Are we shattering our customers’ dreams?

A friend was thinking of buying a new car. One day, he and his son went to see the new cars available in the showrooms. They had shortlisted three brands and  visited the three car company dealer showrooms. At each, they understood about various models available within their budget and took a test drive.

When they visited the first showroom, they rejected that brand out of their consideration list of three brands, due to one small but unsavory incident. It went like this.

They had discussed the various models, variations, prices and even took a test drive. It took them one good hour. In the end, they wanted to see a brand new car of their desired model with a specific color. The salesman willingly showed them the new car kept for display. They were very happy with everything including the price, and almost started dreaming of owning the car. While they were leaving, the son remarked “The interior of this car is very good.” To which the salesman said, “Yes, they are tailor made.” Further inquiry revealed that the car shown on display was not the standard model with accessories listed in the brochure, but with a lot of customized add-on, which costs at least one lakh rupees, not anywhere mentioned in the brochure and also not informed by the salesman throughout this one-hour interaction with them. He disclosed it only when asked. The incremental cost was prohibitive for them and they had to leave leaving their dream behind.

At other two showrooms, they were shown new cars as they were described in the brochure. That made a lot of things easier to decide. They appreciated the business practices of these other two car dealers in contrast to the earlier one.

We all may have come across incidents where we had to pay some “hidden costs” which we were never aware of or were never told of. Such things happen when we are on tours and we are more vulnerable. At such times, we don’t have much choice than to pay up.  It creates very bitter word of mouth publicity and damages the brand reputation irreparably. But when the customer has yet to make a choice, such incidents result in direct loss of sales and our credibility.

Customers are delighted when they get more than they expected. And they get equally disappointed whey we shatter their dreams. Nobody likes people who show them the dreams and then increase the cost of realizing them. Dreams are too precious to be broken by bad marketing. Specially if they belong to our customers’ eyes.

When customer feels hurt the most?

When customers feel hurt the most is when they feel cheated by us while they are in a vulnerable condition, when they are helpless.

A person approaching a nursing home or a hospital for a surgery is one such vulnerable customer. A nursing home is a place where people arrive out of helplessness. Nobody likes to go there by choice, as it is hardly an enjoyable experience one may look forward to. Here if one is cheated or is taken for a ride, then it leaves a very bad taste with him who spreads the bad word outside, too. One such friend who had recently gone through one such unsavory experience narrated this with bitterness :

I had to admit my mother in emergency for a surgery at a private nursing home operated by a surgeon. When we checked in, we were given options of various rooms. When we asked for a separate, independent room, we were told that they have a Special Room with AC, attached wash-room and a bed for the patient’s companion. The room also has a refrigerator, we were told.

We checked in the Special Room. The room was average and disappointing, with the facilities mentioned were present only for the name sake.

a) The AC was there, but the switch was outside, under the control of the head nurse. She would switch on or off only during a specific time. Also, obviously there was no temperature control possible…!

b) The bed for companion was so small where nobody, except a child could sleep.

c) The funny thing was : the refrigerator was very much there, but it was locked…! When asked where was its key, we were told that it was being used for storing some medicines and the keys can’t be given. If we need cold water, they would provide from cooler outside, we were told, coldly.

d) Here comes the funnier part : The medicines belonged to the chemist shop downstairs. And, the chemist shop belonged to the nephew of the surgeon…! He would come occasionally, whenever he needed to take out some medicines… The most strategic arrangement was, the doctor prescribed medicines which were available only at the nephew’s shop. You won’t find them from any other shop nearby. How convenient?”

The friend was angry and hurt for being shortchanged, because in the name of Special Room, what was given was a set of hollow promises. And the compulsion for buying the medicines from a specific shop was also an irritant. The doctor also charged many things exorbitantly, much beyond the estimate given earlier.”

My friend had no choice but to comply, even though reluctantly. But, he vowed not to recommend this doctor or the nursing home to anybody else. In fact, he alarmed all those who listened to him about the unfair practices going on there.

If we treat our customers badly, particularly when they cannot take any objection, or if we take advantage of their helplessness, they may tolerate it then out of no choice, but they may feel terribly hurt and disappointed. And when their bitter experience is spread to others, it spoils our reputation badly. Our business suffers irreparably due to the poor mouth publicity.

We must not take advantage of the customers when it hurts them the most. The bitter experience they will neither forget nor forgive. Instead, at that time if we genuinely help them, that too, they will never forget and thank us a million times. Such grateful customers will remain with us forever.

What helps the most in the future success of our business?

At platform no. 2 of Malad station, there is a book stall. The employee there is since 23 years…!

At our home, the same person delivers newspaper since last 11 years. He knows which papers we like, so whenever there is some scheme or some new paper is coming, he always informs.

The helper at the grocery shop from where my wife buys our provision, helps her remember things when she goes to place monthly order. He knows which things are regularly used by us, because he has grown up in that store and he knows buying patterns of all regular customers. My wife feels pride by the special attention that he extends.

The computer maintenance company that repairs our home PC, has one supervisor engineer since more than two decades. He knows entire history of all the various generations’ PCs that came to my home. He understands my problem quickly and sends the engineer accordingly.

The common thing in all the above examples is some employee who has been with the firm since more than a decade. Their presence makes the customer’s experience much more comfortable. Everybody prefers to deal with a known face. A customer’s comfort decides his satisfaction levels. A comfortable, happy, satisfied customer is a profitable proposition for any business. An old (experienced) employee is a very valuable asset to the company, because not only a customer but also vendors or any other party repeatedly dealing with the business finds it comfortable to deal with a known person, rather than dealing with a different person every time.

We all may have encountered the frustration of talking to different, ‘faceless’ persons every time at the call centers of Mobile, Cable, Telephone, Bank, Credit Cards etc. companies. If, for solving a single problem, we need to call that call center more than once, undoubtedly we will be faced with repeating the same thing again to different people. A customer is not happy or comfortable passing through such experiences.

The current health of our business is reflected in the financial statements listing the assets, liabilities, sales, profit, margins or growth rates. It can also be gauged by the market share and the brand equity held by the brands.

But, how can we judge the future sustainability of the growth of a business? Of course, good products, sound financial health, large customer base, good market share, reputation and positive brand equity promise a good future ahead. But, in addition to all this, one vital element plays the most significant role in the building of strong foundation of the company. And that vital element is the number of veterans or senior employees in the company, who have spent many years in the company.

If we look at the successful companies, we can’t miss the significant role played by these ‘veterans’ in consistently shaping the future. An old employee knows the business, its environment, competitors, challenges, its promises and its people. And that knowledge cannot be replaced by replacing that person. When an old employee leaves, this knowledge also leaves along with him. This is a huge loss to the company. The new person may learn and understand the processes, but the experience and knowledge of the old person will never be retrieved. Without the long term availability of good employees, a company just can’t build strong foundation, and hence can’t go much ahead.

An experienced investment banker once shared this with me. “In evaluating any company, we always try to find out how many people at various important positions are with the company since more than five, ten or fifteen years. That tells us about the depth of the experience of the management and the quality of company’s long-term relationship building practices. The newcomers, however highly qualified, can’t be expected to take the company ahead sooner. That company will have to wait longer to really take off. And that waiting may be unaffordable. Moreover, an employee is the first hand witness of what is going on in the company. Every employee has his/her own dreams. They stay with the company as long as they have hope of fulfilling their dreams by working with the company. When a person gets disillusioned, she leaves. So, the tenure of important employees is one very significant indicator of the stability of the company and its future. For us, a company with more veterans is undoubtedly on a strong footing.”

An employee-employer relationship is an important relationship from the business perspective. Maintaining any relationship is a challenging task. It requires give-and-take from both the parties. If the company respects the employee and gives opportunities to express his abilities and realize his dreams, the person will stay with the company for a long time. But, if the company has short-sighted ‘hire-and-fire’ approach, the disgruntled employees will leave, carrying bitterness and spreading bad reputation outside. Those continuing inside also live in a persistent state of fear and will fly away at the earliest opportunity. Those who remain are the sour apples, who don’t find employment elsewhere. Such excessive churn causes a chaos in the company and quality, customers, sales, productivity and profitability suffer because of the persistent instability and uncertainty.

We have to accept this fact that the strength of the foundation of a business depends mainly upon the employees who are with the business since a long time. We must try to keep such employees. We must maintain good relations with them. We must invest in them and help them to upgrade, grow and fulfill their dreams. If they stay and grow, they will help us grow and fulfill our bigger dreams. If we can’t build strong relationships with our employees, how can we expect them to build strong relationships with our customers? To increase the chances of future success, we need to increase the number of long-term employees in the company. It is very simple. We must notice and act on this simple fact.

Otherwise Aaya-ram and Gaya-ram can make our company a guest house, where people come to spend some time in between two good jobs. No wise entrepreneur would like to turn his company into a transit camp or a career parking lot.

Customer ko unnis-bees ka fark bhi padta hai…!!!

I came across a recent and real example of how a new business loses its credibility in important customer’s mind and how customers feel taken for granted. We all can learn from it.

Pradeep runs a very reputed coaching class in Mumbai. It has more than 5,000 students on its roll. To all these students, they give some stationery like bags, note books, file folders, pens etc. with the coaching class branding. Pradeep ensured that this stationery was always of the best quality. He never compromised on the quality of things on which his brand’s name was printed.

Shrikant, a cousin of Pradeep, started a new wholesale business of PVC file folders. They supplied to bulk users and coaching classes were one of the target customer segments. He approached Pradeep and requested for an order of file folders. Pradeep showed him his regular folders, which were sourced from the best manufacturer with the best brand and quality reputation in the corporate market. Pradeep required 20,000 folders every year. He told Shrikant to provide him the same quality at better rates. Shrikant readily agreed and promised that he will certainly match the quality and will give better price. He took a specimen sample from Pradeep and went to work. Shrikant was very happy that he got a big order right in the beginning of his venture. That was a very good start to build upon, he thought.

The folders were delivered in due course. To Pradeep’s surprise, the quality of folders was not as per the specimen given to Shrikant. It was distinctly inferior. He called up Shrikant and asked for the reason for the difference in quality. He made it clear to Shrikant that he was not happy as the quality obviously did not match that of his earlier supplier. To that Shrikant replied, “I agree the quality is not same. That company gets its material from foreign markets on exclusive basis. It is not available in India to anybody else. What I have given you is the next best to it. And the rate is also 15% less. Sirf  unnis bees ka fark hai. Nobody notices in so much detail. Tere students ko kya fark padta hai….?

But it made a difference to Pradeep, to whom quality was of supreme importance. He realized that he had made a mistake of experimenting with Shrikant without checking his credibility. He felt that Shrikant should have communicated to him when he found out that the same quality was not possible. Pradeep felt being taken for granted and he disliked it.

He never repeated the order to Shrikant. Shrikant’s inability to understand that customers may forget the price, but they always remember the quality of products cost him a very big customer in the early stage of his business.

Really, customers never forget the bad quality or bad service. And they do not forgive being taken for granted. In the matter of quality, unnis-bees ka fark is a big difference. It can kill the credibility of a business. Forever.