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Hi There! This is Shep Hyken, Customer Service and Experience Expert. On this video I am
sharing an amazing customer service ideam the five dollar lifeboat. Tom Glenn, a second
generation owner of a chain of Ace Hardware stores, tells a wonderful story about his
father, Elder Glenn. One day an agitated customer came in the store and walked up to Elder and
stated, "I have a problem." It turns out the customer bought two items that each had a
$5.00 rebate. The customer claimed he did exactly what he was supposed to do to get
his rebates, which was to mail the receipt and the code on the package to the manufacturer.
The rebates never showed up, and the customer was upset. Now, it wasn't Elder's fault. It
may have been lost in the mail, or perhaps the customer did make an error. However, it
became Elder's problem -- a problem he planned to solve. And, he did so quickly, easily and
with no hassle to his customer. Elder simply went over to the cashier and asked her to
take two five dollar bills out of the cash register. He handed them over to a surprised
customer, who had obviously expected a confrontation. From that point on Elder had a customer -- and
a friend -- for life. Every time the customer came in the store he would seek out Elder
to just say, "Hello." Elder would go on to use this example in one of his team meetings.
He shared this story and referred to it as the "Five Dollar Lifeboat." The lesson to
his associates was that for just five dollars he turned an unhappy customer who might never
come back that might be worth hundreds, if not thousands, of dollars into a loyal fan
of the store. He gave permission to his employees to use the Five Dollar Lifeboat whenever necessary
to take care of a customer. There are plenty of companies who have similar Five Dollar
Lifeboat procedures. The Ritz-Carlton comes to mind with their Two Thousand Dollar Lifeboat.
Okay, they don't call it a lifeboat, but similar to Elder Glenn's concept, an employee of the
Ritz-Carlton has the ability to spend up to two thousand dollars to take care of a guest
who has been wronged. Both Ace Hardware associates and the Ritz-Carlton employees have been trained
to understand how and when to put this tool into action. In order for this, and just about
any other customer focused concept to be effective you must: Properly train employees. Empower,
which means trust, the employees to do it right. When they do it right, celebrate the
success. If they do it wrong, make it a teachable moment that doesn't erode their confidence
and trust in the system. Well, I hope you enjoyed this short lesson. Please be sure
to visit my website which is, www.hyken.com. Thank you very much for watching. This is
Shep Hyken, reminding you to Always Be Amazing!