We promise! Customer charters expand guarantees

Abstract

Purpose

This paper aims to describe the experiences of Australian general insurer AAMI, the first private company to offer a customer charter and draw a comparison between service guarantees and customer charters. The paper also proposes a decision-support framework for the design, implementation and management of an effective customer charter.

Design/methodology/approach

The methodology involved in-depth personal interviews and secondary data.

Findings

Many service guarantees are not well conceived, implemented, or monitored. The AAMI case, demonstrates how customer charters, originally developed in the public sector can be effectively adopted in private organizations. The customer charter appears to deliver significantly more benefits to customers and an organization than traditional service guarantees. Charters do this by publishing specific service standards based on extensive research, conducting independent audits, stating outcomes of below standard performance, providing a visible and accountable appeal system, and publicly and regularly reporting on performance against promises. An on-going feedback loop ensures continuous quality improvement.

Research limitations/implications

Customer charter findings are based on one case study.

Practical implications

Using a decision-support framework for a customer charter, services may be clearly defined and customer expectations managed building towards an organization-wide commitment to meet service promises.

Originality/value

Customer charters are rare, with little known about how they operate in a private organization. The findings indicate that charters may be more effective as a quality assurance and marketing tool than a service guarantee.

Citation

McColl, R. (2013), "We promise! Customer charters expand guarantees", Journal of Business Strategy, Vol. 34 No. 6, pp. 11-18. https://doi.org/10.1108/JBS-01-2013-0005