“The Customer Is NOT Always Right”

Not all customers are good relationship customers:

- wrong segment
- not profitable in the long term
- difficult customers

When are relationships at risk?

Where does customer service fit into the creation and maintenance of relationships?

Why the customer is not always right

There are numerous, inter-related reasons as to why the customer is not always right. More importantly, giving
customers the ultimate negotiating power can upend and destroy the value that an organization creates for its
stakeholders. Reasons for why the customer is not always right include:

 Resource Constraints – every business operates under resource constraints that dictate the types of
products and services they can provide. Policies and procedures are one way to ensure that a business
operates within its constraints so that it can continue thriving. Letting customers defy these policies and
practices can dramatically impact operations and even run a business into ruin.
 Customers are not experts – while customers are great for understanding what they want from a business,
they are not the experts in the product or the organization. A series of interdependent decisions and
factors were considered in order to produce and deliver the product and service the consumer buys; a
customer request may not actually be feasible given all of these factors.
 Diminished value of employees – tilting all negotiating power to the customer leaves employees with no
authority or autonomy over their role. This can become incredibly demoralizing for frontline employees
who shoulder most of the burden of a disgruntled customer. The lack of empowerment and authority can
breed resentment and can lead to lower performance, toxic work culture, and high turnover.
 Drives divide between management and employees – adopting a customer is always right policy requires
enforcement of the policy by management. This reads as though employees cannot be trusted to resolve
issues within the business constraints and signals that employees come last.
 Customers that are no good for business – if it costs more to service a disgruntled customer than the
revenue they generate then the business should cut its losses and drop the customer. The cost of the
customer being right can extend beyond real dollars including loss of employees, serious disruption in
optimized operations, and even irreversible damage to corporate culture.

How to manage a bad customer

Organizations that want to strike the right balance between employees and customers and adopt a virtue where
the customer is not always right will need to determine a process for handling abusive and irate customers.
Some recommendations for managers and frontline staff for handling disgruntled and highly unreasonable
customers:
  Be polite but firm – as a manager, once a customer has been told no by frontline staff, stand by the
answer. This demonstrates solidarity with employees and allows the team to continue working together
towards company goals. It also sends a signal to the customer that their request is truly unachievable.
 Be empathetic – evaluate whether or not the customer’s request is actually unreasonable by putting
yourself in their shoes. If what a customer is asking for is ubiquitously available, then there is an
opportunity for improving how the business delivers service.
 Proactively managing customer expectations – complaints often come as a result of misunderstandings,
especially when an organization is undergoing change. Communicate organizational changes to
customers as clearly and as often as possible to avoid misunderstandings.
Why The Customer Is Not Always Right - Professional Leadership Institute