Are Retention Departments Symptoms of Suckiness?

I have been thinking about retention departments lately. And I’ve decided they are the Emergency Rooms of the corporate world, where accounts in urgent need of repair wind up, usually in less-than-ideal circumstances.

Like a real ER, there are countless ways our customers end up there. Sometimes years of neglect pile up and things begin to fall off. Other times the voices of betrayal and annoyance become so loud our customers turn into porcupines. Now and again, it’s a sudden, catastrophic event that sees the relationship dragged before the triage nurse of customer loyalty.

If the retention team is the ER then the Save Team or Save Gate or whatever you call them are the Code Blue responders. The ones who fly through the door with their defibrillators, ventilators, scalpels and things that beep, all working flat-out to keep our customers from going into the light.

Real ERs exist to help family doctors and specialists, not because of them. The same is not true of the retention department. It’s not fair to blame account managers, installers, call centre workers and other front line people entirely for this. Many of them, like many family doctors, battle valiantly with specialists and broken systems to resolve billing, delivery, product and service issues.

They harass customer service, technical support, accounts receivable and just about anyone else who will put things right. And just like doctors, this is an exceptionally expensive use of their time with the result that they often watch helplessly as untreated sniffles progress to more serious complaints and eventually escalate to the point where somebody had better grab a mop.

Yet instead of investing in the diagnostics, early intervention and basic quality fixes that will keep the ER mostly empty, we seem content to build even larger retention departments, all designed around not killing more customers than can be reasonably replaced. Naturally this is followed by even more time and money being dropped into the ridiculous offers we make as our customers circle the Code Blue bowl. It just can’t be cheaper to revive customers than to not try to kill them in the first place.

Joseph Jaffe  has suggested that the only good churn is no churn. Maybe in B2C that’s achievable, but in B2B we can reasonably expect a few customers to go out of business, show up with a do-not-resuscitate order or simply move to a competitor on the wings of whim. To help sort the inevitable from the tragic, hospitals use a process called M&M– which is not how many candy-coated chocolates were successfully extracted from tiny nostrils– but is about evaluating morbidity and mortality.

In corporate terms this would be churn and save. I have no doubt that these stats are tracked closely in most companies, but the studies I see are really not helpful because they are based on the codes the agents or account managers enter to explain the loss or the expensive near-miss. Since there is little incentive to tell the truth, the reports construct a world in which competitors are consistently cheaper and customers unreasonably capricious.

Most ER workers will tell you they would love to see the day when they are no longer necessary. But since there is always someone with a flare gun, a bottle of bourbon and a great idea, they persist. Retention departments, too, are necessary, for much the same reason (especially if you sell the flare gun or the bourbon), but here’s the problem: just as emergency rooms in many places are now delivering the primary care family doctors used to handle, retention departments in companies are picking up the slack for suckiness in other places.

I would bet that if you did a comprehensive survey of your lost customers over the last few years you would need to invent new codes to include:

• ran out of excuses for inaccurate billing
• dropped ball repeatedly on technical issues
• sold crappy product
• lied to customer
• almost destroyed customer’s business with incomprehensible policies

In other words, malpractice, my friends.

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