Customer Service

In one respect, running an investment business is like any other business: the issue of growth.  I don’t know how people on the outside would answer that question, but people in the business know that the key is getting referrals.  The question then becomes: how do you get referrals?  The answer may surprise you; it isn’t so much the things you do right, but the way you handle problems when things go wrong.

Here’s a story about a frequent traveler who provides an insight into this important issue.

I travel a lot so I have more than my share of experience with airlines. I love JetBlue. Let me give you a recent example why. A flight I was scheduled to take was delayed five hours. That would put my arrival in the wee hours of the morning on a day I had to make a morning presentation. I called to let them know that would be a problem and asked if I could be rebooked on an earlier flight. The person on the phone (which, by the way, was who I connected with after a brief wait on hold without having to navigate some crazy routing system requiring typing in eight choices) put me on the new flight and checked with the supervisor to make sure she had permission to waive the change fee. The call was quick, I got what I wanted, there was no additional cost, sorry for any inconvenience. Easy peasy lemon squeezy.

Compare that to a call I made to United Airlines the week before. The day prior to my trip, they canceled the last leg of my flight, meaning I was not going to make it all the way home. I had been booked on another flight the afternoon of the following day. No accommodations for while I was there, mind you, just moved to a different flight. When I called the customer service line, I was handled by someone for whom English was not a native language. That’s relevant because she did not understand the questions I was asking her. Most questions were met with an extended silence followed by a repeat of the statement or question she had posed to me before I asked my question. After 10 minutes or so, I asked to be transferred to someone who spoke English as a first language. No luck. I asked to be escalated to a supervisor. A minute or two on hold and I was informed “he doesn’t want to talk to you.” No lie – that’s actually what she said.

We finally got me onto a different flight to get me home on the right day. “You will have to pay the $150 change fee” she informed me. “Even though you had bumped me clear onto another day?” I asked. “Yes, you will have to pay a $150 change fee.” We went round and round on this one for some time before I had to forget about it and get on to a meeting I was already late for. (In the end, they never did charge me the fee to change flights. That makes this call even more frustrating in hindsight.)

That this is the sad state of affairs with most companies and not unique to United is partly our own fault. We consumers tend to let price exert an excessive influence on too many buying decisions, driving many services toward commoditization. Especially now that we have the internet. Once we had Travelocity, we could instantly compare fares and reflexively select the cheapest one that meets our criteria. The airlines are left with little more than cost cutting to remain competitive. Service gets cut because it does not usually get rewarded by us consumers when we book our next flight. It is true of many other industries.

So, what does this have to do with your advisory practice?

It is not that we should simply provide good service and train our people well. We already know that.

It is about drivers of client loyalty and referability. Who are your most loyal clients? It is not the ones for whom you have done consistently good work. It is most likely not even the ones for whom you have made the most money or provided the most comprehensive service. Your most loyal clients are probably the ones for whom you provided a quick, easy and effective resolution when they had a problem with your firm or a firm you represent (like a money management platform or investment or insurance company).

When you provide good service, clients get what they expect. Good service is what they planned on and you delivered. It is contract. It is not remarkable. You did not pleasantly surprise them when you delivered on your promise.

When something goes wrong, the unfortunate truth about things these days is that we anticipate that it is going to take some work to set things right. That the people we speak to will be defensive about the error. That they will try to explain that they did what they should have. That we wanted something they don’t actually offer and it was our misinterpretation. And we assume fixing it will take a few steps and some time. So when the first person we talk to solves the problem quickly and effectively, it exceeds our expectations. We remember it. We talk about it. We are impressed by that more than getting great service the first time around. Strange and maybe unfortunate, but true.

One of the major benefits of dealing with a smaller investment firm where the people you speak with can solve your problem without getting a manager’s permission because they ARE the management.  You will not get the run-around, won’t be asked to “Push 1 for English” or be put on hold for 30 minutes.  Our job is to make out clients a fair rate of return over the long-term.   Our other job is to fix things quickly and as painlessly as possible when things don’t go as planned.

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