Most of us have connected with the service sector (public or private) and felt like we have been “worked.” That burning feeling that what matters to you does not matter to the service company you are interacting with.
The source of this feeling might be the IVR system you have to go through with its multiple layers of questions and feeling like you won the lottery that day by saying the right words or pushing the right buttons to get to a person that can actually help you. The multiple follow-up calls you have to make to get an answer can be both frustrating and time consuming. All along you think in the back of your mind either “how can I quit using this company” or “how do these companies stay in business with such poor service?” A lot of us tolerate the poor service because we figure the next service organization will be just as bad as this one and the switching cost is too high.
The sad part is that service organizations could provide really good service at a lower cost, but command and control management doesn’t think that way. The command and control mentality prevents good service and promotes higher cost. They just don’t see it. They manage their businesses in a zero-sum game believing there is a trade-off between costs and good service. One can only be achieved at the expense of the other. And guess which loses most of the time . . . good service at the expense of some financial or performance target typically for some financial reward that customers would cringe at if they knew about. The leadership strategy of command and control organizations is to do as little for the customer as possible and maybe they won’t recognize or complain about the bad service.
The problem is customers aren’t stupid and the tolerance for poor service is at boiling point. Social and business networks are now offering mediums to communicate poor service in an on-line instantaneous fashion that is viral in nature. People will know about a company’s poor service much faster than before and avoid using those organizations that are guilty. Recovery will be too late and the costs that don’t show up on the financials will already be incurred.
The management paradox here is that all this is unnecessary. The zero-sum game is a loser’s mentality. More costs are incurred through bad or poor service than are incurred when the service is good. Command and control thinkers do not account for failure demand, multiple calls from the same person to get a problem corrected, or chase the status of a previous call. All failure demand is waste. Imagine how much costs would fall if customers got what they want and the corresponding system was re-designed to give the customer what they want and eliminate this failure demand. Costs would fall and service would improve.
The systems thinking organization understands that value drives profit and not vice versa. The command and control organization only knows the zero-sum game that is a guaranteed loser. A change in leadership strategy is imminent, where will your service organization wind up?
Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public). He is focused on exposing the problems of command and control management and terminating bad service through application of new thinking . . . systems thinking. Download (free) Understanding Your Organization as a System and gain knowledge of systems thinking or contact us about our intervention services at [email protected].