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Posted by on Aug 28, 2012 in Business, Customer Service, Leadership | 11 comments

A Baffling Double Standard

Here’s one that has confounded me for a long time. Maybe you can help me wrap my head around it:

Why do so many companies provide such terrible customer experience when their leaders more or less dwell in five-star service themselves?

Say you’re CEO of a sizable company. Chances are you’re making $5 million, $8 million, $12 million dollars a year or more. When you travel, you stay in the finest hotels, where they spoil you rotten. You fly only first class, or maybe you have your own jet and your own flight crew. You have a company limo with a chauffeur whenever you need it. You live in a mansion or a penthouse, and you have servants. Someone shops for you, except when you need a new suit: then the tailor and his assistants come to you and fit you in your office.

Every minute of every day, you are being treated like a monarch. You understand top-notch customer service because you receive it all day every day.

…And yet your customers cannot say the same. No one spoils them. Often, no one at your company is even nice to them! You make them wait in lines at your stores or branches. Calling your company is one of the most frustrating experiences they’ll face all month. Your sales people beat them up in contract negotiation, or stalk them, or both; the fine print in your contracts would make the Devil blush for its audacity. And because you abuse your employees as badly as you do your customers, they flee quickly, which means your customers never deal with the same person twice.

This discrepancy, between the five-star experience as a customer that most C-level executives live, and the two- or three-star service their companies foist on their customers, has always bewildered me.

Can any CEOs out there explain it? I am truly at a loss on this one.

Graphic by Shawn Murphy

Ted Coiné

Ted Coiné

Keynote speaker. Author of A World Gone Social: How Companies Must Adapt to Survive. Three-time CEO. Chairman and Founder of Switch and Shift. Ted Coiné is one of the most influential business experts on the Web, top-ranked by Forbes, Inc., SAP Business Innovation, and Huffington Post for his leadership, customer experience, and social media influence. Ted consults with owners, CEOs and boards of directors on making their companies more competitive by making them more human-focused. He and his family live in Naples, Florida.

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  • http://Website Dr. Lisa McCool

    Awesome question to contemplate! Thanks!

    • http://www.shiftandswitch.com Ted Coine

      Thanks Dr Lisa!

  • http://www.endgamebusiness.com Steve Borek

    It all begins at the top

    For example Zappos. Selling shoes online doesn’t sound like a profitable idea. In order to be different, their brand was built on exemplary service. There slogan is “Powered by service.”

    This brand was created by the CEO, Tony Hsieh.

    The way your people go about their work, treat their customers, etc is a reflection of leadership.

    With so many choices today, we’ll choose the company that wows us.

    • http://www.shiftandswitch.com Ted Coine

      You’re absolutely right, Steve – Zappos is a great example of how to do business, and why! Selling shoes online? What a dumb basis for your business. So Hsieh didn’t make that the basis of his business. Instead, he made service the bedrock of their entire business model, and look at the results: sold to Amazon during the Great Recession for about $1 billion, and the CEO gets to keep not only his title, but control of his company.

      Every time someone less successful than Hsieh argues with you about the value of customer service, keep this example firmly in mind. You don’t have to be smarter than that other person. You can let Hsieh be smarter for you.

  • http://www.ttmitchellconsulting.com/Mitchblog Mitch Mitchell

    A major part of the issue is that the CEOs of major companies don’t take the time to check out their own product all that often. I’m thinking the show Undercover Boss has proven that CEOs need to get out of the office more and check on their operations, or send someone else to do it undercover so they can see what’s going on. They also need to learn to connect with employees at all levels of their company and express the values the company says they have to those employees. If employees don’t see upper management living those values, they sound hollow.

    • http://www.shiftandswitch.com Ted Coine

      Mitch, you are right on the money! It’s rare for a CEO to be able to sneak onto his or her own front lines unrecognized as they do on Undercover CEO, but someone’s got to do it for them if they can’t – and report directly to the CEO, unfiltered!

      Just about one year ago, I wrote a post, “Undercover Investor,” based on a similar scenario that came to my attention (http://www.tedcoine.com/archives/243). The stakes of business are too high to trust to out-of-touch leaders who never leave C-suite to learn what their own companies are really all about.

  • http://www.frymonkeys.com/blog Alan Kay

    Good question. My view is that a) CEO’s can still make profit happen means other than paying attention to the customer and b) they simply don’t know how to organize their company around the customer. Hence, my blog current post (into which I slipped a link to your post), ‘Leaders: Get Your Organization to Put the Customer at the Centre of Your Business’ http://frymonkeys.com/?p=1688

    • http://www.shiftandswitch.com Ted Coine

      Perfect Alan! Thanks for the link. I love the post.

      Leaders can find profit from sources other than happy customers – for a while. Eventually, all the cost-cutting has been done, all the wage-slashing has been accomplished, and the company’s sole position in a market has been eroded. At that point, profits dry up – often precipitously – and suddenly a CEO finds his company is no longer churning out profits. By then, it’s often too late for anything to save the company other than a major retrenchment.

      What’s the expression? Penny wise, pound…?

  • http://idolbuster.com Greg Marcus

    I think this is a question of values and priorities. Values are demonstrated by actions, and it is pretty clear what is important to a CEO lives a five star lifestyle, and gives his or her customers a 2 star experience.

    Remember the movie Heathers? From the 80s or early 90s, about mean high school girls. One girl says to another “Why are you such a megabitch?” Answer “Because I can be.”

    • http://www.shiftandswitch.com Ted Coine

      Greg, you’re right! I LOVE that movie!! You are completely correct: many leaders act like the “Plastics” in Heathers – until they’re hit by the bus of sudden, customer-savvy competition. I’ve seen it in markets again and again and again. I don’t typically feel schaudenfreude, except in cases of arrogance such as this. Then, it does indeed make me warm all over.

  • Susana Kawai

    Hello Ted, from a customer service point of view and you know this already, but I experienced this myself: Lack of training for a five diamond, a company wants to achieve that, but the management of that company does not really understand five diamond and you are forcing your entire staff to achieve that. Lack of motivation, no leaders by example, low pay, the staff is not treated as five diamonds, they are treated as three diamonds and they have to understand five diamonds, when they never saw a five diamond environment. The product itself might be high quality, but the environment might not be, for example, a beautiful hotel in a bad location. So much to talk about customer service…Greetings.