Service Recovery: Why Early Warning Systems Aren’t Optional

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Concerns about on-line reputation and strategies for reputation management are regular topics at Society meetings. Virtually every physician has experienced at least one harmful review. Negative reviews impact our reputations and, in the extreme, can stifle business growth. Despite the danger, very few practices institute early warning systems to decrease the likelihood of negative reviews.

A smaller subset of physicians who use ratings and reviews to market their practices tell a different story. These practices verify their own quality and use it to attract consumers to their brand. They can attest to the incredible sales and conversion benefits of proactively providing ratings and reviews to consumers for use in their buying process.

Regardless of your perspective on the ratings and review phenomenon, it’s time to adopt an unheralded methodology, service recovery. Viewed through the service recovery lens, a negative review reflects the organization’s failure to ferret out discontent and resolve it internally before it goes viral. Service recovery provides an early warning system that enables practices to resolve service issues privately and internally.

What is service recovery?

“Service recovery refers to the actions a provider takes in response to a service failure.[1] A failure occurs when customers’ perceptions of the service they receive do not match their expectations. By including also customer satisfaction into the definition, service recovery is a thought-out, planned, process of returning aggrieved/dissatisfied customers to a state of satisfaction with a company/service.”[2]

What are the effects of service recovery?

“A growing body of literature on service recovery suggests that a good recovery has a positive impact on satisfaction, recommendation intention, word-of-mouth, loyalty, image, and trust.”[3][4][5][6]

chart

Click to enlarge.

 

“Some even argue that a good recovery can increase satisfaction to a higher level than if nothing had gone wrong in the first place, which is referred to as the service recovery paradox.[7][8] See chart showing the increase in customer loyalty after problem resolution.”

How do you start a service recovery program?

Go the source, your patients. Embrace feedback and use their disappointments as opportunities to improve your practice and your reputation. In this digital age, you must follow up to resolve the often justifiable concerns of your patients.

  1. Survey all patients post consult, post treatment and post op.
  2. Rate satisfaction using 5 point scale similar to ratings and reviews. Your internal scores provide insight into what public scores should be from verified patients.
  3. Follow up with individual patients who indicate they have an unresolved problem. Work with them to deal with the issues of concern. The higher the patient’s satisfaction with the outcome, the better it is for your reputation.
  4. Identify and resolve process issues which are reflected in low satisfaction scores of many patients, i.e., late clinics, lack of responsiveness or poor preparation for recovery. Low scores at consult impair conversions. Low scores post op reduce retention and referral.

Conclusion

Wise practices recognize the value of proactive customer service and responsive customer complaint systems. Service recovery processes can harness patient feedback and turn it into a valuable and profitable asset. The stakes are much higher among today’s perpetually-connected consumers, a reality smart practices should not ignore.

Marie Olesen
Founder, RealPatientRatings®
www.realpatientratings.com
Advisory Board, Center for Services Leadership, W.P. Carey School of Business at Arizona State University

Note: Service recovery is an established methodology in the business environment. I’ve cited these studies because it is important that those of us in medicine adopt these processes rather than question the validity of the concept.

References
  1. Grönroos, Christian. “Service Quality: The Six Criteria of Good Perceived Service Quality.” Review of Business 9, no. Winter (1988): 10-13.
  2. Lewis, Barbara R. “Service Promises, Problems and Retrieval. Working Paper.” Paper presented at the QUIS, Karlstad, 1996.
  3. Maxham, James G. III. “Service Recovery’s Influence on Consumer Satisfaction, Word-of-Mouth, and Purchase Intentions.” Journal of Business Research 54, no. October (2001): 11-24.
  4. Spreng, Richard A., Gilbert D. Harrell, and Robert D. Mackoy. “Service Recovery: Impact on Satisfaction and Intentions.” Journal of Services Marketing 9, no. 1 (1995): 15-23.
  5. Smith, Amy K., Ruth N. Bolton, and Janet Wagner. “A Model of Customer Satisfaction with Service Encounters Involving Failure and Recovery.” Journal of Marketing Research 36, no. August (1999): 356-72.
  6. Tax, Stephen S., Stephen W. Brown, and Murali Chandrashekaran. “Customer Evaluations of Service Complaint Experiences: Implications for Relationship Marketing.” Journal of Marketing 62, no. April (1998): 60-76.
  7. Hart, Christopher W. L., James L. Heskett, and W. Earl Jr. Sasser. “The Profitable Art of Service Recovery.” Harvard Business Review 68, no. July–August (1990): 148-56.
  8. McCollough, Michael A., and Sundar G. Bharadwaj. “The Recovery Paradox: An Examination of Customer Satisfaction in Relation to Disconfirmation, Service Quality, and Attribution Based Theories.” In Marketing Theory and Applications, edited by Chris T. Allen, 119. Chicago: American Marketing Association, 1992.