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Outstanding
Customer Service:
The Key to Customer Loyalty
David E. Deviney, D.B.A.

HOW TO
BOOKS
HOW TO
1
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SAMPLE
Outstanding
Customer Service:

The Key to Customer Loyalty

David E. Deviney, D.B.A.

Coastal Training Technologies Corp.
500 Studio Drive
Virginia Beach, VA 23452

Outstanding Customer Service:
The Key to Customer Loyalty

SAMPLE

David E. Deviney, D.B.A.
Copyright ©1998 by Coastal Training Technologies Corp.
All rights reserved. No part of this publication may be reproduced, stored in a retrieval
system, or transmitted, in any form or by any means, electronic, mechanical, photocopying,
recording, or otherwise, without the prior written permission of the publisher.
This publication is designed to provide accurate and authoritative information in regard to
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publisher is engaged in rendering legal, accounting, or other professional service. If legal
advice or other expert assistance is required, the services of a competent professional should
be sought.
Credits:
PCoastal Training Technologies Corp.
Editor in Chief:
Designer:
Cover Design and Illustration:

Art Bauer
Todd McDonald
Karen Massetti Miller
Gayle O’Brien
Kevin Zdenek

Published by Coastal Training Technologies Corp.
500 Studio Drive
Virginia Beach, VA 23452

Library of Congress Catalog Card Number 98-72664
Deviney, David E., D.B.A.
Outstanding Customer Service: The Key to Customer Loyalty
ISBN 1-884926-95-9

Printed in the United States of America
01 00 99
98765432

Introduction
“Sales are down. We’re just not getting repeat business. We have to improve our customer
service!”

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If you’ve ever worked with customers, you know how vitally important outstanding
customer service can be in building customer loyalty. And you probably also know
that improving customer service is more complex than most people realize. For
example, suppose an organization wants to help its employees improve their telephone
customer service skills. The employees attend a course in which they develop their
telephone communication. But when they return to work, they find that because of
the long delay customers have before they talk with them, the customers are upset and
even abusive. What is the problem?
Outstanding customer service means more than developing good communication
skills, though these skills are very important. In order for an organization to provide
outstanding customer service, it must develop customer service systems that support and
reinforce customer service skills. Customer service systems include hiring, training,
rewards, call servicing, repair support, and order processing, to name just a few. The
best telephone skills in the world will not be able to completely overcome a faulty call
system that requires customers to wait an unreasonable length of time before they talk
to someone who can help them.
This book focuses on customer service representatives, the skills they must develop,
and the systems within which they must work. Our ongoing theme is the basic
philosophy “We care about our customers.” I see this slogan and others like it
plastered all over the walls of some organizations—maybe you have too. I’m sure
these signs are well-meaning, but they miss the point. Words and advertising will not
convince customers that you really care about them—actions and behaviors will. If
you care about your customers, show them. As the saying goes, “Customers go where
they are wanted and stay where they are appreciated.”

Many of you reading this book may have little direct control over the customer service
systems you use. You probably do, however, have some influence over these systems
or at least over the people who work in those areas. To help improve systems, I have
included a section on auditing and continuous improvement that will help you
evaluate your role in the customer service system. You may even begin to influence
others to look at what they are doing too.

About the Author

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Dr. David Deviney is the owner of David Deviney & Associates, a consulting firm
that serves a variety of industries. As a consultant, Dr. Deviney specializes in customer
service, strategic planning, and behavioral change. Having progressed through the
ranks, he received his formal education later in his career. He is noted for his skill in
applying the theoretical in a practical world.

Acknowledgments

I would like to thank the following people for providing input and encouragement in
the writing of this book: Mary Alice Deviney, Jennifer Wilt, Norma Drown, Regina
McCarthy, Tom McCarthy, Mary Gomez, Dennis Engelke, Pat McNally, Carrie
Carson, Jerry Barton, and Bob Sobel.
All these people made my job a little easier.

Assessing Your Current Customer Service Situation
How to Get the Most from This Book

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This book is designed to help you improve your customer service skills and the
environment in which these skills are used. To get the most from this book, think
about the ways in which you interact with customers. We call these customer service
behaviors or actions. In addition, think of the environment you and your company
create for the customer encounter or interaction. It also has an influence on the
customer’s perception of you and your company. Ask yourself which behaviors you
are doing well. Recognize your strengths and continue to develop and improve them.
Ask yourself which behaviors need to change. Below is a self-assessment instrument
to evaluate your current customer service skills and your customer environment.

Customer Service Self-Assessment

This self-assessment will help you measure your current customer service skills and
the customer environment. You are given five choices from which to pick. For each
statement, circle the appropriate response that corresponds with how you see yourself
and your customer service environment. The five choices are Never (1); Rarely (2);
Sometimes (3); Usually (4); and Always (5).
Never Rarely Sometimes Usually Always

1. I greet customers with a smile.
2. Our customer environment is
pleasant and friendly.
3. When dealing with customer
problems, I focus on what I
can do, not what I cannot do,
for them.
4. I maintain a personal feeling
of control with angry customers.
5. People in other departments
are willing to help me with
customer issues.
6. I try to get as much information
as possible from the customer
before I make suggestions and
recommendations.
7. When customers ask me about
one of our products or services,
I feel comfortable answering
their questions.

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Never Rarely Sometimes Usually Always

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8. When helping a customer solve
a problem, I start by asking the
customer open-ended questions,
such as, “Tell me about the problem
you are having.”
9. When communicating with
customers, I make frequent
eye contact.
10. When communicating with
customers, I give them my
undivided attention.
11. We have an efficient customer
service operation that responds
to the customer quickly and
accurately.
12. I follow up on customer
complaints to make sure the
complaint was resolved.
13. My personal appearance is
proper for the customer
environment.
14. I understand that there are
different communication
preferences, and I use a communication style that is
appropriate for the person
with whom I am dealing.
15. When dealing with customers,
I summarize and repeat back
what they have said to make
sure I understand.
16. I feel confident in my ability to
tell a customer “no.”
17. I put a smile in my voice when
talking on the phone.
18. When dealing with upset
customers, I maintain a calm
appearance.

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Never Rarely Sometimes Usually Always
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19. I keep a log of what upsets my
customers.
20. I try to make every customer feel
special and important.
21. I control my emotions with
customers.
22. My company conducts a customer
service audit at least annually.
23. I constantly look for ways to
improve customer service.
24. My boss encourages suggestions
from me on how to improve
customer service.
25. At the end of customer
interactions, I ask customers if
there is anything else I can do
to help them and sincerely
encourage them to return.

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How Did You Score?

If you answered most of the questions as Always or Usually, your perception of your
skills and the customer service environment are effectively developed. You are to be
commended. However, don’t get too “puffed up” at this point. When we rate
ourselves, most of us tend to rate ourselves higher than others would rate us. The acid
test is how your internal and external customers rate your skills and customer service
environment. As you read through the book, identify some ways to make what is
already a good customer service approach even better. If you are not constantly
improving customer service, keep in mind that your competitor is.
Review areas that you rated Sometimes, Rarely, and Never. These are areas you
perceive as weaknesses in your customer service approach. As you read this book,
pay particular attention in these areas.

7

 Table of Contents

Chapter One

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Building a Strong Foundation
Who Are Customers?
Who Are Customer Service Representatives?
Why Is Customer Satisfaction Important?
What Do Customers Really Want from You?
What Is Your Role as a Customer Service Representative?
Maintaining a Positive Attitude
Developing Customer Service Standards
Building Your Product or Service Knowledge
Chapter Summary
Self-Check: Chapter One Review

10
11
14
15
17
18
20
24
26
28
29

Chapter Two

Communicating Effectively with Customers
Developing Active Listening Skills
Speaking in the Positive: Words and Tone of Voice
Body Language: Yours and Theirs
Sending a Message Through Physical Surroundings
Improving Your Telephone Communication
Understanding Your Customer’s Communication Style
Chapter Summary
Self-Check: Chapter Two Review

30
31
34
35
37
37
39
45
47

Chapter Three

Managing the Customer Encounter

Showing Customers That You Value Their Business
Understanding Customer Behavior and Creating Positive Outcomes
Asking the Right Questions
Dealing Effectively with Customer Hand-Offs
Making the Customer’s Problem Your Problem
Telling the Customer “No”
Closing the Customer Encounter
Following Through with the Customer
Chapter Summary
Self-Check: Chapter Three Review

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48
49
51
53
56
59
63
66
67
70
71

Table of Contents ●
Chapter Four

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Handling Complaints and Conflicts
Determining Why Your Customers Complain
Recognizing Different Conflict Styles
Calming Upset Customers
Controlling Your Own Emotions
Chapter Summary
Self-Check: Chapter Four Review

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73
75
78
81
83
85

Chapter Five

Continuously Improving Customer Service
Conducting a Customer Service Audit
Reviewing Your Customer Service System
Putting Your Learning to Work
Action Planning Form
Chapter Summary
Self-Check: Chapter Five Review

Answers to Chapter Reviews

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87
89
94
95
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98

100

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● Building a Strong Foundation

Chapter

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One

Building a Strong Foundation
Chapter Objectives
▲

Explain the connection between external customer service
and internal customer service.

▲
▲

Define the role of the customer service representative.

▲

Identify what customers really want from you and
your company.

Recognize the impact of attitude on customer service.

s a consumer, you are able to recognize when you have
received good customer service and when you haven’t. But
A
as a customer service professional, you might not always be able

An outstanding
customer
service system
must be built
on sound
customer
service
principles.

10

to recognize when you are providing good customer service and
when you aren’t. You may sometimes think you are giving good
customer service, but the customer may perceive that service as
below expectations. One of the primary reasons we don’t
recognize our own shortcomings in customer service is that we
do not realize that customer service is a system that must be
maintained and improved. To build an effective customer
service system, we must understand what influences that system
and how those influences affect customer service behaviors.
An outstanding customer service system must be built on sound
customer service principles. Without these principles in place, a
customer service system cannot reach the level to which most
organizations aspire. While this entire book explores customer
service principles, you will encounter some of the more basic
principles in this chapter.

Building a Strong Foundation ●

Who Are Customers?

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We will start by defining a very basic term—customers.
Customers are people who have a specific need or desire that
they believe can be satisfied by your product or service.
Customers can be either internal or external. We most often
associate the word customer with external customers. External
customers in both for-profit and not-for-profit organizations are
people outside the organization who benefit from that
organization’s product or service.

Internal customers differ from external customers because they
do not necessarily derive direct benefit from the organization’s
products or services. Internal customers are people within the
company who receive your personal work output. For example,
a salesperson takes an order from the external customer and
sends it to warehousing to be processed. The warehouse person
receiving the order is the internal customer of the salesperson.
Accounting and purchasing could also be internal customers.
Following this scenario, we can see that a customer service
problem between internal customers can have a dramatic impact
on external customer service. You cannot provide outstanding
external customer service until you provide outstanding internal
customer service.

1

Customers are
people who
have a specific
need or desire
that they
believe can be
satisfied by
your product or
service.

This book will focus mostly on external customers. However,
most, if not all, of the principles discussed apply directly to
internal customer relations.

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● Building a Strong Foundation

Take a Moment

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Consider your customers, both external and internal.

External Customers
How would you describe your external customers (rich,
poor, old, young, etc.)?
_______________________________________________
_______________________________________________
What do they expect from you?
_______________________________________________
_______________________________________________
What have been some of their recent complaints?
_______________________________________________
_______________________________________________
When customers come to you with complaints, are you able
to work with them so that they leave feeling good about your
organization?
_______________________________________________
_______________________________________________
What could you do differently to help complaining
customers feel good about your organization?
_______________________________________________
_______________________________________________

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Building a Strong Foundation ●

Take a Moment (continued)

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Internal Customers
List the departments or groups that receive your work
output (internal customers).
_______________________________________________

1

_______________________________________________
What do they expect from you?
_______________________________________________
_______________________________________________
What have been some of their recent complaints?
_______________________________________________
_______________________________________________
What was your attitude toward the complaints (negative,
viewed as opportunity to improve, neutral, etc.)?
_______________________________________________
_______________________________________________
Were the complaints resolved so that both the internal
customer and your organization won?
_______________________________________________
_______________________________________________
What would you do differently to improve internal customer
relations?
_______________________________________________
_______________________________________________

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● Building a Strong Foundation

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Who Are Customer Service
Representatives?
We have been using the term customer service representatives, but
who are they? When we hear the term customer service
representative, we generally think of employees with that title or
one similar. While it is true that they have more contact with
the customer than most employees, all employees within an
organization have some impact on customer service. For
example, a shipping clerk impacts customers by filling orders
promptly, and an accountant impacts customers by preparing
invoices accurately.
For some employees, contact with a customer may be casual,
yet it is still important. Consider the customer waiting in a
company’s lobby. An employee walks by but fails to speak to
the customer. That employee has probably just sent a negative
message, especially if the employee’s body language makes him
or her appear hurried or irritated. At a minimum, that employee
has passed up an opportunity to make a positive impression on
this customer.
As you can see from these examples, while some employees
have a great deal of interaction with customers, everyone has a
responsibility for projecting a “we care” attitude. Remember,
all employees project one of three attitudes to the customer:
negative, neutral, or positive. None of us want to project a
negative attitude, and we generally get feedback when we do
exhibit this attitude. Projecting a neutral attitude can be as
damaging to customer relationships as projecting a negative
attitude. In today’s highly competitive world, we must adapt,
develop, and project a positive attitude toward customers.
Customers must walk away thinking, “They really do care
about me.” Organizations must develop, reinforce, and
reward behaviors that reflect positive customer service attitudes.

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Building a Strong Foundation ●

Take a Moment

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What are some things employees do that reflect a negative
attitude toward customers? a neutral attitude? a positive
attitude? List them below.

1

_______________________________________________
_______________________________________________
_______________________________________________
_______________________________________________

Why Is Customer Satisfaction Important?

Almost everyone agrees that customer satisfaction is important,
but why? Why is it important to you, and why is it important to
your organization?

Take a Moment

Why is customer satisfaction important to your organization?
_______________________________________________
_______________________________________________
Why is customer satisfaction important to you?

_______________________________________________
_______________________________________________

The fundamental reason customer satisfaction is important to
your organization is because it allows your organization to stay
in business. In many businesses, service is the only thing that
makes your organization more attractive than your competitors’.

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● Building a Strong Foundation

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Customer satisfaction is also important to you on a personal
level. Using your customer service skills to satisfy your
customers will lower your stress level and help you avoid job
burnout. For example, calming an irritated customer allows
you to focus your energy on solving the problem rather than
arguing or dealing with your own frayed emotions.
You can derive a sense of satisfaction when you solve a
customer’s problem. Most customers appreciate your help and
will tell you so. No matter whether you are selling to a happy
customer or dealing with a dissatisfied customer, you have the
opportunity to help solve a problem.

Take a Moment

Think of all the reasons customers choose not to buy or
stop buying a product or service from your organization.
In your opinion, what are the top five reasons? List them
in order of importance with the most important first:

1. ___________________________________________
2. ___________________________________________
3. ___________________________________________
4. ___________________________________________
5. ___________________________________________

Compare the list you created in the previous exercise to the
following provided by the American Society for Quality:

16

◆

67% of customers leave because of an attitude of
indifference on the part of a company employee.

◆

14% of customers leave because of dissatisfaction with
the product.

◆

10% of customers leave for other reasons (move,
death, etc.).

◆

9% of customers leave because of competitors.

Building a Strong Foundation ●

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Was your list similar and in the same order of importance?
Where should you focus your attention?

What Do Customers Really Want
from You?

When customers decide to buy and use your product or service,
they make that decision based on their perception of how that
product or service will meet their expectations. This is Perceived
Value (PV). There are three components of perceived value—
Quality, Customer Service, and Cost. The relationship of these
three components can be expressed in an algebraic formula:
Perceived Value = Quality + Customer Service - Cost

1

There are three
components of
perceived
value—Quality,
Customer
Service, and
Cost.

You may produce a product, such as parts, paint, food, cars,
lawn mowers, lipstick, or paper. Or you may provide a service,
such as plumbing, accounting, house painting, computer repair,
consulting, or nursing. Whether you produce a product or
service, your output has characteristics and features that the
customer desires or needs. These characteristics and features
define the quality component. The customer service component of
the PV formula is defined as any helpful act performed for the
customer that enhances the quality of the product or service.
Toll-free numbers, customer calling centers, knowledgeable sales
representatives, volume discounting, and customer follow-up are
just a few examples of customer service.
According to the Perceived Value concept, if our customers
perceive our quality and customer service higher and our price
lower than our competitors’, chances are they will buy from us.
Remember, we are talking about the customer’s definition of
quality, service, and cost, not our own. Each customer can
have a different definition of each of these components and
may focus on one more than another. For example, a person
with an income of $75,000 may place less emphasis on cost
and more on the other components of quality and customer
service than a person with an income of $35,000. The person
with the higher income might shop at a full-service clothing
store, while the person with the lower income might prefer a
discount clothing store.

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● Building a Strong Foundation

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As we mentioned earlier, according to a national survey, 67
percent of customers leave because of poor customer service.
Compare this to the 14 percent who leave because of problems
with the product or service. As a rule, PV is influenced more by
customer service than quality or cost.

What Is Your Role as a Customer Service
Representative?
■ Bill’s high school was having a Career Week, and Bill was
interviewing his neighbor, Mary, about her job. “I know you’re a
customer service representative for your company,“ he began,
“but what exactly do you do?”
“I do a lot of things,” Mary responded, “but mostly I just make
sure the customer is happy.”

Is this an adequate description of Mary’s responsibilities? Often,
when customer service representatives are asked this question,
they give a similar response. Sometimes they also talk about the
technical aspects of their jobs, such as completing the work
orders for customer calls.

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Building a Strong Foundation ●

Take a Moment

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List your responsibilities as a customer service
representative. Be specific. For example, “Greet customers” is
too general. “Greet customers within one minute of their
entering the store” is specific. List your top 10 responsibilities.

1

1. ____________________________________________
2. ____________________________________________
3. ____________________________________________
4. ____________________________________________
5. ____________________________________________
6. ____________________________________________
7. ____________________________________________
8. ____________________________________________
9. ____________________________________________

10. ____________________________________________

As a customer service representative, your job is to influence,
as much as possible, all three components of the customer’s
Perceived Value. While you generally have more control over the
service component of the customer’s PV than quality and cost,
you can still influence the customer’s perception of quality and
cost by emphasizing the benefits of your product or service and
the reasonableness of its price. You begin this process the minute
a customer walks into your business, calls you on the phone, or
sends you an e-mail message.

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● Building a Strong Foundation

Other responsibilities of the customer service representative
include:
Creating a positive first impression of the product or service.

◆

Taking ownership of customer problems until they
are solved.

◆

Building positive customer encounters.

◆

Looking for ways to improve customer service systems.

◆

Knowing your products and services.

◆

Trying to understand the customer’s needs before making
recommendations or solving problems.

◆

Leaving the customer wanting to buy your products or
services again.

◆

Managing your own stress level.

◆

Doing what you say you will do when you said you would
do it.

◆

Enjoying the challenge of being a customer service
representative.

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You may not have reached all of these goals yet. Throughout
this book we will explore actions and behaviors that will help
you meet these responsibilities.

Maintaining a Positive Attitude
Managing Your Attitude

■ “I really am looking forward to the weekend,” Brittain said to
her coworker Yoshi as they started work Friday morning. “I’m
getting to the point where I hate to come to work. All I do is
deal with abusive customers. All they want to do is complain.”
“You work right beside me all week doing the same job as
mine,” Brittain continued. “Yet, you’re always upbeat and
patient with customers. How do you do it?”

20

“Well, I don’t look at customer problems as complaining,” Yoshi
answered. “I try to put myself in their situation and ask

Building a Strong Foundation ●

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myself how I would feel. That makes me more positive. When a
customer is really abusive, I tell myself that everyone has a
bad day. In general, I just try to keep my thoughts as positive
as possible.”

1

Good customer service starts with a positive attitude—your
positive attitude. An attitude is a person’s feelings toward a given
set of circumstances. These feelings may be positive or negative.

Both you and your customers begin each customer encounter
with an attitude. These attitudes will affect the actions and
behaviors each of you exhibit. You have little control over the
customer’s attitude. You can, however, control your attitude.
How can we describe a positive customer service attitude?

A positive customer service attitude begins when you come to
work expecting to have a good day. Since part of your attitude
is made up of your expectations for yourself, the way you
approach your day affects how you act and behave. For example,
if your attitude in the morning is “I dread going to work and
dealing with another irate customer,” chances are you will look
for that irate customer throughout the day. This may cause you
to misread a customer’s “irate level” and overreact.

A positive
customer
service attitude
begins when
you come to
work expecting
to have a good
day.

We all have days when we fall into the habit of negative
thinking. But the important thing to remember is that you can
take control of your attitude and turn a negative day into a
positive one. The following phrases can help you get back on
the positive track:
■ “I can help this customer solve a problem.”

■ “I can find something good in every situation if I look for it.”
■ “I have control over my life and this situation.”

■ “I am a good person; therefore, the customer is not angry
at me.”

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● Building a Strong Foundation

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People with a positive attitude use “I can” and “I will” when
talking to themselves and to their customers. Statements that
include “I can” and “I will” are empowering and help free the
creative side of the brain. This can help you develop creative
solutions to problems and lower your stress levels. Thoughts
of “I can’t” and “I don’t” are disempowering and give you
permission to stifle your creativity. With this in mind, talk
about what you can do for the customer, not what you can’t do.

Take a Moment

We have just seen some phrases that can help you turn
a negative attitude into a positive one. Can you think of
others? Write them below.

_______________________________________________
_______________________________________________
_______________________________________________

Overcoming Biases

■ Roger looked at the next person in line at his bank teller
window and shook his head. “Another high school student
with her first checking account,” he said to himself. “They’re
always overdrawn, but they can never admit it’s their fault.
I hate dealing with these kids!”

Our attitudes
toward other
people affect
our willingness
to accept and
deal with those
people.

22

Our attitudes toward other people affect our willingness to
accept and deal with those people. If our assumptions are
positive, our willingness and commitment increase, but if our
assumptions are negative, the reverse happens.
Over the years, you may have developed biases that lead you to
have a negative attitude toward certain customers. You may find
yourself reacting negatively toward customers because of their
age, the way they are dressed, their ability to speak English, or
their ethnic background. To provide outstanding customer
service, we must be willing to question our biases and challenge
the assumptions upon which they are based. This may not
always be comfortable, but you can change your attitude by
practicing positive thinking. All customers deserve respect.

Building a Strong Foundation ●

Take a Moment

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Are your biases keeping you from providing outstanding
customer service to all your customers?

1

Influencing Your Customer’s Attitude

As we said before, the only attitude you can control is your own.
You cannot change a customer’s attitude; however, you can
influence it. One of the best ways to influence other people’s
attitude is by listening to what they have to say and asking
questions to be sure you’ve understood their meaning. As
Michele Matt Yanna states in her book Attitude: The Choice Is
Yours , “The only way to better understand someone and
validate your perceptions is to learn more about the situation.”
Most people want understanding first, and then a solution to
their problem. Once you understand their concerns, you can
move to problem solving.

Take a Moment

Make a list of the things you have been thinking about
doing to improve internal and external customer service. We
will call this your Should List. Place an “x” by those that are
important. Now write an action statement for each important
should listed.
Example:
Should List
Important
Action List
I should smile more.
X
I will smile each
time I greet a
customer today.
Should List

Important

Action List

1. _____________

_________

____________

2. _____________

_________

____________

3. _____________

_________

____________

4. _____________

_________

____________

5. _____________

_________

____________

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Now that you have converted your should list to an action list,
make a copy of it and post it at your desk or workstation. Look
at it several times a day for 10 consecutive days.

Developing Customer Service Standards
Customers see your positive attitude reflected in your behaviors.
A behavior is something other people can see you do. It is action
oriented. Often, we talk about customer service in terms of
attitude, believing that everyone knows the expected behaviors.
However, people can, and often do, have different interpretations
of attitudinal terms, such as “friendly.” For example, employees
might be directed to provide customers with a friendly
environment. “Friendly” is an attitudinal concept. What
behaviors should employees adopt to convey that friendliness?
“Greeting the customer with a smile” describes a specific
behavior that can help create a friendly environment.

Every
organization
should have a
customer
service
standard that
specifically
describes
desired
customer
service
behaviors.

24

As the above example illustrates, every organization should have
a customer service standard that specifically describes desired
customer service behaviors. In fact, every organization has a
standard for customer service, whether it is defined or not. We
usually call these undefined, unwritten standards “the way we
do things around here.” Unwritten standards are generally
inconsistent and difficult to pass on to new customer service
representatives. A clearly written standard can help new and
experienced employees identify acceptable customer service
behavior in a variety of situations.
If your company does not have a customer service standard,
you should develop your own. In defining clear, specific
behavioral expectations, you will set a goal for your own
level of performance. It becomes a tool to measure your
own improvement.

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Whether you develop a standard only for yourself or for your
entire department or organization, you should include
descriptions of behaviors related to:
◆

Personal appearance

1

■ Example: My uniforms will be neat and unsoiled.

◆

Work area appearance

■ Example: I will keep my work area free of trash, and my
desk will be uncluttered.

◆

Personal attitude

■ Example: I will look for ways to help each customer.

◆

Listening

■ Example: I will not allow interruptions when talking
with my customers.

◆

Telephone communication

■ Example: When I answer the phone, I will always speak
with a pleasant tone of voice.

◆

Face-to-face communication

■ Example: I will repeat back to customers what I have
heard them say to make sure I have understood them.

◆

Internal customer teamwork

■ Example: When another department has a problem and
they ask for help, I will exceed their expectations when
helping.

◆

Problem solving

■ Example: When I find a problem, I will fix it or
document it to be fixed later.

◆

Product/Service knowledge

■ Example: I will read one product user’s manual a week
until I have learned everything about our products.

◆

Customer response time

■ Example: I will greet customers within 30 seconds of
their arrival at the front counter.

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◆

Customer knowledge

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■ Example: When dealing with customers, I will ask them
how they use our product or services.

◆

Customer hand-offs

■ Example: When I hand customers off, I will make sure I
get them to the right person every time.

◆

Customer follow-up

■ Example: After every repair job, I will call to make sure
that everything met customer expectations.

◆

Customer attention and comfort

■ Example: When customers are having to wait for service,
I will make sure that they have coffee or juice to drink.

Building Your Product or Service
Knowledge

Features are
the components
of the product
or service
itself. Benefits
are the way a
product’s or
service’s
features can
benefit the
customer.

26

Can you answer basic questions about your organization’s
products and services? Most customers expect you to have some
knowledge of the products and/or services you provide. The old
saying “knowledge is power” is true. Remember the customer’s
Perceived Value and its components of quality, service, and cost.
Knowledge of your products and services allows you to discuss
the various characteristics that set you apart from the
competition. In other words, you have an opportunity to
increase PV. Little or no knowledge of your products and
services has the opposite affect.

What Are the Features and Benefits?

An effective way to present your products or services to your
customers is in terms of their features and benefits. Features are
the components of the product or service itself. For example, a
car might offer such features as leather upholstery, four-wheel
drive, cruise control, and air conditioning. Benefits are the way
a product’s or service’s features can benefit the customer. For
example, a car with four-wheel drive offers the benefit of
allowing the driver to handle difficult road conditions.

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When you describe a product or service to a customer, you may
be tempted to stop with a list of features, as in this example:
■ These running shoes have a new patented insole system. The
treads on the outer sole are designed to provide extra traction
and the upper part of the shoe is waterproof and stain
resistant.

1

The features in the example are certainly impressive. But
remember, customers come to you because they are trying to
fulfill a need or desire. They are interested in how a product or
service’s features can help them meet that need or desire—how
those features will benefit them. When you talk about features
in terms of the benefits they provide, you show customers how
your product or service can meet their needs, as in this example:
■ You mentioned that you’d been having some foot problems
lately. These shoes have a new type of insole that can reduce
the impact that causes that type of problem.

Take a Moment

If a customer were to ask you what the important features of
your product or service are, what would you tell them? Pick
a specific product or service your organization provides and
list as many important features as you can.
_______________________________________________
_______________________________________________
_______________________________________________
Now list the benefits these features could provide a
customer.

_______________________________________________
_______________________________________________
_______________________________________________

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Know Your Competitors
Besides being familiar with your own products and services,
you should also have a working knowledge of the products and
services of your competitors. Such knowledge will allow you to
emphasize the differences between their offerings and yours. A
wise consumer has probably shopped around and knows the
competitors’ advantages. Can you explain your advantages?

Chapter Summary

Everyone within a company has responsibilities as a customer
service representative. Some have more contact with customers
than others, but all employees influence the customer’s
Perceived Value (PV).
As a customer service representative, you have both internal and
external customers. Sometimes customer service representatives
do not recognize the importance of internal customer service.
However, if you are to have outstanding external customer
service, you must have outstanding internal customer service.
The two are inseparable.

Your attitude
and actions
must leave the
customer with
the impression
that “they
really care
about me.”

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Your attitude and actions must leave the customer with the
impression that “they really care about me.” Your attitude is
the feeling you have toward a given set of circumstances.
Approaching the customer with an “I can” attitude rather than
“I can’t” attitude is the first step to building lasting relationships
with your customers. While customer service standards and
knowledge about your product or service are very important,
they are useless without a positive, caring attitude.
Your attitude is shown by your behaviors toward customers.
Behaviors are actions that other people can see you do. You
should maintain a set of standards to guide your customer
service behaviors in various situations. Being knowledgeable
about your product is a behavior that can help you build
perceived value for your customer. Become familiar with the
features of your products and services and be able to discuss
how these features can benefit your customers. Also be prepared
to describe the advantages your products and services offer
when compared to your competition.

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✓

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Self-Check: Chapter One Review
Answers to these questions appear on page 100.

1

1. Who is the external customer?

–––––––––––––––––––––––––––––––––––––––––––––––

2. Who is the internal customer?

–––––––––––––––––––––––––––––––––––––––––––––––

3. True or False?
You can have great external customer service without great
internal customer service.
4. What is Perceived Value (PV)? Explain each component.

–––––––––––––––––––––––––––––––––––––––––––––––
–––––––––––––––––––––––––––––––––––––––––––––––
–––––––––––––––––––––––––––––––––––––––––––––––

5. Define the term attitude. Why is a positive attitude
important for providing outstanding customer service?

–––––––––––––––––––––––––––––––––––––––––––––––
–––––––––––––––––––––––––––––––––––––––––––––––

6. Why are customer service standards important?

–––––––––––––––––––––––––––––––––––––––––––––––

7. True or False?
If a customer asks you about your company’s products or
services, you should be able to describe them in some detail.

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● Communicating Effectively with Customers

Chapter

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Two

Communicating Effectively
with Customers
Chapter Objectives
▲

Develop skills in listening.

▲
▲
▲

Determine each customer’s communication preferences.

▲

Improve telephone skills.

Polish communication skills.

Understand why words do not communicate very much
of your message.

told you I wouldn’t be home on Friday morning, but your
people came to connect my electricity anyway! The gate
was locked, and they couldn’t get in to make the electrical
connection. Now you tell me it will be Monday before you
can get to me. Don’t you people communicate here?”

I

“

Communication
can make or
break customer
relationships.

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In business, no skill is more important than the ability to
effectively communicate. It is especially vital in customer
service, where communication can make or break customer
relationships.
Communication may appear to be a simple process, but in
reality it is highly complex. Within this process, two or more
people attempt to arrive at shared meaning and understanding.
Communication involves at least one sender (the one trying to
transmit a message) and one receiver (the one trying to
understand the message).
In order to achieve shared understanding, both senders and
receivers in the communication process must engage in both
talking and listening. One of the biggest hurdles to effective
communication is that many people believe that

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communication only involves talking. As the saying goes, we
have two ears and one mouth for a reason—we should listen
twice as much as we talk. This is especially true in customer
service. Your primary goal in customer service communication
is to understand the customer. This requires a skill we call
active listening.

2

Developing Active Listening Skills

You may think you’re a good listener, but are you really?
Most people with typical listening skills retain only about 10
percent of what they hear. Active listening can improve your
retention rate.

When you engage in active listening, you actively work to
understand what the other party is trying to convey. You take
responsibility for understanding the message. The following
skills will help you move from being an ineffective, passive
listener to being an active listener.

Avoiding Distractions

The first step to active listening is to focus your attention on the
speaker. This may sound easy, but your environment is filled
with distractions that can pull you away from the customer. You
can also create your own distractions if you try to do too many
things at once instead of giving the customer your full attention.
Here are a few common distractions that can serve as barriers to
active listening. As you read over the list, check those you have
experienced in your own customer encounters.

When you
engage in
active listening,
you actively
work to understand what
the other party
is trying to
convey.

❏ Carrying on a customer conversation in a noisy area.

❏ Taking a phone call when you are dealing with a customer.

❏ Allowing others to interrupt when you are dealing with
a customer.
❏ Trying to carry on two conversations at once.

❏ Trying to do unrelated paperwork when dealing with
a customer.

❏ Checking hair, makeup, or clothing while dealing with
a customer.

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● Communicating Effectively with Customers

❏ Thinking about something else when listening to
a customer.

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❏ Planning your response to the customer while the customer
is still talking.
❏ Failing to paraphrase back to the customer what you
are hearing.

❏ Hurrying the conversation or interrupting the customer.

Making Eye Contact

Maintaining eye contact lets the customer know you are
listening and want to help. Lack of eye contact can create an
environment of distrust. How many times have you heard
people say, “I don’t trust her. She wouldn’t look me in the eye.”

Confirming

Confirming statements are short comments that let customers
know you are interested and understand what they are talking
about. They include:

If the customer
says something
you don’t
understand,
you are
responsible
for asking
questions
to clarify
meaning.

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◆

“I see,” “Okay,” “Uh-huh.”

◆

“Tell me more.“

◆

“That must have really upset you.”

Questioning

If the customer says something you don’t understand, you are
responsible for asking questions to clarify meaning. Questioning
not only helps you understand what the customer is saying but
also conveys your interest to the customer, which will help the
customer feel appreciated.

Communicating Effectively with Customers ●
Reflecting

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Reflecting statements summarize or paraphrase your
understanding of what the customer is saying. Reflecting
statements should also reflect the customer’s emotions and
feelings whenever possible. For example:

Customer:
“The car I just bought from you is using excessive gas and
running rough at stop signs. When I start to accelerate, it stalls
and then jumps. I’ve almost gotten hit twice as a result!”
Your reflecting statement:
“Your car is not accelerating properly, and it’s using more gas
than it should. You’re afraid it’s going to cause an accident.”

Most customer conversations of any length should have several
reflecting statements. A final reflecting statement should be used
at the end of a conversation. This ensures that you understand
what the other person is trying to communicate. Remember, it’s
okay to take notes during the conversation.

2

Most customer
conversations
of any length
should have
several
reflecting
statements.

Take a Moment

Imagine you’re in a conversation with a customer. Write a
reflecting statement for the following statement made by the
customer. Remember, you are looking for the message and
the feelings behind it.
Customer:
“When I bought the dress, I was told by your salesperson
that the alterations would be completed by today. I’m in a
wedding tomorrow and I need the dress. I have shopped
here for over five years, and nothing like this has ever
happened. I don’t know what I’m going to do now!”
Your reflecting statement:

_______________________________________________
_______________________________________________

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As important as active listening is, you will also need to develop
your skills as a speaker in order to interact effectively with
customers. The following tips will help you communicate
positively with your customers.

Speaking in the Positive: Words and
Tone of Voice

When speaking to a customer, your primary goal is to remain
positive. Don’t waste time telling the customer what you can’t
do; focus on what you can do. Put yourself in the customer’s
shoes. Wouldn’t you rather hear, “I’ll be happy to look that up
for you,” than “I don’t know.”
The following table shows some negative phrases to avoid and
some positive phrases you can use instead:

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Negative Phrase

Positive Phrase

I don’t know

I’ll find out

That’s not my job.

I’ll find someone who
can help you with that.

That’s not my fault.

I’ll get that taken care of
right away.

I’m busy right now.

I’ll be with you in just
a minute.

Why don’t you give me a
call back in a few minutes.

May I call you back?

Why did you…?
(implying blame)

Let me see if I
understand…

We can’t do that.

We can do this.

Communicating Effectively with Customers ●

Take a Moment

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Can you think of some negative phrases that you frequently
use when dealing with customers? What are some positive
phrases you could use instead?
Negative

Positive

__________________

__________________

__________________

__________________

__________________

__________________

Though the words you use are important, the way you say them
may be more important still. When you speak, only about 7
percent of the message you send is communicated by the words
being used. Fifty-five percent of the message is conveyed by your
tone of voice. For example, think about the statement “Good
morning.” If you are really having a good morning, your voice
will be filled with enthusiasm. But if you are tired or upset, your
voice will reflect that as well. Have you ever had someone else
say “Good morning” to you and a friend and then immediately
ask your friend, “I wonder what’s wrong with her?”

2

Fifty-five
percent of the
message is
conveyed by
your tone of
voice.

Your tone tells the customer a lot about your energy level,
interest, disposition, attitude, and enthusiasm at that instant.
For example, suppose you have just interacted with a difficult
customer and are still feeling some frustration from that
interaction. Unless you let go of that frustration immediately, it
could be reflected in your tone of voice when you interact with
your next customer. The hostile tone could put that customer
on the defensive, even if the words you speak are friendly.

Body Language: Yours and Theirs

We’ve seen that the words we speak convey 7 percent of our
meaning and our tone of voice conveys 55 percent of our
meaning. The remaining 38 percent is conveyed by our body
language. Body language can include our posture, gestures,
facial expressions, and the way we dress and groom ourselves.
How important is body language? Research suggests that when

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● Communicating Effectively with Customers

our words and body language contradict each other, listeners
will believe what the body is saying rather than our words.

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When our
words and body
language
contradict each
other, listeners
will believe
what the body
is saying rather
than our words.

You can use body language to support the positive message you
want to send to your customers. Here are a few tips to enhance
your communication:
◆

Smile often at customers, especially when you first
meet them.

◆

Keep a professional personal appearance.

◆

Maintain eye contact with your customers when talking to
them. (It’s okay to glance away occasionally.)

◆

Keep a professional, but relaxed posture. Don’t slouch.

◆

When appropriate, take notes of what the customer
is saying.

◆

Move occasionally. For example, leaning forward
conveys interest.

◆

Until welcomed in, don’t violate a person’s personal
zone. This is usually a circle about an arm’s length around
the person.

Take a Moment

How many of the body language tips just given do you
currently follow? Where could you improve? List three tips
that you will work on during the next week.
1. _____________________________________________
2. _____________________________________________
3. _____________________________________________

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Sending a Message Through
Physical Surroundings
Research suggests that physical surroundings can influence a
customer’s reactions to perceived failures in customer service.
For example, if a customer comes to you with a complaint and
your work area is messy or disorganized, its appearance may
intensify the negative feelings the customer is having. On the
other hand, if you maintain a pleasant appearance in your work
area, it can have a positive impact on how customers react when
things don’t go according to their expectations. This same logic
applies to your personal appearance. A neat, well-groomed,
professional appearance will help your customers feel more
positive about their encounters with you.

Physical
surroundings
can influence
a customer’s
reactions to
perceived
failures in
customer
service.

Take a Moment

Close your eyes and visualize your work area. What first
impressions do people get when they enter it?
Positive Impressions

Negative Impressions

___________________

____________________

___________________

____________________

___________________

____________________

Improving Your Telephone Communication

In some organizations, such as mail-order companies, customer
service representatives may never see their customers face to face
Telephones fill the void when customers cannot come to our
place of business. Because you are not dealing face to face with
customers when you speak to them by phone, you lose an
important part of the communication link—body language
When you interact by phone, you must rely on other aspects of
communication to make up for the lack of body language.

One way you can make up for a lack of face-to-face contact with
your customers is by dealing with their calls promptly. Put
yourself in the customer’s shoes. What goes through your mind

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when you call an organization and the phone rings over and
over without an answer, or, worse yet, you constantly get a busy
signal? Many customers find such situations extremely
frustrating. Someone, even an answering machine, should
answer the phone by the fourth ring.

When you
answer the
phone, try
consciously
smiling before
you speak.

When you answer the phone, try consciously smiling before you
speak. Think of the caller as being right in front of you. This
only takes a few seconds and will literally put you in a better
frame of mind to respond to the caller. Try putting a mirror on
your desk or counter and smile into it before you answer the
phone. Glance at it several times during your conversation with
the customer. What message is your facial expression conveying
in your words and tone of voice?
Your greeting should be friendly and professional and include
your name and the company name. For example, you might say,
“Thank you for calling Paige Aluminum Products. This is
Alyssa Jones. How may I help you?” Speak clearly and directly
into the receiver. Don’t hold the receiver under your chin. Since
phone connections are never perfect, the volume of your voice
should be slightly louder than your normal face-to-face speaking
volume.

Letting callers
know what is
happening
gives them
a sense of
having some
control.

Always give your callers your undivided attention. Get a name
early in the conversation and use it often. It is a good policy to
make notes when you are talking, starting with the customer’s
name. If you put the caller on hold (e.g., to get information),
tell the person what you are doing. For example, you might say,
“Mr. Lowe, I don’t have the information you requested at my
desk, but it will only take me about a minute to get it. If that is
inconvenient, I can call you back.” Letting callers know what is
happening gives them a sense of having some control. If you
take longer to get the information than you expected, return to
the phone and let the caller know.
Like all customer service principles and practices, telephone
principles and practices apply to the internal customer also.
Remember, you will never provide outstanding external customer
service until you provide outstanding internal customer service.

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Take a Moment

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When you call a business on the phone, what are some of
the things they do that irritate you? List them below.

1. _____________________________________________
2. _____________________________________________

2

3. _____________________________________________
4. _____________________________________________
5. _____________________________________________
Now ask yourself how you can avoid doing these things to
your own customers.

As you work to develop your communication skills, you may
notice that some of your customers communicate very
differently than you do. Some may want to spend time chatting
before dealing with the situation that brought them to you;
others want to get right down to business. In the next section,
we’ll consider how you can adapt your communication skills to
these very different communication styles.

Understanding Your Customer’s
Communication Style

■ “Mr. Able, please tell me how the accident happened.”

“Well, Mr. Johnson, it all started that morning. I’d had a touch
of the flu, so I decided to go to the doctor. My wife couldn’t take
me, so I had to drive my pickup. The pickup is hard to start and
doesn’t have power steering. Well anyway, I left at about 10
that morning for my doctor’s appointment, which was at noon.
Since it’s only a 10-minute drive to the doctor’s office, I decided
to pick up my friend Jim and have a cup of coffee before my
appointment. But when I got to Jim’s house, he wasn’t home,
so I decided to go have coffee by myself.”
“Mr. Able, excuse me for interrupting, but didn’t the accident
happen after your doctor’s appointment?”

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Most people would agree that Mr. Able likes to talk. This is his
communication style. But Mr. Johnson, the insurance agent,
needs the specific facts of the accident in order to complete his
paperwork and doesn’t appreciate Mr. Able’s chit chat. Mr.
Johnson’s communication style is very different from Mr. Able’s.
Do you think they could get frustrated with each other during
this conversation?

Everyone
has certain
preferences
about how she
or he wants to
communicate.

The key to effective communication is to understand that
everyone has certain preferences about how she or he wants to
communicate. Each of us have certain informational needs.
Some of us use the information we receive to make quick
decisions, while others take more time. Some want a lot of
information, some don’t. Some want to socialize, some want to
get to the point quickly. Some freely provide information,
others require prompting.
We can group people’s communication preferences into four
basic communication styles:

The “don’t
waste my
time” style
is direct
competitive,
forceful,
decisive, and
strong willed.

40

◆

The “don’t waste my time” style

◆

The “let’s get acquainted” style

◆

The “let’s take our time and work together” style

◆

The “let’s study this situation” style

As you read the following descriptions, try to determine which
is your preferred style for communicating.

Don’t Waste My Time

People who communicate with this style are direct, competitive,
forceful, decisive, and strong willed. They don’t want you to
waste their time by being incompetent or ineffective.
When dealing with this type of style, your approach should be
direct and to the point. Don’t talk about the weather or engage
in too much small talk. Too much information can make “don’t
waste my time” people frustrated and upset. Cover the high
points when giving them information. If they want more
details, they’ll ask for them.

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If “don’t waste my time” people become unhappy or frustrated,
they can become obstinate, inflexible, uncompromising,
autocratic, and arrogant. They will generally let you know when
they are upset. They will pressure you to get what they want.
You must give them time to get their point across and you must
let them know you are listening to what they are saying. These
people are competitive, so let them win when you can.

2

Let’s Get Acquainted

People who prefer this communication style want you to engage
them personally. They want to feel welcomed into a warm and
friendly place. They tend to be sociable and enthusiastic and
animated in their conversations.

When communicating with “let’s get acquainted” people, you
should also be warm and friendly. Since they like the sense of
touch, shake their hand or pat them on the back. Ask them how
they feel about different things. Talk about what’s important
to them.

The “let’s get
acquainted”
style is
sociable and
enthusiastic.

Since “let’s get acquainted” people like to talk, you will have to
provide them some “air” time. They want you to be engaging
as well, so don’t be blunt, brief, or closemouthed. These people
will also become bored with too much data, such as facts or
figures. They want to talk about the “feeling” aspects of your
product or service.

When upset or frustrated, “let’s get acquainted” people become
chatty, talking about trivial things. They may appear shallow,
complacent, unwilling to listen, and even egotistical. To help
them get beyond their emotions, you will have to demonstrate
empathy and understanding about how they feel. You must
show them that you genuinely care about them as people.

Let’s Take Our Time and Work Together

People who prefer this style of communication are patient,
persistent, analytical, rational, dependable, faithful, easygoing,
humble, and unassuming. They like to work with people who
genuinely care about what is happening. They prefer a lowpressure environment in which people work together as a
harmonious team. These people value their personal space
and usually do not like too much touching.

The “let’s work
together” style
is patient,
persistent,
analytical, and
dependable.

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When communicating with “let’s work together” people, you
should begin by engaging them in conversation. While they do
not like a lot of “small talk,” they need to know that you care
about them and their needs. Some get-acquainted conversation
is useful. Move slowly and be patient. Abruptly rushing into
business can frustrate and upset them. They will also become
frustrated if you talk too much or attempt to manipulate them.
They need time to make decisions—especially major ones—and
do not like to be pushed. Allow them to ask questions, and
don’t be afraid to probe for understanding.
When upset, “let’s work together” people will become detached
and withdraw. Sometimes they will become nonresponsive or
indifferent. When really upset, they can become inflexible,
rigid, and headstrong. When dealing with their displeasure, be
patient and take your time. Show interest in the person and
look for common ground. They generally are willing to work
out a rational and logical solution.

Let’s Study This Situation

The “let’s
study this”
style is logical,
exacting,
demanding,
careful, and
obedient.

People who prefer this style tend to be logical, methodical,
exacting, conservative, fussy, demanding, careful, tactful, and
obedient. They tend to be perfectionists, expecting excellence
and setting high standards for themselves and others. They
prefer hearing the facts and like a lot of information. They
want you to stick to the business at hand. Since they expect
excellence, make sure your information is accurate and down to
earth. Listen very carefully to what they are saying. Take notes.
Ask questions to make sure you understand them.
Since “let’s study this” people like to stick to business, you
should avoid being fickle, frivolous, chatty, or informal. Be
organized in your communication and presentations. Stick to
the facts. Allow them time to make decisions, especially major
decisions. They tend to have a low tolerance for risk.
When “let’s study this” people become upset or frustrated, they
can become very rigid, headstrong, difficult to please, and
suspicious. When this happens, you should stick to the facts,
be patient and friendly, and avoid comments that could be
taken personally.

42

Communicating Effectively with Customers ●
Adapting to the Styles
The key to
good
understanding
is adapting
your style of
communication
to the other
person’s style.

SA
MP
LE

The goal of communication is to transfer understanding
between two or more people. If this is true, then the key to good
understanding is adapting your style of communication to the
other person’s style. People tend to respond best to those whose
communication style is similar to theirs. Most customers will
send you clues on how they want to communicate. For example,
one person may start the conversation by smiling and talking
about the high school football game. Another may not smile at
all and get right down to business. Your job is to learn the
signals and adapt your communication style to theirs.

Take a Moment

In the space below, write the style of communication
you use most often. Next think of a person with whom you
get along exceptionally well. How would you characterize
that person’s communication style? Write it down. Next
think of the person with whom you have the greatest
difficulty communicating and write down that person’s
communication style.

My communication style is _________________________.
______________________ is a person with whom I get
along exceptionally well. His/her communication style is

______________________________________________.
______________________is a person with whom I have
difficulty dealing. His/her communication style is

______________________________________________.

Now let’s take a look at what you wrote in the previous exercise.
There is a good chance that the person with whom you get
along best has a communication style similar to yours. While
this is not always the case, we tend to get along best with those
whose communication preference is similar to our own. Now

43

2

● Communicating Effectively with Customers

SA
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review the communication preference of the person with whom
you have difficulty dealing. There is a good chance that person’s
communication style is almost the opposite of yours.
When you are dealing with a customer whose communication
style is similar to your own, you may feel as though you
“connect” with that person. When dealing with a customer
whose communication style is different from yours, you may
have difficulty. The key to working successfully with all types
of communication styles is first to recognize the customer’s
communication style and then to adapt your style to the
customer’s. If the customer needs a lot of time or information,
provide it. If they don’t, then don’t. In communication, one
style does not fit all.

Take a Moment

Let’s return to the “difficult” person you identified in the
previous exercise. How can you adapt your communication
style to that person’s?
_______________________________________________
_______________________________________________
_______________________________________________
_______________________________________________

44

Communicating Effectively with Customers ●

Chapter Summary

SA
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Most of us probably assume that we are good communicators.
But in reality, we retain only about 10 percent of what we hear.
Improving your listening skills is the first step in providing
outstanding customer service. You can develop active listening
skills by taking the following steps when a customer is speaking:
◆

Avoiding distractions

◆

Making eye contact

◆

Confirming

◆

Questioning

◆

Reflecting

2

A second important customer service skill is to be sure that you
use positive words when speaking to a customer. Don’t tell
customers what you can’t do for them (“I don’t know how to do
that”). Instead, tell them what you can do (“I’ll find someone
who can help you with that”).
Communication involves more than just the words you use. It
involves your tone of voice and body language. Your personal
appearance and the appearance of our surroundings also send a
message—whether it’s the message you intend or not. What
messages are you are sending to your customers?

Only 7 percent of the message we communicate is conveyed by
the words we use. Fifty-five percent is conveyed by tone of voice
and 38 percent by body language. When you speak with a
customer on the phone, you lack the ability to communicate
through body language. You can compensate for the lack of
face-to-face contact by handling all customer calls promptly and
putting a smile in your voice when you speak over the phone.
Everyone has a communication style. We tend to communicate
better with those who have similar communication styles.
Therefore, you must understand the customer’s style and your
own and be willing to adapt your style to theirs. Doing this
will dramatically increase understanding and improve
customer relationships.

Communication
involves more
than just the
words you use.
It involves your
tone of voice
and body
language.

45

● Communicating Effectively with Customers


The key to good communication, whether over the phone or in
person, is to focus your attention on the customer. If they
perceive they are being “cared for,” then your communication
skills are sending the right message.

46

Communicating Effectively with Customers ●

Self-Check: Chapter Two Review

✓



Answers to these questions appear on page 101.
1. What is the goal of communication?

______________________________________________
______________________________________________

2

2. When communicating, what is reflecting?

______________________________________________
______________________________________________

3. True or False?
Our body language has nothing to do with how the message
we are sending is interpreted.
4. Tone of voice accounts for _____ percent of the meaning
of a message.
5. Why is it more difficult to communicate over the phone
than face to face?

______________________________________________
______________________________________________

6. True or False?
I can always use the same communication approach with
every customer.

47

● Managing the Customer Encounter

Chapter



Three

Managing the Customer
Encounter
Chapter Objectives
▲
▲
▲
▲
▲

Show customers that you value their business.

▲
▲
▲

Say “no” to customers without losing future business.

Understand and influence customer behavior

Ask questions that will help you help the customer.
Hand off customers without making them feel ignored.
Follow five steps for successfully solving
customer problems.

Successfully close the customer encounter.
Provide appropriate customer follow-up.

henever you or another member of your organization
interacts with a customer, you are engaged in a customer
W
encounter. Customer encounters include situations in which:
◆

A new customer makes a buying decision.

◆

A repeat customer brings you return business.

◆

A customer with a problem comes to you for a solution.

The customer encounter is the most critical step in the customer
service system. A successful customer encounter goes beyond the
initial decision to buy your product or service. Customers leave a
successful customer service encounter with the feeling that they
have received outstanding customer service.

48

Managing the Customer Encounter ●



Unfortunately, most customers walk away from a customer
encounter with the feeling that the service was either “nothing
to write home about” or poor. And customers who leave
without receiving outstanding customer service will not seek out
that organization the next time they decide to use a similar
product or service. In highly competitive markets where prices
are about the same between organizations, service is the only
attribute in the Perceived Value formula that distinguishes highquality organizations from mediocre organizations.
As a customer service professional, you are responsible for
managing the customer encounter so the customer perceives that
she or he has received outstanding service. You can do this by:
◆

Showing customers that you value their business.

◆

Understanding customer behavior and creating
positive outcomes.

◆

Asking the right questions.

◆

Dealing effectively with customer hand-offs.

◆

Making the customer’s problem your problem.

◆

Telling customers “no” effectively.

◆

Closing the customer encounter effectively.

◆

Following through to ensure customer satisfaction.

3

You are
responsible for
managing the
customer
encounter so
the customer
perceives that
she or he has
received
outstanding
service.

Showing Customers That You Value
Their Business

Your first step in creating a successful customer encounter is
to let customers know that you value them and their business.
Remember, customers take their business where they feel it is
appreciated. Consider the following example:

■ Rosa needs to return a gift to a large department store. She
waits patiently in line and finally gets to the return clerk. The
clerk, who is very busy, does not look up, but carries on a
conversation with another clerk. Rosa tries to get the clerk’s
attention to ask her a question about something else she
would like to purchase. The clerk reluctantly looks up and tells

49

● Managing the Customer Encounter



Rosa, “I don’t know anything about that. You’ll have to ask
someone in that department.“ Rosa gets the refund and
leaves the store. “It’ll be a long time before I shop there again,”
Rosa says to herself as she walks to her car.

Successful
customer
encounters
always leave
the customer
feeling valued.

Successful customer encounters always leave the customer
feeling valued. Sometimes when you are very busy or having a
difficult day, you may be tempted to hurry through a customer
encounter or not pay attention to what a customer is saying.
But as the previous example illustrates, doing so may result in
the permanent loss of a customer’s business.
Following is a list of actions that may cause customers to think
they aren’t valued. Be honest with yourself—have you ever done
any of these? Check those that apply.
❏ Failing to greet customers when they walk up to you.

❏ Not making eye contact when talking with a customer.
❏ Making customers stand in long lines.

❏ Handing off a customer several times.

❏ Doing paperwork when talking to a customer.
❏ Trying to handle two customers at once.

❏ Allowing a coworker to interrupt when talking to
a customer.

❏ Answering the phone when talking with a customer.

❏ Not using good questioning and feedback skills when
handling a customer’s problem.
❏ Wasting a customer’s time through inefficiency.

❏ Failing to follow up on what you said you would do.

These are only a few of the signals that tell people they aren’t
important to us. What does your list look like? The key concept
here is to greet customers cordially, pay attention to them, and
avoid distractions.

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Managing the Customer Encounter ●

Take a Moment

SA
MP
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From the previous list, pick the action that you engage in
most frequently and develop an action plan for improving
your customer service behavior.
I am most guilty of _____________________________.
I will take the following actions that will let the customer
know that I care:

1. _____________________________________________

3

2. _____________________________________________
3. _____________________________________________
4. _____________________________________________

Understanding Customer Behavior and
Creating Positive Outcomes

■ Sharon hung up the phone and rubbed her ear. Sometimes
she just didn’t understand her customers. “I don’t know why he
yelled at me like that,” she thought. “All I wanted to do was help
him.”

Why do customers behave the way they do, and how can a
customer service professional influence that behavior? As we
discussed previously, behavior involves action; it is something
other people can see us do. Behaviors are triggered by a
stimulus—something in the environment that inspires us to act.
A stimulus can be the stop sign that causes us to put on the
brakes or the hunger pangs that tell us to reach for a snack.
Whatever their nature, these stimuli lead us to act or behave in
certain ways. In turn, the way we behave based on those stimuli
leads to a positive or negative outcome—we avoid hitting an
oncoming car or our hunger pangs are satisfied. Figure 1 below
illustrates this process.
Trigger—leads to—Behavior—leads to—Outcome
Figure 1

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● Managing the Customer Encounter



People are more likely to respond to stimuli when they perceive
that the outcome of their behavior will:
◆

Be immediate.

◆

Be positive.

◆

Have a high probability of happening.

They are less likely to respond when they believe that a positive
outcome will occur sometime in the future or has a low
probability of happening, or when they believe the outcome
will be negative.

If you can
determine what
the customer
believes is a
positive
outcome and
offer it quickly,
you can
influence
customer
behavior in the
direction you
and the
customer
want to go.

52

What does this mean for you as a customer service representative? If you can determine what the customer believes is a
positive outcome and offer it quickly, you can influence
customer behavior in the direction you and the customer want
to go. In other words, you create a win/win situation. Consider
the following example:

■ A customer wants to return a sweater that doesn’t fit, but she
doesn’t have her receipt. Store policy states that the
salesperson cannot make a refund without a receipt, and a
large sign at the cash register outlines the policy.
Before the salesperson on duty can say anything, the
customer starts yelling, demanding her money and threatening
never to shop at the store again. Why is she behaving this
way? First, she probably believes she is not going to be able
to exchange the sweater or get a refund (negative outcome)
without a hassle. She believes that in order to get what she
wants (positive outcome) she has to exhibit behaviors that
indicate she is upset.

This situation illustrates a customer service policy that triggers
negative behaviors in customers. If the customer knew that the
salesperson was willing to work with her, she would probably
exhibit pleasant behaviors. If the salesperson has the latitude,
she could ask a question, such as “Would you like to select
another sweater?” By doing this, she would create an immediate,
certain, and positive outcome for the customer. This would
increase the likelihood the customer would be satisfied with the
encounter and return.

Managing the Customer Encounter ●



Note: Customer service representatives sometimes reinforce
negative behaviors in customers. We have created a group of
consumers who believe they must get angry, yell, or make a
scene to get what they want. We unintentionally reinforce that
behavior by giving in to their demands. People who do not
exhibit this type of behavior may not get what they want under
the same circumstances. Try to provide satisfaction for all
customers, especially those that approach you with courtesy and
respect. If a customer tries to create a scene, defuse the situation,
then deal with the request.

Take a Moment

3

Can you think of a situation in which a customer behaved
badly because he or she believed this would bring about the
desired outcome? How could you have worked with the
customer to defuse the situation and achieve an outcome
beneficial to both of you?
_______________________________________________
_______________________________________________

Asking the Right Questions

To help customers achieve the outcome they want—make a
purchase or resolve a need—you need information. And in order
to get that information, you need to ask the right questions.
Good questioning techniques use two types of probing
questions: open and closed. Open probes are questions that
require the customer to provide more than a yes-or-no answer,
as in this example:
■ “Please describe your garden and the plants you’d like
to grow.”

Closed-probe questions, on the other hand, require only a short
answer—usually “yes” or “no.” You get limited, but specific
information with closed-probe questions.

Generally, open-probe questions are good when used early in the
conversation. They get the customer talking and give you an

Good
questioning
techniques use
two types of
probing
questions:
open and
closed.

53

● Managing the Customer Encounter



opportunity to gather information quickly. Starting with closed
probes requires you to do a lot of guessing, and you’ll miss
hearing a lot of information that the customer might have
volunteered with an open probe. When we ask questions
without making assumptions, customers will give us all the
information we need to help them. Two great open probes are
“Tell me more,” and “Can you give me more detail?”

When we ask
questions
without making
assumptions,
customers will
give us all the
information we
need to help
them.

You can think of customer conversations as working like a
funnel, as illustrated by Figure 2. Like the funnel opening, the
open-probe questions are designed to catch a lot of information.
Begin with them; then use closed-probe questions to establish
specific details toward the end of the conversation. A word of
caution is needed here: Be careful not to waste the customer’s
time (especially the “don’t waste my time” customer) trying to
collect irrelevant information.

Information

Open
Probes

Specific

General

Figure 2

54

Closed
Probes

Managing the Customer Encounter ●

Take a Moment



Assume you are talking with a customer and the customer
makes the following statements. Write an open- and a
closed-probe question for each statement.

Statement:
“Ms. Clark, your company keeps sending me these overdue
invoices. I call every month and someone tells me it will be
taken care of by accounting. Why can’t you get accounting
to straighten it out?”
Open-probe question: _____________________________

3

_______________________________________________

Closed-probe question: ____________________________
_______________________________________________
Statement:
“Mr. Evans, I am looking for a new clothes dryer for my
mother. She has had one for over 15 years and it’s about
worn out.”

Open-probe question: _____________________________

_______________________________________________

Closed-probe question: ____________________________
_______________________________________________

Do you use more open- or closed-probe questions in your
customer conversations? If you are like most Americans, you use
more closed-probe questions. Just listen to a conversation and
see for yourself. If you record your telephone conversations for
quality control purposes, review your own tape. You will
probably be surprised.

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● Managing the Customer Encounter



Dealing Effectively with Customer
Hand-Offs
Consider the following phone conversation from a customer to
an insurance company:
Receptionist:
ABC Insurance Company, how may I direct your call?

Customer:
I’d like to talk to someone about an insurance claim. I’ve had
an accident.
Receptionist:
Just a minute while I connect you.

Claims Agent:
Hello, my name is Dan Smith. How may I help you?

Customer:
I just had an accident and I have insurance with you. I need to
make a claim.
Claims Agent:
Can you tell me about the accident?

Customer:
Sure, I was backing my car out of my house and hit the corner of
the garage.
Claims Agent:
I’m sorry, I only handle homeowner claims. Let me connect you
with Mary. She handles auto claims. (Pause while customer is
put on hold.) I’m sorry, she’s at lunch now. Could you call back
after lunch?

56

Managing the Customer Encounter ●

Take a Moment



What good customer service behaviors are demonstrated
by the previous interaction?

_______________________________________________
_______________________________________________
What customer service behaviors would improve
this scenario?

_______________________________________________

3

_______________________________________________

Customers value their time just as you do. As a general rule,
they don’t mind being handed off to another customer service
representative one time. For most customers, the frustration level
goes up significantly when they are handed off more than once.
Not getting to the person who can solve the problem leaves
customers with the impression that the members of your
organization don’t know what they’re doing. It also makes the
situation difficult for the customer service representative who
actually can help them. By the time those customers get to the
right person, they’re frustrated and ready to vent.
Successful hand-offs begin with your knowing exactly who can
help a customer if you cannot. Remember, you are responsible for
getting customers to the right person and making sure their
expectations are met. Here are some tips for handing off
customers when necessary.

Most
customers
don’t mind
being handed
off to another
customer
service
representative
one time.

57

● Managing the Customer Encounter

When the customer is face to face:
Introduce yourself and get the customer’s first and
last name.

SA
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◆

◆

Make sure you get enough information to get the
customer to the right person. In our opening example, a
few questions would have gotten the customer to the right
insurance agent.

◆

Tell the customer the name of the person that can help. For
example, “Bill Jones is our specialist in that area. I’ll
introduce you to him.”

◆

Personally introduce the customer to the person who can
help. For example, “Bill, I’d like you to meet Angie Cupp.
She’s interested in our new business software.”

◆

Make sure this person can help the customer. For example,
ask Bill, “Do you have time to assist Angie?” Find out how
long it will be before Bill can help, and ask the customer if
that is acceptable. If not, get Bill to call her back. If the
customer chooses to wait, stay with the customer; offer a
cup of coffee or a soft drink.

◆

Thank the customer for allowing you to help. “Angie, thank
you for shopping with us, and if I can be of any more
assistance, please let me know.” Be sure to tell the customer
your name and how she can find you if she needs help.

When the customer is on the phone:

58

◆

With a smile in your voice, get the customer’s name and give
yours again.

◆

Ask a few questions to get information that will help you
direct the customer to the right person.

◆

Tell the customer the name of the person who can help.

◆

Tell the customer that you will have to put him or her on
hold for a minute but will be right back.

Managing the Customer Encounter ●
Call the person who can help the customer and give that
person the customer’s name and any additional information
you have.

SA
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◆

◆

Make sure the person can help the customer at this time.

◆

If your coworker cannot help the customer at this time, find
someone who can or set up a time when the person who can
help will call the customer.

◆

Tell the customer that you will connect him or her to the
person who can help. For example, “Ms. Adams, I will
connect you with Chad Davis, who will assist you.”

◆

When you receive a customer hand-off, put a smile in your
voice and greet the customer. For example, “Good morning
Ms. Adams, I’m Chad Davis. How may I help you?”

◆

If you cannot find someone who can help the customer, you
need to take ownership of the customer’s needs. You should
find out when the right person will be available and let the
customer know. Give the customer your name, phone
number, and the name and phone number of the person
who will help them. Follow up with the customer to make
sure they have their needs met. If a hand-off fails, it does not
matter who caused the problem or dropped the ball. In the
customer’s eyes, it is a failure of every employee at your
organization, and everyone suffers when a customer does
not return.

3

If you cannot
find someone
who can help
the customer,
you need to
take ownership
of the
customer’s
needs.

Making the Customer’s Problem
Your Problem

■ “All I do all day long is solve other people’s problems,” Brian
complained about his job at the software help desk. “How can
customers be so dumb? Why don’t they read the owner’s
manual? It answers most of their questions. It even has a
troubleshooting section. They want to blame us for not making
the computers more user friendly. I wish they would solve their
own problems instead of calling me.”

Many of the customers you encounter come to you because they
have a problem they need help solving. They may have even

59

● Managing the Customer Encounter

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created the problem themselves. This is where your attitude
toward problem solving comes into play. How you view the
customer problem determines your actions and enthusiasm in
helping solve the problem. The best way to view the customer’s
problem is as your problem.

Viewing the
customer’s
problem as
your own helps
focus your
attention on a
winning
solution rather
than just
“getting the
customer off
my back.”

Your job is to create a win for the customer if at all possible.
Viewing the customer’s problem as your own helps focus your
attention on a winning solution rather than just “getting the
customer off my back.” Here are five steps that will help you
and the customer solve your problem:
1. Define the problem.
Your first step is to come up with a specific definition of the
problem. The best way to do this is by listening to the
customer. Sometimes the customer may be upset or even
verbally abusive, but hidden in the emotional words is a
perceived problem that is very real to the customer. Listen
for the problem. You may want to write the problem down.
You should also note what caused the problem if you know
or suspect. These causes do not have to be discussed in great
detail with the customer. However, they will provide you
with useful information when you are trying to improve
your customer service system (see Chapter 5).
2. List alternatives.
One solution does not fit all customers, even if the problem
is the same. Offer alternatives to the customer. Try asking
customers for their suggestions for solving the problem. This
gives customers ownership in the solution as well as a sense
of control.
3. Pick a solution.
Picking a solution that is satisfactory to both the customer
and you is crucial to good customer relations. If the
customer participates in the selection, this will build
ownership and acceptance.

60

4. Implement the solution.
This is the step where most problem solvers have difficulty.
People have good intentions but, for a variety of reasons,
sometimes fail to implement what they said they would do.
The consequence of not implementing the solution to a

Managing the Customer Encounter ●

SA
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customer problem is severely damaged customer
relationships. Making notes or creating a “to do” list helps.
5. Make sure the problem is solved.
Making sure the problem is solved goes beyond just
checking that the agreed-upon actions have been
implemented. The customer has to determine if the solution
has solved his or her problem. This will require follow-up on
your part. Ask the customer if the problem was solved.
When dealing with customer problems, you should always
follow the five steps. It does not matter how simple or complex
the problem, the problem-solving process will work. Sometimes
the entire process can take five minutes, or it can take five
months. The steps are the same.

3

Consider how you would use the five-step process to deal with
the situation described in the following case study:

■ John takes his car to a mechanic because the front of the car
is making a noise that has gotten progressively worse. The
mechanic looks at the car and test drives it. He tells John that
a slipping fan belt is making the noise and that the fan belt
should be replaced and adjusted. The mechanic does the work
and shows John the worn fan belt that was replaced.

Case
Study

Three days later, John returns with the car and tells the mechanic
that the noise is still there. Again, the mechanic listens and test
drives the car. He concludes that the water pump is now making
a noise. The water pump was probably worn, and replacing the
fan belt put too much additional stress on it, creating the noise.
Eventually, the pump must be replaced. The mechanic must now
explain the situation to John.

61

● Managing the Customer Encounter

Take a Moment

SA
MP
LE

Defining the problem is the first step in the problem-solving
process. If you were the mechanic, how would you define
the problem for John? Write your statement below.
–––––––––––––––––––––––––––––––––––––-–––––––––
What are the next two steps the mechanic needs to take
to guide John through the problem-solving process? What
could he say in each step?
Step 2: _________________________________________
_______________________________________________
Step 3: _________________________________________
_______________________________________________

The mechanic in our case study might handle the situation in
the following way:
Mechanic:
John, the noise you’re hearing now is the water pump. Have you
heard this noise before?
John:
I don’t remember hearing it.

Mechanic:
Sometimes when we replace a fan belt and tighten it to factory
specifications, a marginal water pump may fail. That seems to be
what’s happening here. [Define the problem.] I think that this water
pump will last a little while longer. I could try adding some water
pump lubricant to the coolant, which might help. However, I
suggest that you replace it as soon as possible, especially if you’re
planning any trips. [List alternatives.] What would you like me to
do? [Pick a solution.]

62

The mechanic could then complete the problem-solving process
by implementing whatever solution John chose and following
up to be sure that the solution worked for John.

Managing the Customer Encounter ●

Telling the Customer “No”

SA
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LE

No matter how good your problem-solving skills, you will
encounter situations in which you have to tell a customer “no.”
Consider the following example:

■ Claudine is a customer service representative with the local
electric company. Max, who has just moved into the area, has
come in to have the electricity to his house turned on. He
completes the information and authorizes a credit check.
Claudine calls his previous electric provider and finds that Max
left without paying his final bill, and it is three months overdue.
Claudine has to tell Max, who is waiting in the lobby, that she
will need a $150 deposit or she will not be able to authorize a
hook-up. Claudine calls Max into her office.

3

If you were Claudine, what would you say to Max?

_______________________________________________
_______________________________________________

Claudine tells Max that he must pay the $150. He responds
with, “Why do I have to pay a deposit? My cousin moved here
last spring, and he didn’t have to pay anything. All you electric
companies are alike! You don’t care about my situation.”
How would you respond to Max’s statement?

_______________________________________________
_______________________________________________

The key to moving forward in this situation is to work with
Max to reach a win/win situation. What Claudine is able to do
for Max will depend on company guidelines and state laws. She
may be able to offer a payment plan for the $150 or perhaps
take a credit card. Whatever she eventually offers, Claudine
must remain firm but respectful when dealing with Max and
show empathy for his feelings.

No matter how much you wish to help your customers, you will
occasionally find yourself in situations in which you are unable
to correct the problem or meet customer requests. So how do
you say “no” without losing the customer? The following steps
can help you successfully deliver a “no” message.

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● Managing the Customer Encounter

1. Apologize for not being able to meet expectations.

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■ “I’m sorry, but we can’t fill the order until next week.”

2. Give them facts about the situation, not excuses.

■ “There’s been such a demand for these boots that the
factory is behind in filling our order.”

Whether customers view your statements as facts or excuses
will depend on how willing they are to trust you. If you have
followed the principles of good customer service in past
encounters with your customers, they will be more likely to
view your statement as fact.

Avoid
statements
such as “the
policy does not
allow me to
give you a
refund.”

Avoid statements such as “the policy does not allow me to
give you a refund.” While this may be a fact, the customer
will generally see you as hiding behind an excuse. Try to
explain the reasons for the policy. For example, if your
policy requires you to get a photo identification when you
accept travelers’ checks, say, “Our identification policy
allows us to ensure that no one will cash your checks
except you.”
Policies do not fit every situation, and customer service
representatives should be allowed to use their own
judgment. Whenever possible, well-trained customer service
representatives should be given guidelines rather than rules.

3. Be firm with the customer, but gentle.
This may seem like a contradiction in terms, but it isn’t.
What it means is that you can be firm without making the
customer feel rejected or deserted. Part of being gentle is
acknowledging the customer’s feelings. When you say “no,”
the customer is disappointed. The intensity of the feeling
will depend on how the customer views the importance of
the request. Acknowledging how the customer feels
demonstrates empathy. Consider the following example:
■ You are the maitre d’ at a small, popular restaurant. It is
Saturday night, all the tables are full, and a large party has
reserved a corner of the restaurant for a private party.

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Managing the Customer Encounter ●

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Mary Alice and David, two regular customers, come in
without a reservation. They ask for a table and you have
none to give them. What can you do?

You could handle the situation by saying, “I’m sorry, David
and Mary Alice, but I will not be able to seat you this
evening. I know how disappointed you must feel. We have
a group of 22 people that reserved an area of the restaurant
for a party. I’ll be glad to make a reservation for you for
tomorrow, and the drinks will be on me.”

4. Remain calm if customers continue their demands.
Some customers will continue to push you even after you
have told them you cannot meet their expectations. When
this happens, keep in mind that they are not mad at you as
an individual. Chances are, they are having difficulty dealing
with their feelings. Most of the time they are mad at the
situation and may take it out on you. But remain calm, be
firm, and be gentle. Repeat the steps above.

3

Sometimes customers persist, and conflict may develop.
We’ll discuss how to handle conflict in Chapter 4. If a
customer becomes loud or animated, move the conversation
out of earshot of other customers. Not moving can upset
some of your customers and leave them with a negative
impression of your organization.

5. Focus on what you can do.
Whenever possible, follow a “no” with what you can do for
the customer. At this point, you may want to follow the
steps in the problem-solving process discussed earlier in the
chapter. Examine these two statements:
■

“We don’t carry that model.”

■

“We don’t carry that model, but we do carry a similar
model with all the features of the one you want at an
attractive price.”

By offering alternatives, you provide customers with an
opportunity to consider other options that may not have
occurred to them. This gives them a sense of control. Your effort
demonstrates that you value their business and are willing to
help. Remember, they are trying to fulfill a need or desire. This

Whenever
possible,
follow a “no”
with what you
can do for the
customer.

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● Managing the Customer Encounter

strategy can turn a loss into a gain for you and the customer.

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6. Review your interaction and learn.
Take time to examine what happened and learn from each
customer encounter. Review the encounter and focus on
what you did well. Don’t blame yourself for any mistakes
you made. These are opportunities to learn. Decide how you
could handle the situation better next time. Someone once
said that experience is the master teacher. However, it is only
the master teacher if we learn and apply what we learn. So,
practice, practice, practice.

Closing the Customer Encounter

The closing moments of a customer encounter, even a brief
encounter, are critical. If you leave customers with a positive
impression, they will return. But if you leave them with a
negative impression, you will destroy all the rapport and trust
that you have worked so hard to establish.

Closings
provide an
opportunity to
ensure that you
have met the
customer’s
needs.

66

Closings provide an opportunity to ensure that you have met
the customer’s needs. Following these steps can help you leave
the customer with a positive impression:
◆

Smile sincerely.

◆

Stand if the customer is standing.

◆

Shake hands.

◆

Ask if there is anything else you can do for the customer.

◆

Give customers your name and phone number or a
business card.

◆

Invite customers to call or visit if they have questions
or concerns.

◆

Make an appropriate personal comment, such as
complimenting them on their purchase or telling them
you’re glad that you were able to resolve their problem.

◆

Thank the customer for coming in or calling.

Managing the Customer Encounter ●

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Make sure your body language and tone of voice reinforce the
words you are using. A smile is your most effective tool in
closing a conversation, whether in person or over the phone.
Putting a smile on your face, even if you don’t feel like smiling,
will influence your attitude, body language, and tone of voice.

Take a Moment

What do you consciously do when you know the customer
is about to leave?

_______________________________________________

3

_______________________________________________
Review the previous list. Identify two new behaviors you
could try that would improve the close of your customer
encounters, and write them below.
_______________________________________________
_______________________________________________

Following Through with the Customer

The close of the customer encounter isn’t the end of your
contact with the customer. An important final step is providing
follow-up to ensure that the customer is satisfied and received
everything that you promised.

Customers expect you to do what you say you will do when you
say you will do it. Sometimes you have to involve others in
meeting customer needs or solving customer problems. Based on
what they agree to do for you, tell the customer what will be done.
If the people on whom you are depending fail to live up to their
responsibilities, you are left in an embarrassing position (another
argument for good internal customer service). However, you are
still responsible for making sure things get done.

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● Managing the Customer Encounter

The best way to ensure customer satisfaction is to stay in touch
with the customer. Let the customer know if there is a change
in plans. Never leave the customer guessing when something
will get done when agreed-upon actions and times have passed.
Following are a few other tips to help you provide your
customers with effective follow-up:

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The best way
to ensure
customer
satisfaction is
to stay in touch
with the
customer.

68

◆

If you told a customer you would do something and find
that it is not possible or will take longer than expected, let
the customer know. Keep the customer posted as to what
is happening.

◆

Follow up with phone calls to make sure customers are
happy with the product or service.

◆

Send thank you cards with return comment cards.

◆

Ask the customer if all his or her needs were met during
closing comments.

◆

Conduct a formal customer satisfaction survey.

◆

Provide customer service hot lines, e-mail addresses, and
suggestion boxes.

◆

Have everyone, including management, ask the customer his
or her perception of service.

◆

Create a Web page that gives customers product and service
information and allows them to give you feedback.

Managing the Customer Encounter ●

Take a Moment

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Think of a recent situation in which you or your
company did not follow through with a customer or
meet expectations. In the space provided, describe
happened.

what

Situation details:

_______________________________________________
_______________________________________________

3

What caused the poor follow-through with the customer?

_______________________________________________
_______________________________________________
What could you have done to prevent this situation from
happening?

_______________________________________________
_______________________________________________
What could others have done to prevent this situation from
happening?

_______________________________________________
_______________________________________________

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● Managing the Customer Encounter

Chapter Summary

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The customer encounter is the most critical step in the
customer service system. If the encounter is positive, the
customer leaves satisfied, but if the encounter is negative,
the customer may never return.

As a customer service professional, your job is to create an
immediate and positive encounter for the customer. You can
do this by:
◆

Showing customers that you value their business.

◆

Understanding customer behavior and creating
positive outcomes.

◆

Asking the right questions.

◆

Dealing effectively with customer hand-offs.

◆

Making the customer’s problem your problem.

◆

Telling customers “no” effectively.

◆

Closing the customer encounter effectively.

◆

Following through to ensure customer satisfaction.

Following these steps will help you provide your customers with
outstanding customer service that will increase your product’s or
service’s Perceived Value in the eyes of your customers and make
your organization stand out from the rest.

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Managing the Customer Encounter ●

Self-Check: Chapter Three Review

✓

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Answers to these questions appear on pages 101 and 102.
1. Your first step in creating a successful customer encounter is
to let customers know that

_______________________________________________

2. True or False?
Customers are looking for consequences that are immediate,
certain, and positive.

3

3. Open-probe questions require the customer to

______________________________________________.

4. What are the five steps to follow when solving any problem?
a. ____________________________________________

b. ____________________________________________

d. ____________________________________________
e. ____________________________________________

5. When handing off a customer to another customer service
representative, what two things are you responsible for?

a. ____________________________________________

b. ____________________________________________

6. True or False?
When telling a customer “no,” you can maintain a positive
relationship with the customer by focusing on what you can
do rather than what you can’t.

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● Handling Complaints and Conflicts

Chapter

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Four

Handling Complaints
and Conflicts
Chapter Objectives

“

▲
▲
▲

Determine why your customers complain.

▲

Control your emotions when dealing with
stressful situations.

Recognize five different conflict styles.

Follow a five-step technique for dealing with
upset customers.

ot another message from Mrs. Miller,” Matilda groaned as she
checked her voice mail. “It must be her air conditioner again.
She says it’s making a funny noise, but we’ve sent service
technicians out to look at it three times, and none of them can find
anything wrong with it. I think she just likes to complain. I know
she shops here a lot, but I wish she’d stop calling me.”

N

Take a Moment

If you received this message, what would you say to Mrs.
Miller when you returned her call?
_______________________________________________
_______________________________________________

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When customers are dissatisfied, they express their displeasure
in a number of ways. Some dissatisfied customers will complain,
but a number of others will say nothing. Research suggests that
more than 95 percent of the customers who are unhappy with
your organization will not complain to anyone within the
organization. However, most will tell at least one other person
outside the organization. Many will tell 10, 15, or even 20
people about their displeasure, which is certainly bad

Handling Complaints and Conflicts ●

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advertising for your organization. Some will embellish the story
the more times it is told. Worst of all, more than 60 percent of
all your dissatisfied customers will never return.

And what about the customers who do complain? Though it
may be hard to believe, many customers complain because they
really care about your organization. These customers feel a sense
of loyalty. They are surprised that their expectations were not
met and are offering their time and energy to point out areas
they perceive as needing improvement. Unfortunately, some are
not very tactful in displaying their dissatisfaction.

Keep in mind that while complaining customers may not always
be “right,” they believe they are and feel that their “righteous
indignation” is justified. More than 90 percent of your
complaining customers will remain loyal if you resolve their
concerns. If you exceed their expectations when solving their
problems, they will tell others about you. This is the best
advertising your organization can have—and it’s free!

Many
customers
complain
because they
really care
about your
organization.

4

Determining Why Your Customers
Complain

As we saw in Chapter 3, you can turn a customer complaint
into a positive experience for yourself and the customer by
following the steps for a successful customer encounter. As you
follow these steps, however, remember that customer complaints
carry an additional responsibility for the customer service
professional—you need to determine why each customer is
complaining and gather enough information to help your
organization correct those situations that cause complaints.
Customers complain for a variety of reasons. Sometimes they
complain because a product or service failed to live up to their
expectations. In these situations, you should look on customer
complaints as valuable feedback that can help your organization
continually improve its output. As you work with customers to
resolve this type of problem, take notes on the difficulties
customers are having so you can pass on the information to
someone who can correct the root cause of the problem.

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● Handling Complaints and Conflicts

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In other situations, customers may complain about the
customer service they receive rather than the product itself.
Here are a few behaviors and attitudes that customers frequently
complain about. Put a checkmark by any that your
organization’s customers have complained about recently.
❏ Product or service was not delivered as scheduled.

❏ Customer had to wait for a long period of time (in person or
on the phone).
❏ Customer had to stand in line for a long period of time.
❏ Salesperson did not listen to customer.

❏ Customer felt he or she was being “treated like a number.”
❏ Customer complained, and customer service rep acted as
though he or she did not believe the problem.
❏ Customer service rep was not able to resolve problem.

❏ Customer felt helpless, as though the situation were out
of control.

Take a Moment

In the space below, list four recent customer complaints you
have received.
1. _____________________________________________
2. _____________________________________________
3. _____________________________________________
4. _____________________________________________
Now pick one of the situations you listed above and
describe the feelings you would have if you were a
customer in the same situation.

_______________________________________________
_______________________________________________

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Handling Complaints and Conflicts ●

Recognizing Different Conflict Styles



No matter how hard you work with customers to resolve their
complaints, conflicts will develop. Different people handle
conflict in different ways. Some resolve the conflict calmly,
others yell, and others simply avoid the matter altogether. We
may deal with conflicts very differently depending on the nature
of the conflict and the other people involved. We can refer to
the way we most typically handle conflict as our conflict style.
Our conflict style is based on our approach to two dimensions
of conflict: our concern for the other person/relationship
(cooperativeness) and our concern for our own self-interests
(assertiveness). Our conflict style is determined by how willing
we are to cooperate and how much we want to get our way.

4

Take a Moment

Think of how you generally deal with conflict or
disagreement. Check the answer that best fits you.

1. When dealing with conflict or disagreement, I try to
preserve the relationship
❏ All of the time.
❏ Most of the time.
❏ Some of the time.
❏ None of the time.

2. When dealing with conflict or disagreement, I try to get
my way
❏ All of the time.
❏ Most of the time.
❏ Some of the time.
❏ None of the time.

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● Handling Complaints and Conflicts

When we approach a disagreement, we tend to demonstrate
one of five general conflict styles according to our level of
cooperativeness and assertiveness:



When we
approach a
disagreement,
we tend to
demonstrate
one of five
general conflict
styles.

1. Partners
This style of conflict is high in cooperativeness and
assertiveness. People exhibiting this style tend to want to
cooperate yet win. This means they will work to resolve a
situation in a win/win fashion. It is usually easy to resolve
problems when people exhibit this style. They will let you
know what they want and are willing to work with you to
get it.
2. Obligors
This style of conflict is high in cooperativeness but low on
assertiveness. People exhibiting this style approach problem
solving in a conciliatory manner. They give in to
accommodate others because they are willing to give up
what they want in order to preserve the relationship. But,
though they give in easily, they walk away with a sense of
loss. You will have to dig to understand what they really
want, because they will not tell you without prompting.
Customers exhibiting this style will often take a lot of abuse,
but when the conflict is over, they will never return.
3. Competitors
This style is assertive but not very cooperative. People
exhibiting this style deal with conflict by trying to get their
way. They will tell you what they want and may sometimes
appear inflexible and uncooperative. They want to win. We
all tend to demonstrate this style when the conflict is a
matter of principle or violates one of our values.
4. Avoiders
This style of conflict is not very cooperative and not very
assertive. People exhibiting this style want to avoid conflict.
They may not care about the solution, or they just hope the
problem will go away. They generally will not tell you what’s
wrong, and if you ask them what the problem is, they often
respond, “Oh, nothing.” Their facial expression will
sometimes let you know that they disagree.

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Handling Complaints and Conflicts ●



5. Negotiators
This style of conflict tends to be somewhat cooperative and
somewhat assertive. People exhibiting this style are both
interested in getting what they want and preserving the
relationship. They are, therefore, willing to give in on some
(but not all) issues in order to compromise. They will
generally tell you what they want and work with you to
get it.

Take a Moment

Based on the previous descriptions, which conflict style
do you think you exhibit most often?

❏ Partner

4

❏ Obligor

❏ Competitor
❏ Avoider

❏ Negotiator

When dealing with customer dissatisfaction, you need to
consider both your conflict style and the customer’s. You
cannot control a customer’s approach to conflict resolution, but
you can control your own. Once you recognize which style a
customer is exhibiting, you can adopt the conflict style that best
fits the situation.
For example, if the customer exhibits a Competitor style and
you adopt the same style, the conflict will escalate with no hope
of resolution as both of you compete to win. A more effective
approach would be for you to adopt an Obligor or Negotiator
style and compromise with the customer—if you are
empowered to make the necessary decisions.

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● Handling Complaints and Conflicts

Take a Moment



Describe a recent conflict situation that did not have an
acceptable ending for you or the customer.

_______________________________________________
_______________________________________________
Which conflict style did the other person exhibit?

_______________________________________________
Which conflict style did you exhibit?

_______________________________________________
Which conflict style would have brought an acceptable
resolution if you had exhibited it instead?

_______________________________________________
What would you do differently next time?

_______________________________________________

Calming Upset Customers

■ Two customers complain about receiving a cold steak in a
restaurant. One calls the server over to the table and politely
asks the server to warm the steak and then bring it back. The
other calls the server to the table and in a loud, sarcastic tone
of voice asks, “What kind of restaurant are you running here?
My steak is cold! Let me talk to the manager!”

In the previous example, the same issue triggered very different
behaviors in the two people. We might describe the first
customer as simply being displeased because of her low
emotional level. We might describe the second customer as
being upset or demanding because of the high level of emotion
he expressed.

78

Customers become upset for many reasons. Sometimes people
who are usually agreeable happen to be having a bad day. If you

Handling Complaints and Conflicts ●



catch them at the wrong moment, they take their frustration out
on you. Some may even become unruly and disruptive over
what appear to be insignificant issues. Often, these temporarily
grumpy people will end up apologizing to you about their
behavior. Accept such apologies graciously.
Other customers become upset because they believe this
behavior will get them what they want. Remember our
discussion of behavior and its outcomes in Chapter 2. If
customers believe that unruly behavior will bring immediate,
positive results, they may use it to get what they want.
Unfortunately, customer service representatives reinforce this
type of behavior by paying special attention to these customers.
Do not mistake rude, unpleasant, or obnoxious people as
requiring the most attention. The person who complains
politely deserves as much, if not more, attention as the person
who makes a scene.

Do not
mistake rude,
unpleasant,
or obnoxious
people as
requiring the
most attention.

4

Whatever the reason for your customer’s unruly behavior, the
following steps should help you calm the customer and defuse
the situation:

1. Recognize that the customer is not angry at you
personally. The customer is angry at the organization. You
represent the organization, and most customers believe you
have more control over what happens than you do. Not
taking customer remarks personally can be difficult,
especially when a customer is “in your face.” Make a point of
ignoring unpleasant remarks, and focus on completing the
remaining steps in this process.
2. Acknowledge that a problem exists.
This does not mean you have to agree or take the blame. If
the customer is unhappy, you must become a participant in
resolving the problem. Say something like, “Let’s see how I
can help you.”

3. Tell the customer what you can do, not what you can’t
do. Telling upset customers what you can’t do only frustrates
them more. Focus on the future, not the past. Help the
customer generate alternative solutions, and move forward
with what you can do for them. You will probably want to
use the problem-solving steps discussed in Chapter 3.

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● Handling Complaints and Conflicts



4. Keep the lines of communication open.
This is not the time to give ultimatums—that will only close
the conversation. If you can’t give customers what they want,
ask for alternatives and suggestions. Sometimes you will
simply have to say “no,” but not until you’ve considered
every possibility.
5. Stay in control of your emotions at all times.
You have a better chance of resolving an upset customer’s
problems when you respond with calming behaviors. Don’t
exhibit the same hostile behaviors as the customer. Chances
are, other customers are watching you and how you deal
with the situation. You best represent the company and
yourself when you act professionally. Responding with
genuine concern for the customer will often reduce his or
her emotions. Try saying something like, “This seems to have
really upset you, and I want to help solve this problem.”
On occasion, some customers may become abusive. Abusive
behavior goes beyond just being rude or loud. Abusive
behavior includes:

No customer
service
professional
should have
to put up
with abuse.

80

◆

Abusive or obscene language (calling you vulgar names).

◆

Violent threats against your organization.

◆

Personal threats against you.

No customer service professional should have to put up with
abuse. Here are some tips for handling abusive customers:
1. In a calm but firm voice, tell abusive customers that you will
not allow them to attack you verbally. If they persist, you
will not be able to handle their problem.
2. Ask abusive customers if they would like to talk to your
supervisor. You should inform the supervisor when a
customer has been abusive so your supervisor will know
what to expect. Don’t use this as a crutch. It should be used
when you have exhausted all your options.
3. Develop a security action plan to help you deal with
situations in which a customer becomes physically abusive
or needs to be removed.

Handling Complaints and Conflicts ●

Controlling Your Own Emotions



In spite of your best efforts, a particularly frustrating customer
or situation may leave you feeling that you are about to lose
control of your own emotions. How can you remain in control?
The first step is to understand what triggers your emotional
reactions. For example, you may find that you get angry when
people yell at you or when you feel embarrassed. Try keeping a
record of what was happening when you displayed emotions.

Once you understand what triggers your emotions, you can
develop an action plan to help you cope with those situations.
For example, if you discovered that you get angry when
someone yells at you, you may want to say to yourself, “This
person isn’t angry with me; he’s angry at the situation. I can help
this person if I stay in control.”

Once you
understand
what triggers
your emotions,
you can
develop an
action plan to
help you cope
with those
situations.

4

You may find it helpful to put yourself in the other person’s place
for just a moment. Ask yourself, “How would I feel if this
happened to me?” If you have trouble understanding the other
person’s reaction, ask questions to gain insight and understanding.
Showing concern in this way may reduce their emotional
display—and yours as well.

Recognizing the humor in an emotional situation can also be
helpful. However, remember that humor can be a double-edged
sword at emotional times—use it appropriately. Make sure the
humor is directed at you—never make fun of the customer.
When used correctly, humor can be a powerful stress reducer.
You may also find it helpful to take a time-out. This involves
taking time away from the stressful situation to relax and regain
your composure. You should usually take a time-out after the
customer encounter is over. However, it may be necessary to
take a time-out during a very emotional confrontation.
During a time-out, concentrate on something positive rather
than the situation that generated the emotion. If possible, leave
the area where the emotionally charged event occurred. Try
going for coffee, going for a walk, performing deep breathing
exercises, or going to visit a person who is always upbeat.

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● Handling Complaints and Conflicts



No matter how hard organizations work to produce quality
products and services, there will always be situations in which
customers are dissatisfied. By adjusting your conflict style to
your customer’s, calming upset customers, and keeping your
own emotions in check, you can remain in control of complaint
situations and develop win/win resolutions that will benefit
both your customer and your organization.

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Handling Complaints and Conflicts ●

Chapter Summary



When customers are dissatisfied, they express their displeasure
in a variety of ways. Some will complain, but more than 95
percent of your dissatisfied customers will not tell anyone within
your organization.

Many of the customers who do complain care about your
organization and want to help it improve. They may complain
because a product failed to meet their expectations, or they may
be dissatisfied with the level of service they received. Part of your
responsibility as a customer service professional is to correct
those situations that cause your customers to complain.
No matter how hard you work with customers to resolve their
complaints, conflicts can develop. When we deal with a conflict,
we tend to demonstrate one of five general conflict styles based
on our level of cooperativeness and assertiveness. The five
styles are:
◆

Partners

◆

Obligors

◆

Competitors

◆

Avoiders

◆

Negotiators

4

Once you recognize which style a customer is exhibiting, you
can adopt the conflict style that best fits the situation.

Customers become upset for many reasons. The following steps
can help calm your customer and defuse the situation:
1. Recognize that the customer is not angry at you personally.
2. Acknowledge that a problem exists.

3. Tell the customer what you can do, not what you can’t do.
4. Keep the lines of communication open.

5. Stay in control of your emotions at all times.

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● Handling Complaints and Conflicts

You can remain in control of your emotions by:
Trying to understand what triggers your emotions.



◆

84

◆

Putting yourself in the customer’s place.

◆

Recognizing the humor in the situation.

◆

Taking a time-out.

Handling Complaints and Conflicts ●

Self-Check: Chapter Four Review

✓



Answers may be found on page 102.
1. Over _____ percent of the customers who are upset with
your organization will say nothing to anyone within
the organization.
2. What are the two dimensions of conflict?

a. _____________________________________________

b. _____________________________________________

3. True or False?
Most people deal with conflict in the same way.

4

4. True or False?
Most of the customers that are upset with us want to
get even.

5. True or False?
Asking yourself, “How would I feel if I was the customer?”
can help you handle your emotions.
6. What does taking a “time-out” involve?

_______________________________________________
_______________________________________________

-

85

● Continuously Improving Customer Service

Chapter



Five

Continuously Improving
Customer Service
Chapter Objectives
▲
▲
▲

Conduct a customer service audit.

▲

Develop an action plan for improving your customer
service system.

Review your customer service system.

Gain valuable feedback from your customers.

o far, we have discussed a variety of techniques for
improving your communication skills, managing customer
encounters, and resolving complaints and conflict. Effectively
using these techniques will help you satisfy your customers and
increase the Perceived Value (PV) of your product or service.
But we have one area left to consider: Does your organization’s
customer service system support the positive customer
relationships you are working to build?

S

As you might remember from Chapter 1, all customer
encounters take place within a customer service system. We can
define a system as a set of interlinking, interdependent parts that
work together to make up a whole. Each part contributes to the
overall functioning of the whole.

Your entire
organization is
involved in
creating your
customer
service system.

86

Your entire organization is involved in creating your customer
service system, because every part of the organization has a role
to play in meeting internal and external customer needs. If every
part of your organization is running smoothly, your customer
service system should run smoothly as well. But if part of your
organization is not running properly, it can affect the quality of
service you gave your customers.

Continuously Improving Customer Service



For example, if your shipping department is unable to deliver
orders in a timely fashion, your customers will be dissatisfied.
You can use all of your best customer service skills to deal with
your upset customers, but until the shipping department is able
to make its deliveries on schedule, your customers will not be
satisfied, and your product’s or service’s PV will suffer as a result.
In this final chapter, we will consider two ways that you can
evaluate and improve the quality of your customer service
system: performing a customer service audit and beginning a
continuous improvement program. You will then have the
opportunity to develop an action plan for improving your
customer service.

Conducting a Customer Service Audit

Each part of your organization should be periodically reviewed
to determine its contribution to the efficiency and effectiveness
of customer service. You can do this by conducting a Customer
Service Audit. A Customer Service Audit will improve customer
service and increase PV by identifying the root causes of
reoccurring customer complaints.
Begin your Customer Service Audit by determining which part
of the organization you will review. Then develop a checklist of
the specific customer service actions you want to observe and a
series of questions that will help you identify how well those
actions are being performed. If you have a customer service
standard, you can use it to develop some of the questions.

◆

Randy, the manager of a hotel, wants to perform a Customer
Service Audit on the front desk check-in area. Some
questions he wants to ask include:
• Are customers able to find available parking near the
check-in area?
• Do customers have to wait more than one minute before
they are acknowledged?
• Does the front desk staff greet customers with a smile?
• Does the front desk staff answer the phone before
three rings?

5

A Customer
Service Audit
will improve
customer
service and
increase PV by
identifying the
root causes of
reoccurring
customer
complaints.

87

● Continuously Improving Customer Service



Notice that these are specific. Avoid general questions such as
“Is the front desk staff using good communication skills?” This
type of question is too broad and is subject to too much
interpretation. Questions should consider specific behaviors
so they can be verified by observation.
You may want to develop a rating system for each audit
question. For example, this three-tier system is used by
many auditors:
◆

Exceeds expectations

◆

Meets expectations

◆

Falls below expectations

Ideally, we would like to have all our ratings in the “exceeds
expectations” level.

As you develop
your questions,
involve other
customer
service
representatives
as well as
actual
customers.

As you develop your questions, involve other customer service
representatives as well as actual customers. Customer service
representatives can perform the audits, though they will need
some training in observation and auditing techniques. Customers
can also serve as auditors in some situations. When customer
service reps become involved, they must have assurance that
the information collected will not be used to blame them or
lead to a disciplinary action. If they believe the information will
be used against them, they simply will not get serious about the
audit process.
During the audit, provide immediate feedback to the members
of the department you are auditing. Be sure to give positive
feedback when things are done correctly as well as corrective
feedback for behaviors that were below expectations. Try to find
out what is causing any unacceptable customer service behaviors,
and take action to correct those situations. When you complete
your Customer Service Audit, keep the results on file so that
corrective actions can be verified during the next audit. Review
any reoccurring trends to determine their root causes.

88

Continuously Improving Customer Service

Take a Moment



Make a list of 10 specific questions that you and your
coworkers can use to conduct a Customer Service Audit.
Once you have developed the audit checklist, conduct an
audit of your activities.

1. ____________________________________________
2. ____________________________________________
3. ____________________________________________
4. ____________________________________________
5. ____________________________________________
6. ____________________________________________
7. ____________________________________________

5

8. ____________________________________________
9. ____________________________________________

10. ____________________________________________

Reviewing Your Customer Service System

You can move beyond auditing individual departments to
reviewing your entire customer service system. This is an
excellent way to see how the various parts of the system fit
together and to make sure that all the actions taken throughout
the system work to serve the customer. A convenient and
effective way to review and analyze your customer service system
is to use the Continuous Improvement Process, which consists
of seven steps.

89

● Continuously Improving Customer Service

Step 1: Determine the Customer’s Expectations
of Service



Whenever customers buy a product or service from you, they
have certain expectations. You need a clear idea of what these
expectations are in order to determine if your customer service
system is succeeding. As Stephen Covey puts it, begin with the
end in mind.

The best way
to learn what
customers
want from you
is to ask them.

Encouraging Customer Feedback
The best way to learn what customers want from you is to ask
them. Remember, only 5 percent of your customers will take
the time to complain to you if they are dissatisfied; you need to
give the other 95 percent a chance to express their feelings.
There are many ways to solicit feedback from customers. If your
organization wants to create a survey that statistically reflects all
of your customers, it is best to work with a survey expert. An
expert can help you identify the demographics of your customer
base and select a sample of customers that reflect those
demographics. An expert can also help you develop a variety of
feedback vehicles, including:
◆

Telephone surveys

◆

Mail surveys

◆

Customer focus/feedback groups

◆

Employee surveys

◆

Internet surveys

◆

Customer comment cards

As a customer service professional, you can also conduct your
own informal customer research. Though informal research will
not be as statistically accurate as a more structured research
project, it can provide you with valuable insights into what your
customers are thinking.

90

On the most basic level, informal customer research involves
taking the time to talk with your customers about your
products and services and really listening to what they have to
say. Keep notes on their reactions, and review your notes

Continuously Improving Customer Service



periodically to see if you can identify common reactions. Here
are some questions you might ask:
◆

“What do you like best about our product/service?”

◆

“In what ways could we improve our product/service?”

◆

“Have you ever used our competitors’ products/services?
How do our products/services compare?”

Avoid global questions such as “Was everything satisfactory?” In
fact, a customer may think everything was satisfactory and still
not come back because your competitor’s PV is higher than
yours. Wouldn’t you like to have products and services that are
rated exceptional rather than satisfactory?
You can take your informal customer research one step further
by preparing a set of questions to ask customers through a
survey or focus group. Here are some tips for devising your own
customer research:

Wouldn’t you
like to have
products and
services that
are rated
exceptional
rather than
satisfactory?

5

1. Develop a list of questions and test them on a pilot group.
(You can sometimes use employees as a pilot group.) Make
sure the questions will help you gain the type of information
you seek.

2. Determine how you will collect the data. Will you ask survey
questions in person, by mail, or over the telephone, or will
you conduct focus groups?
3. Select your sample of interviewees from the population of
customers. Be sure that you survey enough customers to
allow you to identify any trends in their responses. A good
rule of thumb is to survey at least 100 customers. Work with
a random sample of customers; in other words, select the
sample from the overall population without any regard to
who is chosen.
As previously mentioned, though informal customer research
can provide you with valuable insight into your customers’
expectations, it does not provide the statistical accuracy of a
survey developed and conducted by an expert. If you are
considering major changes or significant capital investments,
consult a survey professional—it will be worth the investment.

91

● Continuously Improving Customer Service

Step 2: Identify the Steps Customers Must Take
to Obtain Your Product or Service



In this step, you’ll trace the customer service process from your
customers’ initial contact with your organization through their
receipt of your product or service and final billing. Following
the flow of this process will help you understand the details of
each action or operation you are performing. Remember, every
contact your customer has with your organization is a customer
encounter. Is the message on your answering machine friendly?
Are there enough spaces in your parking lot? Are goods and
services delivered on time? Do customers have to wait an
unreasonable length of time before they can speak to a customer
service rep? Are the bills they receive easy to understand? These
are all customer service encounters. Be sure they create positive
impressions of your organization instead of negative ones.

Remember,
every contact
your customer
has with your
organization is
a customer
encounter.

Step 3: Go Into Detail

Make a detailed list of all the actions members of your
organization perform for customer service. If your company
uses a customer order form, identify each time someone does
something with the form. Identify how the form moves through
the various parts of the customer service system, how long it
takes, and what contributes to failures.

Step 4: Evaluate Each Action or Operation to
Determine What Is Working Effectively
The goal in this step is to look for ineffective, unnecessary, and
inefficient actions or operations. You can evaluate the actions in
your customer service system by asking these five questions:

92

◆

What is the customer service action?

◆

Is this action or operation necessary?

◆

How can I do it faster and cheaper?

◆

How can I improve my accuracy?

◆

How can I build trust and confidence in my customer?

Continuously Improving Customer Service
Step 5: Determine Needed Changes



Begin brainstorming solutions to any problems you identified in
Step 4. If you have not already involved those who have to
implement the changes, you should do so now. People support
what they help create. You will probably not want to implement
all your solutions, because some will not be as effective as others
and some will be more difficult to implement. Solutions that
have power and are easy to implement should be addressed first.
More difficult solutions will take longer.

Step 6: Develop an Action Plan

If you’re serious about improving your customer service system,
you’ll need to develop an action plan. Action plans must answer
the following questions:
◆

What needs to be done?

◆

When will it be done?

◆

Who is doing it?

◆

Who else needs to be involved?

◆

What are the limitations or restrictions on what can
be done?

◆

Who will follow up to make sure the actions are completed?

If you’re
serious about
improving your
customer
service
system, you’ll
need to
develop an
action plan.

5

Step 7: Follow Up

In order for your action plan to succeed, someone must follow
up to ensure that the actions are completed. In addition,
someone must make sure that the actions taken are producing
the desired changes in customer service. Sometimes this is
referred to as providing accountability.

Following the seven steps of the Continuous Improvement
Process will allow you to identify and correct those weaknesses
that are keeping your customer service system from being truly
outstanding. However, the process does take patience.

After implementing corrective actions in your customer service
areas, don’t expect a sudden significant improvement in your
customer surveys. It takes time for the customer to be impacted

93

● Continuously Improving Customer Service



by the changes. Customers need to have several encounters with
the improved service before you make an impression on them.
It is only then that customers will reflect the changes on your
customer service surveys.

Putting Your Learning to Work

In the course of this book, we’ve seen how you can improve
your own customer service skills and how you can help your
organization improve its customer service system. Only one step
remains: putting your knowledge into action. If you are truly
serious about improving your customer service, you will need an
action plan. Following is an Action Planning Form. Make
several copies of it. You will use two copies of it as you complete
this chapter, and you may want to use more later.

Step 1: External Customer Service

Review each page of this book, paying particular attention to
the exercises you were asked to complete. Using one copy of the
Action Planning Form, complete the form and develop the
action steps you will take to improve your external customer
service. Be specific when defining actions, and make sure they
are feasible.

Step 2: Internal Customer Service

You can’t have outstanding external customer service without
outstanding internal customer service. While this book was not
specifically written for internal customer service, all the same
principles and techniques apply. With that in mind, review the
book again. This time think about the material in terms of
internal customer service. Using a second copy of the Action
Planning Form, complete the form and develop the action steps
you will take to improve your internal customer service.

94

Continuously Improving Customer Service

Action Planning Form



What are the objectives of this action plan?
_______________________________________________
_______________________________________________

What are the desired customer service behaviors you would
like to implement?
_______________________________________________
_______________________________________________
How will they benefit the customer?
_______________________________________________
_______________________________________________
What are the potential barriers to implementing the
action plan?
_______________________________________________

5

_______________________________________________

How will you overcome these barriers?
_______________________________________________
_______________________________________________

Who else must be involved to make this action plan
a
success?
_______________________________________________
_______________________________________________
continued on next page

95

● Continuously Improving Customer Service

Action Planning Form (continued)



What are the action steps you will take?
_________________________________ Start Finish
_________________________________ date _ date
1. _______________________________ _____ _____
2. _______________________________ _____ _____
3. _______________________________ _____ _____
4. _______________________________ _____ _____
5. _______________________________ _____ _____
6. _______________________________ _____ _____
7. _______________________________ _____ _____
8. _______________________________ _____ _____
9. _______________________________ _____ _____

10. _______________________________ _____ _____
How will you reward yourself after you complete your action
plan?
_______________________________________________
_______________________________________________
Follow Up
Did the actions accomplish their objectives?
❏ Yes

96

❏ No

Continuously Improving Customer Service

Chapter Summary



Outstanding customer service is more than a collection of skills
and techniques. It is a system that involves every part of your
organization. As a customer service professional, you are
responsible for continually trying to improve your organization’s
customer service system. You can do this by conducting a
customer service audit of individual departments within your
organization or by reviewing your entire customer service system.
Customer feedback is an important part of any review. You can
gather feedback informally through your conversations with
your customers, or you can design your own survey or focus
group questions. If you are planning major changes in your
organization, you should hire an expert to conduct a formal
survey so that you gather the most reliable information possible.

To put everything you’ve learned into practice, you will need to
develop an action plan. Following through on this plan will help
you provide your external and internal customers with the type
of outstanding customer service that builds loyalty and
encourages repeat business.

5

97

 Continuously Improving Customer Service

Answers to these questions appear on pages 102 and 103.



✓

Self-Check: Chapter Five Review
1. All customer encounters take place within a
_____________

_____________

_____________.

2. True or False?
When conducting a customer service audit, you should ask
general questions that will help you look at broad issues.
3. True or False?
Customer service is not a system that can be improved.
4. What are the steps in the customer service Continuous
Improvement Process?
a. ________________________________________

b. ________________________________________
c. ________________________________________

d. ________________________________________
e. ________________________________________
f. ________________________________________

g. ________________________________________

5. List three questions you can ask your customers when you
are informally seeking feedback.
a. ________________________________________

b. ________________________________________
c. ________________________________________

98

Continuously Improving Customer Service



Notes

5

99

● Answers to Chapter Reviews



Answers to Chapter Reviews
Chapter One (page 29)

1. External customers are those who derive benefit from your
products or services.
2. Internal customers are those who receive your personal
work output.

3. False—Since every aspect of a company can impact the
external customer, any slipup reflects on the customer’s
opinion of the company as a whole.
4. Perceived Value consists of the quality of our product or
service, the customer service we provide in delivering that
product or service, and the cost. PV is how customers
measure the value of our company. High perceived value
produces a loyal customer.
5. An attitude is the way we feel about something. Our
behavior reflects our attitude. If we have a positive attitude,
it is reflected in our behaviors, and customers see it.
Customers also see our negative attitude. We cannot hide
our attitude—positive or negative.
6. Customer service standards define acceptable customer
service behaviors and let everyone know what is expected.
7. True—The customer expects you to know something about
the product and/or service your company offers. They may
ask you the difference between your product or service and
your competitors.

100

Answers to Chapter Reviews ●

Chapter Two (page 47)



1. The goal of communication is to transfer understanding
between two or more people.
2. Reflecting is communicating back to a person your
understanding of what he or she is saying.

3. False—Our body language and our tone of voice
communicate most of the message.
4. 55 percent

5. When we communicate over the phone, we lose the message
delivered by our body language. This accounts for about 38
percent of the message.
6. False—There are four basic communication styles.
Customers communicate differently based on the style
they prefer.

Chapter Three (page 71)
1. You value their business.

2. True—Customer behavior is determined most often by
immediate, certain, and positive outcomes. If they anticipate
an outcome that is immediate, certain, and positive, they will
behave in a manner that results in that favorable outcome.
3. Provide more than a yes-or-no answer.

4. a. Define the problems in specific terms.
b. List alternative solutions and focus on what you can do
to correct the problem.
c. Pick a solution that best fits the desire of the customer.
d. Implement the solution and follow up to make sure it
was implemented.
e. Make sure the problem is solved to the customer’s
satisfaction.

101

● Answers to Chapter Reviews



5. a. Getting customers to the right person. b. Being sure
their expectations are met.
b. Being sure their expectations are met.

6. True.

Chapter Four (page 85)
1. 95 percent

2. a. How much we want our way.
b. How much we want to cooperate.

3. False—We have different conflict styles that sometimes get
in the way of resolving conflict.
4. False—Mot of our upset customers want to be helpful. If
they are listened to, they can become loyal customers.
5. True—When we put ourselves in the customer’s shoes for a
while, it lets the customer know that you care. It will also
help you reach a better solution to the problem.
6. Taking a few minutes to remove yourself from a stressful
situation to regain your composure and relax.

Chapter Five (page 98)

1. All customer encounters take place within a customer
service system.

2. False—You should ask specific questions that help you focus
on specific behaviors.
3. False—Customer service is a system. Since a system has
specific and defined steps, these steps can be improved.

102

Answers to Chapter Reviews ●


4. a. Determine the customer’s expectations of service.
b. Make a list of all the steps your customer must take and
the flow of information.
c. Go into detail about what is being done.
d. Evaluate each step or action to determine what is and is
not adding value.
e. Determine needed changes.
f. Develop an action plan.
g. Follow up to make sure the actions accomplished what
they were supposed to accomplish.

5. a. What do you like best about our product/service?
b. In what ways could we improve our product/service?
c. How do our products/services compare to our
competitors’?

103

104