chapter 11

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Chapter 11Regaining Customer Confidence Through

Customer Service and Service Recovery


Objectives

1. To provide an overview of customer service

2. To access customer service as a strategic function

3. To explore how to develop a customer service culture

4. To discuss why organizations should plan for service recovery

5. To present the steps to service recovery

6. To explore the hidden benefits of service recovery


Outline

I. Introduction

II. Customer Service

III. Customer Service as a Strategic Function

IV. Developing a Customer Service Culture

V. The Need for Service Recovery

VI. Steps to Service Recovery

VII. Hidden Benefits of Service Recovery

VIII. Summary and Conclusion


Customer Service

• Customer service refers to all customer-provider interactions other than proactive selling and the core product delivery offering that facilitate the organization’s relationship with its customers.


Customer Service asa Strategic Function

• Customer Service as an Information Resource

• Customer Service as an Input for Service Design Improvements

• Customer Service as an Opportunity to Enhance Customer Relationships


Developing a CustomerService Culture

• When the customer service function is elevated to a strategic level, the service organization signals its importance to all employees. – As a former CEO of American Express

(http://www.americanexpress.com) noted, "A dissatisfied customer is an opportunity.”


Developing a CustomerService Culture (cont’d)

• Service organizations and manufacturing organizations are realizing that customer service is a major corporate asset.

• One significant function of customer service is to enable the organization to recover from failures that caused customer dissatisfaction and complaints.


Developing a CustomerService Culture (cont’d)


The Need for Service Recovery

• Service recovery is the effort an organization expends to win back customer goodwill once it has been lost due to service failure.


The Need forService Recovery (cont’d)

• The High Cost of Lost Customers– Losing customers is expensive

• When Is Service Recovery Needed? – Each point at which the customers encounter the

service organization may influence their perception of the service’s excellence (the moment of truth)

• Other Means of Identifying Recovery Needs – Many ways to discern when service recovery efforts

may be needed


The Need forService Recovery (cont’d)

• A moment of truth is any contact point with a service organization that the customer uses to evaluate the service delivery.


Steps to Service Recovery

A. Apology

B. Urgent Reinstatement

C. Empathy

D. Symbolic Atonement

E. Follow-Up


Hidden Benefits ofService Recovery

• There are several ways systematic service recovery programs benefit an organization:– The process can help improve the overall quality of

service delivery as the service occurs

– Keeping track of the sources of dissatisfaction that create a need for recovery can help the organization

– Service recovery can reduce the incidence of bungled moments of truth if information regarding customers’ dissatisfaction is put to good use


Web Sites

• Stew Leonard’s (http://www.stew-leonards.com), p. 161

• Angie’s List(http://www.angieslist.com), p. 161

• Aer Arann(http://www.aerarann.com), p. 163

• Sprint (http://www.sprint.com), p. 163

• American Express(http://www.americanexpress.com), p. 163


Web Sites (cont’d)• Sewell Village Cadillac

(http://www.sewell.com), p. 166

• The Consumerist(http://www.consumerist.com), p. 167

• Consumer Reports(http://www.consumerreports.com), p. 167

• Consumers Union(http://www.consumersunion.com), p. 167

• Holiday Inn

(http://www.ichotelsgroup.com), p. 168

• Scandinavian Airlines (SAS)(http://www.scandinavian.net), p. 168

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