Lifetime warranties are a common feature in the product world. These covenants essentially say “we guarantee that the object you bought will work as long as you own it. If the product ever fails, we promise to replace it or repair it to your complete satisfaction.” Lifetime warranties, as opposed to limited warranties, are designed to be bold statements communicating confidence in the quality of a product. What would a lifetime warranty look like for a service?
Service warranties (sometimes called service guarantees) promise that if a service provider fails to deliver the outcome promised, the customer would receive a full refund. They sounds like, “Your pizza delivered in thirty minutes or it is free.” Datapro Information Services guarantees “to deliver the report on time, to high quality standards, and to the contents outlined in this proposal or you can deduct any amount from the final payment which is deemed as fair.”
Most service guarantees are anchored to quantifiable features—like time or compliance with agreements. And, most are constructed around an outcome—like landing on time, error free statements, or answering the phone in three rings. Like service level agreements (SLA’s) with an external customer or consumer, they rely on irrefutable metrics. Think of them much like judging the high jump or 100 meter free style swim in the Olympics—beauty and charm are irrelevant. As long as you jumped the highest or swam the fastest, how it looked at the finish line was not among the “who won” metrics.
But, the essence of service is an experience, not just an outcome. As such, judging the quality of the experience is much like judging gymnastics or figure skating in the Olympics. We recall the great personality of the wait staff long after we have forgotten the fact that the food was as expected. The warm smile and attentive personality of a flight attendant can erase from our memory the fact that the flight was a bit delayed landing. What if service guarantees included the customer’s assessment of the experience–a perceptual event adjudicated solely by the whim of the receiver?
Hampton Inn has built one of the best service guarantees around. “If you’re not 100% satisfied, we don’t expect you to pay. That’s our promise and your guarantee.” Are there a few guardrails? Of course! The story goes that after a truck driver was not 100% satisfied about fifty times, the hotel company instituted a limitation that essentially said if you register dissatisfaction three times perhaps another hotel might be better suited to your needs.
So, here is the question. Pretend you did offer a lifetime warranty on the service experience you provided and the evaluation could only be determined by your customer. Assume the refund to the customer was three times the fee, price, or investment made by that customer. What changes would you make to ensure your new service guarantee did not take your organization into bankruptcy?
