The overlooked consequences of "bad customer" service

Yesterday I more or less wasted 30 minutes at a “Major” department store whose promise to me is “outstanding service is our goal”. How did that happen? Perhaps it was partly because of tight margins and the time of day; it seems the management had arranged that the number of customers eager to buy something outnumbered those eager to make that happen by about 30:1. But that small matter aside, I think most of the waste could be attributed to another case of customer service gone awry involving a “Schemer”, a blender of questionable origin, and a Sales Associate who had been brainwashed that even in the face of compelling evidence to the contrary, the customer is always right. I’ll get back to that in a moment.

No matter what product or service today, the intensive competition for your and my dollar has driven the mantra that the “Customer is King” to sometimes absurd levels, if you have any doubts watch some of the wildly hilarious Read the mission statement, value proposition or strategic plan of almost any business and somewhere you will find the well-worn statement, “we are committed to making our customers satisfied/successful/healthy/(fill in the blank)”. Many companies and service providers today consider their skills (or unfortunately, lack of in some cases) in providing customer service is the most important factor in setting them apart from their competition.

This almost biblical canon of “customer satisfaction is our most important goal” has been drummed into our brain, and today’s well-informed customer expects, or maybe the better word is “demands”, that the experience of our product or service will exceed any before it. In fact, there is s a good measure of truth behind the value of a happy customer. Numerous studies and research have shown that it is far less costly to keep a customer than it is to find a new one and an unhappy customer is known to tell far more people of his or her “horrible” experience than a happy one. With the newly found power of the Internet, an unhappy customer can soon become your worst nightmare. So while much of our focus today is on keeping the customer happy, little is mentioned of the other equally challenging reasons besides satisfied/dissatisfied that can make a customer difficult.

To anyone who has ever owned or managed a business, worked in retail (may God bless your troubled soul), worked in the hospitality or travel industry or even sold the unwanted remnants of this year’s housecleaning on Ebay, the chance that you have encountered a difficult customer is quite high.

When most of us hear the term “difficult customer”, our first reaction is to think of an angry customer, someone whose expectations have not been met, and whose unhappiness is genuinely linked to the failure or shortcomings of our product or service. In fact those are the ones we can most easily deal with in a systematic and usually successful way, if we follow some basic principles.

1. Make sure you have a system in place to prevent problems to begin with. A legitimate quality control program, employee training and a view of continuously working to improve your products and services are the foundation of any successful venture.
2. Approach the situation as if you where the customer, and show at least some empathy. Would you be happy if you found a fly sharing your Margarita or that your iPod just erased a lifelong collection of your favorite tunes?
3. Don’t personalize the situation. This is of course difficult to do when someone is angrily spouting an explicative laced diatribe in your direction, but your ability to keep your composure will triumph in the end.
4. Reach a common understanding with the customer of what exactly was wrong with your product or service and deal only with solving that issue. The fact that your customer’s newly repaired car just went up in flames on the freeway is good enough reason she is in a bad mood, but there is little you can do about that. You can however replace or repair her charred cell phone.
5. Apologize. The simple words “I am sorry”, while not admitting guilt or cause, can go a long way toward diffusing most rational people’s anger.
6. Fix the problem. If you cannot, or if your employer has not empowered you to do so, find someone who can as quickly as possible. The most annoying and damaging act in the face of any customer complaint is the act of unaccountability.
7. Once a resolution has been reached, ask the customer to acknowledge it. Once the resolution has been acknowledged, offer a small gift as compensation for the inconvenience. A discount on future purchases not only shows your sincerity but also may win you another chance to gain the customer’s confidence.
8. Follow up, if possible, to make sure that the problem was indeed solved. A certain company has won my lifetime loyalty on the back of a well placed phone call asking if their recently repaired product was still working and if I had any further problems.

But what about those equally challenging and difficult customers- the rude “Bullies”, The Schemers, The perpetually Unhappy, and the Cherry Pickers? A prudent application of Pareto’s law will generally show that this small group consumes a disproportionate amount of your efforts and, in the end, are unlikely to bring long term benefits to your business anyway. How to deal with this motley cast of characters?

My experience yesterday was a great opportunity to learn from. Here was an overly polite, but outwardly aggressive mother, bratty child in tow, with a blender that was obviously used and devoid of any packaging, sales receipt or even a hint that it actually was purchased in this store. She of course wanted to, “just return it since it never did work right, and yes, she know the store policy was not to return cash, but they could just credit the price of a new one on her charge card”. Bloody hell! Who in their right mind would expect this to happen? Well, the overworked (and wrongly trained) clerk spent 30 minutes trying to find someone to help make this woman “satisfied” rather than uttering the correct “No way” and kept me, an honest customer, waiting in the process.

The simple answer is you don’t deal with them. Train your employees and yourself as best you can to recognize them and make it known that they are not welcome on your customer list. This is of course far easier to say than to do as you always run the risk that you might have unfairly categorized someone. But if you follow the above steps and you are still confronted with an angry and belligerent face in front of you, the odds are pretty good that you have found one of these unsavory few. And if that is the case, distance you and your business as far from them as quickly as you can. No amount of good intentions or effort will be enough and there is nothing to gain by trying; in fact, you just might lose a “real” customer in the process.

Why I am unlikely to ever make Vice President

While browsing through a list of available jobs recently I came upon the following title, Vice President, Omissions and Errors. My god! Is Cheney up for replacement, is his heart on the fritz again? Who would have thought George W. would have to go looking on Monster.com?

Of course my curiosity got the best of me and I used up 30 minutes or so of my life learning what a VP of Omissions and Errors actually did. It turns out Errors and Omissions is a niche field of insurance that covers consequence damages and liability caused by the mistakes of others, primarily professionals like doctors, lawyers, architects and software developers, so the VP must help someone run that area. Hmmm, with my new found knowledge, now I am left wondering does the team in the White House have ample coverage but that is another matter.

So where is this going? For those readers who have not yet been corrupted by the business virus, a few decades ago companies discovered that a well-timed upgrade in title substituted for monetary reward, or at least coupled with less monetary reward, seemed to contribute to improved job satisfaction, and thus better performance. In the extreme of cases, the net cost was little more than the price of a box or two of business cards. As both a practitioner as well as recipient of this clever ploy, I have to admit that bestowing a lofty title along with a little, immediately gratifying, cash does tend to make one more productive, and motivated, at least in the short run. I guess those management experts like Herzberg and Locke were on to something; recognition is a powerful stroke to our fragile egos, and a snappy new title is a one great way to recognize.

Soon, this idea spread like wildfire and everyone was a “specialist”, consultant, manager, executive (fill in the blank), associate or VP. Now, My coffee is brewed by a Barista, the cashier in the men’s section is my Couture Consultant, the guy from Chemlawn who spreads fertilizer is a Senior Turf Technician, the hooker canvassing the local casino likes to be called a Guest Relations Representative, and most corporate offices today have more VP’s than parking spots in the corporate lot. And that takes me to my point, so what is the deal with Vice Presidents anyway, what exactly does a VP do, and where is the President? Ever think about that? Vice in this context means in place of somebody, but who is that somebody anyway? The company that was looking for that VP of Errors and Omissions doesn’t have a President for Errors and Omissions, why do they need a Vice President? Ok, I understand the concept of VP and General Manager, or VP and Division Manager, or VP and Director of (whatever), but VP by itself? Come on!

My meager understanding is that a President is the leader and the one who is responsible for taking charge and making decisions. A Vice President is then someone that supports this person if logic follows. But maybe I got it all wrong; maybe the Vice President is really the one who is in charge, but by being only a Vice President, it makes it easier for us to believe that in the end, it was someone else’s fault, particularly if the outcome is not so spectacular or those well formulated plans did not work out so well. Hmm, maybe a VP is not a bad title to have after all. It sure makes it easier to pass on the blame.

Negotiation 101-what I learned at the wet market

The propensity and power to successfully negotiate shows up early in life. Ask any parent whose argument against buying that particular toy has been mercilessly dissected by the patient, well-reasoned logic of their 6 year old child if you have any doubts. The practice of negotiation is older than Methuselah and is used consciously and unconsciously almost every time we speak to one another, whether to buy something, to borrow something or even to beg something, such as those generally unfruitful efforts with the traffic police. The story line is pretty much the same in any case; one party wants something that the other party has the power to provide, and both parties want the final deal to favor their own interest. Even that sacred act of marriage is only consummated after a usually tough round of give and take.

Most successful negotiators will be the first to tell you that good negotiation is
more art than science, and the act of negotiation is as good of a test of your character as any other. Emotions, ethics, empathy, tolerance, patience, perseverance, honesty and prepared are words that I most associate with negotiation. And while there are tomes of books and thousands of seminars that promise to teach you negotiation skills, my own experience and observation is the best lessons in negotiation can be found in Asia, and there are no better teachers than the hordes of housewives who daily browse through the wet markets to buy fresh vegetables for dinner. Lets take an imaginary trip along with one such housewife and I think you will get the picture.

First, there is a very clear objective or preconception of what will happen. Vegetables are needed for dinner. The household favorite is spinach and that is what she looking for, but there are other vegetables that are also good, so if the spinach is not fresh or the cost is too high, kale or broccoli will do just as well.

Next is to consider how much time she has to buy the vegetables. The day is still young but she doesn't want to spend more than a couple of hours at the market, and lots of this time will be used up already chatting with friends and neighbors. Of course some of this chatting will be talk of who has the freshest and least costly spinach today.

Now she needs to decide where to buy the spinach and she needs more than one option to get the best deal. She already knows where to find the freshest and most tender spinach from her chatting and browsing.

OK, here it gets more difficult. She needs to determine what the other party expects or needs to complete the deal; in this case, what price the farmer is willing to sell his
spinach today. Of course this is never easy because she doesn't know how the farmer's day is going, and she has never bought from farmer "A" before either, so she is not sure how is his style, but needs to find out. The conversation probably goes something like this:

Housewife: Those are nice carrots you have, how much are they today?
Farmer A: These are the best carrots in the whole county. I want you to buy them so
I give you a special price of only 5 Yuan a bunch.
Housewife: Oh! That is so expensive. I can buy them over there for only 2 Yuan.
Farmer A: But those carrots are not as good as mine. But you are a nice lady and I
want you to buy my carrots so I will give you a special price of 3 Yuan.
Housewife: Oh! Still too expensive!
Farmer A: My carrots are the best. It cost me 2 Yuan to grow them. The best price is
already to low! But, if you will be two bunches I can give you a small discount, 5 Yuan for both.
Housewife: Hahaha! You are a robber instead of a farmer, still too expensive! How
much is that spinach you have? Is it made of gold also?
Farmer A: The spinach is same price as carrots.
Housewife: Golden carrots and golden spinach! Ai Yah!
Farmer A: Ok, you seem to be a nice person and I want you to buy my carrots. How
much can you pay?

The housewife then walks away with disinterest, generally with the farmer still asking,
"how much you will pay, what is your price?" The savvy housewife will say nothing of
course, as she is not yet ready to buy, and by doing nothing, she has remained flexible in reaching a deal. She has however established her bottom line indirectly to the farmer when she claimed to be able to buy at the price somewhere else. This process is repeated at the next stall, with variations of course, unless there is some clandestine "farmer cartel " operating in the background, until the housewife has determined as best she can which farmer is likely to give her the best deal.

Notice she has not yet committed or even hinted at her bottom line, but she has gotten a very good sense of each farmer's bottom line and style of negotiation. Now it is time to buy the spinach and go home. Farmer A seemed eager to sell his carrots and his spinach was pretty good, so back to Farmer A's stall.

Housewife: You seem rather slow today so maybe I will buy some of your carrots and
maybe some spinach too. I will give you 3 Yuan for one bunch of carrots and one bunch of spinach. Ok?
Farmer A: Hahaha! I can make no money at that price! It is getting late so just for
you, I give you both for 4.5 Yuan.
Housewife: Here is 3.5 Yuan in my hand. Take it and give me the vegetables.
Farmer A: Oh, too cheap! Give me 4 Yuan.

Our outwardly irritated housewife begins to walk away and, as she has expertly
calculated from their earlier exchange, the farmer shouts back, " Ok, you are cheating me but I give you both for 3.9 Yuan to save me from having to cart them back home." The housewife comes back then proceeds to find a blemish on 1 or 2 carrots, and after another mildly heated discussion with the farmer, walks away with a bunch of spinach for only 1.9 Yuan.

In reality both parties are reasonably satisfied or the deal would not have been concluded.

Global arms treaties, corporate takeovers and divorce settlements aside; this rather simple exercise teaches the most important fundamentals of negotiation. The interesting but seldom practiced fact is that all things in life are negotiable if you know what you want, make sure you have suitable options, invest some time to carefully study your options, gain an understanding of the other parties needs and are willing and able to walk away if your bottom line is not reached.

Beats shopping at Wal-Mart doesn't it?

Karaoke, Khakis and the Art of the Deal: A Businessman's Guide to Karaoke in Asia

Imagine this.

Two middle-aged “senior” executives, their inhibitions blissfully sleeping under the influence of way too much Chivas and green tea, throw all decorum aside as their vocal chords strain to unleash a heretofore never achieved destruction of "Unchained Melody". Next up, an equally inspired trio with a collective sound strikingly similar to "nails on a chalkboard" who are tenacious in their belief their rendition of Queen's "Bohemian Rhapsody", despite their serious melodic challenges and equally poor grasp of English, is the real reason the audience was wildly applauding at the end. As one looks around the packed room, there seems no end in sight to the horrors of sound that might follow as patrons at every table are busily browsing through a seemingly infinite directory of tunes from around the globe, from every genre and generation, searching for that special song they need to sing tonight.

But imagination is optional. Just visit any karaoke lounge in Tokyo, Shanghai, Hanoi or Seoul almost any night of the week and it is possible to witness firsthand this shameless display of raw talent and emotion. Welcome to karaoke Asian style!

Modern karaoke is reputed to have originated in Japan in the early 1970's and is arguably the most popular pastime in Asia. Karaoke has been pegged by many so-called experts on Asian society and social psychology as the much needed relief valve to vent one's feelings of joy, frustration, anger and pain, whether in love or in life; an act normally considered culturally taboo in daily life in Asia. Coming from Japan, a country noted for its lemming-like conformity in hiding emotions, this idea of karaoke as therapy is not so strange. Whether or not karaoke is indeed a psychic healing force remains debatable but one thing is for sure. Day in and night out, whether at home, on the road, or in the literally hundreds of thousands of KTV joints flourishing in the region, karaoke, or at least the karaoke as practiced by our Asian friends, has certainly taken entertainment to a whole new level.

At the commercial level, there are karaoke venues targeting every conceivable subset of society-from young and old, the rich or poor, the prim or promiscuous. My particularly favorite, or at least most familiar, business model targets predominately male patrons, especially those on expense accounts. Set amid a backdrop of high end electronics, plush leather sofas and muted lighting, one can experience this cathartic release of emotion surrounded by a harem of nubile cuties, dressed in low cut black, beige or red chiffon evening gowns clinging to their youthful curves like saran wrap; their principle purpose being to light cigarettes, mix drinks, and shower their gravel voiced patrons with profuse and highly exaggerated compliments on their singing skills and manliness.

Besides a seemingly endless array of commercial establishments, almost every home, from the lowly peasant dwellings of China and Vietnam to the penthouses and palaces of Hong Kong and Kuala Lumpur, is equipped with at least one device capable of putting the wails of the neighbor's cat in heat to shame. With a virtually bottomless price floor for consumer electronics and the proliferation of low cost DVD burners throughout Asia, the pleasure of one's own stage on which to warble to their heart's contentment is now within reach of anyone with access to electricity. From the young and young-at-heart "wannabes" in Tokyo covering the latest pop hits in the chic clubs in Roppongi and Ginza to those old Red Army warriors in Sichuan wailing the heart rendering lyrics of "Ostmanthus Flowers Blooming Everywhere in August" at family dinners, almost no social outing in Asia is complete without at least one round of singing, often evolving into an all night affairs. Karaoke is as deeply engrained in the fabric of society in Asia as khakis are in the business casual wardrobe of America's business elite.

But to a businessman like myself, the most intriguing aspect of karaoke in Asia, particularly when practiced in the man friendly environment described above, is its pervasive influence in successfully concluding a business deal, something I would like to call the ktv-Quotient. Let's consider the following not so hypothetical situation.

Company A has a superior product, excellent after-sales support, the best value and all the trappings of a reliable business partner. Company A's sales effort is led by a seasoned professional who is at the top of his game in every aspect.

Company A's team, although highly skilled in the art of selling, has a very low ktv-quotient and would have a hard time finding their way around a karaoke lounge even with a GPS system.

Company B's product, pricing and service are just so-so, in fact, in some aspects, border on inferior. Its sales pitch and presentation is not that persuasive nor does its team really understand the customer's requirements.

Company B's team has an awesome ktv-quotient, with each member holding a wallet full of VIP cards and all of its staff on a first name basis with the staff at every KTV in town.

Under these conditions, Company B will almost always win the deal, particularly when the time gap between the last visit to KTV hosted by Company B for the customer's predominately male decision makers and the contract signing by the customer's predominantly male decision makers is less than one week. Now why is that? What exactly is it power of this ktv-quotient in closing the deal?

Well, I cannot say for certain, but I think I have a pretty good idea. To share this with you I would like to liberally paraphrase the thoughts of Samantha Culp, found in an interesting article in Asia Sentinel about her experiences as a hostess in Japan. From my own experience and observations I think her insight is spot on.

"Drinking is a huge part of the Asian business culture itself where a staggering percentage of the male populace "staggers" home each night (pun intended). Karaoke and Hostess bars are an important part of this culture that requires obligatory drinking with colleagues after work, and getting wasted with partners to seal a business deal. Drinking comes to signify trust, relaxation and a certain absolution from any adult responsibility. When inebriated, men are almost not accountable for their actions, whether those entail attempting to cop a feel on the train, or to passing out in public after hurling chunks all over the subway platform.

Looking at the clients in the club, the majority are middle-aged, married with children, and in the middle of pretty conventional lives, which begs the question, why were they here? What were they looking for?

Of course the bevy of beautiful and sexy young attendants play no small part. Yes, they want the fantasy of sex, but also they want the fantasy of romance, of a "perfect" ageless girlfriend, always ready for drinking, flirtation and fun, but who disappears at the end of the night, no strings attached. They want a world apart from the daily grind of the working world, where they could be simultaneously children and kings of the castle. Especially in the world of salarymen or corporate staff, where most were not as powerful or as rich as they had trained to be, they wanted a place where they could still command awe and respect, if only by spending $20.00 on a dish of stale Pringles or impressing their peers with an earthy performance of "Feelings" that would make Morris Albert proud"

So there it is. The ktv-quotient is 1 part play, 1 part fantasy and 2 parts, in the immortal words of Aretha Franklin, R-E-S-P-E-C-T. Those late deliveries, mistaken invoices and shoddy goods can all be worked out later between friends because in spite of everything, the good intent was there to begin with wasn't it? And we are friends aren't we (?), because only friends would allow friends to get drunk and sing karaoke.

So as karaoke's recent rise in popularity in the US suggests, along with its supporting cast of the likes of "American Idol" and the "Singing Bee", it may only be a matter of time before your local latte hangout not only offers WIFI but also the tools you need to work out the kinks in your version of "My Way". With that in mind, here are some thoughts for you road warriors out there to ponder. Will those polished and well-practiced PowerPoint presentations extolling your features and benefits soon be subordinated in the laptop to the list of latest hot lyrics? Are those front row seats for the Knick's games soon to be replaced by a corporate table at Sing Sing? Is the HR department already looking for a reliable measure of ktv-Quotient to add to their immense battery of screening tests? After all, this is the age of globalizing best practices isn't it?

Sorry, I have to go now and I will leave you to mull over those possibilities. It is my time to work on that technique of hand cupping the mic to maximize the vocal modulations. My coach really thinks I am only a few weeks away from nailing a killer version of "Summer Time".