently provide, or even be perceived to be providing, good customer service? Our society is forgetting the importance of empathy. The ability to imagine oneself in another's place is critical in creating or providing products and services others want and are willing to pay for.

I wish I had a solution to this, but I don't.

One thing I heard quite a while ago that has always stuck with me;

"The customer is NOT always right, but they ARE the customer."

If you want or need their business, you have to be willing and able to contend with their requirements. If you're in a position where you don't want or need their business, then you're already ahead of the curve.