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Sri Lankan Business World

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A critical review on THE SRI LANKAN BUSINESSES

The success of a product or service is largely dependent on service. Customer service is the provision of services before, during, and after the purchase of a product or service in order to enhance satisfaction. Customer service ensures that the product or service serves its purpose from inception to its use and disposal. Most organizations across the world have recognized the importance of customer service in increasing sales, customer satisfaction, brand loyalty, and customer retention. The legal and regulatory frameworks in most countries have forced organizations to keep up to their brand promise and deliver to the satisfaction of the customer. Sri Lankan organizations have realized the importance of customer service, however, have not yet elicited successful progression in this path. A couple of recent examples of poor customer service:

  1. Recently, I purchased some floor tiles from a popular up-market tile manufacturer in Sri Lanka. The service was great and the sales person seemed very concerned of my needs. However, this was short lived—only until the purchase was over. Subsequently, I purchased another set of tiles from the same manufacturer. There was a slight mismatch in color in the second batch, and they told me that only after I had made the payment. After a complaint, they agreed to refund any unused tiles. I happened to return some of these tiles and when I took the tiles to them in their original packaging as instructed, they said that they cannot refund the money, but can offer vouchers for more tiles. I told them that my need for tiles was over and even if I had a need, I wouldn’t come to them after the negative experience. I demanded a refund. They discouraged me saying that it will take about a month to refund the money. I did not understand how a simple thing as the reversal of a payment could take a month in a world where transactions take place across national boundaries within seconds. Finally, after continuous calls back and forth and being put on hold for hours when called, I managed to get my refund, about eight months after the original request.
  2. I am not a big fan of custom-made products—I prefer mass produced products. My slippers were worn-out and I was on the look for a good comfortable pair. My wife suggested that I go to this “great custom leather shoe manufacturer” close to Galle Road in Kolpety. The shop had a couple of handcrafted slippers, which did not fit my size or did not serve the purpose. I spoke to the owner and he told me that there was something wrong with the shape of my feet and that it requires a custom-made pair of slippers. He also advised that if I continue to wear normal slippers it would worsen and cause orthopedic issues. He told me things that I can assume only an orthopedic would know. The convincing part was great and after much hesitation, I agreed to go for a custom-made pair at a premium price. As promised the pair was ready in two weeks, I picked up the new pair but neither the salesman nor the owner showed any enthusiasm compared to the first day. I only wore the pair for an hour and my feet were hurting, I tried it for a day with great difficulty and then decided to take it back to the manufacturer. The so called “expert” had failed to do his custom job this time. He then told me that custom pairs won’t work for my feet and that he cannot refund the money and I will have to go for a pair in store with a replaced sole. I did not have a choice, so I selected a pair from the store. Two weeks later I came to pick up the new pair, just only to find an old-looking, poorly-crafted, aesthetically-dull pair of slippers. They had just pasted the sole without fixing it professionally. The edges were just cut pieces of leather affixed poorly to the original pair. I could have done a better job myself. I complained to the owner and his reply was “there is nothing wrong in this pair, that’s how it is, and that is the best we can do.” And he put the pair back in the bag and forced it on me. Few days later I found a better pair which cost a fifth of the price, on my way to Kandy in a small leather shop.
  3. A couple of months back, an agent of a local telecommunications service provider called me and said that there is an offer for cable television. After considering the conditions, I agreed to install a unit at my home. After a couple of days, two agents from the service provider came to our place and got us to sign an agreement. They promised to fix the unit within a week. After a month, since they did not turn up to fix the unit, I decided to give the agent a call. The agent said that they will fix it in a week. In the mean time I was asked to submit another request by visiting one of their service centers in Colombo 5. A month after submitting the request I called the agent back and she said that the service provider was out of stock and I will have to wait until the next stock arrives and was asked to submit another request, which I did not. It has been almost a year now; I am still watching terrestrial television and waiting to hear from the stock department of the service provider.

On the contrary there are small businesses with entrepreneurs with no MBAs or knowledge on marketing concepts that provide better after sales service to their customers.

What I have mentioned is just three out of about twenty instances of poor customer service over the past year of dealing with Sri Lankan companies. Customer service is a taken-for-granted aspect in Sri Lankan businesses. If at all, only a handful of companies strive to uphold the standards of customer service and deliver their brand promise. Most sales people and customer service staff seem to think that they are doing the customer a service by trying to fix an issue of their product or service. Little do they know that it is their duty to fix these issues—the customer already paid for the product or service in anticipation of better utility. Advertising and branding makes promises that build increased customer expectations yet due to delivery of bad after sales service the gap between expected and experienced is greatly increased. A legal system that is not strong enough in defending the customer, the hassle of suing, and dissatisfied customers keeping quiet about these injustices contributes to this reality. On the contrary there are small businesses with entrepreneurs with no MBAs or knowledge on marketing concepts that provide better after sales service to their customers. Exchange of an item is done without a fuss, and the approach to rectifying is polite. These businesses—although were started in small scales—expand quite fast and their employees seem to have the same values as their leaders. The Government has plans to develop six key hubs in Sri Lanka in its development strategy to become the Wonder of Asia. The six sectors of focus are leisure, shipping and ports, aviation, energy, commercial, and education. This means that there will be more foreign direct investments (FDIs) coming in to the country and in return Sri Lankan companies will have to step up to deliver a world-class service in order to be competitive in the market. This is where customer loyalty and repeated purchases will be more valued than one-off purchases. Customer experience, without a doubt will be a catalyst of the bottom-line. I’ve picked a few statistics from the Beyond Philosophy blog of Colin Shaw to illustrate this point:

  1. “Price is not the main reason for customer churn; it is actually due to the overall poor quality of customer service.” —Accenture Global Customer Satisfaction Report 2008
  2. “A customer is 4 times more likely to defect to a competitor if the problem is service-related than price- or product-related.” —Bain & Company
  3. “The probability of selling to an existing customer is 60%–70%. The probability of selling to a new prospect is 5%–20%.” —Marketing Metrics
  4. “For every customer complaint there are 26 other unhappy customers who have remained silent.” —Lee Resource
  5. “96% of unhappy customers don’t complain, however 91% of those will simply leave and never come back.” —1st Financial Training Services
  6. “A dissatisfied customer will tell 9–15 people about their experience. Happy customers who get their issue resolved tell 4–6 people about their experience.” —White House Office of Consumer Affairs
  7. “70% of buying experiences are based on how the customer feels they are being treated.” —McKinsey
  8. “55% of customers would pay extra to guarantee a better service.” —Defaqto Research
  9. “It takes 12 positive experiences to make up for one unresolved negative experience.” —“Understanding Customers” by Ruby Newell-Legner
  10. “It costs 6–7 times more to acquire a new customer than retain an existing one.” —Bain & Company

Customer service will inevitably make or break your profit and brand name. So invest and make your decisions on customer service wisely, today.

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