In hard times, try harder

2008-12-11 00:00

As talk of global recession sends many companies on a cost-cutting mission, I am reminded of a remarkable story from the annals of European history. In 1815, the British army under Wellington faced the might of Napoleon’s forces at Waterloo.

Most investors in London, on fearing a French victory, panicked, with many selling into a weakened market. One person, Nathan Rothschild, head of the Rothschild banking family in London, spotted an opportunity. He was the first person in the city to learn of Wellington’s victory, thanks mainly to a private intelligence system that he had established. Rothschild sold his investments, knowing that most other investors would interpret his move as a signal of Wellington’s defeat, and also sell. As the London market collapsed, Rothschild started to buy. When Wellington’s victory became public knowledge, the market skyrocketed. Rothschild’s shrewdness made him a profit of one million pounds, a formidable sum in 1815. He coined the now famous phrase that the time to buy is when blood is running in the streets.

This story is inspirational for those companies wanting to remain competitive during times of economic difficulty. Yet as the first signs of recession appear, many companies take fright, and start to cut back, instead of investing in customer service.

The following six tactics will assist firms to weather any economic downturn, from a customer service perspective.

• Don’t cut service at the front line. Make sure that service is consistently spectacular wherever your company touches your customer, or customer organisation.

Empower your front line people to make decisions that will encourage customers to do business with you. Invest in suitable training programmes to keep your staff sharp, motivated and focused on serving their customers well.

• Bring your suppliers into the picture. They can be an incredible source of ideas. The knowledge, skills and expertise that suppliers have in their industries can be a useful input to your service output.

• Become embedded with your customer. During a downturn, customers need to be understood at a deeper level. Companies in the business-to-business sector can use the adverse conditions to improve their understanding of customers’ businesses with the view to identifying and exploiting value-adding opportunities. Companies selling to the consumer need to reassess consumption patterns and adapt their service to encourage customer spending.

• Re-evaluate your systems. Take the opportunity to examine all your systems — sales, production, operational, warehousing, delivery, administrative, financial, etc. Chances are that there is one or more blockage preventing your organisation from giving impressive and spectacular service. Look to improve the status quo.

• Ensure a first-class complaint handling system. At the best of times, employees don’t like dealing with complaints, even though they know that complaints provide the company with feedback about how it is performing. During times of economic difficulties, complaints enable a company to sharpen its skills when purchasing consolidation may well be taking place in its industry.

• Invest in employee behaviour. The manner in which employees deal with customers is even more important during an economic downturn. Sam Walton, founder of Wal-Mart, the world’s largest company, once said: “There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, by spending his money somewhere else.” The secret to customer service during a downturn is to prove to the customer that al-though times are difficult, you are willing and able to help him or her cope. Adding value in a business-to-business setting, or to the end consumer, is a worthwhile investment, the dividends from which will be payable when the good times return.

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