Handling Complaints—An Introduction
by Alan Carson – Carson, Dunlop & Associates Ltd.
What does handling complaints have to do with marketing your home inspection firm? The way you receive and resolve complaints from clients can work for or against you in retaining those clients and attracting new ones. Remember, marketing is an activity designed to encourage prospective customers to contact your company. It is also inherent to inspections themselves, including the way you handle problems when something seemingly or actually goes wrong. Without trying to sugarcoat the situation too much, you can turn a complaint into a marketing opportunity. And because every home inspector eventually gets complaints, you might as well polish your skills.
Art versus Science
It is appropriate for this topic to start with a disclaimer. Explaining technical aspects of home inspection is easy. Research can be done, and technical issues are anchored in physics and building science. Explaining complaint resolution is more challenging. There is little authoritative material, and we are dealing with the art of human relations rather than a science. As a result, no definitive answers exist. Our goal is to make you think. We encourage you to challenge everything presented here to take away any of the ideas that work for you.
One Size Does Not Fit All
When dealing with communications and human emotions, there is one thing we can be sure of–one approach does not work equally well with all clients. You will need more than one strategy to be successful.
Identify Your Philosophy and Approach
Your personal and business philosophies play a role in how you handle complaints. We find that, in general, there are three types of home inspection professionals:
1. The hardliner. These home inspectors defend themselves against any and all complaints vigorously, never admitting any mistake.
2. The validator. These inspectors defend complaints vigorously when they feel unjustly accused, but they respond if there was a valid problem with the inspection.
3. The conciliator. Some inspectors try to satisfy every client and may pay to make a problem go away even though they made no mistake.
There is no right or wrong approach, but you should recognize your philosophy and develop your approach accordingly before you are in the midst of a complaint.
Your philosophy of complaints might depend heavily on whether or not you have errors and omissions insurance. If you do have this kind of insurance, you have to decide whether you are willing to submit a claim and risk increased premiums.
There are three schools of thought regarding handling complainants who ask for money:
1. Deny all requests for financial compensation.
2. Pay all requests for financial compensation.
3. Pay only the valid claims.
The deny-all-requests supporters believe that every complaint is a negotiation, and you have to start from a tough posture.
Those who follow the pay-all-requests approach believe that goodwill is more important than the claim. The downside to this approach is it does not take long before you have a reputation for having deep pockets. People will complain knowing
you will grease any squeaky wheel.
Paying only the valid claims seems like a good approach, but how do you determine which claims are valid?
Complaint Validity Is a Grey Area
In reality, we believe that you can’t take a black-and-white approach to the situation because different strategies work for different situations. Furthermore, callbacks and complaints are rarely black and white. They almost always involve shades of grey. From our experience, the client is clearly wrong about 10 percent of the time, and it’s easy to show them why. About 10 percent of the time, our inspector just missed something and we have to decide how to resolve the issue to everybody’s satisfaction. But 80 percent of the time, the situation is a grey area. Later we will look at approaches to determining the complaint validity and the responsibility for the problem.
To start down the road to effective complaint resolution, there are two things you should keep in mind:
Complaints Are Opportunities
1. It’s just business–don’t take it personally or it will consume you.
2. A complaint is an opportunity. Someone who has a complaint resolved to their satisfaction becomes a more loyal client than a client who never had a problem to start with. Nine out of ten clients who have a complaint resolved to their satisfaction will tell five people about the positive experience, whereas the average client who was satisfied from the start tells only two other people of their satisfaction.
For more on this see Basic Facts on Customer Complaint Behavior and the Impact of Service on the Bottom Line by Jack Goodman, President of e-Satisfy and former President of TARP, a company specializing in the measurement of customer satisfaction and loyalty. See www.tarp.com.
Complaints Are Opportunities
A complaint is an opportunity to do the following:
Satisfy Your Client
You will probably be referred business from a satisfied client.
Do this with all parties involved in the transaction. The agent, the seller and perhaps even the lawyer will see how professionally you handled the situation.
Avoid Bad Publicity
Whether you are right or wrong, a complaint handled badly could end up losing you lots of business if a disgruntled client decides to sink you at all costs. A disgruntled client could write to the newspaper, tell 100 friends, or register a website called www.thisinspectorsucks.com.
If you handle a complaint well you may:
• save money;
• save time;
• prevent the situation from turning into a lawsuit, which is bound to cost you more than the original complaint, even if you win;
• keep your insurance premiums down; and
• take the stress out of your life.
A complaint is also an opportunity because many clients who have had a bad experience will not complain to you. Instead, they will just tell an average of ten other people about the bad experience. Thank people if they complain. Consider it a chance to turn a client around. If you end up paying out, consider it a learning experience.
In this article, we have briefly introduced the concept of handling complaints and marketing your business, although it may not seem like it. In a future article, we will explore this further by discussing how to:
• avoid complaints from the start,
• competently deal with the complaint, and
• handle yourself competently at a revisit, or callback.
In the meantime, understand that complaints are part of the inspection business and any other service-based business. Be comfortable with this fact and focus instead on turning it into an opportunity.