What to do when your company makes a mistake

It can happen to good companies as well as weak ones. Your organization makes a “relationship defining” mistake with a new customer or even worse, one of your best customers. How do you handle it?

On a recent client engagement where we were retained to increase sales force effectiveness, we got to see firsthand our client company reaction to an operational mistake in one of their after-market spare parts service engagements. It wasn’t pretty. Once the service break came to light, their first reaction was to go into “denial-mode” as they disputed the customer claim.  After that didn’t work, they moved on to “shirk-mode” where they cited other factors that may have caused them to miss their service obligations. Lastly they entered “apology-mode” where they went overboard apologizing profusely instead of solving the problem in the first place. At that point, it got pretty ugly with their longstanding client.

What could they have done differently to remedy the situation and save the customer relationship? Here’s what I like to see my clients do and the advice I give them. It’s a pretty simple 3 step formula that everyone in your organization should follow when there is a service disconnect of any proportion.

  1. Get to the heart of the matter immediately. Don’t look for back doors or contributors to help share the blame. If you make a mistake, own it outright and clearly. Don’t be wishy-washy. Be strong in your admission and stronger in your statements of reparation. Then move to step 2.
  2. Contain and problem solve. Putting your company’s energy here instead of trying to distance yourself from the problem will not only limit the damage, it will show your customer that your organization has core values and that your intent is to limit your customer’s exposure and then fix the service break. You don’t need to be super-heroes here, be focused, listen and act decisively. Then move to step 3
  3. After the smoke has cleared and tempers have subsided, reaffirm your company’s commitment to your customer and reiterate the steps you took to solve the problem in the short term as well as the steps you will put in place to insure that the issue will not reoccur. Do it in writing. Conversations fade as well as memories. Everyone will remember the pain of the service issue, make sure they remember the short term and longer term solution. One note of caution here; this is not the time to be patting yourself on the back. You screwed up, but you made it right for the long term. That’s why your customer chose you in the first place. Reaffirm your commitments to your customer and do it in writing.

Customers don’t like mistakes, and they have a bigger dislike for mistakes that come with a lack of ownership and path to resolution. Follow these simple steps above and keep more customers for the long term.

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