Many years ago, the CEO of Scandinavian Airlines, Jan Carlzon, used the term “moments of truth” to describe the myriad interactions customers have with companies and the lasting impacts those moments can have. He explained that SAS customers don’t know the quality of the airline’s maintenance, the skill of the pilots, or other operational aspects they’re not directly exposed to. Instead, they evaluate the airline based on things they can see, such as the cleanliness of the tray table, the attitude of ticket agents, and the efficiency of baggage handling. These moments of truth can determine the success or failure of the airline.
Carlzon’s insight made me think about the moments of truth for other professions, such as coaching and consulting. Certainly being prepared — showing up on time and having knowledge about the subject to be discussed — is one key determinant. Another is the care you demonstrate with clients. Do they know they matter to you? Are instances of misunderstanding handled without rancor and clarified tactfully?
I think every business can benefit from analyzing its moments of truth to find weaknesses that may require it to invest differently. One retail organization focused on their merchandising and in-store customer experience, offering distinctive products, stores that were fun to shop in, and helpful salespeople. Customers were delighted, until they had problems with the store’s credit card. To save money, the store contracted out its credit card operation to a little-known bank that outsourced its customer service to an offshore call center. Customers often had to make multiple calls to get simple issues resolved, which negatively affected their perception of the store. The retailer — and its customers — would have been better served if it had invested in a better credit card partner.
Similarly, a cell phone service provider touted its robust customer care system, with its elaborate response escalation scheme, as a differentiator. Unfortunately, their response team was anything but responsive. After multiple calls and hours spent on the phone being escalated from level 1 to level 2 to level 3 without a resolution, many customers switched service providers. Investing in better customer service training could have stemmed the defections.
How can you find shortcomings in your organization’s moments of truth? Some companies hire “secret shoppers” to discover strengths and weaknesses in their customer service. If you offer online services, do you regularly test them to make sure they’re working correctly with all browsers and on all operating systems? Are all your employees committed to a customer-centric approach to achieving success? Given that on average bad customer service experiences get repeated to ten people while good experiences are only shared with two or three people, it’s no surprise that just one person who does not put the customer first can have an outsized impact on success.
Some organizations conduct focus groups with customers to find out what they like and dislike about the products, service, or experience with the company. Videos of these sessions are then shared with frontline employees and product managers. And a potential pitfall in surveying your customers is not taking their suggestions. If customers see that you act on their ideas, they will believe in your commitment to customer service; but if you don’t act, asking for their input may only irritate them.
There is ample research that shows the cost to acquire a new customer can be as much as ten times the cost to retain one, yet I still see more energy devoted to finding new customers than keeping them. Happy customers are your best and most cost-effective advocates, so it makes sense to ensure all your organization’s moments of truth are positive.