CB6 6th Edition by Barry Babin,Eric Harris

Exercise 5

Culture Creates Customer Dissatisfaction?
Written by Mohan Menon, University of South Alabama
It was close to lunch time in Singapore when a long-time customer, Mr. Joe Teng, walked into the offices of Global Voyages and began to raise his voice in anger. He was not in a joyful mood. When employees at the travel agency offered to help, he brushed them aside. He wanted to see the owner to demand his three airline tickets for a flight that night. Mr. Teng had planned to travel to Australia with his family to plan the wedding of his daughter in Sydney. His daughter, who completed her graduate program in environmental sciences at Macquarie University, is working in Sydney. She invited her parents to visit and help her with the wedding in a couple of months.
As Mr. Teng rushed past the row of employee desks, heading toward the back of the office, the owner, Mr. Tarun Yadav, walked out of his office to meet him. "I've been getting my tickets from you for the past four years, and now you make me lose face with my future son-in-law. If I can't leave tonight I would have to postpone the wedding." Mr. Yadav kept his cool in front of his employees and tried to calm the customer down, but in vain. Mr. Teng was in no mood to reason. He wanted his three tickets and nothing else mattered.
The genesis of this service encounter began a few years ago when the customer was referred to Global Voyages by one of Mr. Teng's business acquaintances, who was himself a customer of the travel agency. Global Voyages is a full-service travel agency that primarily serves the corporate market in Singapore and countries in the Asia-Pacific region including China and India. But through referrals Global Voyages developed a significant proportion of business in the retail sector over the years with little or no promotion.
Global Voyages' owner, Mr. Yadav, worked for Thomas Cook, a global full-service travel agency, before establishing his own business. He was with them for about ten years in their Kuala Lumpur, Malaysia, office. He was involved with both corporate and retail clients during that time. At Thomas Cook, Mr. Yadav experienced the peril of retail travel business in the Asian markets and was deliberate in his attempt to target the corporate marketplace with Global Voyages. As with other businesses in the high-context Asian region, retail referrals are sustained if not sought after. Small- and medium-scale businesses welcome referrals, which provide higher marginal revenues with little effort.
Yet many small business owners, like Mr. Yadav, deal with referrals such as Mr. Teng's with trepidation. The reason is cultural, in that consumers develop the bonds of trust with business owners and thus expect to be served without regard for their own "deficient" payment habits. The situation with Mr. Teng's dealings with Global Voyages is illustrative of this phenomenon. Consumers expect prompt and high-quality personal service but seem reluctant to make timely payments. For various reasons, consumers expect unsecured credit for services. Seldom do they skip town without paying, but delayed payments affect a business's cash flow situation.
At the same time, in such high-context cultural societies, repeated pleas or threats for payment are frowned upon and most business owners, such as Mr. Yadav, feel uncomfortable doing so anyway. In the past, he tried having his employees do this "dirty" job with mixed success. Longtime customers sometimes feel slighted by the approach. Travel business is personal in the region, therefore a high level of satisfaction among customers is a prerequisite for building loyalty. Meeting or exceeding customer expectations is the name of the game.
The travel industry has been battered in recent years on several fronts. The economic downturn across the world, including in southeast Asia, a rise in aviation fuel prices, and competition among the major carriers and the low-cost airlines have had a profound negative effect on the travel business. Add to this the pricing pressure from airline websites, third-party consolidator sites, and meta-search sites such as Kayak.com, and it is easy to understand the scope of the problems that contribute to fullservice travel agencies being squeezed.
Since travel site switching costs are negligible, younger customers tend to price-shop online and thus are harder for full-service agents to attract. Older travelers, on the other hand, are generally in need of additional help with their travel arrangements and tend to value relationships they've cultivated through the years. They are not very price sensitive and thus patronizing businesses such as Global Voyages provides higher levels of service and satisfaction.
But given his earlier experiences with Thomas Cook, Mr. Yadav also feels that some consumers take advantage of this cultural peculiarity in Asia. Both his corporate accounts and retail clients are generally satisfied with his company, and 80% of them are repeat buyers. His own surveys and audits of travel-related blogs and forums confirm his belief that the company is doing well in the satisfaction ratings. He is fond of adding personal touches to his client interactions. For instance, he and his employees call clients once they reach their destinations to make sure they had pleasant trips and reassure them of help if they need it. At the same time, he uses these personal calls to subtly upsell local attractions or other arrangements they might need. Older clients appreciate this level of attention and often refer their friends and family to the business.
But he has had enough with a few consumers such as Mr. Teng. He feels that their service expectations about Global Voyages are high, yet their reimbursements for services rendered are protracted beyond reason. Customers' vision of what they want from businesses is sometimes colored by their unrealistic expectation of the level of service they feel they deserve within a cultural context. Mr. Teng is not likely to delay payments to service providers in Australia, a country he visits often. Other customers also tend to exhibit such behaviors to varying degrees, and Global Voyages has had to resort to intense coaxing to get paid. Legal maneuvers are rarely utilized, since they might backfire in the high-context culture of Singapore.
This time, he wants to take a stand, yet not in a manner his customers or employees might find hostile. He needs to set the right tone and be the role model that his employees have come to expect. Mr. Yadav also wants his employees to take a stand insimilar situations in the future.
Which of the characteristics of relationship quality does Global Voyages exhibit in the case?