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38 Managing Customers Through Economic Cycles

to protecting the customer experience from other cost-
cutting corporate initiatives. This group knew how critical
the customer experience was in maintaining business levels
in a contracted economy. As a result, they began funding
efforts to educate other groups within the organization
regarding the direct impact customer experience has on
business levels. This initiative’s focus was to measure the
degree to which any potential cost-cutting initiatives would
impact customer experience. Areas that were identified for
potential cost savings were the mostly “creature comforts”
on both business and leisure travelers flying domestic or
internationally, e.g. free Hawaii Mai Tai for a leisure traveler
on the flight to Hawaii, a hot meal in business class, a hot
meal in economy class on an international flight, charging
for a second bag for domestic flights. Of these suggested
cost-cutting measures, all but the charge for the second bag
were considered minimum requirements by the travelers
when they flew this particular airline. The charge for the
second bag was less a driver of customer satisfaction because
most travelers could alter their behavior to avoid this charge.
The impact was also mitigated by the fact that the entire
industry quickly moved toward this as a new travel standard.
The lesson is to identify the palpable and conspicuous core
drivers of experience to the business and voraciously protect
them from cost-cutting measures in tough economic times.

“We didn’t plan our updates/refurnishing activities around
economic cycles” Most businesses have operational compo-
nents that need to be updated or refurbished on a regular
basis. Optimally, these updates and refurbishing activities
are best done when demand eases. While it is impossible
to accurately predict the timing of economic cycles, there
should be plans in place to sequence as much of the updat-
ing and refurbishing activities as possible during downtimes.
One major airline took the opportunity during a recent con-
traction to refurbish their international aircraft because of