What’s a customer worth? If you roll the dice, you could “crap out!”

In a recent manager’s meeting I attended, there was a discussion regarding a poor performing employee who was disrupting co-workers and exemplifying very poor customer service.  The Boss’s initial knee-jerk reaction he said, “Fire her!”. The employee’s supervising manager was lobbying The Boss to keep her on duty until he could hire a replacement to take her place.  This is a service business already operating in an understaffed position due to a low unemployment environment and lack of qualified applicants. A position that most employers are experiencing in today’s economy.  As I listened to the discussion, I began to hear The Boss’s position change as he was being sawed by the supervising manager.

After a while, I began to ask a few questions to get their attention.  What does it cost to lose a customer? How hard is it to gain a new customer?  We already know how challenging it is to find good workers in today’s world. I continued, in my experience when a company retains a bad employee, it is hard for the very good employees to justify staying with the company.  The good employees leave not because they cannot do the job, they leave because they do not feel comfortable in the company culture. They know how hard they work compared to others, they are confident in their abilities and feel they will be successful wherever they work.  They may have already been contacted by your competition because when you are in a very low unemployment market; “The good employees leave because they can, and the poor employees stay because they have no choice!” If you keep poor-performing employees on staff simply because you need a “warm body” you are jeopardizing your established relationships with your customers and the culture of your organization.  

I fully understand the impulse of not wanting to fire an employee until you have a replacement, but at what expense?  The Boss and I stayed and continued our conversation in private where I said, “I’d rather close down temporarily for a day or close early one day a week until a new recruit can be hired than keep a poor employee solely to fill a shift.”  The Boss stated what he estimated the lost income would be to close an hour early or at worse, a day a week. I asked how that compared to a lost customer’s annual spend or the on-boarding and training expense of a new replacement when a very good employee leaves for a better culture.

At the end of our conversation, we agreed to disagree.  The poor performing employee kept her job and filled a shift, the supervising manager is going to keep looking for her replacement between the damage control he has to do to keep very good employees from walking out, and the company will continue to “roll the dice” and hope they don’t lose customers or employees due to their decision.  

As I taught about this exchange, I realized that the issue of poor customer service was not the real issue after all.  Poor customer service was a result of poor management who tolerated poor customer service, poor management was a result of The Boss allowing management to keep employees on staff that gave poor customer service.   What was the real issue? I would say it is The Boss creating a culture that valued a warm body over great customer service. I don’t know about you, but I have worked too hard and risked too much to “roll the dice” with the success of my business.  I consider this type of management a “crap shoot!”