Are your decisions at the top hurting your decision makers at the bottom? This is the question that came to my mind during a conversation with a sales rep this week. He works for a huge delivery service, which shall remain nameless.
Until a couple of months ago, he had the ability to issue up to $2500 in credit for mistakes and mishaps committed by the company. Not once, in nine years, has he ever needed anywhere near that much to make a customer happy. But he has appreciated the trust the company placed in him to make the best decision in each situation.
With the volume of packages diminishing markedly, however, the firm’s leaders have been looking for ways to save money. So they have reduced his credit authority, and those of his colleagues, to $100 per incident without seeking approval from above. That is a 96% reduction.
Of course, even when package volume decreases, mistakes still happen. But rather than being able to resolve these situations with one phone call, he is now completing appeal forms and consulting with management. This results in delayed resolutions by as much as two weeks. You can imagine the irritation for both he and his customers.
It is only natural for an organization’s leadership to seek cost reductions when revenue is threatened. There are shareholders to be considered and belt-tightening is certainly appropriate.
But if you create obstacles to execution and customer service in the process, you will erase any effort at cutting costs. This is not just something that happens in larger corporations, of course. What would you do to resolve this issue? Consider your own situation. What decisions at the top of your firm are stressing those who are customer-facing?