Tuesday, July 19, 2005
When Bad Business Rules Backfire
In many cases, he says, the poor guy's employer is the one at fault, and he tells an interesting story - against himself - to prove his point.
And like many stories of this nature, it just could be that the lesson to be learned from it is relevant not only to the world of business, but can be applied to other areas of life as well.
Brodsky runs an archive-retrieval business. When customers ask to have boxes delivered to their offices, they charge a regular delivery fee plus a surcharge for priority service. As to be expected in any business, disputes over the charges arose from time to time. When Brodsky saw that a couple of his customer-services reps were giving in too easily, he made a rule: no credits could be issued without the approval of someone in management.
What happened then? Occasionally a customer placed a rush order and, for whatever reason, the box didn't arrive on time. In other words, there was nothing to talk about: the company was unmistakeably at fault.
An angry customer would call up and say: "Because it was late, we couldn't make any use of this stuff. You guys can stand on your head, but I'm not paying."
"I'm sorry," the customer-service person would reply, "we made the delivery and you have to pay for it." When the customer would continue to insist "Nothing doing!", the rep would say, "Well, you'll have to speak to a manager."
No question, the manager would waive the charge after hearing the story, but the damage would have already been done. Bad enough that the delivery was late, but the customer sees that they would have been charged for it anyway had no one complained. Then to top it all, he had to waste time arguing with a rpresentative of the company before he was transferred to a manager who cancelled the bill.
So the customer would go away thinking. "That damn service stinks!", and the company would consider themselves lucky if they ever heard from him again.
Thus, the rule that Brodsky laid down came back to haunt him. He now quickly grasped that establishing a rule to eliminate costly errors was not the right response. Among other drawbacks, good, faithful customers were being penalized for the sake of the one or two who tried to take advantage. A few employees with questionable judgement were tying the hands of perhaps the majority whose judgement was perfectly sound.
Now, he has adopted a completely different approach to the sticky problem of well-meaning but inexperienced employees who were a little too looose in passing credit. The real solution, he realized, lay in better training. His people had to be equipped with more knowledge and better tools to make the right decisions.
Rather than clipping their wings, with all that this entailed, time, effort and even money would have to be invested in order to get the potential offenders up to speed.
The point should be clear.
We're living in the age of instant solutions. In business, as in other areas of our lives, we're inclined to fall into the trap of shortcuts, easy answers, the least painful way out. Why do we make bad rules? Often, it's because we're not really attacking our problems head on.
Rather, we're avoiding them. And therein lies the danger - and the challenge!
Labels: business communication, business ethics, customer service, the workplace
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