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(We’ll keep this blog here at Blogger for your reading pleasure)

Southwest and FedEx: Their Contrasting Organizational Cultures

Both companies fly airplanes.
Both are well-known (in the US at least.)
Both do their best to keep their employees happy.
But each one of them uses a different approach.
Those companies are Southwest Airlines and FedEx.
Southwest is “the extended Italian family you knew growing up.”
FedEx is “less touchy-feely,” and “employees float on a Nile of nomenclature.”
CMO Magazine published an article in their October 2005 issue comparing the contrasting organizational cultures of these two companies, and explains how they impact service to customers.
And the reason behind their ways? Here’s a quote from the article:

Make no mistake, employee-centrism at both of these organizations does not rest on altruistic motives. “FedEx and Southwest want to treat employees well, but they still want to make a profit,” says Brenda Ellington-Booth, a clinical assistant professor of management and organization at Northwestern University’s Kellogg School of Management. “And the way they make a profit is through their people.”

Great service to customers is great for business.

(we'll be moving to Servimetrica.NET soon)

High Altitude Outsourcing

It was on the front page of yesterday’s Wall Street Journal (paid subscription required) :
Northwest Targets Flight Attendants For Outsourcing: Ailing Carrier Seeks Savings By Pushing Veteran Staffers Off Prized Overseas Routes.
Flight attendants are not the only ones being considered for these changes. Here’s a copy/paste from a paragraph in the article:

Northwest also is seeking to outsource all ramp workers’ positions except at its hubs and all customer-service-agent jobs at its non-hub airports.

If this happens, maintaining morale among remaining employees will not be an easy task, which will impact the quality of the service that customers get.

Coming soon: outsourced pilots. Any bets?

Back to Basics: What's Service Quality, Anyway?

Some people say such-and-such company provides great service. Others say that the same such-and-such company really stinks.
Who’s right?
Service quality –just as beauty- is in the eye of the beholder. It is a matter of expectations and perceptions. If in a service transaction, the customer perceives he/she received better service than he/she expected, then he/she will evaluate the service favorably. The same applies the other way around for customers who get less-than-expected service.
In their book Delivering Quality Service -published back in 1990 by the Free Press- Professors A. Parasuraman, Leonard L. Berry and Valarie A. Zeithaml define service quality as

the extent of discrepancy between customers’ expectations or desires and their perceptions.

Therefore, the key to providing quality service resides in knowing what customers want and expect, and deliver accordingly.
Obviously, each customer is different; including his/her quite ambiguous and unique needs and wants. This is what makes service quality such an interesting subject.
At least for us.

(and yes... we are crossposting entries in Servimetrica.NET)

Yes, Service can be Inventoried

In their very peculiar way of course.
In an article published in the Fall 2005 issue of the MIT Sloan Management Review titled Managing Service Inventory to Improve Performance, Sunil Chopra and Martin A. Lariviere explain how “Creating “service inventory,” that is, a way to store completed work, can reduce costs and improve quality. For example, financial institutions establish predetermined rules to apply to customers based on credit scores. Hotels create systems to record guests’ preferences. In such cases, firms reduce the work required once customers enter the process.”

Bringing the Sizzle Back

After a series of unfortunate events that almost drove them out of the restaurant business, Sizzler’s is trying to make a comeback, Michael Hiltzik reports in his column in the Los Angeles Times.
One of the strategic missteps that preceded Sizzler’s bankruptcy in the 90’s was the evolution of the salad bar into an all-you-can-eat buffet, where “quantity” surpassed “quality”.
Now Sizzler’s is adapting itself to today’s market, aiming at consumers that have good memories of its restaurants of yesteryear, but offering a redesigned restaurants, menus and service.
Here’s an interesting passage that shows how consumer perceptions work:

When the company brightened the color scheme and decor of a prototype restaurant outside Sacramento, visitors remarked on the sudden improvement in the food, which actually had been upgraded the year before.

Service Quality for Taxis

Drive a taxi? How can you measure the quality of your service?
Lets see this example from Singapore:
First: Don’t get in accidents. The standard is not more than two accidents for every 10 million kilometers traveled.
Second: Answer your phone. In Singapore, cab companies are required to answer 90% of their calls, including a confirmation of availability in less than five minutes.
If these standards are not met, taxi cab companies are fined.
However no word about sticky floors and cardboard pine scents.
(From Channel NewsAsia)

A Year and a Half in Beta

Gmail –Google’s free e-mail service- was unveiled on April 1st, 2004. Since then, it has been labeled as a “Beta” release, meaning the service is still being tested. But so far, it has been under evaluation for more than 18 months!
(No… we do not need an invite. We have Gmail already. Thanks!)
Some observers have pointed out that Gmail still uses the “Beta” name to minimize the negative effect on users if something goes wrong with the service (“See? It wasn’t fit for general release yet! You should have known we were prone to a crash sooner or later because we are still in Beta testing!”)
However, we believe it still carries the Beta designator to increase the perception of newness of the service among users.
But, “newness” after 18 months?

We changed our minds...

…and we are renaming this blog CustomerServiceQuality.com back again. Hope you don't mind.

We’ll use the Servimetrica.NET domain for our new blog, which will replace this one in a few days.

In the meantime, we’ll continue posting to both blogs while we tweak the settings in the new one.

Domino effect: Great managers – great employees – great service

Looks quite difficult: how to deal with high employee turnover in quick service restaurants (a.k.a. “fast-food joints”)

This article in StartupJournal –a free website from the Wall Street Journal for entrepreneurs- shows Domino’s Pizza way: instead of paying higher wages than other chains, the company focuses on hiring and developing quality store managers.

And better store managers tend to have better employees, and better employees provide better service to customers.

You can't always get the Decaf that you want

The ABC TV show 20/20 airing tonight will feature a report about some coffee chains serving regular instead of decaffeinated coffee.

Among the culprits found pouring something stronger than decaf are Starbucks, McDonalds and Krispy Kreme. Obviously, PR departments of these companies were quick to point out that these were “isolated incidents” attributable to “human error”.

Some decaf fans –and coffee consumers in general- who watch this installment of 20/20 may feel their trust dishonored.

Other customers may wonder if the same mistakes happen with diet and regular soft drinks.

Last impression also counts

It is important to take extra care of the start of a service experience with a customer. It sets the stage for the rest of the transaction. If -from the customer’s perspective- something goes wrong at the beginning, it will require an extra effort to recover from the fumble.

But, when something goes wrong at the end of the service encounter, it is worse because there’s no time to recover, and that will leave the strongest impression in the mind of the customer.

Check this example from Jackie Huba -at the Church of the Customer Blog- when she tried to print an airline boarding pass at a Crowne Plaza Hotel just before checkout.

A Premium for Premium

Yes, there are customers willing to pay a premium for extra service… even when buying a commodity as fuel for their cars.

See this article from the Los Angeles Times: Full-Serve Lingers in Self-Serve World

New name

New name for this blog: Servimetrica.net

However, we are not dumping our original domain. You still can reach this blog at CustomerServiceQuality.com, and the name of the blog within Blogger is still customerservicequality.blogspot.com

The 2005 Customer First Awards

(I know this was released weeks ago, but we are catching up on our reading.)

Fast Company magazine has published their annual list of companies that excel in customer service in the US. This year winners of the Customer First Awards are:

• Netflix
• Panera Bread
• Talbots
• Cabela's
• W Hotels
• Intuit
• Build-A-Bear
• Craigslist
• Travelocity
• Kiehl's
• Virgin Atlantic
• Best Buy
• USAA
• Zappos
• Whole Foods Market

The interesting thing about Netflix -the overall winner per the magazine's criteria-, is that it is an "automated-web-based-self-service" business. The workers that are closest to the customers are the warehouse employees who prepare the DVD shipments.

Is impersonal service becoming more important than human interaction?

Not quite… technology and automation bring consistency and responsiveness to services processes by minimizing or eliminating human error.

Netflix got high marks because they do what their customers expect and want. And that's the basis of great service.

Forecasting Hot or Cool Trends

The Los Angeles Times chronicles the work of the trend forecasters previously known as “coolhunters”. Their research helps large corporations to develop and offer products –and services- that will take advantage of the latest trends or fads.

But thanks to (or blame?) the Internet, fads come and go as fast as you can say “Macarena”.

According to the profiled experts, these are the “Macro” trends of the moment:

• "Conscious living" — increased social activism, community service, spiritual awakening, eco style, the organic boom.
• "Hot land values" — real estate craze, Middle America, Christian-themed entertainment, redneck humor.
• "Hip parenting" — stylish, Gen-X-driven baby brands, blogs and mags, kid-friendly rock shows, members-only clubs.
• "Curation nation" — mass customization craze, e.g., podcasting, TiVo, custom Nikes, Internet-driven interests, niches.

What are the lessons for service businesses?

First, if you decide to focus your service offerings towards the “trendy”, you better continue to follow that course, or risk getting an imaginary “passé” stamp on your door next month.

Second, trends –long-lasting or short-lived- are not only tangibles such as colors and styles or flavors. Trends also include the way things are done. And they are part of the customer’s expectations. And if customers don’t get what they expect, there’s no quality in the service.

For some reason, McDonalds introduced salads and such in their menus.

Starbucks Tribal (not Trivial) Knowledge

The Brand Autopsy Blog has a great series of posts on Starbucks Tribal Knowledge.
John Moore, author of the blog, defines Starbucks Tribal Knowledge as:

Well … it’s the pithy quote uttered by a respected Starbucks executive. It’s a mantra used by Starbucks project groups to bring forth passionate followership. It’s ‘A-ha moments’ from successful (and failed) projects. It’s company campfire stories passed down from one generation of Partners to the next. It’s poignant. It’s thought-provoking. It’s actionable.

The series is an interesting insight from an insider. We highly recommend the Touchology Trumps Technology post if you are thinking about buying that whiz-bang POS system for your business.

At Your Service

After becoming an "accidental" customer of the health care service industry, the main author of this blog is back.

The website of The Times newspaper -not NY Times nor LA Times, we are talking about the one published in London- has a special section titled "At Your Service". It is a series of articles about "how offering good service can give small businesses an edge over their larger rivals". All the articles are about small companies doing business in the United Kingdom. (BTW, It includes an article about Gordon Ramsay, the cranky chef of the "Hell's Kitchen" TV show)

Easy reading, particularly if you are looking for examples of customer-centric attitudes instead of techniques or "how-to" recipes.