How to use “process” to destroy goodwill and lose revenue (1)

Recent experiences with some well-known businesses have made me wonder if managers know how their organisations suffer from their employees’ interpretation of their “process”. And if they care. Here is a series of 3 short stories.

After attending a trade fair in Bangalore recently, I returned to London on a British Airways flight, leaving at 650am on a Monday morning. The flight was quite empty. A senior colleague was returning as well, but in a different class. So I thought, let’s ask for a possible upgrade for him. This is how the conversation went.

Me: Hi. My colleague and I were both here on a British trade delegation. So we fly BA naturally. Is there a way for you to upgrade him so we can travel back together?

BA CSA: Madam, the flight is quite empty. So we have no need to offer any upgrades.

At 5am, it took me a couple of seconds to figure the logic of this explanation. The airline would bump up some travellers if the lower cabins are over-booked and customers need to be accommodated. Of course, one could also be amongst those who get bumped off the flight altogether from an over-booked flight because it may serve the airline’s need. But we shall leave that aside for the moment. So in an empty flight, there is no need to upgrade anyone.

Business logic also tells us that once the plane is committed to a route, the operating cost is more or less fixed. So this was clearly a chance to be nice to a regular customer. Besides, we had not ruled out paying, but the CSA presumed we would not pay. So I persisted.

A recession is the time to work harder to keep the few customers you still have.

Me: I understand that logic but to someone who does not know how your industry works, it can sound odd. Of course as a trade delegation, we fly BA as much for the symbolism as for anything else.

BA CSA: Madam, we have no need to offer upgrades because the flight is quite empty. But if you can get me a signed authority from someone, I can do an upgrade. That is the process.

By now we had heard twice about the “airline’s need” to offer or not offer upgrades. We were then offered “hierarchy” as possible mitigation by way of “process”. At 5am. I gave up. This was a negotiation I was not going to succeed at.

I must however admit I admire the tenacity of the BA CSA. Her business logic and stick-to-it-iveness were impeccable. But on the other hand, the CSA also missed an easy chance to make a neat profit by selling an upgrade to a customer, who had woken at 330am to make the flight and would have relished a chance to stretch out and sleep.

And what about goodwill?

Especially at a time when BA is making losses? Of course BA is cutting costs. But is it naive to expect that they would focus as much on try to retain the paying custom they still have? Never mind the chance to make revenue that was lost. Ironically, I had travelled on a promotional ticket while the colleague had paid for his.

Related reading:

It’s when you deliver that counts

Is your business missing a trick?

3 thoughts on “How to use “process” to destroy goodwill and lose revenue (1)

  1. As a guy who flies down the back unless he has the points I have always that the same regarding business and first class.
    What a huge goodwill opportunity being lost of each flight.
    Quite simple to organize
    1. upgrade 6 passengers on each flight from business to first
    2. upgrade 6 people from cattle to business
    12 Ambassadors just flew your airline

    @Pat: Thanks for your note. I couldn’t agree more. But you see the airline is fixated on its “need”, even as the customer-facing staff miss opportunities to bother asking a customer for some money.

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  2. Shefaly, I understand your point but the other side of the story is that if the airline upgrades passengers even when there are seats available in economy more and more people would start buying economy tickets in the belief that they will be upgraded any ways. The other problem in upgrading could be that the business class passengers might object because the price difference in the two classes is too much.

    @Prerna: Thanks for your note. The airline industry already knows that people are switching down to economy, given the state of the economy etc. while some are switching from full-service airlines such as BA to cheap-fare airlines like Ryanair muttering about bad customer service all the same. The industry is also painfully aware that people are just not flying. Which means those who are still flying are precious cargo, so to speak. So, as I mention, recession is the time to try and hold on the few customers a business still has.

    Now on addressing expectations: I doubt people determine the class of their purchased flight tickets on the hope of an upgrade. The probability is slim. Airlines upgrade people all the time, but they appear to reserve that for frequent fliers and for people already travelling on a full-fare ticket (which few do nowadays). Every once in a while a good smile or travelling alone may win an upgrade too. I was once upgraded on Air France because the stewardess saw me reading Le Deuxième Sexe and thought I was French. But those are long shots. Realistically most people arrive at an airport not expecting to be upgraded (or bumped off from an overbooked flight!), so it is always a surprise, welcome or otherwise. BTW if you are in business class, nobody really knows how you got there and it is nobody else’s business anyway. But as Pat points out, if it doesn’t cost the airline extra – and if the CSA was not going to bother asking us to pay, for instance – upgrades win ambassadors. I do, after 8 years, still remember that Air France upgrade, don’t I?

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  3. I’ve had mixed reports and experience with at-checkin upgrades. I’ve only ever been upgraded once because of overbooking, but all other attempts – including smiling, being nonchalant, flirting, talking about bad backs – have failed. Now I don’t bother, and am just happy if they get me to my destination on time.

    Apart from the reason you’ve given (about it building a positive image of the airline in the customer’s mind), I’d suggest another reason for them to upgrade fliers – premium visibility. I submit that having first, business, and premium economy seats being more full than economy helps because:

    1) It gives the impression to other fliers of the upper class seats that the airline has the approval of fellow high-paying passengers, whatever its financial situation, especially if the said flier is not a regular. They’d probably go, “Hmm, well if this place is all full, their premium service must be damn good. I better not switch to another”.

    2) It makes the economy class fliers more envious, and gives them that much more of an incentive to fly premium. They’ll probably go “Ok, business class is more full than economy class, so maybe they’re doing something better up there. Might be worth spending a little bit more when I fly next time and see what the fuss is about – I’m really sick of these uncomfortable seats”.

    Make sense?

    @??!: It makes sense to me but it would also a different brand promotion game than airlines seem to be playing – the aspirational game. Here is my guess as to why this may not be the most effective tool. Economy fliers can rarely see whether or to what extent, business or first class cabins are full. At the point of entry into the aircraft, one can see some go upstairs, some turn left but that is about all. Right? How does this aspirational message then get carried over? More importantly, how does the airline measure its efficacy as a tool? Tricky.

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