Contempt for Customers - 2 Tropicana Pure Premium

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Running alongside my occasional series on Management Insults, I thought I'd add a set of entries entitled, "Contempt for Customers" that will highlight some of the ways in which companies, largely through their marketing materials or product packaging demonstrate their contempt for their customers. Funnily enough I don't think there will be any shortage of material for these blogs!

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It would be difficult these days for anyone to fail to know that there are concerns about our stewardship of the planet and how it is in a state of considerable stress environmentally.

Most of us are familiar with the concept of organic produce and the need to ensure that crops are grown in a sustainable fashion - that is efficiently and with the lowest possible impact on the environment.

One aspect of this is a growing concern about something called food miles. Over 90% of the food on our supermarket shelves is imported. While it may cost the supermarkets themselves less to source their produce this way, they are not picking up the tab for the environmental damage that this results in. A recent Defra report estimates the cost of food miles at £9 billion each year.

This is a sufficiently serious problem that the UK Government has decided to take action and is planning to reduce the environmental and social costs of food transport in the UK by 20 per cent by 2012.

This is not news - it is very widely understood throughout the food industry and the retail sectors. Already the supermarket chains ARE doing something about it - albeit we could question how seriously, how quickly and what their motives are, given that they knew about all this for a long time but only appeared to take action when there became a consumer demand.

So you would think that food producers would also be sensitive to it; would do all they could to source locally; would minimise their transport impacts where they can and would endeavour to offset 'unavoidable' impacts using one of the schemes set up for the purpose - through which an organisation establishes woodland or other habitats to offset their environmental impact.

Sadly though this news doesn't seem to have reached Tropicana - the makers of a range of 'Pure Premium' squeezed fruit juices. Their product packaging instead proudly boasts that EVERY DAY, a train measuring ONE MILE LONG, travels OVER A THOUSAND MILES carrying their juice to quench the thirsts of New Yorkers ALONE.

Now, if I was the producer of Tropicana, I don't think I would be proud of that kind of environmental pillage. If such devastation is really justified, then I would be boasting of all the things I was doing to put right the damage that my train was causing to the environment.

Oranges don't grow all year round - not without artificial help they don't. Yet, Tropicana only uses those picked at their MID-SEASON BEST, so they are presumably storing the juice somewhere after it is squeezed since nowhere on their package do they suggest that it is FRESHLY squeezed. So, we are left to wonder what other damage they are causing in the production and storage processes before they train the stuff over the US to those folks in the "Big Apple".

Interestingly, they describe their consumers as DISCERNING. It seems to me that they can't be that discerning if they wilfully sanction damage on this scale by buying it in such quantities. Whatever, Tropicana definitely qualifies for one of my Golden Awards for Customer Contempt for its brazen packaging!

Best wishes

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GRAHAM WILSON
London + Oxford - 07785 222380
Helping Organisations & People Achieve Things They Never Dreamt Were Possible
grahamwilson.org; inter-faith.net

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Contempt for Customers - 1 Chiltern Railways

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Running alongside my occasional series on Management Insults, I thought I'd add a set of entries entitled, "Contempt for Customers" that will highlight some of the ways in which companies, largely through their marketing materials or product packaging demonstrate their contempt for their customers. Funnilly enough I don't think there will be any shortage of material for these blogs!

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Back in the 1980s, more and more companies woke up to the importance of quality as a competitive strategy. What this really meant is that there were so many organisations offering rubbish that by selling something that actually worked, or did what it said on the box, you could either charge a premium or sell more items. The same applied to services. The word got around that it was clever to "listen to your customers" and firms started offering those not-so-wonderful** "freephone" (0800) or "lo-call" (0845) numbers to encourage their customers to let them know how they had done. Only the tiniest business would dream of offering other than 24hr answering on these phones.

When they analysed the types of call and the topics customers complained about, there were some surprises. For example, Texaco emblazoned their 0845 number on every petrol station forecourt expecting complaints about hygiene, lighting, slow-resetting of pumps, rude staff and so on. Instead, apparently 9/10 calls were to complain that the customer hadn't been given enough stars on their Texaco points card! (These were the days when the points were STUCK on to a collecting card!)

Many firms found it quite hard to recruit people to work on these lines. After all, it isn't exactly motivating to spend a shift just listening to whinging customers - some of whom have a serious stress issue, some are trying to rip you off [work out how much an extra Texaco Star was worth and you'll see these were not exactly big time criminals!], and some have a genuine complaint. So we began to see smug firms changing the name of their COMPLAINTS department to CUSTOMER SERVICE or some similar platitude.

The ultimate Mickey take of this kind was the Carlsberg advertisement that featured a phone ringing in the distance, until a diligent member of staff tracked it down to a cobweb strewn room that hadn't been opened in decades and was labelled "complaints" department - only to discover that it was a "wrong number". The ad back-fired on Carlsberg because it implied that IF you DID have a genuine complaint, you could ring their number and it would take ages before it was answered.

So, you'd think that companies would have become a little more sophisticated in their handling of COMPLAINTS these days. After all there are Professors of Customer Service, PhDs on the topic, and even modules on MBA programmes dealing with it. And yet, Chiltern Railways have managed to bungle in just about every way possible today, demonstrated their credentials for the "Contempt for Customers" gold award.

When I arrived at the Bicester North station at 10:45 this morning, planning on catching the 11:04 to London having renewed my Network Railcard, I was disappointed to discover that the Ticket Office was closed. I stood looking at the screen for a moment in some amazement, but realised I would have to buy a full fare ticket instead and call back to renew my Railcard another time. Irritated, I turned to one of the ticket machines and let myself be led through the ticket buying process. Now, I would like to give credit where it is due... Whoever the techie was that designed these machines, they did a pretty good job. Frankly, you'd need to be fairly thick not to be able to work out how to use one. It even remembered what I had bought last time and offered me that as an option. Sadly I couldn't take it as I no longer had the Railcard, so instead a little salt was rubbed into an open wound by making me doubly aware that instead of a £13 fare I was going to have to spend £20.

Now, although these machines are pretty much idiot proof, there was actually a very considerate person in the booking hall helping what I assumed were fellow passengers to use the machines. It seemed that they had been motivated to be a good Samaritan because the ticket office was unbelievably closed. (Bicester North gets quite a few foreigners because of the Bicester Village Retail Outlet and I guess these were foreigners who couldn't work out how the machines worked!) Incidentally, the Samaritan was wearing blue slacks, a white Aran type pullover and a red padded waterproof jacket.

Armed with my tickets, I boarded the train and arrived at Marylebone. Now this is where the customer experience began to get worse. As I reached the concourse, I noticed that there were a couple of similarly dressed individuals standing there. In addition to the red jacket and blue slacks they had peaked caps and badges - indicating that they were employees of Chiltern Railways!

In other words, a regular customer had arrived in the booking hall in Bicester, stood in dismay at the closed ticket office, bought a higher priced ticket, and been made to queue later for a railcard, when all the time a member of Chiltern Railways' staff was ignoring him and helping people use machines to buy tickets that any child could use without difficulty.

Now, being a conscientious follower of quality improvement, I figure that unless an organisation knows how it has fouled up it can't do anything to put it right. So, this afternoon, when I got home, I decided to ring Chiltern Railways to tell them of my experience and suggest that they help the Ticket Office clerk with the Aran pullover (no Samaritan, after all) to reevaluate her priorities when she is meant to be serving behind the desk.

The Chiltern Railways website doesn't have a button to push for their COMPLAINTS department. Instead, you have to follow a "contact us" link in tiny letters at the top of the screen. Once there you are given an 0845 number to ring for "Customer Services" but there are two provisos;

The phones are only manned "Mondays to Fridays 0830 to 1730". Now, given that this is the time that the vast majority of their customers will be at work, doesn't it seem a little avoidant of them to pick those hours? Perish the thought that they could man the phones when agrieved customers can actually ring in.

But obviously, quite a few customers DO manage to COMPLAIN because we are also told; "On average, our Customer Services team receives about 500 contacts every week. They aim to respond to all correspondence within 10 working days."

Now, that brings me to the real contempt-for-customers issue. What they are saying is that, despite putting loads of obstacles in their way, FIVE HUNDRED (500) PEOPLE EVERY WEEK TAKE THE TROUBLE TO RING CHILTERN RAILWAYS TO COMPLAIN ABOUT THEIR SERVICE.

I don't think that is a track record I would be proud of. Would you?

** So why are 0800 and 0845 numbers not-so-wonderful any longer? Well, it's simple really, for more than 15 years now, telephone service providers have been selling packages to householders whereby they can pay a fixed price and get all calls to REAL numbers free. But the 0800 and 0845 ones don't count for those deals, so ironically, a company that provides such a number to 'encourage' its customers to ring is actually causing the customer to pay more than they would have to do if they were given a REAL number instead. Savvy firms (such as British Airways) have realised this and almost always cite both numbers for the customer to choose from, but obviously Chiltern Railways is not so savvy!

Best wishes

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GRAHAM WILSON
London + Oxford - 07785 222380
Helping Organisations & People Achieve Things They Never Dreamt Were Possible
grahamwilson.org; inter-faith.net

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Profit and loss - more than a simple equation

In the real world, profit may be achieved fortuitously through little effort, minimal investment, almost immediately and at next to no risk. Conversely, losses can be incurred despite enormous effort, huge investment, tremendous 'patience', and great risk. Profits are NOT therefore a reward for these qualities, so what entitles a business to make them?

The Western economy is portrayed as operating within a 'free market'. This model argues that profits are the result of a business offering products and services at a price that is determined through competition, at a cost achieved through the efficient use of resources. Among competitors, the business that conserves resources (ie keeps costs low) is rewarded with the greatest profit. Of course, there are many markets that do not operate competitively - monopolies, cartels, and those where the price is predominantly determined by Government levies are obvious examples. In these price is actually determined by what the customer is prepared to pay. The company can therefore manipulate the price to maximise their profits, which leads to the question of what is a "fair" profit for them to make?

There is plenty of evidence that good firms invest wisely in new products, but this often focuses on applications rather than new technologies and has sadly been used as an excuse by some to dilute their profit and justify exceptional earnings, while it is actually escalating their profits in the longer-term. How much should a company be expected to invest in itself to sustain its future?

In this environment, it is important that there are some who can take a longer term view, who have a belief in the potential of almost anything and who are prepared to tie up their resources (generally financial but occasionally intellectual) until a return can be achieved. These people effectively regulate the free market economy by managing shortages and surpluses. Such speculators depend on the quality of their knowledge, imagination and luck. Society has strong views about the behaviour of speculators especially when their 'knowledge' is gained through insider networks, or the result of their 'luck' is actually a 'fortune'. Is luck an appropriate basis on which to manage a business?

Another form of speculation is internal investment in new technologies. The speculator alone though cannot create wealth - they create the opportunity but they don't create the products. Instead, they depend on someone finding a way of converting the raw materials (and ideas) into merchantable goods and services. Such people are 'entrepreneurs', balancing risk of failure with longer-term investment in the future. But, there's a finite pool of money to reward investors (including employees) and develop capacity. How much should a company risk investing in speculative new ventures?

Under the free market model, it is at the individual level (corporate and personal) that 'success' is measured in profits, yet it is often self-reinforcing - the more successful someone is, the less they risk and the less important luck is. This leads to the view that there should be a fairer distribution of profit either through government intervention (taxation) or personal discretion (philanthropy).
There's good evidence that philanthropic organisations out-perform those who are more self-interested, though that's a view that is not popular with many companies! Nevertheless, a US survey demonstrated that companies who are committed to giving increased their contributions by 14% last year, closely tracking their profits which rose by 17% and their turnover which rose by 15%. Philanthropists are often inspired by their Faith and such people formed the bedrock of social reform in the Industrial Revolution, but today there's frequently cynicism about the motives of industrialists who sponsor educational institutions or engage in politics. Is philanthropy something that should be expected, required, or left to individual judgment and what proportion of profit should a business expect to contribute?

NB These notes were used to stimulate discussion at a management retreat that I led recently.

Best wishes

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GRAHAM WILSON
London + Oxford - 07785 222380
Helping Organisations & People Achieve Things They Never Dreamt Were Possible
grahamwilson.org; inter-faith.net

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