RTM: I guess there is a small minority of channel players who are forever moaning about their suppliers’ performance.

SHL: Yes, and it is easy for companies to become fixated by this group and to ignore the hidden opinions of the silent majority. Often that will come through complaints. The problem is that most suppliers are not very good at handling them.

RTM: So what is the best way of managing complaints?

SHL: Often staff don’t like to hear complaints about their product or service, so they don’t always respond very well. Also most companies spend 95% of their resources on reacting to individual complaints and less than 5% on analysing and using the information from complainants.

RTM: I suppose that part of the problem is that not all dissatisfied customers complain.

SHL: No. In fact most customers do not complain at all. 

RTM: So how do they respond?

SHL: Essentially, customers respond in other ways, such as exiting the relationship or engaging in negative word of mouth, which can be very damaging.

RTM: Why don’t dissatisfied customers complain?

SHL: A variety of reasons. They may believe the organisation will not respond to their complaint. They might not want to confront the person responsible for the failure. They might be uncertain of their own rights and responsibilities. They might be concerned about the high cost (in terms of time and effort) of complaining.

"Some companies tell customers explicitly how to lodge a complaint and what to expect from the process."

Fear can also play a role within an unequal power relationship, for example a GP–patient relationship or one where the supplier is deemed to be very powerful, such as Microsoft, for instance.

RTM: So you should actively want your customers to complain so that you can deal with the problem?

SHL: Absolutely right. But firstly you need to encourage dissatisfied customers to complain. The annual customer-satisfaction survey may be too little, too late.

RTM: How do you do that?

SHL: Best practice suggests that firstly you need to set clear performance standards and communicate these to customers AND staff. You then need to emphasise the importance of service recovery to the staff and to embed it in the culture. You also need to train your customers in how to complain.

Some companies tell customers explicitly how to lodge a complaint and what to expect from the process. This demonstrates a clear message to customers that you care and will listen to them, that you are customer-driven.