5 Things Your Business Should Learn From United’s Experience
“This entire incident could have been avoided with one thing: more empowered frontline employees. There were no takers at the $1,000 compensation offer, and the company’s policy ensured that the agent couldn’t make a higher offer. Not $1,001. Not $1,100. Not $1,500. Of course, today, $1,500 looks dirt cheap compared to the fallout from the incident. Which is why … announced that they were increasing the maximum compensation for involuntary ‘bumping’ to $10,000.
Most policies for customer service employees are made to protect the business from unnecessary costs. But it’s important not to lose sight of the fact that by giving your employees the power to make customers happy, you’re protecting the business from far, far worse.
At Ritz-Carlton Hotels, each employee is given a $2,000 budget to make any single guest happy. That budget is PER GUEST. How’s that for empowerment? Now, a $2,000 allowance to make things right for a guest sounds like a lot. And it is. Now, here’s the thing: that amount is very rarely used. But the freedom that a number so large signifies to the support team shows that the brand trusts them to make the right decision; and that the right decision is to do whatever it takes to make the guest happy.
‘We entrust every single Ritz-Carlton staff member, without approval from their general manager, to spend up to $2,000 on a guest. And that’s not per year. It’s per incident. When you say up to $2,000, suddenly somebody says, wow, this isn’t just about rebating a movie because your room was late, this is a really meaningful amount. It doesn’t get used much, but it displays a deep trust in our staff’s judgment. …
Significantly, there is no assumption that it’s because there is a problem. It could be that someone finds out it’s a guest’s birthday, and the next thing you know there’s champagne and cake in the room. A lot of the stuff that crosses my desk is not that they overcame a problem but that they used their $2,000 to create an outstanding experience.
There are stories about hiring a carpenter to build a shoe tree for a guest; a laundry manager who couldn’t get the stain out of a dress after trying twice flying up from Puerto Rico to New York to return the dress personally; or when in Dubai a waiter overheard a gentleman musing with his wife, who was in a wheelchair, that it was a shame he couldn’t get her down to the beach. The waiter told maintenance, who passed word, and the next afternoon there was a wooden walkway down the beach to a tent that was set up for them to have dinner in. …
– Simon Cooper, Former President of the Ritz-Carlton Company'”