Does a 'Virtuous' Company Offer Better Customer Service?

Last Updated Jun 4, 2011 8:21 AM EDT

One of the most unquestioned pieces of conventional wisdom among consumer advocates is that good companies do good, at least when it comes to service.

The latest Airline Quality Rating, for example, found that Southwest Airlines had the lowest consumer complaint rate -- 0.27 per 100,000 passengers -- in its industry. That shouldn't come as a surprise to anyone who knows the airline's corporate culture, which celebrates individuality, emphasizes fun and declares that employees are "number one."

How could an airline like that deliver bad service?

(By the way, for more on Southwest, check out Kevin and Jackie Freiberg's 1996 book Nuts! Southwest Airlines' crazy recipe for business and personal success or catch reruns of the A&E series "Airline," which shows how Southwest does -- and sometimes doesn't -- do service.)

I've always believed that how you treat your employees is reflected in the way you serve them. In more than a decade of advocating for customers, I've found that as a general rule, companies with toxic corporate cultures take their clients for granted and offer substandard service, while businesses with good reputations understand service.

A company's virtuousness may also affect its profitability. In Theodore Malloch's 2008 book, Doing Virtuous Business: The Remarkable Success of Spiritual Enterprise, he argues a "virtuous" company with a deepened sense of spirituality is better for corporate America.

As the son of a protestant minister, I should probably steer clear of theology. But the idea that company could be virtuous -- or maybe a better way of saying it is "not evil" -- and that being good could lead to better customer service, is certainly an interesting one.

So what's a "virtuous" company? Here are a few ways I might define it, in a more secular sense, and with apologies to Malloch. And to my father.

  • Employee morale and retention is measurably high.
  • People are promoted into customer-service positions, not demoted into them.
  • There's a generous profit-sharing and 401k program in place.
  • The company donates a higher-than-average percentage of its profits to a charity.
  • It has a generous leave policy for sabbaticals or spending time with your family.
  • The business invests in employee training and enrichment programs even when not required.
How do you define a virtuous company? And do "good" companies do better in the customer service department, or is that just a myth, in your opinion?

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Christopher Elliott is a consumer advocate, syndicated columnist and curator of the On Your Side wiki. He also covers customer service for the Mint.com blog. You can follow Elliott on Twitter, Facebook or his personal blog, Elliott.org or email him directly.
image courtesy of flickr user, jerandsar
  • Christopher Elliott

    Christopher Elliott is a consumer advocate and journalist. A columnist for National Geographic Traveler magazine and the Washington Post, Elliott also has a nationally syndicated column and blogs about customer service for the Mint.com. He is at work on a book about customer service issues.