Every businessperson is a service agent first.

Through a strange set of circumstances, a junior colleague was scrambled on short notice last week to be the lead contact for our company at an industry tradeshow.

As he was getting ready for his first major solo customer-side contact, someone in our group asked him if he was prepared to answer customer questions onsite. He rattled off corporate positioning detail and product knowledge like the most heavily-trained sale professional, gaining confidence as he did. As he was about to leave, we threw him one more question.

“What if someone asks you for service?”

“What?”

“We’re a service business that runs 24/7. How do you handle a customer who approaches and would like you to help with a service issue?”

Blank stare.

“Do you know how to get him / her to someone locally who can help?”

We spent some needed time giving our friend some critical detail on how to resolve a few service issues without reaching out, and hooked him up with someone that would know most local customers and could step in to provide assistance.

This story is unfortunate, but not unusual. Every time you see a company’s social media expert ask a customer with a complaint if they have called customer care, it is this dynamic at work. We’re a culture of corporate specialists. If you are unlucky enough to work in a corporate headquarters, picture all the people that could serve a customer immediately, if one approached them in a crowded airport and asked for help. Probably not many. (As an aside, are any of the faces C-level executives?)

It’s flawed logic to say that because serving a customer is not a role that everyone in an organization plays, not everyone needs to know it is done. Anyone in a support role ultimately plays a part in serving customers. Consequently, we should know how that job is done and be able to do it. Support organizations (that army of staffers most of us are part of) provide better internal service and customer support when we know the details of the customer experience.

The Army gets this. The idea that “every soldier is a rifleman first”, doesn't mean that infantry is everyone’s primary responsibility. It means that everyone should know how to help the organization achieve its most basic objective, because that knowledge helps the organization better support those that play that critical role.

Zappos knows it too. I hear experts claim that the Zappos culture can’t be replicated – that their culture is specific to their business model and doesn’t translate to other organizations. That may be. One aspect of their business that is transferable to any company is their core understanding of each function’s role in supporting the overall mission.

My new colleague did spectacularly well in his impromptu field assignment, because he carries a service orientation and had the willingness to learn a role others might feel was beneath his level.

Organizations that aren’t top performers are the ones that don’t stress to all employees the importance of understanding the service role.

Customer-centric leadership? I'll take Sir Richard, thanks.

We’re in an interesting time, where the ubiquity of business has created an environment where some CEO’s have become celebrities like their entertainment and athletics counterparts.

There has been much written about whether having a celebrity CEO is good or bad for a business. But it is good for service businesses, in that celebrity CEO’s keep companies honest by keeping them in touch with customers at the highest levels.

Lack of interaction between management and customers is a problem that has long plagued all kinds of companies. How many service businesses do you support through a regular billing cycle, for which if the CEO rang your doorbell on Saturday morning, you would recognize them?

The flipside also applies. I know several senior leaders who couldn’t pick one of their customers out of a lineup. Not that they don’t know any individual customers, more that they are too far removed to be empathetic to their customers’ lives and experiences.

But take a handful of celebrity CEO’s. Richard Branson of Virgin, Mark Cuban of HDNet, Gary Kelly of Southwest, Tony Hsieh of Zappos. They’re highly recognizable to their customers, but more importantly, they are often caught moving among them in the service environment. When a customer recognizes one of these business leaders in the service environment, there’s a good chance they’ll take a second to give feedback – good or bad – about their encounter. There’s also a good chance that these CEO’s spend a minute or two asking customers about how their experiences are going.

Feedback – solicited and unsolicited – begets questions that CEO’s ask their teams. Why do we have this policy? Couldn’t we change this process to make things easier? Why can’t we deliver this part of the experience better?

That kind of connectivity is contagious. Leaders that report to a CEO that spends a good portion of their time interacting with customers, aren’t going to spend less, and so on and so on.

Many senior leaders never bring these questions up because they don’t have the context to do so. Their only connection to customers is through the customer satisfaction reporting and 4 layers of staffers at corporate headquarters. The only hard questions they have to answer come from Wall Street. If that’s the only constituent input to base future business direction, it’s a bad one. Celebrity CEO’s may have their problems – it seems that more of them are prone to incarceration, though that may be a visibility thing too – but for customer service driven by the interaction of business leaders and customers, they have the built-in advantage of customer connection.

We’re running out of stupid customers.

Years ago, I worked with a company President that remarked on multiple locations that his best customers were stupid, and what he really needed from sales & marketing was for them to find more stupid customers.

What he meant was that, at least on the surface, customers that showed the highest levels of operating profit were those that were willing to sustain a long-term relationship with our organization but did not price-compare among service brands. As a result, the price they paid was dramatically above-market.

Apart from the customer contempt that this remark showed, it also showed his (and that organization’s & really, that entire industry’s) fundamental lack of understanding of cost-to-serve and customer lifetime value. As the industry rejected any effort to base it’s business model off of contemporary service pricing schemes, it developed another industry comprised completely of intermediaries who (smartly) made their money by helping end users make more informed decisions.

The pattern repeats itself across service industries. Airlines had their own version of the imperfect information problem. Wireless and cable services are well known examples, but any industry that has an ongoing service relationship model faces a version of the same thing – a company’s commitment to an existing profit stream favors new customers, allowing them better access to value than existing customers exhibiting brand loyalty.

Is this a fair outcome?

It doesn't matter what the company thinks. It isn’t perceived as fair when the relationship customer accidentally gets a “service invitation” promotion in the mail, and calls the cable company for the new customer deal, only to be told their ineligible. (I have heard literally scores of those stories about cable companies)

The Internet changed many business models, and it has become the great equalizer when it comes to improving the information customers rely on to make purchase decisions. Small, loyal customers that once happily paid above-market prices today have full visibility to what a fair price is, and can compare their deal with that of others.

The counter I often hear – usually from pricing and finance organizations – is that “our company can’t afford to give those customers the same deal that new customers get.”

That’s a shortsighted answer. Those loyal customers are precisely the one that your competitors are targeting with their new customer offers. When they ultimately discover what their relationship is worth, they won’t be nearly as receptive to your matching offer. Some of the most intelligent people I know have run themselves ragged trying to figure out how to stop loyal customers paying above-market rates from churning from a business, without ever considering what loyalty looks like to a customer who learns that a prospect who has never put a penny into the company's coffers is more prized than their relationship.

The only thing that hasn’t exposed how bad this is as strategy is that in each industry, every competitor follows the same strategy. A company married to this business model inevitably loses that business to someone who isn’t, who doesn’t draw their profit from a small base of loyal stupid customers.

We don’t have perfect information yet, but it’s closer than it was 10 years ago and approaching rapidly. The pool of stupid customers is getting too small to sustain everybody. Amen to that, because it’s about time that these service industries started designing value into their offer, rather than dispatching search parties for the increasingly elusive stupid customer.

Sports. Just service encounters with extreme customer interaction.

I’m a sports fan.

My pragmatic side knows athletic competition is mostly arbitrary, but as entertainment businesses go, sports have some of the richest service environments developed.

Customer-to-customer interaction isn't just encouraged, it's expected. (In fact, without any other customers, sports entertainment would be a pretty silly service encounter indeed.) Front-line service providers (the athletes) prefer the environment when customers (fans) become part of the performance.

And so it is with today’s post.

With a nod to the ongoing Stanley Cup final series, here is how the Vancouver Canucks anthem singer Mark Donnelly and 18,500+ fans collaborate on production of Oh Canada. (Full disclaimer, I’m a born & raised western Canadian, though I would think this was a cool execution in any context.)



Notice that Mark raises the microphone to the crowd to indicate that it is their turn to carry the song. This isn’t a singer taking advantage of an unusually participative crowd, it’s the way the service encounter begins on Canucks game nights. Customers know & accept their role in the production. Even those attending for the first time pick up the social cues from other customers quickly enough to participate.

In this encounter, something so routine as the singing of a national anthem, when embraced by the customers, changes the entertainment experience and makes it much more compelling than it is in other venues.

It is the nature of sports experiences that the customer-customer interaction makes the experience richer. Customers arrive in the service environment ready for a heightened level of customer-customer interaction and co-production. But they didn’t always show up to Canucks games expecting to sing the national anthem. That built over time.

Ironically, customers’ ability to impact the result of their service experience is greater in almost every other type of service than entertainment. So how do you take a standard service environment and, like Mark Donnelly has done, create one where customers support each-others’ experiences? How do you develop, over time, the customer role in the production of the encounter?

Are we changing how we complain, or just how often?

A New York Times article “Consumer Complaints Made Easy. Maybe Too Easy" sparked some dialogue yesterday on the nature of complaints, complainers and service recovery effort.

I joined Wim Rampen, Arie Goldshlager & several others to discuss whether social media has indeed made it too easy for customers too complain, and if this has led to “social bullying”.

My quick take: Social media hasn’t made customer complaints “too easy”. Instead, good service businesses are happy to have yet another way for a customer with a complaint to have that complaint heard and responded to. Companies suggesting that it’s too easy for customers to complain may not have the right service orientation in the first place, which leads to those scores of complaints that they’d rather not hear.

In a related post on Arie Goldshlager’s Posterous, he commented on the proliferation of easy, uncommitted complaints and “social bullying” as a potential resource drain on well-meaning service organizations that tried to serve all customers to their fullest extent.

With the rise of social as a venue for complaining, the ground may be shifting on this one. If a company responds to customers that are complaining for popularity reasons and aren't looking to engage them, they may waste valuable service resources chasing service experiences that can’t be recovered with customers that aren’t looking for resolution as much as they are a chance to use their social media bullhorn.

Pndering the issue for a few more hours, I’ve got one more issue to add to the body of work.

Complaining about failed experiences is easier with the availability of social media than it was before, no doubt. But in any service experience, customers themselves play a role in a successful outcome. When a customer with a failure complains directly to a company, the company has the ability to help fix problems that began with the customer not accepting their role or not playing it well. But when the interaction happens in full view of social media, there’s less opportunity for that type of customer coaching.

Will social media move companies toward limiting customer role in production of their own experiences, making service more servant-like & less collaborative?

I sure hope not. The customer, because of their unique knowledge of their needs, has the potential to be the most productive resource in the service experience, if & when we make good use of the shared effort. It would be a shame for businesses worried about the complaints that could be best fixed through better company-customer interface to design the customer out of the fulfillment process completely.

Old School CRM.

For those skeptical whether a company wants or can have true relationships with its customers, here is the bulletin board of a Starbucks I happened upon in my travels:

A simple note, handwritten cards with customers' names, favorite drinks & details. The odd customer photo. How long do you think that it took to construct this mural? 30 minutes? 60?

The answer is on the blackboard. 4 years of investment in customer relationships, made 30 seconds at a time.

ANY company can have this kind of relationship with its customers. Only those willing to invest 4 years do.


(No, it’s not lost on me that it is really people that create and maintain the relationships. Service businesses are about people, and front line staff in particular. Front line people are the are “product”, the marketers and the customer service staff. Customers’ feelings about them are transferred to the company. Customers’ feelings about the company are likewise transferred to them.)


(One other note from this: Want to be the Mercedes of your industry? The Ogilvy of your local market? The Zappos of your niche? In service businesses, all three are represented by your front line providers. 3 functions in 1. Don’t tell me service businesses are inefficient.)

Saturday Night, Alive.

I’ve been holding onto this one for a few days because I didn’t quite know how I felt about it.

On Saturday evening, we heard tornado sirens sound in our neighborhood, as they do anytime a tornado is sighted in our rather large county in northeastern Kansas.

It was late, and not wanting to wake the kids up unnecessarily, we quickly tuned in to the local television broadcast to quickly see what exactly we were faced with and whether we would have to beat a hasty retreat to the basement.

It turned out that the tornadoes were as far away and as small as they could be and still cause the alarm, but in our minds – as always with these things – better safe than sorry.

But here’s where the service encounter comes in. To broadcast the emergency, the Kansas City area NBC affiliate broke in on Saturday Night Live. Specifically, the season finale featuring Justin Timberlake and Lady Gaga.

As they did so, the meteorologist almost continuously apologized for preempting SNL, which to me seemed a bit unnecessary, in that I couldn’t imagine anyone who would be willing to forego their own safety or that of their neighbors for a rehashed version of dick-in-a-box.

At that point, I did a quick twitter search on “SNL Tornado”, and saw the vitriolic reaction that the weather alert was generating towards NBC.

At first, I didn’t consider this a service failure, so much as a group of irates voicing their displeasure at a very sensible action on the part of the network. But the idea stuck with me. I wrote a post about situations when one service experience (National Weather Service) interferes with another and another about cases where the customer isn’t right, taking the position that the Meteorologist shouldn’t have to apologize for keeping viewers safe by the best means available.

What I came back to, though, was that as much as I didn’t agree with their positions, this was a service failure in the eyes of the customers that were complaining. Their service outcome – namely experiencing the finale of SNL – was not fulfilled by NBC, regardless of how good the reason. The local NBC meteorologist was right to apologize. Better, their service recovery of pointing watchers to the broadcast streamed over the internet kept with a key element of good service recovery, providing successful delivery – either through the streaming video or a later rebroadcast – as a fair outcome.

NBC prioritized the service needs of its customers appropriately. Serving some caused an unavoidable service failure for others. But in recognizing it and offering an alternative, they provided each customer group a fair outcome in the service they wanted or needed in the first place.

Lessons in customer role, from a chainsaw company.

In the summer months, I'll often throw my local Kansas City Royals baseball game on the TV to serve as background noise as I settle into my evening routine.

One of the advertisers on the local broadcast – Stihl – a chainsaw manufacturer, gets experience and customer role well enough to mention, even though I don’t own a Stihl chainsaw, nor am I likely to anytime soon.

The ad is for a dealership promotional period, but doesn’t offer a price discount. It doesn’t even offer suggestions on where they can be found beyond, "your local Stihl dealer".

Instead, it talks about the quality of the product, reinforces the quality of the product, and closes with the quality of the product. Somewhere in the middle, they mention that if a customer purchases a 6-pack of oil with the chainsaw, Stihl will double the warranty period.

Tremendous service marketing from a product company.

The logic is simple: If a customer buys the oil, they’ll either use it or they won’t.

Most people that buy a six pack of oil will likely use some, if not all of it. Doing so inherently lengthens the life of the chainsaw. So for those that use it, they get a customer who spends additional money upfront on a maintenance product and understands and accepts his or her role in maintaining the product.

The life of the chainsaw is extended by a well-maintained machine, the likelihood of needed repair decreases, and the customer’s perception of Stihl as a brand of high quality, (or at least long-lasting) chainsaws increases.

For those that don’t use it, the purchase of the oil at least partially offsets the warranty costs for repairs to the chainsaws that aren’t maintained.

As a side benefit – call it the Chris Zane corollary – any competitor that tries to match warranty terms without the added benefit of customer-provided maintenance may find themselves with a money-losing warranty.

The warranty is a service aspect of a product purchase. The customer role of maintenance is part of the product experience. Stihl may not be Zappos, but they know their service marketing. It’s a good promise. You do your part in maintaining the product, and we’ll guarantee that it will stay running for years.

I unfollowed @PV_at_SAP today.

Along with @outdoorrussia, @CarinaAllen and 20 others. At least, so said a tweet from @PV_at_SAP caught by my mentions column yesterday afternoon:

“@Reaburn , @outdoorrussia , @CarinaAllen and 20 others unfollowed me today ... checked by http://fllwrs.com”

An interesting way to mention someone. Of course, it was entirely possible. I do unfollow people from time to time. So I checked, and actually, I had unfollowed @PV_at_SAP the day prior, making the mention ever so slightly inaccurate.

It's not the first time I’ve unfollowed someone. But it is the first time I’ve been called out for it, and I’m not quite sure of the purpose. My guess is that “PV” wants to alert the twitterverse that someone isn’t playing by the implied reciprocity rules.

Interesting take on the purpose & use for twitter. Yes, building one's self-perceived popularity through masses of followers is one potential source of value for Twitter, though it’s not where I find value, and in all fairness, I doubt PV does either.

For me, Twitter’s value is in engaging experts, leaders & interesting people on subjects I want to learn more about, contributing to the collaborative dialogue where I can, while creating a shortcut to exceptional content for which the search cost would be too high for me to ever obtain it on my own.

Right now, I’m near the magical 2,000 twitter followers, so Twitter demands that I watch my balance of follows to followers. I’m trying to break through that mark, not because I want access to legions of potential pseudofans, but because I’m pretty certain there are more than 2,000 people out there that I’m going to find interesting, and I want to be able to find & follow them with fewer restrictions.

PV isn’t following me, and so he’s limiting my Twitter experience by hampering that objective. I also don’t find much value in his content – nothing personal, it’s just not for me.

Any customer-customer interaction can change behavior in the service environment. In this case, unfollowing PV was my way of improving my own experience, since PV wasn’t contributing to it, and actually was limiting its effectiveness.

I’m sure PV would understand. After all, his bio reads “Its all about the Customer and the Experience at SAP.” It’s a sentiment I share (it was likely a reason I chose to follow PV in the first place), and exactly what I was practicing when I unfollowed him.

Homeaway.com (Pt II): Don't take a customer's need for assurance lightly.

After reviewing their Super Bowl advertising as part of this year’s #BZBowl, I was intrigued enough by the Homeaway.com service model to give them a try, using their marketplace for vacation rental properties to book a condo for a future family vacation in an area of the world I've never spent much time.

I was blown away by the front-end, but there were some execution inconsistencies and assurance misses that could be improved to make the booking experience as tight as the search & engagement process.

Once I had potential locations down to a short list, I contacted the property managers to check specific dates, availability and to inquire further about the properties themselves. Not all of them replied, and of those that did, I had response times from a few hours to almost a week. It's difficult to manage any network of intermediaries responsible for fulfilling your service experience. A network of small business owners / property managers that spans the globe has to be one of the most complex intermediary networks I’ve ever encountered. Still, the variance between responses was a bit extreme. While I was down on the hotel experience in part one, I’ve never had a hotel not respond to my inquiry as to room availability.

Once the short list was narrowed down, I began an engagement with the manager of the property I was most interested in. The manager seemed extremely nice, wrote back to me in my first language even though it wasn’t his, provided detailed information on the property and included references – all great stuff. But it was when he - a service intermediary that I’ve never met, whom I know isn’t employed by Homeaway and operates out of another country - asked for my credit card information that my service encounter needed some assurance that this was a normal part of the experience, and that I could trust in the intermediary network.

To get that assurance, I checked with Homeaway, asking if this was common practice or if I should look elsewhere. In this case, Homeaway didn’t respond for 3 days. That may be acceptable for routine questions (or not) but certainly not for what was to me an urgent inquiry about information security.

Marketplaces like Homeaway, where networks of service intermediaries gather to compete for the aggregated demand of a mass market, are growing in number and breadth of the markets they serve. But they are fundamentally difficult service models to manage with consistency. Service quality basics such as reliability, empathy and expecially assurance have to be considered at every step of not only the engagement experience, but the purchase, service experience and post-experience as well.

Homeaway had me with the engagement, but a small fail at a critical point just about lost me at the exact moment I was willing to put my money down.

Homeaway: A refreshing un-hotel encounter.

After reviewing their Super Bowl advertising as part of this year’s #BZBowl, I was intrigued enough by the Homeaway.com service model to give them a try, using their marketplace for vacation rental properties to book a condo for a future family vacation in an area of the world I've never spent much time.

The Homeaway accommodations marketplace provided a service encounter far superior to the hundreds of hotel and hotel aggregator sites I’ve used in the past.

With thousands of properties spanning the globe, individual property managers compete with each other for travelers' vacation accomodations experiences. They’re motivated to position their properties in the most compelling possible way – making their best promises as to the experience a vacationer would have. Users see extremely detailed information on the properties, surrounding neighborhoods - often including an insider’s information on local events. Property managers usually include property layout diagrams, a full suite of pictures, including video walkthroughs for prospective renters. Those promises are kept honest through user reviews, with past renters posting reviews of the amenities and the service for the properties where they’ve stayed.

By comparison, direct hotel sites typically give a generalized room category with some vague images of the accommodations style, and a price. Aggregators of hotel accommodations (like hotels.com and priceline) may offer even less, narrowing down to a neighborhood (not a specific property) a nebulous star rating for the property and a price.

With more space, more variety, and more decision information at every bit as competitive a price, the homeaway.com search and engagement experience is so much better than traditional hotels and site aggregators, it makes me wonder if the hospitality industry isn’t undergoing every bit the business model change that happened when the demand aggregators first arrived on the scene.

But while the experience of finding potential vacation sites was an exceptional experience, there are a few service experience missteps and inconsistencies that took place in part two of my service encounter, once I committed to using a property.

AT&T broadband cap gets a consumer wag-of-the-finger

AT&T made news this week by announcing a cap on broadband for personal internet use. Based on my own (purely unscientific) review of the comments circulating through social media sites, the move wasn’t favored by consumers.

From Twitter:

JD_Wright: Broadband cap? I think our days with AT&T for internet service are very limited.

Joel_Turnipseed: @att added a cap and didn’t lower price, this is why I have moved internet providers "att capping broadband http://t.co/u9YrKmi"

kevinlam14: AT&T cap broadband usage! 150gig for DSL and if you go over, $10 is charge for another 50gig http://ow.ly/4NAAs This is a load of crap!

beermonkey: Time to switch providers out of principle alone. RT @News4WOAI: AT&T putting cap on broadband http://bit.ly/mGoiqT


But before committing to indignation about how this is a money extracting move by an evil cable company who doesn’t want to provide the service it’s loyal customers, consider this as a move that potentially protects the service experience.

According to AT&T, the top 2% of customers – those for whom the cap will apply – use a full 20% of broadband.

When one customer’s service experience adversely impacts the service experience of other customers, the company has a decision to make – protect the experience for the customer whose use is negatively impacting others, or intervene to protect the experience of the many.

In some cases, the decision is easier than others.

If the customer is improperly using a company’s service experience – think of a severely intoxicated passenger on an airplane – the difficult but appropriate response is often to remove them from the service environment, to be served in another way or not at all.

On the other hand, if a customer simply uses “more than their fair share” of the company’s service capacity, the company has the option to charge for the capacity-draining use to either modify the behavior and bring capacity use back into balance or ensure any continued extreme usage of the service is compensatory.

The AT&T cap on broadband (which isn’t a cap, as much as a charge for excess use) isn’t without precedent. In fact, it is somewhat similar to the intelligent traffic system IBM implemented in Stockholm, which concurrently solved a major congestion problem while increasing municipal revenue and was ultimately seen as a creative solution to a difficult problem.

What is interesting to me is that while both organizations made changes to preserve scarce service capacity to serve more customers more effectively (and make more money doing it), one is met with case studies while the other is met with catcalls.

Rating "Rate Our Chicken."

Successful service encounters start off with well executed marketing as the process of making relevant promises that set the expectations of what will be delivered through the experience.

The Domino’s ad “Rate Our Chicken” is an effective one not just for the promises it makes but also for how it personalizes promise fulfillment for customers.



The ad makes that simple promise that is easy to evaluate - specifically that we’re going to like their new chicken product. But while most advertisements stop here, Domino’s challenges customers to evaluate their delivery of the promise by asking every customer to rate their chicken with a survey on the box the chicken is delivered in. If you’re a fan of Chip & Dan Heath's SUCCES formula for evaluating marketing, there aren’t many promises you’ll see that are more concrete than this one.

But because service encounters are about more than the tangible goods associated with them, and successful service marketing finds a way to express the intangibles of the offering. Featuring the people who make and fulfill the service promise in marketing is a usually a strong execution of the message and the brand.

In this case, Domino’s personalizes the promise by literally giving it a name. I don’t know if Tate Dillow is really the man behind Domino’s chicken, but putting him in front personalizes it as one person making a promise to customers. There’s a good chance customers will feel sympathy when Tate’s boss asks customers to rate the job he’s doing with the new chicken by putting a survey on the box.

As a service ad, “Rate Our Chicken” works because it is a simple quality promise well executed by making it easy to evaluate and including the people responsible for performing it in the service encounter.

Does a company's executive pay impact the service experience?

Executive pay has been in and out of the headlines for some time now, but is there a consumer impact for companies involved?

Attention and public outcry peaked when executives of some of the financial industry companies bailed out by the U.S. government were treated to pay increases and large bonuses, even as millions were being put out of work throughout the rest of the US economy.

That outrage sparked change in the form of legislation, granting shareholders a larger hand in determining CEO pay through an up-or-down vote. While many are adopting the new standards (and many still have not) it is still being debated whether the shareholder say in CEO pay will have the desired effect.

These measures are interesting from a shareholder’s rights & corporate governance perspective, but I’m interested in executive pay from another angle.

As a consumer of service experiences, does CEO pay factor into your decisions to support or not support a business?

If you knew that CEO A received total cash compensation of 6.5M, while CEO B was paid one dollar, would it affect your brand choice if the service experience was the same?

If the company with the high CEO pay was a worse service provider than the one with low pay, does that increase your level of frustration with the brand / make you less likely to tolerate failure?

Theoretically, it shouldn’t.

The pay of a company’s CEO is not an experiential aspect of a company’s offering.

But does it enter into an evaluation of value when our sense is that an organization with a sub-par experience takes for itself through rich pay before it gives to customers through a rich experience?

Open question. I'm interested in whether this topic impacts our behavior as consumers.

The service quality air travelers refuse.

When traveling, accompanying business associates tolerate my travel habits as much as I tolerate theirs.

See, most of my travelling companions are prototypical business pros when it comes to travel. You know the ones. You see them moving through the terminal like a mule train, with oversized laptop cases perched atop oversized carry-ons.

When I pick up my checked bags on arrival, they always grouse about the delay in getting to the rental car shuttle quickly. It’s about that time that I remind them that it was they, along with 50 similarly-intentioned travelers, who, in trying to fit a steamer trunk into the overhead bins, backed up the loading of the plane while they tetrissed their luggage into position, warped bin doors closed or had to have them gate-checked, inevitably making the plane late for departure.

Checking luggage is my own social contract. We can all take off & land on time much more frequently if we let airlines do a better job separating the loading of luggage from the loading of people.

Don’t believe me?

Check out this video from IBM about the baggage operation at schiphol airport in Amsterdam. 140,000 bags per day. 21km of conveyors. In-transit tracking. 50 million bags / year, expected to increase 40%. Runs like a Swiss clock.




Engineered service systems like this are making service processes more efficient while they are improving the likelihood of positive outcomes. Yes, this is an extreme example, but it has been years since I’ve had a bag misplaced or delayed. My track record for on-time flights is nowhere near as stellar.

You may not change your behavior (airlines imposing baggage fees are doing their best to make sure their operations continue to run as inefficiently as ever) but the next time you see a business traveler fight their carry-on for 3 minutes, only to give up and gate check, walking back up the plane aisle past 30 passengers waiting to board and unable to proceed to their seats, perhaps you’ll think about miles of conveyors and systems designed for the movement and loading of bags onto planes.

How much work would you ask your customers to do?

On a recent trip to see a good friend, he and I went to dinner at a steakhouse he was excited to show me. The source of his excitement was their unique take on meal preparation. He described a flat stone heated hot enough to cook on and brought, with my steak, to me for tableside grilling. The twist: I get to do the grilling myself, preparing my steak to my own desired doneness.

This didn’t seem like a terrific idea to me as a customer. I go to restaurants to have professionals – better cooks than I – prepare my food for me. That I was going to play a significant role in my own service experience while I knew there was someone more qualified and paid to do it standing through a set of double doors didn’t excite me.

Still, I’m always up for a new experience, and I trust my friend completely. (military basic training followed by 4 years of college together tend to do that) So, I mustered up some excitement to accompany the anxiety that came with the prospect of cooking my own tableside meal.

An immediate benefit of this format was that I got to see the main ingredient raw. You can’t hide bad product when the inputs are raw, and this steak was spectacular. I grew a little more excited.

As I started searing my steak, I began to see the participation benefit. Rather than a distracting hassle, the experience let my friend and I share an experience along with each others’ company.
The quality of the product, the way every other detail was taken care of and the result created accomplishment satisfaction that surpassed what consumption satisfaction would have provided.

Customer role is often overlooked in development of the service encounter. Most businesses fail to realize the potential of the service-producing capacity that also pays the bill, and how in some cases, getting a customer to do more work may actually increase their satisfaction with the encounter.

As you way how to include the customer in producing your performance, be strategic, but don’t overlook opportunities to push the boundaries of how you can apply their service capacity. Like a restaurant owner that says, “I know! Let’s get customers to cook their own meals!”

More service than is reasonable.

Give more service than our customers think is reasonable.

If you take one message away from Chris Zane’s new book “Reinventing the Wheel”, that’s it.

Service is fundamentally about making and delivering on promises. That means different things to different businesses. For Zane’s Cycles, that means the biggest, most audacious promises they are willing to make without scaring themselves. (And sometimes even when they do.) It also means delivering on those promises with exceptional reliability, continuously executing on fundamentals, finding defects and driving them out of the business. The promises that Zane’s makes are the kind that stretch well beyond customers’ own expectations. Its good theater and good business. The extent to which they’re willing to go amazes, but their ability to deliver on them wins them loyal customers while keeping the actual outlay on amazing promises to a minimum.

Zane’s pushes the envelope in providing service that others can’t or won’t deliver by using Customer Lifetime Value as their compass. As a service business, they make decisions based on the relationship - like we all say we should, rather than on the next transaction - like most of us do. One of the most refreshing aspects of the book is that they have chosen a service philosophy as a stern guide, but use trial and error more than a Fortune 500 would in finding ways to follow it. They don’t always get it right, but when it does, the results are spectacular levels of differentiation from their competitors.

There are other ways to run a successful service business - delight isn’t a strategy that anyone can or should follow. In fact, Zane’s Cycles relies on the fact that competitors that try to follow their service lead often hurt themselves financially trying to live up to a service level their people and processes aren’t prepared to support. Zane’s story demonstrates only how they did it and how they intend to continue into the future.

But while Zane’s success may not be a blueprint for everyone, the lesson that everyone can take from their story is that to develop true service business – customer relationships make service decisions based on the lifetime value rather than the profit involved in the next transaction. That logic applied consistently will make it feel to your customers (and competitors) like you provide more service than is reasonable.

What is Service?

As the service community active in social media rushes to define terminology that supports still emerging business models, (where SCRM begins and ends, how to make CX & CEM meaningful for everyone, and “now that we’ve got one, what the heck is a Chief Customer Officer supposed to do?”) I’m spending some time on a simpler question.

It’s not new, but one I see peers, academics, industry experts, even the Twitter #custserv group struggle with from time-to-time. The confusion is partially born out of our deep bank of experiences as consumers, which gives definitions for "service" a Potter Stewart, I-know-it-when-I-see-it kind of fuzziness.

Adding to the problem is that service has three accurate and potentially concurrently applicable meanings. We use any and all of them, based on our own experience and perspectives from within the organizations we work.

It can be a business model that relies on a performance or process to satisfy customers. In this sense, service can be the rough equivalent to a “product line” of intangible goods, or even an revenue model for an entire company.

It can be the process or performance act itself – either the entire operation that delivers an experience to customers, or a part of it.

It can be the support provided to customers that interact with a company’s products or services – what we tend to consider when we’re talking about “customer service”.

The distinctions between them are important, but only to an en extent.

Whether you’re speaking about an enterprise or a customer encounter, whether you use it for internal or external audiences, the core idea is simple, and it is the same: Service is the process of making and fulfilling promises to customers.

You can put the act of making and fulfilling a promise into each one of the definitions of “service” that are typically used, and they not only work, but are made even more distinct from each other.

I’ve said here that service is important because every business is a service business. What I mean is that every organization is in business to make and fulfill promises.

If you want to get better at service, one way is to take a long look at how your organization deals with promises. How you make them to customers, how you make it possible for them to be fulfilled, and ultimately how - or how well - you keep them.

A performance diner misses a note.

Traveling through Ontario last week, I unexpectedly came across a new restaurant location of a burger joint that served as a hangout in college. While it wasn't the original location from my youth, my wife (who frequented the same place in her collegiate days) and I stoppped in for some nostalgia.

The original was a great old diner with a vintage feel. Great food. The experience was made more unique by their tendency to sing out the orders in unison as they were taken from the customer. It wasn’t a necessary component of the experience, but it was a unique touch and a differentiator for those who appreciated the kitsch of the physical environment.

Fast forward ten years, and my college hangout has been somewhat successful. They’ve expanded goegraphically, including the location we patronized.

The experience is designed to be the same, but in a small single location remote from the original business, it didn’t come off as consistent with the original. The retro restaurant layout was similar, and the food was still exceptional. But the performance component of the experience that involved singing was half-hearted at best, and sometimes abandoned entirely. My guess is that remote location employees, who had never seen the experience effect of the original but been coached to execute it, failed to see what that aspect of the experience added.

Consistency of the experience is tough to maintain as a business grows and control over how the service is executed gets more & more remote.

As the business grows, revisit the service experience from time to time to see what components still fit with the overall service vision, which don’t and which, while they may fit, have become too difficult to execute.

If this business had done so, rather than just stamping out copies of the original model and expecting them to work in alternate locations with different management and employees, it would have noted that the singing component of the experience wasn’t core, that it was increasingly difficult to execute consistently as the business grows.

Its true that every service encounter is a performance. But if your performance contains elements that are tough to execute and are not critical to the experience, consider editing the routine to place more emphasis on elements that will create an impact.

Changing customer behavior? Choose carrot or stick carefully.

I got an email from my insurance agent, informing me that I hadn’t signed up for electronic delivery of my bill. It turned out that I was still receiving paper bills and, sensibly, they wanted me to shift to paperless transactions.

But they didn’t just rely on an appeal to my sense of morality to get me to make the transition.

To motivate me to change my behavior, they told me that if I weren’t to change my billing to the paperless option, I would lose my 10% ebilling discount (that frankly, I was unaware I had.)

There are a lot of ways to get customers to change their behavior. In many cases, change is as easy as letting customers know what behavior you expect of them. In others, the only way to effect the change in customer behavior is align the customers benefit with it. Some companies gently make it worth the customer’s effort to change. Southwest Airlines is a master at this, for example, getting customers to the gate early through their unique boarding process and keeping them close by with comfortable chairs and electrical outlets.

Another way to align customer interests with the desired behavior is to punish the alternative.

In this case, my insurance company suggested that a benefit I already receive would be lost if I failed to act the way they wanted.

Whether the discount was real or not is almost immaterial. I was going to have to pay an additional 10% if I didn’t make the small change in behavior they were asking for - enough for me to go online and make the shift.

Both methods of changing customer behavior can be effective. Of course, Southwest’s behavior changes are subtle enough that most don’t even perceive them until they’re ingrained, and their efforts often win them fans along the way. My insurance company on the other hand? Well, the threat was definitely perceived. And while it didn’t upset me any (it might others) it certainly won’t endear them to me either.