Customer Complaints as a Source of Business Insight

futurelab default header

by: John Caddell

We’re taking a brief detour from the corporate change series to discuss customer complaints (every businessperson’s favorite subject) though in truth it is very much in sync with the "letting the outside in" philosophy we’ve been discussing in those other posts.

The Wall Street Journal’s occasional Business Insight section prompted the thoughts with today’s article, "Making the Most Of Customer Complaints," by Stefan Michel and David Bowen of the Thunderbird School of Global Management and Robert Johnston of Warwick Business School.

"Making the Most…" focuses on the relationship between the customer, the front-line rep, and service management, and correctly describes how to manage a complaint to minimize damage to customer satisfaction without "giving away the store," and to incent behaviors that will result in customers leaving the interactions feeling good (or at least not badly) about their vendor. It’s particularly insightful when describing the conflicts the front-line reps feel when trying to deal with a difficult customer situation:

These workers have the difficult task of dealing with customers who hold them responsible even when the failures in question are completely out of their control. The attitudes of customer-service workers, positive and negative, spill over onto customers.

Yet companies do surprisingly little to support them.

To be successful, these workers need to feel that management is providing the means to deliver successful service recovery on a continuing basis. Alternatively, when employees believe management doesn’t support them, they tend to feel they are being unfairly treated and so treat customers unfairly. They display passive, maladaptive behaviors and can even sabotage service.

This alienation is compounded when the workers believe that management is not improving the service-delivery process, which keeps employees in recurring failure situations. Even though complaining customers represent an opportunity to fix problems and improve satisfaction, alienated employees often see them as the enemy.

In addition to the sound advice to repair the processes, provide appropriate guidance to employees and management, and incent customer-delighting behaviors, there’s a broader value that I see to studying these interactions.

Customer complaints are a window into the customer’s use of the product and perception of the company. Virtually all satisfied customers are silent. Many dissatisfied customers are silent as well–calling customer service is time-consuming and frustrating. The fact that many problems aren’t resolved compounds people’s feeling that engaging with the company is simply not worth the trouble.

This means that any customer complaint reported to the company is a very important piece of data. Taken together, complaints can illuminate patterns pointing to product over-complexity, poor usability, underservicing, poor expectation-setting. The patterns might tell you that the customer-service approach you are so proud of is not working as well as it should. Or that customers are using a product differently from how you expected them to. The patterns serve as marching orders to product management, marketing and customer service for important value-adding projects.

But… you have to collect and sort through the data. It can’t be resigned to the bit bucket because it’s unpleasant or tells you things you’d prefer not to hear. I have started to work with clients to learn from customer-service interactions–the raw material, not just the statistics. And, not surprisingly, we are always surprised by what we learn.

Related posts:
Time to start listening to front-line employees

Original Post: