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07/11/2010: "Your Frontline: A Source of Competitive Advantage"

The research (as summarized in Chapter 1) is crystal clear: businesses that succeed earn their success by: (1) developing superior strategies and (2) by engaging all functions. An often overlooked source of competitive advantage for a business is its frontline: customer contact employees. An example highlights the power of the frontline.

My wife likes to shop at Bruno's Fine Foods in Toronto. But, due to a negative experience the other day, she has decided not to be their customer any more. In the checkout line she mistakenly gave the cashier an expired credit card (she had the new one with her, she just had forgotten to get rid of the old one). The cashier threw the card back at her saying that it had expired.

My wife told her that she could have merely handed the card back and demanded an apology. The cashier refused. My wife asked for the manager. She was told there was no manager on duty. Instead, a part-time employee came to handle the situation. The cashier reluctantly apologized, then went on to rationalize her behavior to the next customer! My wife said: "Do you realize it is a Saturday and your store is empty. The Loblaws [a supermarket] down the street is full." The part-time employee told her: "We used to be full. My job was reduced to part-time."

Bruno's has not only lost one customer transaction, but a lifetime of opportunities with the customer, a relationship worth around $5,000 a year (based on my wife's purchase history with Bruno's). Besides, the negative word of mouth from this incident is incalculable.

Granted that my wife was at "fault" for inadvertently handing the cashier an expired card. But, codes of conduct dictate that the customer must be treated with respect. I am sure many of us can relate similar incidents. Conversely, we can all recall incidents where the frontline employee made all the difference between a severed transaction and a cemented relationship.

I look forward to hearing from you at asirsi@schulich.yorku.ca