March 30, 2009

The Art of Service Recovery… Westjet gets it

Lahaina, Maui.

My family enroute from Vancouver to Kapalua were inflicted by the classic traveller’s infection - a lost bag. Only in this case, in the bag were kids clothes for their 3 year old and 14 month old; critical for vacation survival.

The story goes like this:
- Westjet computers were down in Vancouver and required luggage tags to be manually prepared and applied to each bag
- As a result, the kid’s bad was not tagged in Vancouver; the 3 tags found themselves on the other 2 bags
- They arrived in Honolulu sans 1 bad and reported it to the Westjet agent who completed the required documentation to track and recover the missing bag
- Westjet were contacted from Maui to tell the story again, check the status of recovering the bag, and to impress on them the importance of getting the lost bag back as soon as possible as kids’ were involved
- Westjet apologized appropriately for the service breakdown, and presented two options:
  My family could travel 45 minutes to Kahalui and pick up the bag on the following day they would recieve $100 for their efforts, or
  Westjet would have the bag delivered direct to their room on the next flight out of Vancouver
- In addition, the agent told them that they could go out and buy $150 of whatever they needed for the kids to hold them over until the lost bag returned
- The bag was delivered to the room in the evening the following day.

Westjet clearly understands the power of Recovery.

BE DiFFERENT Learning Points:

First, Service recovery is more than fixing the problem (people expect that this will be done); its about fixing it and then doing the unexpected. My family did not expect the $150 to buy their kids clothes until the bag was recovered. It blew them away!
Second, give the customer options so feel they have some control in the situation. Westjet gave the option of going to Kahalui to pick up the bag and get $100 for the trouble OR wait until it was delivered to their room.
Third, the frontline agent made the decision to give the $150. They didn’t have to ‘check with a supervisor’ for authorization. This resulted in immediate gratification.
Fourth, the entire recovery process took less than 24 hours. Any longer and the ‘good feelings toward Westjet’ would have evaporated
Lastly, my family certainly recalls the pain of losing the bag. but they speak longer and more passionately about the Recovery experience.They were dazzled and I was as well.

Nicely done. Certainly a stellar model for others.
Cheers, Roy Osing

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Posted 3.30.09 at 08:40 am by Roy Osing | Permalink | Comments (0)

March 27, 2009

Hawaiian Tel Too Vital to Fail

Interesting Opinion Piece in the Maui News today March 27, 2009 advocating that Hawaiian Telcom which is currently in bankruptcy proceedings should not be allowed to fail. Barry Fukunaga’s case essentially is that since the company is providing critical utility value to the state of Hawaii, it’s failure would cause undue hardship on its customers and the Hawaiian people generally. He basically tries to make the case that the company plays a social role for the state and its failure would negatively affect the societal benefits Hawaiians’s enjoy from its operations.

Over the past two weeks I have read quite a bit about the situation that ‘Haw Tel’ finds itself in. Why is the company in bankruptcy? Well, the telecom business has gone through enormous change over the past decade or so - more competition in the traditional telephony markets, greater price sensitivity of its customers, and more recently of course the economic downturn challenging all businesses to find the secret of survival. I know of what I speak. Been there; done that in my 30+ year career with BC Telecom and TELUS in Canada.

Mr Fukunaga’s opinion is noticeably absent on the fact that the obligation rests not with ‘society’ to prevent the failure of Haw Tel; rather it rests square on the shoulders of the company to ensure they survive! Businesses are not about receiving survival pay, their prime purpose is to earn the right to survive by taking care of their customers in a manner that is unmatched by others in the market.

Sure, the telecom business is more competitve than it used to be. Welcome to the real world where monopolies are bordering on extinct if not completely there already. Executives get paid to steer their corporate ship through turbulent times; ever-changing challenges that test the survival instinct.

Rather than spout rhetoric suggesting that ‘someone’ needs to prevent Haw Tel from failing, we should be demanding that the company table a Renewal Plan that convinces people that they will be unique and competitive in providing the very best communications solutions (with dazzling customer service) demanded by their customers. They need to stand up and show the market they are a force to be reckoned with and that in spite of the current tough times they are facing, they will arise as the BE DiFFERENT champion of Hawaiian telecom. Quite frankly, having seen some of the competitive positioning ads posted by their competition, winning should be quite straightforward if they have the BE DiFFERENT practices in mind.

Haw Tel - Renew Yourself
Begin with your Strategy

Stay tuned for more blogs on this topic.Cheers, Roy Osing

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Posted 3.27.09 at 02:30 pm by Roy Osing | Permalink | Comments (0)

March 25, 2009

Small Business Survival in Recessionary Times

Mark Healy’s article in the Globe and Mail March 23, 2009 titled What’s your Post Recession Marketing Plan? appropriately discusses the need for small business to consider their strategy coming out of the recession.

Mark does a good job outlining the basic steps to take and I agree with him for the most part. I would suggest, however, that now is not the time for small business to start looking beyond the recession; rather it is critical that their strategy during the recession requires the highest priority and utmost diligence. My fear is that if Small Businesses don’t use the recession as an opportunity to renew themselves during this period they won’t make it out of it.

My blog series Ten BE DiFFERENT Practices to Renew Yout Organization in Recessionary Times outlines practical and proven ways for business to get the most from the economic downturn. The rewards of getting on with the strategic renewal process NOW is that Small Business will not only be able to weather the current storm, they will be positioned to come out of it and prosper. Two blogs in the series have been posted; stay in touch with the entire renewal journey. But don’t wait -  renewal begins now!

Cheers, Roy Osing

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Posted 3.25.09 at 08:49 am by Roy Osing | Permalink | Comments (0)

March 23, 2009

BE DiFFERENT Practice #1 - Renew your Organization

BE DiFFERENT Practice #1 - Strategic Renewal

Pause, take a deep breath, reflect and renew your business strategy.

The fact of the matter is that your declining performance is NOT due to the recession. Rather, it is due to the fact that your current strategy doesn’t work in an environment that is characterized by a reduction in consumer demand, greater competitive intensity, new competitors entering your market, much more discerning and fickle customers and more excruciating price sensitivity.

The recession isn’t the cause of your performance decline:  your strategy is flawed because it doesn’t work in the new environment with new pressures and challenges. You need to renew it so that it is relevant in recessionary times.

The process is quite straightforward, and involves answering four questions:

1. HOW BIG do you want to be?
2. WHO do you want to SERVE?
3. HOW do you intend to compete and WIN?
4. WHAT is your STRATEGIC GAME PLAN?

HOW BIG?
As context for this, the BE DiFFERENT strategic renewal process starts out with determining your financial goals. Most strategies have the financial results developed at the end of the process and generally get modified as the CFO decides they simply aren’t aggressive enough. As a result, higher numbers are driven out of the tabled strategy rather than adjusting it to deliver stronger financial results.

This is a huge mistake. Assuming that the assumptions behind the plan are reasonable and acceptable, forcing more aggressive numbers from a strategy without increasing strategic risk is a fool’s game. The expected higher performance numbers will not happen.

So declare right up front the financials you want, and be realistic to reflect the recessionary forces at play. I am not suggesting that you roll over and drop your expectations to near zero levels. I am suggesting, however, that a contraction in the economy will reduce the growth of the market, increase the number of competitors, erode customer loyalty and enhance customers’ sensitivity to the price of a good or service. You may decide, for example, to reduce your 12-month sales growth expectations of 25% in a market growing at 20% (implying that you intend to gain market share on your competitors) to 5% if the market growth flat lines, more competitors enter your market from the higher boutique segments.

WHO to SERVE?
The second step in the BE DiFFERENT strategic renewal process is to reassess the customers you have chosen to serve. Examine the customer groups that you currently do business with. Given the new recessionary market realities, can they deliver to your new financial expectations? Are their market characteristics appropriate to give you the revised growth you want? Apart from demand factors, what about the competitive environment - is it intense or are there opportunities to enhance your market position?

Carefully evaluate your options and choose the customer segment that can deliver you the growth you need as well as leverage the competencies of your organization.

One final point: Be prepared to dump the customers that are no longer part of your strategic focus. Keeping them will only drain your resources and waste your time with no economic return.

HOW to WIN?
In my experience, the third step is the most critical in re-vectoring your strategic direction. This is where you decide how to differentiate yourself from the mosaic of new competitors you are facing and beat them handily.

Engage your team in what I refer to as creating your only statement. The only statement reads: ‘We are the only ones that…’ This is the ultimate manifestation of a unique competitive position in the marketplace.

This is not a task for the faint-of-heart. It is difficult to do and involves looking at every nook and cranny in your organization for opportunities to separate yourselves from the pack - brand, service, product, product support, and how you leverage technology are some examples of where you can look to create your only statement.

WHAT is your STRATEGIC GAME PLAN?
The final step in the strategic renewal process is to integrate the answers to the previous three questions into a seamless Strategic Game Plan. Here’s an example: ‘We will grow our top line sales revenue by 3% over the next 12 months by focusing our scarce resources on the retired couples segment of the greater Seattle market. We will compete and win by providing personalized transportation services to assist them in getting around the city.’

There it is. Crisp. Simple. Clean. And it can be used very effectively to communicate your renewed direction internally and to your investors if required.

Stay tuned for more. Cheers, Roy Osing

Blogs in the BE DiFFERENT Practice Series: 
Introduction
Practice #1 - Renew your Strategy
Practices #2, #3 and #4 - Focus, Modify Business Processes and Cut the Crap
Practices #5 and #6 - Be Anal about Execution and Set Cost Objectives
Practices #7 and #8 - Plan on the Run and Customerize your Marketing
Practices #9 and #10 - Dazzle your Customers and Sell Intimate Relationships

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Posted 3.23.09 at 05:10 pm by Roy Osing | Permalink | Comments (0)