01 January 2008

Pursuit of Customer Satisfaction

Nordstrom ranked fourth overall and first among retailers in Business Week’s customer satisfaction ranking, March 2007.

In their 1995 book, The Nordstrom Way, Robert Spector and Patrick D. McCarthy describe the 8x5 inch card handed out at the Seattle-based retailer’s one-day employee orientation. It welcomes the new hires to Nordstrom and lists one rule. “Rule #1: Use your good judgment in all situations. There will be no additional rules. Please feel free to ask your department manager, store manager, or division general manager any question at any time.”

This policy frees employees to do what they need to do in order to satisfy the customer. A sales person can help a customer find items in other parts of the store, gather items for a busy customer, make a delivery, or lower the price in order to avoid being undersold.

Nordstrom’s commission-based pay system encourages sales people to meet customer needs and build a personal clientele. Sales associates keep a book, recording each customer’s preferences and past purchases.

This information helps the salesperson keep in touch with customers, send thank you notes to customers, and call when a new item might interest a customer.

Spector and McCarthy report Managers hire, fire, schedule, evaluate, coach, and encourage their personnel. And they regularly spend time on the sales floor interacting with coworkers and customers. Directors and managers visualize the organization as an inverted pyramid with the customers at the top. Sales and support personnel do everything they can to satisfy customers. Department managers, buyers, merchandise managers, store managers, regional managers, the executive team, and the board of directors focus on helping front line staff satisfy customers.

As then department manager Betsy Sanders told Spector and McCarthy, one day in 1974, the Nordstroms walked through a store on their way to a meeting and heard two women complaining about being disappointed. Bruce Nordstrom pointed the women out to Sanders.

Sanders caught up with the women, and found they were disappointed because they could not afford a particular dress they had admired. Sanders took them to a different part of the store, and they each found something they liked.

Several hours later, Bruce Nordstrom emerged from the meeting and asked Sanders, “Betsy, I know you took care of those customers. I just want to hear what the story was.”

“That was just emblazoned on me." Sanders said, "I thought, ‘…the customer is number one with them. It doesn’t matter what’s on his mind. He’s not going to forget there is a customer with a need.’”

This article first appeared in Character First's business bulletin series 3. It is reprinted here with permission from Character First and Strata Leadership.

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