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Home > Business > Special


The product-service gap

Govindraj Ethiraj | December 12, 2006

The other day I was speaking with Wockhardt Chairman Habil Khorakiwala, who had an interesting air traveller's tale to narrate. He was returning to India from Boston a few weeks ago. He had a confirmed first-class ticket on British Airways all the way. At London, he was told first class was overbooked and he was being downgraded to Business Class. To make up, would he sign for a $500 voucher?

Khorakiwala says he declined. He landed in Mumbai and launched a mini media tirade. Despite the attention, British Airways, he says, never really apologised. They did fix up to meet him. He had to postpone the meeting by an hour because of other engagements. "They went off saying they had a flight to catch. That's where it stands today," he told me.

I asked him why he was so upset. I mean, after all Business Class is not exactly the cargo hold. First, he said, he could not fathom how first class was overbooked or, how he could have been the last guy to make a booking. Especially since he booked ten days earlier. Second, he was not informed at Boston this could happen. And they should have. But what angered him the most, he says, was their indifference. "They did a lousy job of handling it face to face."

I too had a run-in recently with Jet Airways. The problem was not the issue where I obviously felt I was on the right. Maybe the supervisor felt the same, too. But she should have given way because a customer, who is a frequent flier at that, is perhaps right. Far from being apologetic, the supervisor was indifferent and rude. If you ask me, it was the arrogance that angered me most.

Now, most people swear by Jet Airways' efficiency. I do as well. Then how do these things happen? It's actually simple if you come to think of it. Airlines like Jet Airways or telecom operators like Hutch and Airtel offer world-class products and services. Their products are backed by cutting-edge technology. Their systems ensure high levels of back-up and support. All of which is relatively new to India.

So we are rightly impressed. But sometimes things go wrong. People step in and attitudes take over. In the past, both "products" and services were bad. So we were, in a sense, used to it. Whether it was Air India or MTNL. Today, the products are strong but the servicing can vary. So we are actually more upset than we would perhaps be if it was the traditional equation.

So I ask, why do people who work for products which are intrinsically sound or brands that are well-entrenched behave so badly? I have a couple of theories. The first is product arrogance. I believe that as time passes, people begin to believe: "I have the largest marketshare, I have the best product so I must be right."

Chances are that customer disagreements are not that frequent. If they happen, the customer may have little choice but to return. Even in competitive markets, a habit once formed is difficult to break. Sometimes weak regulation helps, such as the lack of number portability in Indian telecom.

The interesting thing is that both managements and customer-facing executives can suffer from this. Quiz the management and you are likely to be told, "Do you know what it takes to run an organisation that services millions of customers? These things happen. You must understand." So you are quite likely to be treated as an unfortunate statistic rather than as a dissatisfied customer. To be fair, Jet's management is appropriately responsive.

The second is, of course, insufficient training and retraining. This is obviously easily said. To be fair, while there might be a lot of systems and process training within market leaders, teaching people to remember what got them to the number one position in the marketplace is not simple. Memories fade, the initial struggle becomes history and life centres round daily delivery.

My own sense is that most private enterprises in India have barely seen more than one clear cycle. Mostly, it's been startup glitches (industry and company) and then a strong run-up. We are yet to see too many brutal market churns where upstarts dislodge several incumbent leaders. While some credit could go to the enterprises themselves, one must not forget that most marketplaces have opened up only recently. Possibly the best lessons are learnt when competition or technology forces a landscape change. That way, both management and workforce are yanked back on their toes. I will admit that this is somewhat utopian as well.

I like British Airways as a product. And I too was downgraded like Khorakiwala (not from first class!) on a flight back to Mumbai in January this year. I took up the matter, wrote letters and all of that. The folks here acknowledged there might have been a problem. That was the furthest they would go. An apology, leave alone compensation, it seemed, was out of the question. And I did fly BA again, more recently. Does this mean nothing ever happens? Of course, not. Khorakiwala says neither he nor his entire company will fly BA again. Unless they are forced to. That's a dent if you ask me. In image, if not business as well.



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