Travelling with Bill - part 1
Last summer I travelled with Bill, a business professor at CMU as we were teaching some classes together. Bill is a former business executive so he has a lot of experiences that he often shared with me. We went to Asia then to Europe and spent a lot of time in hotels, restaurants, trains, bus, and airports.
As a habit, Bill often noticed the way people operated business based on how they treat customers. He said: “There are many things that companies must learn to be competitive and customer service is the most important. I do not know how many executives understand it because their operations are so bad. Do they know that there are many competitors that provide the same service like them too?”
He started with one airline in Asia: “I really like this company. Their people dress professionally and often smile to greet customers as we approach them. They are polite, helpful, and always make sure that customer needs are met. We only spend less than few minutes with them at the airline counter but I know that I will fly with them again.”
To another airline in Europe, he said: “What are these people thinking? They ignore customers as they sit and chat with each other. When we approach they look somewhere as they are not welcoming us. They answer questions in a bad manner and seem not to care at all. Do you think I would come back? Many executives do not understand that price is not the only factor. As customers I have choice and I would be willing to pay a bit more money if I like the customer service at a particular company. I wonder if their executives even know how well their workers perform or only sit comfortable in a luxury office counting money.”
Bill is not a difficult person, He has a very pleasant personally but as a former Chief Executive Officer (CEO) of a multi-billion dollars company, he understands customer service well. His company is rated one of the best in customer service for many years. He retired last year and became a professor in business school.
During the trip, we ate at a wide variety of restaurants, from small coffee shops to well known dining places. Of course, you expected different levels of service at different places. To my surprise there were better service at the place you least expected and worst service at the most expensive dinning. Bill said: “The Japanese and S. Korea have the best customer services. They understand how to treat customers well. It could be their customs but I rather think it is the management system and training.”
I was not sure about that so I asked one restaurant worker and she confirmed: “We must go through lot of trainings as customer service is priority number one. We know that better service is always rewarded by customers coming back.” I asked: “Even at a small local restaurant like this?” She said: “Every restaurant workers know that their job is depending on how well they perform and their attitudes toward customers. There is no exception.”
We had a bad experience in France where the restaurant service was bad and the servers’ attitude was rude. During the dinner, they talked about customers with each other in French as they do not like the Americans. They did not know that Bill speak fluently French and German. Of course, we never go back to that restaurant even it is next to our hotel. More than that, we also let our friends know so they could avoid that place. With social network such as Facebook and Twitter, in a very short time, we received thousand messages thanks us for pointing out a bad place to avoid.
I agreed with Bill that customer service is a key part in deciding whether people would return to a particular business or not but I wonder how many customers a business could lose due to bad service. To my surprise, Bill had the answer. He told me that every year his company always conducted a survey on customer’s satisfaction and compared it with others in the industry. He said: “About two third of customers said that they will switch business based on bad service. That is why my company considers customer service as the most important. Two third is a lot of money. Imagine that you are making one million dollar a year and due to poor service, you only get over three hundred thousand dollars this year then next year you only get one hundred thousand dollars, it means bankruptcy. The evident is so clear but how many executive knows about it?
Bill further explained: “Today most customers are often busy so they do not tolerate bad service. More than 75 per cent said they would switch to the competitor after receive a poor service. Many of them will tell friends and family about it and the damage can be severe. In my company, satisfy customer is NOT enough; my workers must exceed it. Our research found that “Satisfied Customers” will return to do business with you 52 per cent of the time but “Delighted customers” will return 95 per cent of the time. With those data, you do not have much choice but make sure that you provide the best customer service possible. Customer service is at the core of my company. To serve customers, my workers must have a thorough understanding of what problem they could solve for customers and how to exceed it. We provide a lot of trainings and establish standard processes to implement them. I personally visit our customers often to make sure that we operate the way we want.”
It is hard to imagine a Chief Executive Officer of a large company would spend time to visit customers often but Bill is an exceptional person. He said: “I came from a poor immigrant family; my parents came from Germany and migrated to the U.S before World War 2. I worked hard and did everything, including empty garbage, sweep floors, clean washrooms to earn money to pay for my education. I started at the bottom of the company and worked my way up so I understand how the company operates. I built the company to a large enterprise with office in every state in the U.S. then expand international. Because I understand customer services and make sure everybody understand it, my company did well. I believe in customer relationship, as you give customers the best services, they always return a favor. Unfortunately, decisions at other companies are far removed from this understanding. If customers want something they have to request and as the request goes from one department to another, from one level of manager to another, it often get lost. Senior managers pay no attention to customer and that is why many do not know why they lost sales to better managed companies.”
“If senior executives are not experiencing the company’s products and services as a customer would then the company has a major weakness and this is how a competitor can exploit. Another critical area of customer service is to know how your customers use your products. Many executives only concern with how they want their products to be used or what problems they solve for customers. It is not enough; they must exceed it by knowing how customers are actually using them. You need to know what they love, what they expect, what they hate, and what they wish for. This customer knowledge is the secret for business success in this global economy. I personally visited my customers and saw how they use my products and services with my own eyes. I also asked them in details and listened to their suggestions. Nothing is small to ignore, even the lowest level workers at the factory floor also had something to suggest and I listened very careful to them. You cannot rely on what your sale people or marketing people tell you. You need to have a deep understanding of customer’s use of the products. I always ask customers what one thing I could do better. It is a simple question but very powerful because it demonstrated to customers that I really care about them and that is my secret of success.
Sources
- Blogs of Prof. John Vu, Carnegie Mellon University
