Research Tidbit

January 2,  2002

How to Keep Customers Happy

A global hotel chain was stunned to discover a perverse consequence of its customer-centric Six Sigma quality initiative. Apparently guests were mildly pleased by the chain's sincere efforts to provide a hassle-free stay. But what really moved the customer-satisfaction needle was how well the hotel responded when something went wrong.

Guests who had experienced a problem that was quickly and politely resolved rated the hotel service higher than guests who had had no problems at all. What's more, more guests with happy resolution of their hassle said they were likely to recommend the hotel than did the trouble-free guests.

Now, some might jump to the conclusion that service companies should stop preventing problems altogether – to give them more opportunities to correct mishaps. Such a strategy would certainly be too extreme – not to mention the public relations nightmare if it became public. But things go wrong often enough anyway. And while many companies commit significant resources to preventing mishaps, they might be better served by shifting some of those resources to fixing problems when they occur.

Few faces look happier than a frequent flier who receives – without asking – a polite apology and a free upgrade after a miserably late flight. Cheerfully comp dessert for the impatient patron whose entree is served 20 minutes late and the restaurant makes a customer for life.

Companies need to learn how best to fix things for their customers – without going so far as to annoy them. Different approaches may be appropriate for different customer segments.

The managerial problem is that most individuals and institutions are miserable failures at failing. By definition, quality organizations are so focused on preventing problems that when problems do materialize, they are woefully underinvested – both culturally and financially – in dealing with them in a cost-effective way.

As more and more organizations recognize that their paying customers and clients are their most important asset, they will make every effort to shift resources to correcting problems. Why? Because it's the surest way of maintaining interaction with the customer. People don't call you up to tell you everything is wonderful; they call you up because they want something else, something better, or something fixed.

SourceFORTUNE, December 24, 2001

Would you like to learn more about keeping your customers happy?  Let us design a research study for you. Call Jay Zaltzman at Bureau West Research Group – tel: (818) 881-0020.

 
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