Here is an evaluation of the Northwest Airlines case study and how the company could have dealt with their crisis better to ensure their customers remained satisfied. This was part of my MBS Digital Marketing in DCU, Dublin, Ireland.
Tom Muldowney - Northwest Airlines and the Snow Storm - Dealing with Customers in Times of Crisis
1. MG 527 Services and Tourism Marketing
Tom Muldowney – 59212790
Eimear Murphy- 59210952
Rosemary Clancy - 59212099
Caroline Mullen - 59213267
Northwest Airlines and the Detroit
Snowstorm
2. Q1. How bad was the situation?
1. People
Aggression
Impatience
Hostility
Rude
2. Policy
Cell Phones
Alcohol consumption
Smoking
“Service failures can often be categorized by faults that fall into the following criteria
people, policies, processes and the actual service”. (Tax and Brown 1998)
3. How bad was the situation?
• Processes
• Lack of Communication
• Lack of snow emergency plan
• Lack of clear safety assessment
• Quality of Service
• Check in computers
• Hotel
• Food and Drink
• Comfort
• Toilets
14. Q3. What should the NWA strategy be
now for Service Recovery?
• Samaritan Health Services developed framework -‘AAAA’
Action Plan for Service Recovery:
– Anticipate – be prepared for backlash, staff ready to deal with crisis
– Acknowledge – full responsibility, at time of crisis, reduces conflict
– Apologize – regardless of who is at fault, must be sincere
– Amends – take action, compensate appropriately
Action Plan for Service Recovery
15. Benefits of AAAA Action Plan
• Management and staff would be aware of the emergency procedure
• Prepared for the unexpected - remain calm and professional
• Company performance will be improved through customer satisfaction
• Organised and professional approach – no loss of customers
16. Customers Management
“Is it a bird? Is it a plane? (kind of) No!!! Its NWA’s management team!!”
- Onlooker Flight 1829
(Quote may not have happened)
Customers NWA Management
17. Q4. What should be their course of
action for the future?
Tax and Brown 1998, have identified four practices that
aid service recovery.
1) Hiring, training and empowerment
2) Establishing guidelines and standards
3) Providing Easy Access and Effective Response
4) Maintaining Customer and Product Databases
19. 2. Establishing Guidelines
& Standards
To improve procedures and performance of
customer service
The ‘AAAA’ action plan could be used as a
standard guideline as to what action the
airline takes in the case of a service failure.
22. 4. Maintaining Customer &
Channel Databases
NWA cannot operate effectively as a standalone
entity
23. Management Implications
• Disadvantages
Labour Costs of training and educating employees
Employee buy-in, if the risk is not obvious
• Advantages
Customer-orientated investment
Customer satisfaction positively impacts bottom-line
(Aksoy et al 2008)
Minimises risk of damaging brand image
25. Bibliography
• Tax, S.S. and S.W. Brown (1998) Recovering and Learning from
Service Failure. MIT Sloan Management Review, 40(1): p. 75-
88.
• Lewis and Clacher (2001) Service Failure and Recovery in UK
theme parks: the employee’s perspective (2001) International
Journal of Contemporary Hospitality Management. Volume 13
(4) pp. 166-175
• Askoy et al (2008) The Long-Term Stock Market Valuation of
Customer Satisfaction, Journal of Marketing, Vol. 72 July pp
105- 122
Editor's Notes
Lack of Communication between NWA staff and:
NWA business units
DWA staff
Passengers
Competitor Airlines
Meteorologists gave them weather warnings. They stopped over in Tampa so that they wouldnt fly into the worst of the stno
AA cancelled all their flights
Staff couldnt get to work
Runways werent cleared
We’re not prepared to deal with ground delays
Internal databases between NWA’s various automated crew communication and scheduling systems were overloaded during the snowstorm. This led to the chaos that preceded and followed the service failure.
Message did not get throught to the Captain – but perhaps he wouldnt have wanted to hear it anyway because his mind was made up to fire ahead
The issue of role conflict between who had the authority to make the decision to speed up the flight en route to DWA caused the misjudgement of safety from Captain Stabler.
This option did not have to be taken and was a very risky move considering the adverse weather conditions they were going to be flying into.
This was therefore a very poor perception of safety on behalf of both pilots involved.
As noted by Lewis and Clacher (2001) in their study on service failure and recovery in UK theme parks; safety and security procedures are often governed by law in service industries. In the case of NWA, passengers lives depended on the decisions made by Captain Stabler and risks should not have been taken that could have put their lives in jeopardy.
Tax and Brown address the resolution of customer problems based on customers perception of what is fair by assessing outcomes of the service failure, procedural features of the incident, and the interactional treatment they were engaged in.
Lewis and Clacher (2001) address the strategy management can take to reduce unsatisfactory service outcomes by resolving customer problems before they escalate.
Management and staff would be aware of the emergency procedure - would help deal with potential conflict that can arise from unexpected crises
Shows to their customers that during a crisis they have remained calm and professional and most importantly were prepared for the unexpected
Achieving fairness and customer satisfaction represents a direct approach to improving company performance
Management will be looked on very favourably either during or after the crisis by the customers because of their organised and professional approach – no loss of customers