You know the stories: There's the legendary tale of a Nordstrom clerk who refunded the price of a customer's tires, even though Nordstrom doesn't sell tires. And who could forget the one about a Midwest Express employee who lent his own suit to a passenger whose luggage had been lost?
Reserved for world-class companies, these stories tell of the loyalty-boosting customer service most entrepreneurs would kill for. The problem? Most entrepreneurs don't have the foggiest idea how to provide this kind of service. In the words of Jay Goltz, 42, founder and president of Artists Frame Service in Chicago, and author of The Street Smart Entrepreneur (Addicus Books), "You read books, go to seminars, hear speakers talk about great customer service, but it doesn't always work."
There are, however, a few things that almost always work. Consider the following five ideas the equivalent of "Once upon a time...," the beginning of your own tales of legendary customer service.
1. Hire The Right People.
"Find and retain quality people," advises Ron Zemke, founder of Performance Research Associates, a Minneapolis service-quality consulting firm, and co-author of Delivering Knock Your Socks Off Service (Amacom Books). "You can't create world-class customer care if you hire run-of-the-mill employees."
Customer service employees who excel have the right personality for the job, according to Peter Baron, 38, founder and principal of Socket Public Relations in Tucker, Georgia. "The people we hire [are] high-achievers who take charge," he says. According to Baron, this type of person is best suited to doing whatever it takes to make customers happy.
Ask the right questions when interviewing candidates, advises Goltz. Artist Frame Service's interviewing protocol probes deeply into prospective customer service employees' past job experiences. "I ask them to tell me about how they handled their worst customer service experience," Goltz says. "You can catch a [candidate's] attitude that way."
In today's tight labor market, it can be tough to find the right people. Zemke suggests asking your best customer service employees to identify other people like themselves. "If you have good workers," he says, "use them to recruit [others]."
2. Make Service A Core Value.
Even the most eager-to-please employee must know what's expected in a variety of customer service-related situations. But that's not easy. For instance, how could Midwest Express train its reps to lend their clothes to stranded passengers? It couldn't, says Leonard Berry, a Texas A&M University marketing professor who cited the Midwest Express story in his book Discovering The Soul of Service (Free Press).
"There's no way to write a policy manual that instructs employees on what to do in every conceivable situation," argues Berry. "But by building the ethic of excellent service into the [organization's] core values, even without the rulebook, your employees will know what to do."
Making service a core value keeps it fresh in everyone's mind, says Berry. The process of embedding customer service as a core value starts at the top, he emphasizes. "The best way to perpetuate a concern for excellence is to have excellence at the highest levels of management," says Berry.
Just as you can't tell people what to do in every situation, you can't tell them exactly what great service is either, Berry says. Instead of detailing your values, inspire people by example. Tell them stories about your company's great service--appeal to their hearts as well as their minds.
3. Empower Front-Line Employees.
Fear may be the biggest factor blocking great service. By providing extra-special service, employees may fear overstepping their bounds. To counter this fear, entrepreneurs must empower employees to do what's necessary to achieve their customer service vision.
At Socket Public Relations, Baron's employees are empowered to stop billing clients who are dissatisfied with a press release or other job. "It definitely sends a message," he says. "It gives each employee the knowledge and discretion to make sure the actual time they deliver is high quality. If they're engaged in an activity they don't think is valuable to the client, they decide whether to charge or not."
Giving employees the discretion to provide free service isn't always the best form of customer service empowerment, however. At Sonic Innovations, a Salt Lake City hearing-aid manufacturer, company president Andy Raguskus, 53, empowers customer service employees to make a whole range of decisions in an effort to make customers happy.
"They're free to offer refunds, swap one product for another, send out free batteries or provide free consulting services," says Raguskus. "They have a wide range of latitude." He stresses, however, that this type of empowerment only works if customer service reps aren't reprimanded for making bad decisions. That means backing them up if they give away something they shouldn't have in an effort to please a customer. "If employees make a decision I wouldn't have made, I won't burn them for it," explains Raguskus. "Nine times out of 10, our reps make fabulous choices."
4. Solicit And Use Feedback.
Before you know how much power to give employees, you have to know what's important to customers. For instance, Sonic Innovations has two types of customers: users, often elderly and hearing impaired, and professional audiologists, who dispense its products. While a user may require an explanation of the difference between analog and digital hearing aids, an audiologist may have technical questions about programming. Knowing what's important to each type of customer is essential.
How do you find out what customers want? Listen and take notes, says Fred Wiersema, co-author of The Discipline of Market Leaders (Perseus Books) and editor of Customer Service (HarperBusiness). "The one thing that can make up for all deficiencies is being in touch with your customers," he says. That means using a variety of approaches to encourage customers' letters, calls and other feedback.
Use computer systems to record as much of this information as possible. Customers of Lenel Systems International, a security management systems firm in Pittsford, New York, are asked to provide an identification number when they call. Service reps then enter the number into computers to retrieve customer files, including all past problems reported regarding Lenel's software and hardware.
"[Our customer service database] has a tremendous amount of information," says Rudy Prokupets, the company's executive vice president of research and development, and chief technology officer. Lenel also uses its Web site to gather service data. Customers who access the site are prompted to enter a unique password, identifying themselves and funneling comments or complaints into their file. "We have a feedback area on the site," adds Prokupets. "And we make sure we respond to it."
Don't restrict yourself to computerized solutions, however. Wiersema recommends that entrepreneurs regularly call a few randomly selected customers and simply ask about the company's service. "Make sure you get directly in touch with the customer," advises Wiersema.
Prokupets agrees about the value of direct experience. "We like to send service people into the field to see real installations," he says. "Once they come back, they're changed people."
5. Pick The Right Customers.
Nothing will work if you're trying to serve the wrong customers. "Small businesses don't do a very good job of segmenting," says Zemke. "If you've been serving everybody and not thinking about who your core customers are, you're going to be in trouble when business changes."
Some customers are too demanding, reducing your ability to serve those who are more easily satisfied. Others are too small to make serving them worthwhile. To differentiate, says Zemke, "Define your core customer, the one you would live or die for. Figure out who's going to be the customer you'll go to the mat for, with all kinds of value-added services."
You can use data-based tools, such as projected lifetime revenues, to identify the best clients. Or, says Zemke, you can simply listen to your gut instincts. "Ask yourself, who would you go out in the middle of the night to make a delivery for?" he suggests. Then try to figure out what traits make those accounts so valuable to you, and match new prospects to the profile. Otherwise, warns Zemke, "You can spend an awful lot of time romancing marginal customers."
Baron says Socket uses two traits to decide whether customers can be successfully served. First, customers must have products or services that are likely to be successful. "If we feel their expectations are out of line with what they have to offer, we decide then and there it's not a good fit," he says.
Equally important, Socket clients must be people who are easy to work with. "If we have a customer who's hard on our employees, we walk," Baron says. "We put our people first."
Summing Up Service
Even the five best customer service ideas may not need to be used every day. Baron says it's only three or so times a year that an employee stops billing a client for customer service reasons. The number of times he turns down a client for service-related reasons is about the same, he says.
And don't expect to see instant or constant customer service improvements when you do apply them. "Take the long view, have a game plan and make choices," says Berry. "This calls for prioritizing, sequencing and planning. Pick your spots so you get the most leverage and the most return for the investment you make."
High-impact moves you can make include Berry's recommendation of requiring each employee to submit an idea once a month for improving customer service. "Make it part of their job description and part of their job evaluation as well," he says.
Wiersema advises entrepreneurs to spend an hour each week listening in on customer service phone calls. "You're going to get an earful," he warns. "But you'll gain an appreciation for [recurring] problems."
Perhaps your first move, Berry says, should be to institute a formal measurement system to calculate the true costs of mediocre service. "If business owners take the time to properly measure the revenue lost to customers who left due to poor service and the extra costs involved in reperforming a service that wasn't performed properly the first time, the number they come up with will be so large, it will never again be an issue as to whether service quality is important in their company," promises Berry. "It's instant religion."
Whatever it takes to institute that religion, it's worth it. That's because these five customer service ideas are more than business tools. They're the stuff of corporate legends--yours. You know all the other stories of great customer service. Now go out and createyour own.
Artist Frame Service, (773) 248-7713
Lenel Systems International, (716) 248-9720, http://www.lenel.com
Sonic Innovations, (801) 288-0993, http://www.sonici.com