Amiram Hayardeny's My China Experience

One Last Response to Comment - I Promise!

OK, I can see already that we are on to something here.  And that my "no responses to comments" attitude can be put to rest, at least for a while.  I have received another very interesting comment from Corporate Pirates (very interesting choice of alias!) which, in short, states the following: customer service is demanded by people who do not pay the check, when people are given a choice between customer service and price, the unanimously choose lower prices over good service.  Corporate Pirates gives examples from the airline industry: Southwest airlines is the example of supposedly poor service, but lower prices.  American and United are examples for the opposite.

Truth is, at first glance I thought that there was something to it.  If I was given the choice of low price or good service and quality - wouldn't I choose the price over service?  That is if I, personally, was picking up the tab.  And then I realized, I respectfully disagree.  Hear me out.

First, Southwest has excellent service AND low prices.  In fact, Southwest was on the list of 25 top ranking customer service champions ().  What makes the difference at Southwest is NOT that they have given up on customer service for lower prices.  It's because they have found ways to lower their operating costs significantly.  To give a couple of examples: they only use Boeing 737.  This choice of one type airliner lowers their maintenance costs significantly.  They fly out of secondary airports - again lowering the operating costs.  The crew is multi-tasking.  I once saw a pilot handing me my luggage, and then I realized - this is GOOD service AND low cost!  Last but not least: they hold the industry record for preparing an airplane which has just landed for takeoff.  In that, they get more flights from an airplane then any other airline in the world.  By the way, United and American are poor service AND high prices. 

Moving on.  Service is not only the frequency with which the flight attendants smile at you.  It is also how much can you trust that what you are getting is not going to harm you, or worse.  In other words, if  you are guaranteed that everything always goes well, you may choose prices over quality.  But what if something goes wrong?  If you were given the choice of price vs. quality, what would you do?  Go with the cheaper airline, with questionable airplane maintenance?  With less pilot training?  I don't think so.  What you pay for under the umbrella of "service" is much more than that: it's safety, quality, security.

Continuing on the same thought.  We were addressing airlines.  What about the rest?  Would you choose lower priced medicine?  Education?  I think not.

So while I do think that customer select their service provider based on multiple categories - price, quality, service, and more.  Indeed, service and quality are tangibles for which people are willing to pay.  So maybe we should change the bottom line: the customer must be satisfied on a variety of categories: price, quality, service to name a few.  Companies who know how to offer the best of all shall win the heart and the wallet of their potential customers.

Taking it to the business I am in.  I have been working in the enterprise storage area for many years.  Currently I work for Sun Microsystems, as a development director for the Solaris operating system.  Suppose for a second that you are the manager of a corporate data center, for a large, global, financial firm.  Suppose further, that your data center must support hundreds of thousands of transactions every minute, 24/7, coming in from every remote corner of the globe.  Suppose, that if your systems are not available for what ever reason, you suffer a loss of $20M, every hour.  Would you choose the no name, no backing, storage controller?  Or would you go with Sun?

Posted at 08:37AM Mar 28, 2007 by Amiram Hayardeny in Personal  |  Comments[0]