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6 November, 2012 Posted by John G. Self Posted in Stories, Technology
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Profits Over Service, Satisfaction: Microsoft’s Yellow Cab Lesson

Posted November 6th, 2012 | Author: John G. Self

On Monday when I returned to Dallas from a weekend trip I experienced, first hand, strategy trumping service, producing less than pleasing results.  

A Yellow cab driver, first in line, which means she was obligated to accept the first customer, refused to take me from Union Station to my downtown office.  It is not a big fare, but I tend to tip generously because I respect the fact that hacking a cab is hard work, requiring long hours to make a decent living. 

As I stood around while other Yellow cab drivers argued with my driver about her responsibility, I realized that her refusal was based on a strategy to wait for a longer trip and a bigger fare.  She was willing to break a time-honored cab industry rule and create conflict with her fellow drivers to achieve her marketing/revenue maximization objective.  Increased revenue, not good service, was her top priority.

Frustrated, I walked away and took the light rail.

Later in the day, I saw a clever, hip television advertisement for the new Microsoft notepad called Surface.  It is a $650+ entry into the portable computer market designed to compete with Apple’s hugely successful iPad. Microsoft, which has always been about software—and unbelievably mediocre customer service—is now entering the hardware segment, the frustrations of their former hardware partners notwithstanding.

Microsoft’s ad with snappy music and a television screen-full of 20-somethings joyously dancing, opening and clicking their new tablets, started me thinking about the dynamics of Microsoft’s attempted frontal assault on Apple.  There are plenty of disconnects:

  1. Microsoft, with billions in cash reserves, outsources customer service to India replete with poorly designed barriers for access to technical support, inconsistent telephone connections, language barriers, and solutions that do not always work. They were first, but never the best, and there has always been a faint hint of disdain for the less than sophisticated computer users.
  2. Apple focuses on the customer experience, from conception, design, distribution, and service, which is among the best of all technology companies.  They are hugely profitable, making products people want—then love—and they support this winning combination with easily accessible and understandable technical support. (Full disclosure:  I threw out Microsoft because of my frustrations with customer support.  My search firm is now, happily and productively, an Apple shop.) 
  3. Both companies are in business to make money.  Apple now is one of the most profitable and highly valued technology companies in the world, the title Microsoft once held.  Microsoft’s long standing strategic emphasis on engineering profits versus delighting their customers with an exceptional experience has produced a slide to mediocrity.  They have allowed their marketing/revenue maximization objectives to overshadow their customer service experience.

There is a lesson here for Microsoft and ambitious cab drivers.  When you are number one in line, embrace your customers, take great pride in delighting them with best-in-industry service and support, even when they are a mere small businessman who just wants to get back to work.

© 2012 John Gregory Self

© 2017 John Gregory Self

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