I published an interview on the Sun Microsystems small business site called "Why the Best Service Is No Service." It features Bill Price, Amazon's first Global VP of Customer Service, explaining how to provide excellent customer service. He recently co-authored a new book, The Best Service Is No Service: How to Liberate Your Customers from Customer Service, Keep Them Happy, and Control Costs, with David Jaffe. To read the interview, click here.
Bob Sutton continues to fight the good fight against certified orifices. He started by literally writing the book about it. This time, he's created a test for you to determine if you have the client from hell. Click here to take the ACHE (Ass**** Client from Hell Exam). Luckily, he provides a path out of this predicament. The point is: Life is too short to deal with orifices. Of course, it could be you that's the orifice. Click here to determine if that's the case. Incidentally, he just wrote a great post about why you should hire female superstars but not male superstars.
Jeffrey Pfeffer is the Thomas D. Dee II Professor of Organizational Behavior at the Graduate School of Business, Stanford University. He is the author or co-author of twelve books.Dr. Pfeffer received his B.S. and M.S. degrees from Carnegie-Mellon University and his Ph.D. from Stanford.
He began his career at the business school at the University of Illinois and then taught at the University of California, Berkeley, and he has been a visiting professor at the Harvard Business School, Singapore Management University, London Business School, and IESE in Barcelona.
Pfeffer currently serves on the board of directors of Audible Magic and SonoSite (SONO) and writes a monthly column on management issues entitled “The Human Factor” for the 650,000 circulation Time-Warner business magazine, Business 2.0
This interview is based on his latest book:What Were They Thinking?: Unconventional Wisdom About Management
Answer: First, they ignore feedback effects. There has recently been a lot of interest, and apparent surprise, that programmers in India now cost a lot and their wages have been rising rapidly. Did people forget supply and demand? If everyone moves work to India, what did companies think would happen? Or, to take another example, when companies cut their retirement benefits, and people can not afford to retire, guess what, they won’t.
Second, companies often ignore the interdependence or connections between actions in one part and those in another. So, even as some departments are trying to cut the costs of benefits, others are worried about recruiting and retaining enough qualified people. Maybe the parts should work together.
Third, many companies presume that incentives are the answer to everything, and have a very mechanistic model of human behavior. That is also incorrect.
Question: What can companies do to get smarter?
Answer: Companies learn just like people learn—by trying new things and seeing what happens. That requires, first, a tolerance for failure, since by definition, learning means doing things you aren’t very good at.
Second, it requires structured self-reflection—after-action or after-event reviews so that instead of having one year of experience repeated 20 times, people and companies actually accumulate learning over time.
Question: How do you stop the misdeeds (for example, Enron) in organizations?
Answer: What is interesting is that there are few social sanctions—as contrasted with legal or financial ones—for bad behavior. Executives who have served jail time are back on TV and are still celebreties. More to the point, they aren’t shunned by their colleagues.
The prevailing mood seems to be, as long as people retain enough wealth, they can buy their way back by donating time and money. If we are serious about enforcing norms, then there have to be real sanctions. In the military academies, violations of important norms are met with expulsion or social ostracism—eating alone, for instance. Not so, not yet, for the most part in the corporate world.
Question: How do you get a company to behave in a truthful manner?
Answer: You start by having leaders tell the truth—which includes admitting what they don’t know and what they have done wrong. It is impossible to manage successfully if you don’t know what is actually going on. But a lie takes two people: the person who tells the lie and the individual who signals that s/he wants to hear it. So, you don’t want to punish people for surfacing problems or telling you bad news. You don’t want to “shoot the messenger,” but thank them for bringing issues and concerns to light.
Question: What’s the best way to improve customer relations?
Answer: This is almost too simple—actually take care of customers! I am sure we have all heard the recorded message, “you’re call is very important to us.” Well, if the call were important to the company who has recorded the message, maybe they would answer it in some reasonable time instead of either playing music or bombarding the caller with advertising messages. When you make a mistake, fix it and admit responsibility. Tell the truth. By the way, the airlines seem to be the worst at all of this, with a few exceptions.
Question: I think I know what you will say, but what’s more important: CRM software or recruiting and training?
Answer: Before you can manage customer relationships through some software product, you first need to build those relationships. And relationships are still largely built through people. That’s why the most important three feet of real estate in retail—or in many industries—is the distance between the customer and the sales associate or individual who is serving that customer. Hiring the best people who are likely to stay, and investing in their training, will build relationships that CRM can manage. Without taking the first steps, there is nothing there.
Question: What is the key to global competitiveness?
Answer: The data on this are clear—companies choose to locate their R & D facilities on the basis of the availability of talent. This is more important than tax abatements and certainly much more important than rates of pay. If location was determined by cost, Silicon Valley would be empty. The best way to build human capital is through education—both elementary and secondary as well as higher education that is truly world class. This costs money, but it is worth it.
Question: What is the proper role for a CEO?
Answer: To develop others and their talents and to create an environment in which people can do their best and want to. It is not to make all the decisions or, like some kind of “sun king,” absorb all the light and the attention.
In fact, sometimes, as the Grammy-award winning Orpheus Chamber orchestra shows, the best leadership is less leadership. No seed can grow if it is dug up and examined every week, and for people to innovate and get things done, sometimes they need some time and space and resources.
Question: How do you turnaround a company?
Answer: As the late Peter Drucker said, there is no business without a customer. Turning around a company is mostly about providing people a great value proposition—giving them more than they expect. Better products, services, more attention, than the competition. It is hard to do any of this if you lay people off. People—the best people—will head for the exits. And you can’t cut your way to success, because it’s a strategy that’s too easily duplicated. Look at Singapore Airlines—they are able to charge more for the same flights because they provide such a superior product and experience. I wish more companies would figure this out.
Question: But what if it’s no fault of the company and people just aren’t buy, flying, etc…then what do you do?
If you are going to lay people off, do it once, tell the specific people who will be let go, do it with compassion and generosity, and get on with it. But often organizations can find ways of avoiding layoffs, such as reducing everyone’s work hours a little, reducing variable components of pay, or finding ways to capture market share from competitors.
If Southwest Airlines could come out of 9/11 without doing layoffs in an industry, airlines, that was devastated, then I am not sure they are ever necessary. But the typical way they are done—announcement of a number so that everyone is worried and distracted, and often doing the layoffs by escorting people out the door so they can’t say good-by, leaves “survivor guilt” and demotivated people.
Question: What are the characteristics of a good work week and vacation policy?
Answer: We live in a world where ideas and innovation are paramount. But people can’t be creative if they are exhausted. And when people work when they are tired, they make mistakes. If we have learned anything from the quality movement, it is that the cost of finding and fixing mistakes is greater than the cost of preventing them. So, give people time off. And, by the way, the younger generations want a life as well as work. Work-life balance is a great way to attract—and retain—great people.
Question: What are the characteristics of a good incentive plan?
Answer: Incentives should be large enough to provide an occasion for celebrating success but not so large as to distort behavior. And incentives can include recognition and things other than money. Companies get themselves into trouble all the time by being too clever with their incentives.
Stock options did reward leaders for getting the price of the stock up—it’s just that it was often for a short period, and was accomplished by distorting earnings. Be careful what you pay for—you might just get it.
Question: What does it say about a company if it asks a candidate with twenty years of experience to submit school transcripts?
Answer: To tell you the truth, neither hiring on the basis of a resume—the positions people have held and the credentials they have acquired—nor hiring on the basis of a transcript makes much sense. In the first case of the 20 years of experience, you need to ascertain not just what the person has done but also how well s/he has done it—something that is difficult to do in a world in which lawyers will tell previous employers not to say much—and more importantly, what they are capable of doing in the future.
Every CEO was CEO for the first time, which meant that some company had to decide that “previous experience”—in this instance, in the CEO role—was not a requirement, and similarly for every other position. In the second case, transcripts mostly reveal whether people can succeed in school. There is little evidence in the one area I know best, business schools and MBAs, that grades in school predict subsequent career success, and to the extent there are positive correlations found in some studies, they are incredibly small.
The answer, in terms of hiring, is to first of all be clear about the relevant behaviors and then test for those behaviors, either using work samples or else interview questions that probe how people have handled or would handle relevant situations.
Question: What role should budgets play in the management of an organization?
Answer: Budgets should be general guidelines. As hard and fast rules, they become subject to “gaming.” People delay doing sensible things, push expenses around, hide sales, etc. And also, budgets often just reward the best forecasters and negotiators. It is possible to make “budget” as you lose market share and go broke, as long as the targets are set low enough.
Question: How should people judge a company’s results?
Answer: By comparison to its peers and by comparison to what its own aspirations are. Companies, as the balanced scorecard notes, depend on customers, employees, investors, suppliers, and others in the ecosystem. It is wrong to give one of those groups priority over the others. Brand loyalty and employee loyalty are both real assets, even if not reflected on balance sheets and income statements.
Just look at Apple Computer with respect to products and DaVita, the kidney dialysis company, which has few open nursing positions because it is a great place to work. As Herb Kelleher of Southwest Airlines recognized long ago, if you take care of your people, they will take care of the customers, who will keep coming back, which will make the shareholders happy. It is all interrelated.
Question: What role should strategic planning play in the management of an organization?
Answer: Doing the right thing is important, which is where strategy comes in. But doing that thing well—execution—is what sets companies apart. After all, every football play is designed to go for a huge gain. The reason it doesn’t is because of execution—people drop balls, miss blocks, go to the wrong place, and so forth. So, success depends on execution—on the ability to get things done.
It’s hard to write something about the iPhone that takes a new angle. For the next few days you’ll be seeing hands-on reviews of the iPhone by folks like Walt Mossberg of the Wall Street Journal and David Pogue of the New York Times. Come Friday night, you’ll also see the first customer reactions. Thus, every possible angle is covered.
Lucky for me, AT&T dropped a gift in my lap last night.
I recently installed a landline for Truemors and today, out of the blue, I got a notice that AT&T is turning on DSL for the line. In fact, it was turned on five days ago. There’s only one problem: I never ordered DSL, and I don’t want a Dumb Slow Line. How hard could it be to cancel a service that you never ordered? The back of the order said you can get help via an online chat system 24 x 7. Tally ho!
This is the actual transcript of my support session:
Please wait while we find an agent to assist you…
You are currently at position number 11 in the queue.
All agents are currently busy. Please stand by.
You are currently at position number 11 in the queue.
An agent will be with you in a moment. Thank you for your patience.
You are currently at position number 11 in the queue.
The next available Agent will be with you in a moment.
You are currently at position number 10 in the queue.
All agents are currently busy. Please stand by.
You are currently at position number 10 in the queue.
An agent will be with you in a moment. Thank you for your patience.
You are currently at position number 10 in the queue.
The next available Agent will be with you in a moment.
You are currently at position number 9 in the queue.
All agents are currently busy. Please stand by.
You are currently at position number 9 in the queue.
An agent will be with you in a moment. Thank you for your patience.
You are currently at position number 9 in the queue.
The next available Agent will be with you in a moment.
You are currently at position number 8 in the queue.
All agents are currently busy. Please stand by.
You are currently at position number 8 in the queue.
An agent will be with you in a moment. Thank you for your patience.
You are currently at position number 7 in the queue.
The next available Agent will be with you in a moment.
You are currently at position number 7 in the queue.
All agents are currently busy. Please stand by.
You are currently at position number 6 in the queue.
An agent will be with you in a moment. Thank you for your patience.
You are currently at position number 6 in the queue.
The next available Agent will be with you in a moment.
You are currently at position number 5 in the queue.
All agents are currently busy. Please stand by.
You are currently at position number 5 in the queue.
An agent will be with you in a moment. Thank you for your patience.
You are currently at position number 3 in the queue.
The next available Agent will be with you in a moment.
You are currently at position number 3 in the queue.
All agents are currently busy. Please stand by.
You are currently at position number 2 in the queue.
An agent will be with you in a moment. Thank you for your patience.
You are currently at position number 2 in the queue.
The next available Agent will be with you in a moment.
You are currently at position number 2 in the queue.
All agents are currently busy. Please stand by.
You are currently at position number 2 in the queue.
An agent will be with you in a moment. Thank you for your patience.
You are currently at position number 2 in the queue.
The next available Agent will be with you in a moment.
You are currently at position number 2 in the queue.
All agents are currently busy. Please stand by.
You are currently at position number 2 in the queue.
An agent will be with you in a moment. Thank you for your patience.
You are currently at position number 2 in the queue.
The next available Agent will be with you in a moment.
You are currently at position number 1 in the queue.
All agents are currently busy. Please stand by.
You are currently at position number 1 in the queue.
An agent will be with you in a moment. Thank you for your patience.
You are currently at position number 1 in the queue.
The next available Agent will be with you in a moment.
You are currently at position number 1 in the queue.
All agents are currently busy. Please stand by.
You are currently at position number 1 in the queue.
An agent will be with you in a moment. Thank you for your patience.
You are currently at position number 1 in the queue.
The next available Agent will be with you in a moment.
You are currently at position number 1 in the queue.
All agents are currently busy. Please stand by.
You are currently at position number 1 in the queue.
An agent will be with you in a moment. Thank you for your patience.
So far, so good. It’s no big deal that I had to wait because I just had the chat window open and did other things while waiting.
Thank you for contacting AT&T Internet Services, my name is [AT&T Person]. One moment while I review your information.
[AT&T Person]: I see you want to cancel your DSL service, is that correct?
Guy Kawasaki: yes, I never ordered it
[AT&T Person]: I am sorry you are experiencing this issue and will be happy to assist you.
[AT&T Person]: Guy Kawasaki, is 650-329-2020 your DSL phone number?
Guy Kawasaki: yes, I want to keep the number. It’s my business number. I don’t want DSL on it at all.
[AT&T Person]: Do you have a dial up account with us?
Guy Kawasaki: Dial up as in data/dsl? No. 329-2020 is strictly voice for my business.
[AT&T Person]: I see. Please call us up at 1-877-722-3755 under normal business hours and over the prompt, say Orders.
[AT&T Person]: Do you have any questions regarding the information that I just sent to you?
Guy Kawasaki: Why? I’m not adding/ordering anything. I am canceling something I never ordered.
[AT&T Person]: Guy Kawasaki, I am sorry for this inconvenience but please understand that I am a technician.
Guy Kawasaki: Why am I calling this number? So you didn’t take care of canceling DSL. I just wasted 30 minutes?
Guy Kawasaki: Why didn’t you just tell me you can’t cancel a service?
[AT&T Person]: I am sorry. I do understand your frustration. Do you have any questions regarding the information that I just sent to you?
[AT&T Person]: Is there anything else that I may assist you with today?
[AT&T Person]: Before you go, I would like to inform you that you may receive a survey in your email, requesting that you rate the service you received from me. Please take a few minutes to fill this out and let my manager know how I am doing and how satisfied you are with the support you received from AT&T Internet Services.
Holy cow: a survey!
Thank you for using AT&T Yahoo! Chat Support. You will now be disconnected from this session. The chat window will remain open until you close it. For quick answers, make the new AT&T Yahoo! Help site your first stop. Visit http://help.sbcglobal.net where you’ll find pages of product information to assist you. Again, thank you for choosing AT&T Yahoo! Chat Support.
What’s Yahoo! got to do with this? Maybe this is why Terry Semel bit the dust. I guess when the notice said that people can get help 24 x 7 it was only for installation and troubleshooting, not an adminstrative task like canceling an order.
Thank you for using AT&T High Speed Internet. You may now close this window.
Your session has ended. You may now close this window.
Okay, so I call AT&T the next day. I start the process at 11:33 am. At 11:45 am I speak to a human, she does some research, and tells me I need to speak to the DSL folks at 11:52. At 12:00 I’m off hold and speak to the next human. She tells me I need to speak to another department and transfers me. This person does more research and tells me that the order was a mistake (no kidding!) and that it’s already been canceled. At 12:07 I ask him what I should do if I see charges on the next bill. He assures me that it this won’t happen, but if it does, I should call back and tell the person—I’m not making this up—“Stanley canceled this on 6/27/07 at 12:00 pm.” I guess there’s only one “Stanley” who works at AT&T.
At 12:08, thirty-five minutes into it, I think I’ve canceled DSL that I never ordered. Give or take a few minutes, it’s taken a total of sixty eight minutes of my life to do this.
I love Steve. I love Apple. I’m even open to spending more on a phone than a computer, but AT&T? The slowness of its data network is only exceeded by its lack of customer service. Can I just buy an iPhone to use as a PDA to impress my friends, listen to music, watch video, and access the Internet via Wifi while not having anything to do with AT&T? Can you hear me now?
Photo credit: Pia Torelli/Reflex News/WpNThe ability to print boarding passes for flights is a great convenience. Unfortunately, half the time you’re in a hotel room when you check-in online and can’t print the boarding pass.
Some airlines (Northwest for one, but I always fly United) will fax the boarding pass to you—but this still requires that you get the fax. Unfortunately, lots of things can happen between the hotel fax and your room—for example, the business center is closed until after you depart.
The Hyatt Regency hotel at McCormick Place in Chicago, Illinois has a very helpful solution to this problem: an airline board pass printing kiosk. It’s very helpful and shows that someone was thinking about the customer. I hope that the person who thought of the kiosk sees this blog posting.
I found a very good follow-up to my posting called The Art of Customer Service. This is by Doug Hanna, and the entire text plus some other postings about customer service are available here:
http://snipurl.com/p3w5
1. Use their name. Though it may seem obvious, you’d be surprised how much of a difference addressing a customer by name can make. If a customer has their name somewhere in their email (as well as in the actual email address such as bob@bobinc.com), start the email with “Hi Bob.” If someone is calling you, ask for their name, and then actually address them by name when appropriate (basically anywhere you’d use sir or madam). Another good way to make the customer service experience more personal is to ask for the customer’s name instead of just a reference or a ticket ID. If there’s a lot of people with their name, then ask for another personal piece of information like an email address or phone number. If all else fails, use the reference or ticket ID.
2. Don’t give them a sales pitch. Never give customers a sales pitch unless they’re calling your sales department. Most customers that call for customer service, technical support, or whatever are not in the mood for a sales pitch and they can be downright annoying. Avoid putting a sales pitch in your hold recordings or actually having the representative say “Would you like to hear about our special offers?” at the end of the call.
3. Have operating procedures, not scripts. You’ve probably called at least a few companies and you’re sure the representative is reading a script - it’s annoying and certainly not personal. Have standard operating procedures (SOPs) for common things like cancellations, frustrated customers, etc. to ensure the job is done properly, but never ask or train your representatives to read from an actual script or anything like it.
4. Use operators. Endless PBX systems (the push 1 for sales, 2 for billing, etc.) are extremely frustrating for customers. If possible, hire an operator. Make it so the operator can answer basic questions (like how do I signup?), collect information about problems, assign a ticket number or reference ID, and find an available representative to take the call. The operator should somehow communicate with the representative before connecting the customer to provide the reference ID (so the customer is not forced to repeat the problem), whether it be via some sort of chat system, in person, or by phone. If you must use a PBX system, keep it very simple. Have it be one level with three or four options as well as an option to be connected to an operator.
5. Keep customers in the loop. Customers should never have to ask what are you doing. Let them know what's happening as you're doing something (such as lookup up their account or researching an issue). Extend keeping customers in the loop beyond the actual communication as well - if you're having a service outage, post it right on the front of your support section. Be honest - tell them what's the problem, when service will be restored, and what you're doing to prevent it from happening again. Apologize profusely and don't be cheap (aka offer compensation). This way, customers feel that you appreciate them and do go out of your way to keep them in the loop.
6. Make customers feel important. Train your representatives to make customers feel important. If a customer makes a suggestion, the representative should note it and let the customer know they’ve noted it (see follow-up). Don’t hesitate to do things like give credits or say things like “because you’re a valued customer, we can probably do this for you.” Customers are often frustrated when they call customer service or support, so if you can make them feel good, all the better.
7. Ask them questions and keep the answers in mind. Somewhat like making customers feel important – ask them questions. Don’t assume and feel free to clarify. You should also ask questions like “What’s your level of technical expertise?” and if they say complete novice, give them some extra instructions and help. The same thing works for other industries – anticipate the questions beforehand and provide the answers and clarification without being asked.
8. Follow-up. Probably the biggest difference between acceptable and great customer service is how often (and how well) the customer service department follows-up. If a customer makes a suggestion, follow-up on it and give them a call or send them an email with the result. If a customer calls with a customer service problem and you believe it’s resolved, send them an email or give them a call asking if their problem has been resolved to their satisfaction. Make follow-ups personal (avoid “Our records indicate you had a problem on April 1, 2006. If you need further assistance, please contact us.”) and sincere and customers will truly appreciate it.
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![Istock 000000528121Small[1]](http://blog.guykawasaki.com/iStock_000000528121Small%5B1%5D.jpg)
This blog entry is a response to a topic suggestion by Douglas Hanna. It covers the art of customer service, a subject that is near and dear to my heart.
1. Start at the top. The CEO's attitude towards customer service is the primary determinant of the quality of service that a company delivers. If the CEO thinks that customers are a pain in the ass who always want something for nothing, that attitude will permeate the company, and service will be lousy. So if you are the CEO, get your act together. If you're not the CEO, either convince her to change her mind, quit, or learn to live with mediocrity--in that order.
2. Put the customer in control. The best kind of customer service happens when management enables employees to put the customer in control. This require two leaps of faith: first, that management trusts customers not take advantage of the situation; second, that management trust employees with this empowerment. If you can make these leaps, then the quality of your customer service will zoom; if not, there is nothing more frustrating than companies copping the attitude that something is “against company policy.”
3. Take responsibility for your shortcomings. A company that takes responsibility for its shortcomings is likely to provide great customer service for two reasons: first, it's acknowledged that it's the company's fault and the company's responsibility to fix. Second, customers won't go through the aggravating process of getting you to accept blame--if you got to the airport on time and checked your baggage, it's hard to see how it's your fault that it got sent to the wrong continent. (Except if you were a schmuck to the ticket counter person.)
4. Don't point the finger. This is the flip side of taking responsibility. As computer owners we all know that when a program doesn't work, vendors often resort to finger pointing: “It's Apple's system software.” “It's Microsoft's 'special' way of doing things.” “It's the way Adobe created PDF.” A great customer service company doesn't point the finger--it figures out what the solution is regardless of whose fault the problem is and makes the customer happy. As my mother used to say, “You're either part of the problem or part of the solution.” (By the way, as a rule of thumb, the company with the largest market capitalization is the one at fault.)
5. Don't finger the pointer. Great customer service companies don't shoot the messenger. When it comes to customer service, it could be a customer, an employee, a vendor, or a consultant who's doing the pointing. The goal is not to silence the messenger, but to fix the problem that the messenger brought so that other customers don't have a bad experience.
6. Don't be paranoid. One of the most common justifications for anti-service is “What if everyone did this?” For example, what if everyone bought a new wardrobe when we lost their luggage? Or, to cite the often-told, perhaps apocryphal, story of a customer returning a tire to Nordstrom even though everyone knows Nordstrom doesn't sell tires, what if everyone started returning tires to Nordstrom? The point is: Don't assume that the worst case is going to be the common case. There will be outlier abusers, yes, but generally people are reasonable. If you put in a policy to take care of the worst case, bad people, it will antagonize and insult the bulk of your customers.
7. Hire the right kind of people. To put it mildly, customer service is not a job for everyone. The ideal customer service person derives great satisfaction by helping people and solving problems. This cannot be said of every job candidate. It's the company's responsibility to hire the right kind of people for this job because it can be a bad experience for the employee and the customer when you hire folks without a service orientation.
8. Under promise and over deliver. The goal is to delight a customer. For example, the signs in the lines at DisneyLand that tell you how long you'll have to wait from each point are purposely over-stated. When you get to the ride in less time, you're delighted. Imagine if the signs were understated--you'd be angry because Disneyland lied to you.
9. Integrate customer service into the maintstream. Let's see: sales makes the big bucks. Marketing does the fun stuff. Engineers, well, you leave them alone in their dark caves. Accounting cuts the paychecks. And support? Do to the dirty work of talking to pissed off customers when nothing else works. Herein lies the problem: customer service has as much to do with a company's reputation as sales, marketing, engineering, and finance. So integrate customer service into the mainstream of the company and do not consider it profit-sucking necessary evil. A customer service hero deserves all the accolades that a sales, marketing, or engineering one does.
10. Put it all together. To put several recommendations in action, suppose a part breaks in the gizmo that a customer bought from you. First, take responsibility: “I'm sorry that it broke.” Second, don't point the finger--that is, don't say, “We buy that part from a supplier.” Third, put the customer in control: “When would like the replacement by?” Fourth, under promise and over deliver: Send it at no additional charge via a faster shipping method than necessary. That's the way to create legendary customer service.
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