Customer Service: Extraordinary Results at Southwest Airlines, Charles Schwab, Land's End, American Express, Staples, and USAAby Fred Wiersema
Imagine a company that receives five times as many letters of praise as complaints. Picture a business for which tens of thousands of customers line up, unsolicited, to open an account. Think of a global corporation that continues to set record earnings year after year, despite increasingly heavy competition. Then envision knowing the keys to these companies'
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Imagine a company that receives five times as many letters of praise as complaints. Picture a business for which tens of thousands of customers line up, unsolicited, to open an account. Think of a global corporation that continues to set record earnings year after year, despite increasingly heavy competition. Then envision knowing the keys to these companies' successesand using them to your company's benefit.
Southwest Airlines, Charles Schwab, Land's End, American Express, Staples, and USAAat a time when "customer service" might seem to be more about talk than action, the six companies profiled in this book have gone beyond lip service to surpass the competition by putting quality service at the core of their value systems. In Customer Service, the second book in the BusinessMasters series, you'll discover the innovative strategies these six companies have used to triumph through their commitment to excellence in customer service. Edited by noted customer service expert and New York Timesbestselling author Fred Wiersema, this definitive guide offers field-proven philosophies, how-to tools, and invaluable insights gained from years of providing superior service to millions of customers across the country and around the world.
Discover how Southwest Airlines has built a $3.8 billion industry by going beyond the call of duty time and time again. (The airline's agents have been known to drive passengers to their destinations several hours away in rare cases of delays or schedule mix-ups!) Find out how Land's End keeps its promise of reliability no matter what (even during a UPS strike, when the company kept its policy of quick delivery by creating its own mini-post office)making it the nation's leading apparel catalog. And learn how Charles Schwab has developed a system to turn customer complaints into opportunities that actually strengthen their bond to consumers. The strategies of these companies vary, but their principles remain the same: they anticipate consumer needs and find every way they can to meet them, constantly challenging themselves to improve their service and demonstrate their respect for their customers as individuals.
Through these inspiring profiles you'll also learn:
- Why meeting customers' needs on an individual level actually outweighs a factor such as cost.
- How the most successful companies excel by making employee happiness a top priority
- Why simplifying your message and focusing your service will keep customers coming back
- How developing ways to measure customer input, disseminate it company-wide, and utilize it to grow with your customers can be the most important thing you can do for your business
With this short, accessible book, entrepreneurs and executives alike will glean the tools and insights needed to create a successful customer-oriented culture that is defined by service excellence.
Read an Excerpt
Southwest Airlines Company
What do you call an airline that serves peanuts for breakfast, lunch, and dinner, has bunny-costumed flight attendants popping out o f overhead compartments, and announces that those wishing to smoke should "file out to our lounge on the wing, where you can enjoy our feature film Gone With the Wind"?
A rip-roaring success, that's what.
Dallas-based Southwest Airlines Co. (www.southwest.com) has brilliantly combined a bent for wacky behavior with a reputation for stellar customer service to propel itself into the ranks of American business legend. In the process, it has grown from a three-plane intrastate start-up with only $2.1 million in annual revenues in 1971 into a $3.8 billion national player and one o f the industry's most successful enterprises. The company that was originally designed on the back o f a cocktail napkin now makes over 2,300 flights daily. And 1997 marked Southwest's twenty-fifth consecutive year o f profitability, as well as its sixth consecutive year o f record profits.
The company has achieved its remarkable record by giving customers an inexpensive, safe airplane ride sprinkled with a lot o f laughs and plenty o f personal attention. Southwest's accomplishments are particularly noteworthy in an age o f excess: That passengers give superb marks for customer service to an airline built on a no-frills, noreserved-seating, no-meals approach to air travel might seem somewhat incongruous, but rave they do. So does the U.S. Department of Transportation, which for five consecutive years has acknowledged Southwest for achieving the best on-timerecord, finest baggage handling, and fewest customer complaints among major carriers.
What's the Southwest secret? No one would dispute that cofounder Herb Kelleher, who took over as Southwest's president and chief executive officer in 1982, is both the inspiration and the leading (funny) man for this long-running hit. But Kelleher, in turn, gives all the credit to his employees. "The hardest thing for a competitor to do is to copy our people," he says, adding that "the intangibles are more important than the tangibles. " Those intangibles translate into a company esprit de corps that is second to none, prompting Fortune magazine recently to crown Southwest Airlines the best company in America to work for.
The Southwest management readily admits that employees come first, customers second, because Kelleher believes that workers who are happy are workers who take good care o f customers. And, indeed, taking good care of customers is a priority. Executive vice president o f customers Colleen Barrett puts it succinctly: "We are not an airline with great customer service. We are a great customer service organization that happens to be in the airline business. " The company's mission statement affirms its "dedication to the highest quality o f customer service delivered with a sense o f warmth, friendliness, individual pride, and company spirit." Faithful adherence to this creed makes possible the airline's legendary speed (twentyminute turnarounds versus the forty-five minutes that other airlines take), efficiency, and crowd-pleasing attitude.
That word "attitude" lies at the heart o f Southwest's success, and it is nurtured by a strong corporate culture based on values and principles. There is even a Culture Committee to reinforce the attitude and make sure the airline's underdog origins aren't lost on new employees.
Far from the underdog these days, Southwest has emerged as a trendsetter, described by the Transportation Department in 1993 as "the principal driving force for changes occurring in the airline industry." Its low-fare, short-haul, no-frills style of operating forces other airlines to scramble to stay competitive wherever Southwest flies.
To keep costs low, Southwest is always on the lookout for ways to save. It flies only Boeing 737s, conformity that makes maintenance work and flight-crew training simpler, faster, and more cost-effective. It was the first airline to institute Ticketless Travel, and more than SO percent o f Southwest customers now choose that option--often purchasing seats through the company's Website.
There, o f course, there are the ruts. Kelleher long ago had a hunch that passengers would choose low-fare tickets over so-called frills such as in-flight meals. Those who fly Southwest get a beverage and a small bag of nuts. Lest anyone forget what the modest meal represents, the bag is labeled "Frills. "
Value at Southwest Airlines is built on the three pillars of speed, efficiency, and customer service, just as Rollin King and Herb envisioned when they decided to start the airline. The way Herb and Rollin saw it, if you provide flights when people want to go, operate on time, offer the lowest possible fares, and make the experience enjoyable, people will fly your airline. And, boy, were they right! We now fly nearly fifty million people a year to fifty-two destinations in twenty-five states, using 262 planes on more than 2,300 daily flights.
Our "keep it simple" strategy of using short, highfrequency, point-to-point flights into less-crowded airports, combined with our no-frills approach to service, has helped keep our costs and fares low. The average length of a Southwest flight is 563 miles and costs just $72, numbers meant to compete more with ground transportation than with other airlines.
Another big factor in our success has been productivity. Although our wages are consistent with those in the rest of the industry, we seem to get a lot more effort from our workers. Because of Herb's hands-on style, we have such good labor-management relations that few people realize we are heavily unionized. Our passenger-per-employee ratio of 2,100 to 1 is about twice the average of our nearest competitor, and we need just ninety-one people to run each plane. No other major airline even comes close to getting below-hundred-person teams.
Judging by the impression Southwest workers make on passengers, though, you'd never guess there are significantly fewer of us involved in serving the public. Customer letters praise our service and often single out particular employees for their humor, creativity, and endearingly helpful ways. In our case, it really does seem that less is more.
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Meet the Author
Fred Wiersema is a business strategist and sought-after lecturer, as well as the author of Customer Intimacy and coauthor of The Discipline of Market Leaders. He is the founder of Ibex Partners, a global think tank that focuses on strategies for market leadership. Dr. Wiersema has worked with high-profile companies on issues ranging from business development and market strategy to competitive positioning and management alignment. He and his family live in the Boston area.
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