(I’m taking a break from blogging and will return after August 2. In the meantime, enjoy this column from 2005.)
Even companies offering great customer service receive complaints. You know you are going to receive them. I believe that all companies, large and small, should have a customer complaint process (also called a “response” policy, customer complaint resolution policy or something similar)
There are at least five reasons why you should have one in place.First, activating a process to handle customer complaints goes a long way to resolving the complaint quickly and increases the likelihood of keeping the customer. (Remember, it costs three to five times more to acquire customers than to keep them.)
Second, quick resolution reduces the risk of the customer going out of his or her way to tell others about a negative experience. In fact, you have the opportunity to wow the customer by exceeding his/her needs and turning them into an advocate for you.
Third, having a staff versed in knowing what to do reduces the risk of the complaint being sidetracked and the customer´s ire increasing. More importantly, an effective complaint resolution process reduces the amount of time your staff spend handling the complain allowing them to spend more time on their primary responsibilities.
Fourth, when your employees know how to handle and resolve a complaint it raises their confidence and reduces their stress levels. That positively impacts their productivity.
Fifth, if you build a feedback mechanism into your customer complaint process you may be able to more quickly identify a defective product or unprofessional employee that´s causing you to lose business. One of your vendors may have sent you a shipment with defective parts. Let´s say your business has sales representatives spread out over many territories. If three fourths of them each receive one complaint on the latest shipment from one of your vendors, they may think the problem is isolated. But if you receive reports from them you are able to spot a trend. Time to get on the phone to your vendor before you have a major crisis on hand that could lose you valuable customers and snowball into a public relations nightmare.
I believe there another aspect to a customer complaint process. In order to react quickly, you must empower your employees to resolve the complaints at their level. Regardless of how the complaint was resolved, they should also report upward to you so that you can spot any developing trends.
To encourage empowerment, you should reward employees for handling these complaints. “I can´t afford to pay them money,” you say. How much does it cost you when you lose a customer? Isn´t that many times more than a reasonable bonus? At the least you can thank them in front of the other employees (or through newsletters, e-mails, etc.) and use the incident as a teachable moment.
When you are wrong, admit it quickly and emphatically. –Dale Carnegie