Friday, November 16, 2007

The Rinko syndrome and its impact on customer loyalty

The rinko syndrome is probably most common in older businesses where tradition and policy are well-defined and well-known among all the employees. However, it is also evident in businesses which hire people and give them customer contact jobs with inadequate training.

You may have already guessed or at least have a good idea what the rinko syndrome is. Let me give you the background on the name so that you too can appreciate the robustness of this concept. It seems there was once a small printing company somewhere in the Midwest that was run by a man named “Rinko.” He was very good at printing and was successful. He worked on a job-by-job basis where each job was done for a fixed price.

The limitation of the printing company was that it could only produce certain kinds of documents with certain kinds of fonts on certain types of paper. When a particular job met the guidelines of document, font and paper type, the job was sure to be a success. However, these constraints never held Rinko back from taking a job, any job. On the other hand, customers were never made aware of these constraints. Are you beginning to see the customer problem?

Don’t jump to the conclusion that Rinko just did what he wanted within his constraints. In fact, Rinko was very customer oriented and took time with each customer. He would carefully listen to each situation and try to understand the customer’s needs. If it was unclear, he would ask enough questions to clarify the job so that he understood what they wanted.

It was here that the Rinko syndrome occurred. He would take the customer information and redefine it so that it would fit his operational constraints. So, the rinko syndrome can be defined as:
Rinko syndrome: the redefinition of the customer problem to fit a standard product (or service) even when the resultant product (or service) may not meet the requirements of the customer.

Many customers would not even be aware of how their job was changed and some were so naïve as to be unaware that the job was changed. Since he was a good salesman as well as printer, the customers were often led to believe that his product was the best they could have or that his solution was the best one for their particular requirements. Some customers would be happy because they felt that an expert had accurately evaluated their job and given them the best solution. There will not be a negative side for the timid or naïve customer, however, as customers become more sophisticated, the rinko syndrome can have a very negative impact.
When the analogy is made to technical service operations, the implications are equally serious. Consider where the rinko syndrome can occur in technical service operations.

1. Selling contract service – The customer is guided into choosing the service contract that is the “standard” for the company or industry instead of what best meets the needs of the customer. An example is selling a customer next day service (since that is all you can provide) when the customer really needs two hour response because of the critical application of the product in his business.

I had a client several years ago who had a large field service organization around the United States and provided 4 hour response time for on-site service. He was very proud of meeting that level of performance for his customers until we asked his customers what they wanted. We found that 43% wanted 2-hour response and 27% would be happy with next-day service. By changing his dispatch procedures he was able to meet the varying customer needs and by charging more for the 2-hour response add more than $100,000 to his bottom line without adding any additional resources.

2. On-site service – The customer is guided into believing the equipment needs a new part although the failed part is repairable (perhaps because the service tech gets a commission on parts sales). Another way is the customer is told the equipment failure is very complicated so the service tech changes many parts. This can happen when the service tech really doesn’t know exactly what is wrong and solves the problem by swapping out many parts (rather than taking the time to solve the problem or appearing not to know how to solve the problem).

The use of a parts-swapping repair strategy may actually be the correct strategy when downtime is very expensive and the swapped parts are included in the service contract. It is when the parts swapping is done for other reasons that the rinko syndrome is an appropriate descriptor.

3. Tech support – The customer is guided through diagnostics until the tech support personnel can go no further. The customer-oriented person will find the next step toward solving the customer problem. The rinko syndrome person will give up on the problem and tell the customer some story to get rid of him or he will create solutions by trial-and-error until the customer problem is fixed or the customer leaves from exasperation.

I am sure you have seen the rinko syndrome in your service operation. The questions you may have are:
1. Is the rinko syndrome really that bad?
2. Can I eliminate it from my organization?
3. How will I know when it’s gone?

Yes, the rinko syndrome is really that bad! It is the lazy way to solve customer problems. You essentially put all problems (pegs) into the solutions (holes) you offer. The old adage applies: you can fool some of the people some of the time, but …

The rinko syndrome really says to the customer that he is one of many and not special enough to solve his PARTICULAR problem. This insidious process eventually erodes customer confidence in your organization while allowing your personnel to get sloppy about their attention to the customers. If you are trying to differentiate your company from the pack by providing excellent service, STAY AWAY FROM THE RINKO SYNDROME.

The way to eliminate the rinko syndrome from your organization is through training and measurement. Train personnel to be attentive to specific problems and not to compromise the customer requirements! When customer-contact personnel believe their role is to really take care of the customer, and know that management supports this policy, they become aware of the importance of their role. There are service organizations that have incentive programs aimed specifically at rewarding customer-focused behaviors. The type of training that will accomplish this is focused on valuing the customer. This training is NOT a one-time program. Rather it should be an on-going refresher program that is repeated periodically to re-enforce the concept and remind each customer-contact employee of the management commitment to the customer.

Equally important is the need to eliminate performance measurements that encourage rinko performance. (Yes, some performance measures encourage rinko.) Avoid performance measure such as number of customer contacts per day or number of completed calls in a specific time. These speed measures are excellent measures of productivity but they can also backfire when activity level is high. If productivity measures are used, they must be balanced with other measures that focus on taking the time and effort necessary to resolve customer problems. Institute measurements that support effective problem solving and do not encourage front-line service personnel to offer and provide the “quick fix” that ignores the real need of the customer. The measurements of customer retention and customer satisfaction can provide the balance.

The rinko syndrome will disappear (and you will know it) when you have developed the customer-contact personnel in your organization through the appropriate training to the level where they believe their primary mission is to support the customer and your performance measurements are consistent with this policy.

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