We Forgive You: Dos and Don'ts of Service Recovery

April 22, 2014
If a company commits a customer service faux pas and does nothing to make it up to us, most of us will never buy that product or service again. And yet too many companies are tonedeaf when it comes to hearing the voice of the customer.

Most of us are pretty forgiving. We understand that things go wrong. We also know that it is often not the service delivery person’s fault when service is bad. However, we still want you to make it right.

Some organizations are excellent at service recovery and others don’t seem to care. Their attitude seems to be that there are plenty of new customers waiting to give them money if you go away. I guess you can be that cocky if you are a NYC restaurant with a month-long waiting list or a company with great products like Apple or Tesla, but most organizations have plenty of tough competitors and need to work hard to keep each customer.

The basic principles of service recovery are not rocket science, yet large and successful companies often seem to struggle to regain our goodwill when they make a mistake. Stories about horrible and outstanding service recovery make for good conversation. Everyone has a good story or two about how bad some organization is, or how well another made up for their mistakes.

Loyalty is a fickle thing. Trying to predict loyalty of customers via surveys is probably a waste of time. We can’t even predict our own future behavior very well, so what we say on a survey may not determine what we actually do in the future. I love the service I get from Marriott hotels, for instance, but whether or not I stay at a Marriott in the next 12 months is mostly due to where my clients are. What is clear, however, is if an organization really screws up and does nothing to make it up to us, most of us will never buy that product or service again.

Don't Blame Someone Else for the Problem

It’s not the waiter’s fault if the cook forgot to put the sauce on the side; or the pilot’s fault if the flight is delayed due to weather in Chicago, or your dealer’s fault if the supplier provided poor quality parts, causing a recall on your vehicle. We get that. However, waiter, pilot and car dealer are the ones we talk to or at least listen to directly and have to deliver the bad news. Blaming someone else is not acceptable. People want the truth, but they also want to hear from the customer contact person what is going to be done to remedy the situation.

What I notice in call centers lately is that they begin each call with a scripted apology: “I’m sorry to hear that you are having problems with your computer, Mr. Brown. Just let me get some information from you before we begin.” Scripted generic apologies like this don’t really help and just raise my blood pressure even more. After the 10th or 12th call to Dell over a few weeks, hearing the same scripted apology each time made me madder each time I heard it. At that point, I was way beyond an apology; I wanted to speak to someone who could solve my problem.

Do Apologize and Accept Responsibility

The first step in a service recovery process is to accept responsibility and apologize. I noticed that Mary Barra, the new CEO of General Motors, appeared on the morning news shows as soon as the news came out that some GM cars were being recalled. She was sincere and promised to look into the cause and correct the problem for all owners. Yes, her remarks were undoubtedly scripted by the PR department, and she was reading them, but I give her credit for being proactive in that situation. If nothing else, it helped win her some sympathy from the public, which was much needed as the recall situation grew much larger than originally thought.

I don’t think Toyota handled their recall situation a few years ago as well. They spent months doing research to try to prove that they were not at fault. Even if you think that you are not at fault, accept responsibility and apologize now, and research the situation later.

Don't Transfer People to Someone else or Pass the Buck

Don’t expect the customer to understand your organizational structure. If you give me a customer service phone number, I assume that is the right place to call with a problem. I don’t care that you have different departments and call centers that handle warranty technical support versus hardware issues. The worst situation is where you have to key in your customer number, account number, social security number, password, and then have to give that same information to the CSR who finally comes on the line, only to then find out that you have to call a different phone number and wait on hold to provide all of this information again. “It’s not my job, man” happens in person as well as on the phone.

Blaming bosses or other employees is a common and effective way for a lot of customer contact employees to get out of the responsibility of dealing with a customer problem. I heard a new one a few weeks ago from United Airlines. I was buckled into my middle seat along with a hundred or so others awaiting take-off from LAX to Dulles. The door was shut, cell phones were turned off, and we were ready to go. After about 10 minutes the pilot came back on the PA and announced that we all had to de-plane because United did not make a payment on the aircraft and Wells Fargo, the lease holder, would not let them fly the plane. We were all shocked that the pilot would admit this, and no one had ever heard this excuse before. Three hours later we boarded a new plane that apparently was paid for.

Do Make it Your Problem if You Hear About it

The Ritz-Carlton Hotel Company has won two Malcolm Baldrige Awards and is the only service company to do so twice in the 25-year history of the awards. One of the statements that defines the culture of the Ritz is: “If you hear about a problem, you own the problem until it is solved.” If you are a gardener and overhear a guest talking about how the air conditioning in her room was rattling and making noise all night, you are trained to tell the guest that you will contact Engineering, make sure the issue is addressed and follow-up with the guest later in the day to make sure the problem has been corrected. If you are a waiter in the restaurant, and hear about a problem with room service the previous day, you make it your responsibility to follow-up with room service, make sure the problem is remedied, and let the guest know what the follow-up action is.

For such a system to work, rules like the ones the Ritz-Carlton has need to be communicated many times, and employee problem-solving behavior needs to be rewarded by managers. Employees also need to know enough about other departments and functions so they know who to contact if a problem is outside of their area.

Don't Require that Managers Have to Approve Service Recovery Actions

You know the drill. Employees cannot do anything about a problem other than to alert their manager, who is probably busy doing something else, who may or may not come back to solve your problem. Organizations that operate this way seem to be in the majority. Employees are not trusted to do anything beyond their narrow job responsibilities, and all important decisions are made by management.

In a command-and-control culture like this, bosses have all the power and authority and must approve any action to solve a customer issue or problem. Wrong order in a restaurant, the manager has to come over for a chat; car not fixed right the first time, service manager needs to approve the fix; CSR from tech support unable to fix your e-mail problem, “hold for the supervisor, please.”

Do Empower Frontline Employees to Solve Customer Problems

The reason Ritz-Carlton is so good at service recovery is that employees are empowered to use their judgment and to take action to solve a customer problem or recover from a bad experience. In order for this to work, employees need to be trained to make good decisions. I remember hearing a story about a Ritz-Carlton doorman that supposedly flew a guest to their airport in a helicopter when he saw that he was going to miss his flight. Probably not the best decision, and this undoubtedly resulted in lots of decision-making training for Ritz doormen.

Empowerment does not mean there are no rules, but it does it mean that there are guidelines and limits on employee authority. If those limits allow the employee to solve the customer’s problems, great, but often this is not the case. My Dell technician on the phone was empowered to order new parts for my computer, but could not send me a new computer when the third new hard drive and mother board installed did not work. The last thing a mad customer wants is to have to wait around and explain their situation to some other person who may or may not have the authority to solve the problem.

Don't Offer a Cheap Gift to Pacify an Angry Customer

Expecting good service at a restaurant on New Year’s Eve or Valentine’s Day is a lot to ask, but restaurants usually have a fixed price menu with only a few choices. Our waiter this Valentine ’s Day was clearly in a rush to get out all seven courses for the gourmet meal we reserved months in advance. Each course was hurriedly dropped off with no explanation of what we had received, and when the entrée came, the waiter took our forks from the previous course, and disappeared for about 20 minutes. We signaled a busboy, but he ignored us as well. When we finally got the new forks, the food was cold so we just told the waiter to wrap it up. The manager came over to apologize and said he was going to deduct 15% from our $250 bill because of the lousy service. Wow! 15% off for dropping a couple of hundred dollars on a meal with really bad service. Don’t think we will go back there any time soon.

Remember the earlier story about my delayed flight because United did not make the lease payment on the plane? At the end of the five-hour flight, we received one of those standard generic apology cards with a code and website to go to. I had received these before and in the past it meant you’d get 25,000 miles added to your Mileage Plus account, which would be enough for a free ticket or at least an upgrade. Not anymore. The apology I received was worth 3,500 miles. I was blown away by United’s “generosity.” Frequent flier miles are worth about a penny a piece. This means that United gave those of us who received the apology cards (not everyone on the plane got them, though all were inconvenienced) a gift worth $35 for three hours of our time. As a customer, this was like a slap in the face, just like the offer of 15% off of my restaurant bill.

An apology gift needs to be tailored to the seriousness of the infraction and needs to be perceived by the customer as fair. The apology offer also needs to be consistent with expectations. In the past, I had received 25,000 miles because the sound did not work on my headphone jack, or the tray table was broken. Minor inconveniences, and a nice apology. A three-hour delay that could have been avoided and a $35 apology does not add up. I have flown over 2 million miles on United so I wrote to them about this situation and was told that the 3,500 miles was more than fair in their eyes. Losing a loyal customer that has generated hundreds of thousands of dollars in revenue over a dumb mistake like this makes you wonder who is running some of these companies.

Do Match the Apology Gesture/Gift to the Seriousness of the Situation

Whatever you offer to an angry customer to make them happy after a bad experience needs to be tailored to the situation. My wife and I went to lunch in Beverly Hills recently at a casual outdoor restaurant. The staff all seemed to be having a meeting so we sat and sat in the hot sun waiting for an umbrella and menus. We eventually moved to another table with an umbrella and got our own menus. The manager immediately came over, apologized and said have a round of drinks on me, and sorry for the long wait. Great move and the free drinks were appreciated.

When my wife and I had a number of instances of bad service (like checking into an upgraded ocean-view room and later being told we had to move to a room with no view and no fruit basket) at the Ritz-Carlton in Dana Point where we go every year for Thanksgiving, I documented everything in a letter and sent it to the GM—no response. I was there a few months later for a meeting and mentioned the situation to the bartender. He took down my contact information, and said he would arrange a nice lunch for our next visit. Several months later, no reply from the Ritz. After about nine months had gone by, I noticed the original letter in my documents file and decided to forward it to Ritz corporate headquarters in Atlanta, with a copy of my book on the Baldrige Award that the Ritz has won twice.

Finally I got a response and it was a good one. I got a really nice apology letter from the VP of customer service, an offer of a free night in an ocean-view suite, and free dinner any time I wanted to come back. When we did go back we were greeted by name by the valet (how did they know who I was?), the front desk manager came out to the car and introduced herself, got us checked in, and personally took us to our beautiful suite, and made sure our dinner reservations were confirmed. Throughout our stay, all the staff seemed to know our names—it was great! The Ritz certainly redeemed themselves in our eyes and their gesture is much appreciated and will go a long way to keeping me as a loyal customer.

Don't Wait for a Customer to Complain or Fill Out Your Survey

The trigger for kicking in the service recovery process in most organizations is a formal complaint (usually in writing) or a negative rating on a survey. Anyone who is mad enough to write a complaint letter or fill out your survey clearly has a problem with your service or product. However, the vast majority of customers do not write complaint letters or fill out surveys. They may go on Facebook or Twitter and complain, or tell their friends, and they probably just won’t go back. If your service recovery process is only triggered by a formal complaint, you are missing the vast majority of opportunities to make angry customers happy again.

I read about how new software can detect the level of aggravation of a customer from listening to their voice. Smart call centers are using this data to detect unhappiness before an issue escalates to an actual complaint or grievance. New facial recognition software can also be used to detect frustration and anger in customer’s faces. Frontline staff needs to be trained in behavioral observation to detect situations where service recovery needs to go into action. Having to stand for 20 minutes in a crowded doctor’s office because there are no chairs is frustrating but probably not something most people will complain about. Getting overcharged at the grocery store aggravates all of us, and checkout clerks need to do more than apologize when it happens.

Do Train Frontline Staff to Address Minor Customer Problems before They Escalate

As much as I love the Ritz and respect them for their exceptional service, the problems I had should have been handled locally, but a number of staff members dropped the ball. The problems could have been resolved at the hotel when I experienced them and for a lot less money than the several thousand on the free stay and dinner. In order to avoid escalation of issues like this, staff needs to be trained (not just managers) to identify situations where customers may be frustrated or experiencing problems. Training is not going to make up for a lack of basic traits either, so you first have to make sure you are hiring people with the right abilities and traits like compassion, and attention to detail.

Employees also need to be empowered to do something about the situation immediately. Recognizing a situation is an important first step, but staff needs to have tools at their disposal for handling it. When I checked into the Hyatt in NYC, there was a long line at check-in and when it was eventually my turn to check in the clerk apologized for the line and gave me coupons good for free breakfast the next morning.

Designing the Service Recovery Process

When designing the service recovery process it is important to understand that you can’t predict everything and have a remediation strategy laid out for all events and circumstances. However, what you can do is to create a matrix chart that lists typical problems on the left and appropriate remedial actions on the right. Decision-making charts like this are a good way to help employees make good decisions and avoid situations like the doorman getting a helicopter to take the guest to the airport because the hotel car was not available.

Some amount of scripting may be appropriate for a service recovery process, but this can backfire because it is often seen as insincere. The CSRs at Dell who all recite the same apology word-for-word does not do a lot to appease an angry customer. Better to teach employees a variety of ways to apologize that are appropriate and some basic rules like using the customer’s name and mentioning the specific problem that occurred.

The keys to a successful service recovery program are to:

  • Recognize service failures and take immediate action—don’t wait for surveys or complaints.
  • Accept responsibility and sincerely apologize.
  • Offer something that the customer perceives as fair compensation for the inconvenience.
  • Empower employees to take action—don’t make managers make all the decisions.
  • Follow up to make sure the customer is satisfied.

The good news for organizations is that most of us will put up with mistakes and remain loyal. Switching airlines, banks, restaurants, or hotels is an effort and who’s to say the new choice will be any better than the old choice? Smart organizations view every opportunity where bad service occurs as a chance to further enhance a relationship with customers, or to destroy it.

When an organization admits they are wrong and made a mistake and offers a nice token of appreciation for the inconvenience, this actually increases feelings of goodwill and enhances the loyalty level of the customer. All organizations make mistakes and have problems—it is how you handle them that separates the good from the great.

Mark Graham Brown has 30 years of experience consulting with organizations all over the world on measuring and managing performance. He is the author of many books, including his most recent, Killer Analytics: Top 20 Metrics Missing From Your Balance Sheet (Wiley/SAS 2013). Mark has his own consulting practice in Manhattan Beach, California. He is currently working on a new book with Ken Dean and Dr. Adam Pollard called “Reverb” about how to link voice of the customer research with products, processes and people.

About the Author

Mark Graham Brown | Principal

Mark Graham Brown has 30 years of experience consulting with organizations all over the world on measuring and managing performance. He is the author of many books, including his most recent, Killer Analytics: Top 20 Metrics Missing From Your Balance Sheet (Wiley/SAS 2013). Mark has his own consulting practice in Manhattan Beach, California. He is currently working on a new book with Ken Dean and Dr. Adam Pollard called “Reverb” about how to link voice of the customer research with products, processes and people.

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