Sun Tzu and The Art of Customer Service PDF Print E-mail
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By Paul Dorrian

T
o study Sun Tzu is to study the essence of strategic thinking. Whilst the early Athenians may have given us the term ?strategy', this ancient Chinese sage can be credited with providing a number of fundamental and timeless principles which are applicable to the perennial problem of outmanoeuvring an opponent. This is equally true for the marketplace as it is for the battlefield. No matter which translation of Sun Tzu's classic work The Art of War one reads, it is patently obvious that the nuggets of wisdom contained in this ancient treatise are meaningful for many aspects of contemporary living.

{xtypo_quote} To the modern marketer seeking a competitive advantage in the global arena that has been labelled by some as hypercompetitive [1], and which is characterised by shorter product life cycles, quicker product design times, geographic market invasions by newer and different competitors, to name but a few, Sun Tzu's thinking offers the opportunity of engaging a competitor in a manner conducive to winning. His most widely acclaimed principle is the pursuit of victory through tactical positioning, and without having to resort to fighting. One wonders that if Sun Air had applied some of Sun Tzu's thinking it may never have become yet another statistic in the domestic airline industry. Underpinning Sun Tzu's philosophy is a fundamental belief that the environment, as well as one's opponent, needs to be preserved for the benefit of society as a whole. Who better to propose such a thesis than this man who witnessed war and destruction, so elongated and abhorrent, that one modern day commentator likened it to one hundred and fifty continuous years of World War Two [2]. Millennium man, whether in politics or business, does not appear to have learned much from these particular annals of history. Yet their implication for business is obvious. Care about people and you will preserve your market, your customers and your workforce. Preserve your competitor, and your own competitiveness and efficiency will be heightened. That, of course, as Sun Air no doubt found out to its cost, depends on how one is strategically positioned in relation to one's competitor.

The corporate bravado that abounds in many boardrooms, and which manifests itself in the attitude of direct confrontation, fuels a culture of competitiveness which promotes destructive tendencies, and conflicts with the principle that Stephen Covey refers to as the abundance mentality. There is plenty of business out there for everyone, but the bravado displayed by many senior executives often means the wrong kind of focus is applied. Instead of focusing on the customer, his needs and requirements, many managers see only market share and money. Profit is the focus, not the result. More specifically, customer service is often used as a tool to boost short-term sales instead of building long term relationships. The hunger for short-term profits in many businesses underlies a corporate avarice that erodes longer term potential. To many, the paradigm shift is perceptually too hazardous a step to take. The result is that much strategic potential and creativity is never realised because service in its broader context plays second fiddle to profitability.

One interesting aspect of Sun Tzu's thinking is the provision he makes for those occasions when there is no alternative but to stand one's ground and fight; what he terms unavoidable conflicts. Customer service employed from a strategic perspective can assist the marketer to ward off any attack by a competitor intent on securing sales and market share at his company's expense. To deploy this particular shield, I have identified nine principles from The Art of War that I believe can assist the marketer to make the most effective use of customer service thinking.

The first principle is that of dominating your market without destroying it. Customer service should be used to develop strong customer loyalty. The concept of the loyalty ladder tells us that customers can be moved through a series of rungs from a superficial relationship with an organisation and its product, all the way to the top. At this latter stage, the customer becomes an advocate, actively promoting the company and its brand, and often on an unconscious level. In many markets, (particularly in the industrial sector), advocates are often prepared to pay a price premium because of the security they feel with the supplier. Moving to a new supplier and having to start a new relationship with untried service levels may be too costly to contemplate. This is a better option that the run of the mill (and often indiscriminate) price war which is destructive in nature, and which can lead to market ruination. Invariably the only people who win in a price war are the customers. Whilst a good marketer wants his or her customer to win, one has to remember the cost of such action in the broader context. The warring companies usually foot the bill, and more often than not the service levels suffer.

Secondly, you must hit your competitors where they least expect it. This course of action requires a deep and insightful knowledge of your competitor's business. If you can find a weakness within your opponent's operation, and can focus your efforts in that direction, great gains can be made. Take the example of a well-known South African water company that faced competition from a French rival. The French took time to survey the market and analyse the local company's modus operandi . They soon identified that their rival's strength lay in its well-established and sophisticated technological infrastructure. So proud was it of possessing first world technological capability that it had become arrogant and over confident, believing that no foreign organisation could come into its territory and win any important customers. Its senior management believed that South African customers (in this context, the municipalities) would want to be served by a South African company. It was therefore totally unprepared for the ferocity of the French assault. After carefully canvassing customers, the French went after a major municipality that was tired of poor service, broken promises and a culture of arrogance that had permeated the local supplier. Not only did the French succeed in securing a lucrative contract, other local customers soon began to reconsider their own position with the incumbent.

Thirdly, make effective use of market information. One of the weaknesses of marketing in South Africa, relative to say The United States, is the inadequate availability and therefore use of highly specific and targeted market information, especially competitive intelligence. Put simply, if you want to outmanoeuvre your competitors you need to know as much as possible about them and that includes how good or bad, consistent or inconsistent and innovative or lacklustre their service really is. One lesson that can be learned from companies such as Virgin Atlantic and BMW is that having carefully studied their competitors' service capabilities, these world class and highly innovative organisations use that information to strategize on how best to put themselves into a more advantageous position in the marketplace relative to their competitors.

Fourthly, think thoroughly, move quickly. Building on from the use of market information is the speed with which one has to move in today's environment. D'Aveni has made the point that companies today have to be positioned and structured for speed and surprise, more so than ever before. [3]. Sun Tzu himself did not favour slow and protracted campaigns, but advocated the use of speed to disorientate the enemy. The same is true in customer service, but that has to be coupled with on going, innovative thinking

Fifthly, use service to master your competitor. It is no secret that we live in an era where creating and maintaining a competitive edge is most difficult. Indeed, a school of thought has emerged over the past few years, which suggests that the best that can be hoped for is the perpetual creation of a series of temporary advantages. The shrewd marketer realises that in order to stay ahead of the pack, he or she has to proactively erode any advantage that has been created and replace it with something better. Service is probably one of the last frontiers that can assist in this regard, as it is probably the only aspect of modern business practice that cannot be directly copied by a competitor. This is true because it is dependent on people's behaviour and attitudes. Implementing this course of action on an on going basis means that you can force your competitor to play catch ? up with you. In Sun Tzu's eyes you would essentially be using customer service to master your competition.

The sixth principle suggests that managers need to be effective leaders when things get tough. Customer service is relatively straightforward when everything is going well. But in times if economic downturn, or when things start to go wrong, managers more than ever before need to lead by example and avoid the tendency to cut service costs.

The seventh principle is to be united in purpose particularly at the front line . For years now I have used the same hotel chain whilst travelling within South Africa. Very recently, during a stay in one of their Johannesburg facilities, I had cause to complain (my first ever with this company) to the duty manager in the early hours of the morning. I was met with a rude and insolent attitude. When I brought this to the attention of senior management at Head Office, they moved like lightening with their service recovery. Aware of a crack that had appeared in their front line they took the relevant action to minimise the chance of such an incident re ? occurring anywhere within the group. They also provided me with the relevant feedback, thereby saving the customer and enhancing their reputation in my mind as being serious about customer service.

My penultimate principle is always to act with integrity. Canadian authors Susan O'Dell and Joan Pajunen reflect Sun Tzu's thinking by stating that trust is built when the customer never has to worry about being surprised or fooled or cheated or lied to. [4] The customer who experiences service in this manner from whoever interacts with him is more likely to develop a sense of loyalty towards the company and its product.

Finally, only in the case of a last resort should you attack your competitor's support system. Although Sun Tzu is clear about the preservation of one's opponent, there will be occasions when unavoidable conflict will force you to stand and fight in order to survive. By attacking your competitor's support system such as his delivery or promotional capabilities, or perhaps headhunting key personnel, with the view to denigrating his operation and not only to improve your own, you will be weakening the systems that enable him to carry service to his customers.

Far too many companies try to do away with competition in the misguided belief that things will be much better with fewer, or better still, no competitors. Tom Ansley, Chairman of Elliott International has publicly stated that he wants and needs competition to keep his organisation on its toes. With an attitude like that it is hardly surprising that Elliott is the only South African removals firm ever to be awarded the Platinum Award from The Overseas Moving Network International in London, for being the number one removals firm in the world. As Sun Tzu has shown, how one positions oneself to manage an opponent is what counts. In the business arena, utilising customer service principles correctly helps one to do just that.

Notes.

1. The reader may be interested in consulting Richard D'Aveni's excellent book Hypercompetition, ( The Free Press, 1994)

2. A full account of this thinking can be found in R.L.Wing, The Art of Strategy, ( Thorsons, 1988)

3. Richard D'Aveni, op. cit.

4. See Susan M. O'Dell and Joan A. Pajunen, The Butterfly Customer, ( Wiley, 1997)

Reprinted from Dorrian, Paul. Strategic Customer Service. Lessons from Sun Tzu, The Future, Volume 1, No. 2, 1999.