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Case Study: An Order Gone Wrong

“Your most unhappy customers are your greatest source of learning” — Bill Gates

Photo Credit : Shutterstock

Sanjeev Rishi carefully lifted his sandwich an inch, with the end of a fork. The bread was crumbling to his touch. A small cry left his throat. He then picked up the upper slice gently to examine the steak. It looked good. But the crumbling bread was a huge let down.

Sanjeev ran Wordsmiths-4, a content development firm for top management, with Budoo, Kailash, and Mini. They had been working four days on a presentation on ‘Recent developments in neglected tropical diseases, new worms and vaccines’ and the inroads made by the Melinda Gates Foundation. There was a lot of silence and keenness that surrounded their work. Precision and accuracy was core to all that they stood for. Finesse naturally followed.

That Wednesday, the foursome had decided to order a sandwich from JustOrder, a new, much-in-the-news catering startup. They had all heard about JO (as the lingo went) and the newspaper carried a story about their best: Bowled Over, a salad bowl…

While others pored over the menu offerings for choices, Sanjeev read their corporate statement of values. It always nagged him that new comers did not think out their mission statements. Budoo had decided they should all order and so, the app was downloaded and orders placed and in 36 minutes, there was, ‘Hi, I am Rujjesh and here is your order’.

Even before Rujjesh’s bike had sped off, they each grabbed their boxes and got down to eat and work. But Sanjeev’s sandwich was in trouble. The bread was curling at the edges, even broke when he tried to pick it up. Clearly the bread was days old. Certainly not ‘put together with care and patience’ as their website claimed.

Sanjeev turned the box over, found the e-mail address and wrote to JO: My order No. JO396339 for a Prime Rib Steak Sandwich. The bread is a stale multigrain but your menu says ciabatta. Nevertheless, it crumbles to the touch. Cannot eat this. I am not ever ordering again unless you have a good reason why I should.

Sanjeev got back to work when his mail box pinged. It was JO. They greeted him cheerily and downloaded a few paras on their quality control, their drive, passion, what customers mean to them. Then came the apology – “Sincerely sorry if we disappointed you”. Then some paras on marketing and how great was their process. And then, an offer of refund.

At Just Order’s Parish Street kitchen, Jai Varkey who handled orders and deliveries, saw the mail flying in, picked up the phone, and barked at the kitchen, “Who screwed up? …. Yes, but customer says the bread is old! We are carrying old bread?! Who issued material today?”

Dhanesh Jain (chef): Listen, don’t try and sound like you are running a Michelin star kitchen, ok? I issue materials to my kitchen, I cook, I serve orders and, damn it, I do the dishes too some days when the riders don’t report, and Piloo and Hanki have to drop their aprons and wear helmets!

Jai: Ok, you don’t have to make a point. Now, redo the order no. JO396339 while I see what I can do.

Dhanesh: Has he asked for a replacement? If the fella is angry, he is going to slam the door on the delivery fellow’s face and that will be Rs 275 worth of cost, not adding petrol… sorry? ...whatdyoumean? I have daily parameters too!

Back at Wordsmiths-4, the reply from JO sailed in on  Sanjeev’s screen, as the others yet celebrating their orders, chatted excitedly.

Budoo: Hey, this is the same place that does the greatest salads and power meals for executives? Rahul recommended them to us! What did you order? Soup and salad? How is it? Yeah, mine too, pretty decent.

Mini: Who is Rahul? My salad is sad. The argula is wilted, it is supposed to be a ‘Roasted Fig Salad with Walnuts, Goat Cheese, Prosciutto – how the hell do you say it – and Arugula’ (she read out from the menu) – but there are exactly three slices of figs, which don’t even make up for one whole fig, and two pieces of walnuts. Call my lawyers!

Budoo: Come on, you are complaining! How is the taste?

Mini: Arre! When the name of your dish starts with Figs, then it means the hero of your dish is Figs. If not say ‘argula salad’ and be quiet about the rest! Sanjeev, how is your order?

Sanjeev: Disappointing. I have written to them. Naturally… how long does it take to figure they have ruined your order? (And he read out JO’s reply mail with all its apologies).

Kailash: That was quick! I do think they have a lot going for them if they reply so quick! And offering you a refund!

Sanjeev hammered a reply to JO: I am not keen on a refund. I understand that food can spoil. If you could  let me know why this happened – that explanation will determine if I continue to order from you or not.

Meanwhile they were examining Mini’s salad. It was more of an argula than a fig and argula salad! Much dissection and dissertation went on.

At the other end of the city, JO’s operations head, Kabir Diwakar, and the only guy with a designation, chewed his lip as he read Customer Sanjeev’s reply on his screen. ‘…if you could let me know why this happened…’  Kabir groaned. How does one tell how things went wrong? Life in the kitchen was the same as every other day. Stuff came, stuff was processed and stuff was sold. Yes, of course, they had a routine. They had documentation and sign-offs. Even piped music that played jazz so the cook would be happy. But if this customer stopped ordering, he, Kabir, would have to answer his promoters, who sampled food and customer mails. As a rule, Kabir scanned the orders periodically to see what the day’s trend was. Sometimes a red star blinked on an order to tell him there was trouble. That was how he had zoned in on Sanjeev’s mails.

As business was brisk, Kabir could not devote much time to this immediately. A little distressed, he thought about the care that went into every order. Why this happened… he mouthed Sanjeev’s question sincerely. Something told him to bookmark that question.

Suddenly, winning back Customer Sanjeev JO396339 became most important to him. Kabir cared deeply for this business and he did have a great team. But food did not always behave well….

Later Kabir would tell his advisors, “The letter we send out makes sure the customer knows our ethos. And it is not that I send those out every day. We have mess ups 5-6 times a week. That is a decent average!”

Kabir wrote to Sanjeev: “Please, can someone from my Incident Audit team meet you and understand where the product has failed your expectation? I must confess we may know how to create a great dish but we learn from customers how to meet their expectations.”

Sanjeev did not resist. He knew about startups and besides Kabir sounded sincere. So, he replied, “Why not. Send your team anytime tomorrow after 11 a.m.”

A relieved Kabir confirmed the plan and resumed breathing. He left a message for Jai  to make sure someone went across to meet Sanjeev.

The next day began with a flurry of meetings at JO. A VC firm was calling on them to inspect premises and facilities and Kabir dressed his formal most and rushed around checking every nook and corner.

The meeting was decent, no promises but a lot of deliverables were listed and Kabir swore he would work on each. When the last of the VC guests and promoters had left at 3.15 p.m., Kabir looked at his phone and his heart sank. He had set an alarm to remind him to follow up with Jai. But he had left his phone outside the conference room with Shylah, who managed his office.

There was also a mail from Sanjeev, “No one came as promised by you. Neither am I surprised. My guess is, if you were a restaurant, you would have had to deal with my complaint immediately. But as an online portal you have the luxury of pretending to be ‘remote’. All the best to you! Please do not bother to call.”

But Sanjeev did get a call from Kabir who apologised for allowing this to slip his mind. “I will be honest, we had a VC firm coming in to inspect and we were all seriously rattled and anxious. That was how I clean forgot to have the Incident Audit team to pop by. Please allow them to call you at 5 p.m. and fix time for a visit.”

That call too did not come but a unique mail came from the ‘Delight Team’: Subsequent to your chat with Mr Diwaker, please find below a code that discounts by 25 per cent your next meal at our gourmet restaurant ‘JO’s Fine Dining’ on Maruvel Street.’

Budoo and Mini read the mail with mixed feelings. Mini wondered if this was not commendable that JO had courageously kept the ball in the air despite having dropped it four times. “Grant it to them, they fell and got up each time, silly people, but they do mean well.”

Budoo: How is that? Refunds and discounts do not solve the problem. It only assumes to have solved. It does not even address the failed transaction. If you examine the psychological forensics of these exchanges, JO is convulsing over getting Sanjeev the customer they failed, back on their list. But are they working at finding out how they failed the order?!

Tell me what did JO learn out of this? It is a sorry delivered without feeling regret.

Kailash: I agree. But I have a thought. While we communicate with each other, with outsiders, etc., there is also a communication going on with ourselves. Since this is where truth resides, tell me, what makes a vendor think that refunding takes care of customer disappointment?

Budoo: Then let’s see, what is customer expectations and what are its constituents?

Kailash: That Kabir chap is thinking to himself, telling himself, a refund solves the economic loss.

Sanjeev: But as a customer, I didn't go to Just Order to solve an economic problem. The problem was hunger. They didn't solve that. As a consumer, I want to know what went wrong and if it has a chance to repeat itself. A reply to that will determine if I will go back to them to solve my hunger problem again.

Mini: There is a problem there, which they are not alert to. The last mail to Sanjeev offering the discount, says, “Subsequent to your chat with Kabir, we send you this coupon...” Clearly the person who wrote the internal memo (likely explaining Sanjeev’s chat with Kabir) is different from the one who offered the coupon, and those two are not Kabir Diwaker. See? The team that offered the coupon to Sanjeev may not be aware that the Incident Audit team, did not call the customer.

Budoo: Or... they knew but did not read the letter they were signing. Or they used a standard letter.

Kailash: Communication failure.

Kaizad Nariman, a promoter at JO, happened to walk into Kabir’s office at just that moment. Seeing the young man’s distressed face, he asked about it and Kabir said, “How often we get mud on our face because some salad leaf wilted or the zucchini lacked crunch. Today I am thinking about a customer who has written saying something unusual. He says, “Tell me why this happened, that will determine if I continue to order from you or not.”

Kaizad had come in to read the minutes of the VC meeting as he had been travelling. Now he sat there and read the mail trail. Something about all this made him call Sanjeev and ask to meet with him. “Sounds like an interesting chap. I would like to meet him,” he said.

Kaizad did that now and then. People like Sanjeev with their strong but carefully worded comments almost always had him thinking.

Sitting before him at a coffee shop, Kaizad thanked Sanjeev and said, “Talking to customers like you who demand quality will help us put our culture in place better. Often what is not visible to us is visible to an outsider.”

Sanjeev nodded letting Kaizad to do his talking. Then Kaizad added, “We have this passion to set up a food place. A place that delivers great quality, great taste and great health within 30 minutes. I am not hands-on in the operations but as a promoter, but more as family friend, I have been guiding Kabir Diwakar and Jai Varkey with their act. Hence let’s say I am the details guy. I don’t sweat the profits or top line. I look at the detail.”

Seeing that Sanjeev was still only listening, Kaizad said, “So, for instance, I look at the customer mails regularly to get insights into what can be better. That was how I saw your mail. I like watching newcomers work and then guiding them towards ethical business practices. Hence may I ask you, what in your opinion caused the product failure?

Sanjeev: I think it was lack of quality control or even one step before this, your quality assurance process is not in place.

Kaizad: And what would you expect to see in the QA process?

Sanjeev: A system that assures you that every aspect of the work flow has a method and a route. So, suppliers, raw materials, storage (hot/cold), preparation processes, manpower, packaging and delivery, are fully defined. Even maintenance routines of your deep freezers and water systems. There could be space for decision makers to use their experience and contacts, their ideas and innovation to cut through a problem when it occurs.

For example, if the regular vendor for bell peppers does not deliver as per the order, the procurement guy may use his contacts in the market to fill in the order (since it could be for just a day or for just a shift).

Kaizad: And you are saying that the procurement guy will know what quality he wants so he will procure appropriately?

Sanjeev: That is how tightly a quality system is supposed to be knitted in place. That is when you can truly assure the end customer that your quality is 100 per cent. A procurement guy will look up the ‘procurement requirements’ and place an order.

In an F&B environment, the procurement requirements are very specific. How do I know? Because I work with some very fine minds in the foods business. So, they tell me that their procurement specifications includes things like, “Vendor should have own cold storage and transportation facility; Should not use third-party logistics provider; Should not source cabbage and artichokes from farms outside a radius of 200 km,” and so on. These don’t appear to be central to QA, but in effect, they are the strongest pillars of QA. Can you imagine, sitting in Hyderabad, you expect that your Delhi vendor's succulent paneer will travel via his third-party transporter and yet, reach your kitchen all fresh and spongy?  Will the Delhi supplier stop despatches if the third-party fellow’s transport vehicle’s refrigeration is not working too well? Do you know what is his priority: completing the sale or perfect spongy paneer?

But in an emergency, the procurement guy may decide to overlook a few of these supply criteria, leading to a wobble in quality. This wobble is almost invisible, but can have dramatic impact on flavour, texture, colour and volume of food. Have you walked into a kirana store and seen how they stack bags of aata? It comes in 100 per cent condition from the manufacturer’s warehouse, approved by their QC; but the boy in retail will sit with a safety pin (more likely an unsafe pin) in his hand and jab every bag of aata 10 times to let out air and thus get it to behave itself so that the 25 bags of flour can be neatly stacked.

Does Shakti Bhog or Pillsbury have a control on this? Is the end user getting the quality that the manufacturer intended for them? I would like to know. Or when his refrigeration shuts down and he is not on UPS, all his frozen peas become unfrozen, wet and wobbly but by morning, power is back and bingo you have frozen peas again! But those peas are not safe for consumption anymore!

Hence QA, which stays many steps ahead and minds these details stubbornly.

Kaizad looked worried. “Are they not the same, this QA and QC?”

Sanjeev: While both are processes, QA comes before QC. Good QA processes ensure QC is not expensive, does not hold back production or time to market and puts flawless products into the market. QC has one more critical role – when aberrations in quality are surfaced by the QC process, it becomes an input for the next QA cycle thereby making production/ release better with each iteration. In other words, QC cannot be seen as the implementation of a process.

Kaizad (aghast): You appreciate JO is a startup, they have lean staff... great expectations, no time… all that you are suggesting is for the big guys with loads of money and people…

Sanjeev: You can’t have a food startup that says, “I have a lean staff, so I am going to send out half-fried French fries.”

Kaizad: You are right. All these systems – I agree should be there. It’s just that the deliveries come from our regular chaps... we have agreed on systems with them; that bread should not have crumbled...

Sanjeev: The organisation is young but its operators cannot be forgiven for failing. That is what you are seeking. I am not Daddy. I am a customer. I pay you Rs 350 for a sandwich at my doorstep. That is Rs 10,000 a month. What are you doing to earn that, to take that away from my savings?

Kaizad, he may be your son, nephew, whatever. You may feel proud that the little boy has learnt to walk. I don’t share in that pride. It’s your pride. I diverted my purchase from a regular guy to you because you promised me good food. So, where did that good food go along with my money?

Money is not all that goes into a new business. The kind of things that get included in delivery are amazing: time of delivery, packaging, package weight and volume (for storage), etc. All this comprise delivery!

Kaizad: You know hotels are big. Startups are small. To have such detail in QC means more people....

Sanjeev: These things for QA in most instances need to be attended to once – when shortlisting and determining the supplier. From then on, it is a matter of setting up checks to ensure the QA process is followed. Not broken by “experts” in “emergencies”. Quality happens when you pay attention to it. Quality is not an accident.

How do you appraise your people’s performance? (Then, seeing the look on Kaizad’s face, Sanjeev said) Oh, no! You have no HR?

Kaizad: JO is yet 14 people…. Maybe we should get someone…

Sanjeev: Not ‘someone’. HR is not about payroll and leave records. That your secretary can do easily. HR is about helping people meet organisation goals.

Let us meet next week to talk about your HR. I need to get back to work.

Also read: Case Analysis by Arun Katiyar | Ranbir Batra

To be continued...

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case study magazine 22 July 2017 startup