Service Recovery – Best Practice

KARA Blog

Build a Culture of Service Recovery

Now the fourth largest beer manufacturer in the world, Carlsberg is a Danish institution known for their humorous TV advertisements. A few years ago, one ad showed an employee walking a quiet corridor in Head Office. Hearing and old style telephone ringing relentlessly in the distance, he established the sound coming from behind an old door with a sign that read: Complaints Dept.

Scraping back the dust, he answered the telephone. It turned out to be a wrong number. The inference here is that Carlsberg never receive complaints.

For the rest of us, that concept is highly unlikely. With the best will in the world, even with great products and people – everyone gets complaints at some time or other. Sometimes we cause them and other times it may be someone else’s fault. Regardless, generic research shows us that typically only 4% of customers that had a bad experience actually complain. Of the other 96% that don’t complain, 91% of them defect. They take their future business elsewhere. If these generic numbers apply to you, then that equates to a possible 17½% annual defection rate!

There is no room for complacency in handling and managing complaints. Customers will defect when they have an issue unresolved – which in turn has serious implications for retention and future sales. An effective Complaints Management Programme is essential for all organisations regardless of size.

How often have you personally experienced complaints handled badly? Sadly it seems more the norm these days. I had an experience this week, where I was overcharged by a large furniture store. Trying to get a refund turned out to be a major inconvenience. It took 10 days to resolve – and when they quoted their process to me, I was ready to take a plane to their head office!

Challenges with Complaints

When complaints are handled badly they often end up costing you hard cash in compensation. However, when you act professionally early on, you win with a relieved customer and possibly no financial loss.

The challenge for your organisation therefore is two-fold. Prevent them as much as possible in the first place… but also handle them effectively when they do arise.

EPCAF – a Model for Service Recovery

For a start, change your vernacular. Stop the negative ‘complaints’ word and switch to positive ‘Service Recovery’ instead. It will help to alter the mindset internally and the attitude of your own people.

Everyone in your organisation should be trained on how to recognise a service issue and handle it skillfully. I have been encouraging my clients for years to embrace EPCAF as an effective model. It will work in almost every situation and can be learned by all who interact with customers.

E – Empathise
We as service providers should stop and think about the impact of our failures on our customers. I appreciate that not all issues are caused by you. The customer too can get it wrong and blame you unfairly. But you still need to handle it effectively though.

If you are defensive, argumentative, blaming or pass the buck, you will inflate the situation. Use empathy instead. When you empathise you effectively show great understanding and put yourself in the customer’s shoes.
The customer is usually irate that they have had an issue in the first place and this approach genuinely helps to calm them down. Phrases such as ‘I’m sorry that you’ve had a bad experience’ is not an admission of fault but will help to placate the situation.

P – Probe
The customer will have told you their story in their own words and in their own way. It may have been peppered with jargon, with profanities or with limited or useless information which is not always helpful to you. In order to understand the real issue, the implications and indeed the causes of the problem, you will need to establish the full facts.

Gently ask appropriate questions to get the relevant detail. Open ended questions will help you to get information in a nice softer way than closed-ended questions. By asking questions you will take control the situation.

C – Clarify your Understanding of the Situation
Having heard the customer’s story, summarise your full understanding of the situation. This has the effect of showing the customer that you’ve listened and that you care. It also gives you the opportunity to check if you’ve missed an important piece of information.
It acts as a bridge and sends a gentle message to the customer that you know the full story and that you are now about to move on to finding a solution.

A – Agree an Action
It is now time to agree a solution. Agreeing a solution is usually the better tactic here than telling the customer what you will do. By telling you might risk disagreement which you may have to back down from again. And do not quote company policy! That’s like a red rag to a bull.
Usually customers will be reasonable at this point, particularly if they feel you have listened, empathised and truly apologised for their inconvenience. Ask ‘what would you like us to do for you?’

F – Follow-up
Having secured agreement on an appropriate solution and course of action, be sure to follow through on your promises. The cynical customer is of course expecting you to forget and mess up again. Prove them wrong and show that you truly have taken their service issue seriously.

Summary

When you look on service issues in a positive way with skill and a positive attitude, the results will be much improved. There is evidence too that when customers have had their service issue handled well – they actually become stronger advocates for you in the future.

Take Service Recovery seriously. Document all cases so you can build up data and trends for analysis. With that you can take corrective actions to reduce or eliminate them completely in the future.