"How to Prevent Your Customers from Failing"
Stephen Tax, Mark Colgate, and David Bowen
MIT Sloan Management Review
Spring 2006, pp. 30-38
It is estimated that customers cause about one-third of all service problems. The authors of this article define a customer failure as "any action by the customer that has negative impact on that customer's experience, the experience of other customers or the company's productivity."
In-depth interviews were conducted in 52 organizations and with 60 customers. It was discovered that companies have much less-developed processes in place to deal with customer failures, as opposed to dealing with the company's own service failures.
A three-step framework is proposed for preventing customer failures:
Collect Diagnostic Data on Customer Failure Points—The article provides a very useful list of diagnostic questions to ask of Senior Managers, of Line Managers and Middle Managers, of front-line employees, and of current customers and lost customers.
Identify Root Causes of Customer Failure—The underlying causes of customer failure generally fall under the categories of People (customer lack of skills; customer attitude and effort; poor fit between the customer and the service; failure to communicate important information to the service provider; and unclear employee and customer roles), Processes (complex processes; lack of information to clarify procedures; customer-unfriendly overall design); Servicescape, which is the physical environment that customers encounter at the service site (ambient conditions; spacing and functionality; physical tools such as signs and symbols); and Technology (difficult to use; poorly designed; nonfunctional; inaccessible; poorly-supported).
Establish Preventive Solutions—A combination of the following aspects is necessary:
- Redesign processes
- Implement technological solutions
- Manage customer behavior
- Encourage customer "citizenship" and mutual support
- Improve the servicescape
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