It’s amazing that we are in the 21st century and we seem to have solved many of life’s mysteries, yet can’t seem to get our hands on quality customer service. I have therefore decided to make a short step-by-step guide for companies that find themselves in trouble with customers. They need to engage in what I call “Recovery Customer Service”, or recovering the trust of expectations that they lost due to their error. The following are three main rules that executive officers of corporations should memorize, and instill in their customer service departments.

1) Admit You Were Wrong

Have you ever had a longtime friend who did something wrong to you? It happens to the best of us, and we do it to them as well. What did it take to smooth things over? Generally, you start by saying “I’m sorry - I know what I did was wrong”. That simple phrase (although painful to some people’s ego) establishes an atmosphere of respect for the other person, as well as letting him know you are being honest and have a realistic view of what has occurred.

2) Take Action To Prevent It From Happening Again

Have you ever had a longtime friend who did something wrong to you? It happens to the best of us, and we do it to them as well. What did it take to smooth things over? Generally, you start by saying “I’m sorry - I know what I did was wrong”. That simple phrase (although painful to some people’s ego) establishes an atmosphere of respect for the other person, as well as letting him know you are being honest and have a realistic view of what has occurred.

How do you know if your friend meant it? Is he really sorry? Well, the measurement we usually use is: People who are sorry for what they did, take all necessary actions to avoid it from happening again. It doesn’t mean much to you that your friend is “sorry” for getting into an accident with your car if it happens every week, right? Surely we require the person admitting they are wrong and that they not only regret (that is, feel bad) what happened, they actually don’t want it to happen again and will exert effort to prevent a recurrence. This builds your trust in that friend again.

3) Compensation, Compensation, Compensation

When it comes to real estate, location may be the key, but when we are talking about service errors, compensation is the key. We see too few companies following through on steps one and two, but few are willing to compensate appropriately.

What is the appropriate amount to compensate? Well, figure out the fair cost, and then add something special on top. For example, say I took a trip on an airline and the meal was spoiled. A proper compensation would be (a) a voucher for a free meal at a local restaurant, (b) a refund of $50-100 for that flight, or (c) a free flight.

Now, of course, those of you in the customer service departments reading this will think this is absurd. Your very job usually requires you to fight any customer who calls in a complaint, and the idea of “giving” something, especially something the customer would actually appreciate, is slightly repulsive to you. But guess what? On that flight, if you add up all the damage you caused, you should compensate me for:

- the loss of a decent meal
- the violation of my expectation of a decent meal (which your ads frequently hold up as being “world-class”)
- ruining my “experience” of a wonderful flight

After all, the very buffer in pricing that you charge me over your actual gas and labor costs, is only due to your brand - a “promise” of how business will be run. You violated that promise, and therefore the value of that flight to the customer with the spoiled meal is lowered (and not just by the actual value of the meal).

Follow me? Most companies don’t even think about proper compensation, and this is a major problem. Have they forgotten how much easier it is to get repeat business than to earn new customers?

An example of a company which recently harnessed these three rules is JetBlue. In case you don’t know what I am referring to, you can read more about their Valentine’s Day crisis.

If you follow these three rules of customer service when your company fouls up, you can be sure that the bottom line will not be hurt in the long run…although you may get a few scrapes on your ego.