Are Customer relations friendships?

Customers in a shop or guests in a restaurant usually very much appreciate it when the employees are friendly, understanding or even empathic. It contributes to the fulfillment of their desires and needs with full satisfaction. Therefore, customer focus rightly is an important requirement in customer relations – the customer as a human being should always be in the center.

However, the human relationship between the customer and the company is being abused more and more as a sales gimmick. At Starbucks, you’re the barista’s best friend; you belong to the IKEA family or the salesperson at the high end Ralph Lauren store trusts you with her very own preferences.

The staff in shops or restaurants is instructed to create a feeling of closeness through simulating a strong friendship. Customers get the feeling that you really like them. But in reality it is only about encouraging them to buy more. It’s not about the individual and understanding and considering his or her personality and needs, but about hard selling and sale success. So customer focus ultimately only serves the purely financial success of a company and doesn’t add to the perceived quality of life of a particular customer.

 However, in a humanistic perspective, human beings are considered as ends, not as means. Each human being is a unique person with specific interests and values. Already in the 1970s, Erich Fromm called for recognizing the “oneness” of people in a capitalist society, instead of considering them only in anonymous customer group categories in terms of “sameness”. Pretend friendships exploit our human peculiarities.

The employees of companies with such sales strategies are exposed to an emotional dilemma. They are asked and usually also trained to put their human abilities in the service of financial ratios. As a customer you also face a dilemma: How should you interpret the kindness of the salesperson? If it is authentic, you don’t want to reject it, but if it’s only manipulative, you can’t and don’t want to trust their advice.

 However, recent empirical 1) evidence confirms that the trustful treatment of people and their recognition is crucial to the perceived quality of life. I hope that in 2014 you will have the opportunity in your professional life to contribute to the quality of human life. 

 

1)      Anderson, C., Kraus, M. W., Galinsky, A. D., & Keltner, D. (2012). The Local-Ladder Effect: Social Status and Subjective Well-Being. Psychological Science, 23, 764-771.

Purpose matters

This weekend I was visiting my father who is spending four weeks in a little village in the Swiss mountains for recovery. When I entered the hotel I was pleased with the warmth of the receptionist. She gave me the feeling that I was really welcome and that she cares for me. It was not the usual customer orientation we experience in many hotels from employees who are trained to be customer oriented. It was an encounter between human beings. During the entire stay in this hotel I met various people who love their work because they like caring for others.

The hotel belongs to a foundation, which aims at providing services to human beings in all phases of life. Besides hotels they are engaged in child and elderly care.

In doing business we often have a weak connection to why we are doing this work. Rendering a good service is much easier when we know why we are doing it and what we stand for when providing these services.

This hotel stands for doing good to people. Whether we base this on Christian values or on a humanistic commitment in a philosophical sense does not matter that much. What matters is that we know with which purpose we are serving whom. Customer orientation in this perspective is not a mere technical term but a humanistic commitment in the broader sense.

Sybille Sachs

Caring about the customer

 

 

In stakeholder management customers are regarded as primary stakeholders of the firm but also many a firm not pursuing general stakeholder management, does think it should be customer oriented. “Usability”, “ergonomics” and “human centred design” are no longer exceptions in strategic considerations. The customers are moving toward the core focus of business, which I think is a good development, because traditional customer orientation is not enough. A deeper and more honest relationship to the people who are buying your goods is necessary. As I see it, the primary focus should not be on how to sell more of a company’s products, but on what the person buying the product really wants (also resulting in selling more products).

I would like to illustrate this think shift: Many people like to eat healthy food. A snack company spots this customer need, puts some milk into the product and praises it as being a healthy snack, even though most nutritionists would assess the product to be of the contrary (heavily sugared and fatty). So just by recognizing and addressing the consumer need doesn’t make a customer centred firm. Another example: Consumers like the look of dark red meat (not grayish meat) because they have built the mental shortcut (heuristic) that intense color in food is a sign of freshness. This is why market research study participants would prefer the dark red meat to a grayish meat product. A company that follows what the consumer actually wants, will not sell the consumer a meat that was treated with a gas that keeps it red (but doesn’t keep it fresh), it will sell the consumer fresh meat. This is not only a shift in strategy, this will have wide implications for a company’s daily business in distribution, packaging, communication and so on.

 

We use these mental shortcuts (here: intense color equals fresh food) because they mostly lead us to making good decisions (read publications by Gerd Gigerenzer for more on this topic). Shortcuts make life easier; especially in this fast paced, information-overloaded environment. These heuristics are good because they are often based on experience and implicit knowledge. But the shortcut only works if it is not tampered with by others. Robert Cialdini, a social psychologist, wrote several books on persuasion, summarizing his findings based on many experiments he had made in his research on e.g. selling tactics. But he states “Just because a given [powerful psychological] principle is successful does not mean we are ethically entitled to commission its persuasive power to create change.” I think this misusing psychological mechanisms such as heuristics is not only unethical it is also a strategy that won’t lead to sustainable business success. A company that shares its purpose (the “why” of a company) with its customers and therefore wants the same thing, will be able to engage the people they call their customers and conquer the challenges (such as resource scarcity) together in an innovative way, and of course sell their products.

 

Vanessa McSorley

About minimizing costs and transferring costs

 In general, minimizing costs is seen as a virtue: Who in the process of producing goods and services seeks to keep costs as low as possible avoids the unnecessary squandering of often valuable resources, which could otherwise be put to good use. Who would oppose this? Unfortunately, one soon discovers that the word ‘minimizing costs’ is not always used in this positive sense, but often with far less noble intentions.

When I call my insurance company, as a rule I’m told that all the employees are busy at the moment, that my call is however welcomed and I will be connected as soon as possible with an available representative. Then without being requested, an overview of the products and services of the company are transmitted, framed by a catchy melody by Mozart or Louis Armstrong. In the meantime, without having asked for it, my waiting time has increased and with it the cost. After a certain time the whole welcome ritual is repeated – all at my expense! The reason for this is that the insurance company has reduced the number of its employees in order to cut costs, which by virtue of my waiting time has in essence been transferred to me. This is not cost minimization but rather cost transferral.

Something similar takes place when I’m at the train ticket-window of the Zurich Main Station to get a train ticket not available from the automat. Of the 11 available windows, only 3-4 are open; of which one is served by someone in training and another Korean tourists are trying to put together their trip through Switzerland. At the 2-3 well functioning windows a queue of maybe 10 or 15 people are waiting. Again the company is minimizing its costs at the expense of their customers. How the cost transferral of the Swiss train service takes place can be witnessed at the above location, daily for hours and especially at rush hour. It would be interesting to calculate how many man-years the economy loses or to estimate how much is lost in human wellbeing, including that of the persons at the windows, who are subject to constant pressure and the cantankerous reactions of customers. In no way does this correspond to the concept of “people for people”, as we understand up-to-date value creation in firms.

The most crass examples of unreal cost minimization are those promoted by some politicians. They tell the public for example how the cost for health or educational institutions can be kept low or that one can save money on infrastructure. However they fail to say that this very often involves a tangible reduction in benefits. This has less to do with the virtues of minimizing costs than with a net loss in the quality of life.

Edwin Rühli