Firing Customers: Is It Ever a Good Idea?

Graham Hill

Fixing the Problem at Source

Naras

In my original post, I lambasted Sprint for the slovenly way in which they had targeted customers to be 'fired', without apparently going through root-cause analysis to identify the real problems and attempting to fix the problems. They simply fired them and then waited for others to ask questions later.

Acquiring customers, no matter how profitable, costs money. Servicing them costs money too. So does firing them. It makes sense for companies to understand the flow of costs out and the flow of revenues in. If a customer costs more to acquire and to service than the revenue they bring in, then they should look at how they can reduce costs, increase revenue and reduce risk (which carries a cost). If having done that, the customers still cost more than they earn, then they are at liberty to decline to service them further. They should do this with polite decorum. They should also look at how they can reduce this type of customer acquisition so that the same problem will be smaller in the future.

Sprint's problems seemt to be almost entirely of their own making. Their plans are structured in such a way that they aren't rewarded adequately when customers roam into other providers' networks. They acquired customers they couldn't serve profitably. Their internal systems produced countless errors e.g. in billing, which they were unable to rectify, both causing multiple calls. Their internal call logging counted individual calls multiple times as customers were handed from one department that ccouldn't help to another. A litany of cruel incompetence where the left hand didn't know what it was doing, the right hand didn't know what the left was doing, and neither were responsible for intelligently solving the many problems.

The biggest indictment of all, is that somehow I can't believe this would have happened if Toyota had been running Sprint's business.

Graham Hill
Independent CRM Consultant
Interim CRM Manager

Gwynne Young

I was "fired"

Years ago, my bank "fired" me, after I'd had my purse stolen and had to open up a new checking account. The bank kept screwing up the new checks (misspelled name, broken promises that the new checks would arrive by a certain date). Despite the fact that none of it was my fault, when I went in to complain in person, the bank manager told me to close my account. I was a student and had only enough money for my next rent payment in my account. Clearly, I wasn't worth the effort.

But here's the thing. I had another account at a savings and loan (in the days before savings and loans could issue checking accounts) with more money the bank manager didn't know about. I was also headed toward a college degree, which should have pegged me as someone with future value. I avoided that bank like the plague, and I'm happy to report that it's no longer in business. So I think it would have behooved the bank to try to please me, rather than wash its hands of me.

I worry that companies are blaming the customers before they look within, at their processes and people. I worry that the customer has become an inconvenience: "That young woman keeps complaining about us. We've already spent unrecoverable person time and printing costs on her. She's not worth it," rather than, "Why do our employees keep making mistakes? This is really going to irritate the customer. I hope we're not this bad with all of our customers."

Gwynne Young, Managing Editor, CustomerThink