the art of service recovery

The Profitable Art of Service Recovery The Profitable Art of Service Recovery

Article presentation Article presentation

Christopher W.L. Hart : Cambridge Massachusetts

James L. Heskett : HBS

And W. Earl Sasser Jr.: HBS

Published by Harvard Business Review July-August 1990

Christopher W.L. Hart : Cambridge Massachusetts

James L. Heskett : HBS

And W. Earl Sasser Jr.: HBS

Published by Harvard Business Review July-August 1990

Summary Summary

Introduction : Concepts & Findings

Measure the costs

Break the silence

Anticipate the need for recovery

Act Fast

Train employees & Empower FLE

Close the loop & Conclusion

Introduction : Concepts & Findings

Measure the costs

Break the silence

Anticipate the need for recovery

Act Fast

Train employees & Empower FLE

Close the loop & Conclusion

Introduction : Concepts & Findings

Introduction : Concepts & Findings

Zero Defects doesn’t exist in Service Business

All of us have experienced service defect

But still the topic is ‘’tabou’’

Front Line Employees are unprepared

Companies have made idiot-proof systems. But idiots can’t solve problems.

Zero Defects doesn’t exist in Service Business

All of us have experienced service defect

But still the topic is ‘’tabou’’

Front Line Employees are unprepared

Companies have made idiot-proof systems. But idiots can’t solve problems.

Measure the Costs Measure the Costs

Managers are trained to get new customers not to keep them

Managers underestimates the profits of a departing/unhappy customer

The costs to keep a customer (A)

The costs to replace a customer (B)

The truth is that A is (always) less than B

Managers are trained to get new customers not to keep them

Managers underestimates the profits of a departing/unhappy customer

The costs to keep a customer (A)

The costs to replace a customer (B)

The truth is that A is (always) less than B

Break the SilenceBreak the Silence

Every customer complaint is an opportunity

Listen to customers complaints

Make it easy for customers to complain : Hot lines, toll free, boxes etc.

…but do it right.

Every customer complaint is an opportunity

Listen to customers complaints

Make it easy for customers to complain : Hot lines, toll free, boxes etc.

…but do it right.

Anticipate needs for recovery

Anticipate needs for recovery

Know where errors are in the company

Know the product life cycle : When errors occur

Identify the FLE in contact with customers

File and do some statistics on complaints

Know where errors are in the company

Know the product life cycle : When errors occur

Identify the FLE in contact with customers

File and do some statistics on complaints

Act fast Act fast

Research : 11 people (Bad) Versus 6 people (good)

Learn the lesson

Fix the problem

Talk to the customer

For example :

Research : 11 people (Bad) Versus 6 people (good)

Learn the lesson

Fix the problem

Talk to the customer

For example :

Train employees & Empower FLE

Train employees & Empower FLE

Do me another favor : Train FLE

Empowerment & Responsibility

Authority & Incentives

How is Training being carried out ? (Real life and Role play)

Do me another favor : Train FLE

Empowerment & Responsibility

Authority & Incentives

How is Training being carried out ? (Real life and Role play)

Close the loop & Conclusion Close the loop & Conclusion

Close the loop

Go to the end of the complaint

Conclusion : make it a culture

Close the loop

Go to the end of the complaint

Conclusion : make it a culture

Q&AQ&A