Tag Archives for " Horst Shulze "

Why price does not drive quality service (or how United Airlines still hasn’t solved their mistake)

An unsolved mistake United Airlines made tarnishes their brand

How two brands solved their mistake (or not)

(and why a third brand actually solved a mistake that wasn't theirs)

Have you ever made a mistake? How about one that directly impacted one of your customers, clients or guests? We've all made mistakes, but it's how you deal with them that's the real important issue.

You'd think the more money you spend the better service (and the faster mistake resolution) you would receive. Well, turns out nothing could be farther from the truth. Let me tell you my experience with two airlines I had last month. Both are US carriers. Both made mistakes. However, that's really where the similarities end. 

If you know anything about providing good service to your customers, then you know that mistakes are one of the best opportunities to make a positive impression on your customers. Actually it's not the mistakes, but how you handle them that makes or breaks the relationship with your client. 

[Side note: Ever since I've heard Horst Schulze, the former CEO of the Ritz-Carlton, speak about service (read more on that in "What I learned about service from a wise hotelier"), I've become very interested in watching how the brands I use provide customer service and am working hard to build a customer service focused company myself.]

Mistake #1: United Airlines loose my bag for 7 days

United Airlines mistake turns into a major hassle for their customer

United Airlines mistake turns into a major hassle.

Mistake #1: I booked a business class ticket to Asia on United Airlines (@United). Price of the ticket $2,445.76. Multiply that by three for the rest of the team that is flying with me and we're spending close to $7,500.- on that flight. When we arrive in Saigon 5 out of 6 checked bags don't make it. Even though they are tagged 'Premiere Service' and are supposed to be off the aircraft before any other bags. 2 days later 4 out of the 5 missing bags make it to the hotel, but the 5th bag -one of my bags- takes a full week to get to my hotel. But it's not the mistake that makes me upset with United Airlines.

Mistake #2: Spirit doesn't issue promised travel vouchers

Mistake #2: I booked a flight for my wife and daughter to evacuate before a hurricane hits Florida on Spirit Airlines (@SpiritAirlines). Price of both ticket $318.11. Their connecting flight in Houston is overbooked, so they decide to give up their seats for a free travel voucher and a flight later that day. Houston had just been hit by a hurricane a few days earlier, and Spirit's systems are down, so all of this is being done by hand. When my wife checks a few days later, there are no travel vouchers to her name and the call center tells her that their records indicate she was on the Spirit flight, even though Spirit paid for a change to fly them on United. 

It's not the mistake that gets you

OK, like I said mistakes happen - we all make them - it's in how you solve them that makes the difference. In the interest of full disclosure, I personally have made the exact mistake that United had made, when I worked for an airline in college. I routed a bag onto the wrong flight and my boss at the time sat me down once they figured out what had happened and explained to me the inconvenience I had caused one of their customers. I never made that mistake again.

  

  

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"A key principle in fixing a problem is to resolve the customer's sense of injustice–of having been wronged or let down." write Leonardo Inghiller and Michah Solomon in their book Exceptional Service, Exceptional Profit: The secret of building a five-star customer service organization. "You can find a way yo restore the smile to almost any customer's face, wether it's a free upgrade or a more creative offering.

Let's look at how these two companies address their mistakes. On the face of these two examples, you would think that United would be much more interested to solve a mistake they made to a $7500 customer than Spirit would want to solve a mistake they made to a $300 customer. Well I was surprised too. Here's what happened:

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a few months ago

Are you making the same mistake 93% of all small businesses make?

The mistake 93% of small businesses make

93% of small business focus on the wrong priority. It’s a pretty big mistake to make if you want to take your business up to the next level, but the vast majority of small businesses are making it today. So was I.

I’ve been making this mistake for the past 25 years. At first, I felt pretty bad about that, but then I wanted to see if other small businesses are making the same mistake. So I created a poll on OwnIt and asked other entrepreneurs to rate their business priorities. The pie chart on the right shows the answer over 200 small businesses. Surprisingly less than 10% got this right.

What’s the focus of your small business?

I’ve been thinking about the UX (User Experience) I create for my clients all year. And I really got challenged by Horst Schulze, when I was fortunate enough to film the former CEO of Ritz-Carlton at a keynote speech a few weeks ago.

(You can read a bit more about that talk on my last blog post: What I learned about service from a wise hotelier).

4 priorities of an excellent company

Mr. Schulze talked about the 4 priorities that every successful company needs to have in the right order to excel. Here they are in no particular order:

  • Be efficient.
  • Keep current clients.
  • Make money.
  • Find new customers.

When I looked at my company’s priorities, I was surprised to learn that I’ve focused on the wrong priority for over 20+ years. Don’t get me wrong all four are vital to a company, but one is more essential than the other three.

Find out if you’re wrong too – take the poll!

You can take the poll “What’s the number One priority of your business” here and see how you stack up against other small businesses. Then let me know – are you in the 94% that get it wrong or in the 7% that are doing it right?

I for one intend to shift my company to focus on the one most important priority and that change will take place over the course of the next few months.

94% of small business make this mistake.

Take the poll to see how your business compares!


[OwnIt is an online small business community run by Quicken. To take my survey, you will have to sign up for this free small business social platform. I have found great advice here, and many owners are beneficial to share their experiences.]

UPDATE: I edited the post three weeks after publishing the initial numbers, to reflect the new responses. The change is less than one percentage point with twice as many surveys answered as in the original post.