Short pay

This is a concept implemented by Graniterock, a 100-year-old company in Watsonville, Calif., that sells crushed concrete, sand, asphalt, and gravel.

They did this to achieve an ambitious goal: for total customer satisfaction.

Imagine that every invoice you issued carried the following message:

If you are not satisfied with any item on this bill for any reason,don’t pay us for it. Simply scratch out the item, write a brief noteabout the problem, and return a copy of this invoice along with yourcheck for the balance.

Graniterock customers are encouraged to “pay an invoice short” if they are dissatisfied with any product or service provided by the Company. Customers should pay us only what we’ve earned.

Reputation is important to a company’s longevity.

Short pay gives the customer full discretionary power to decide whether and how much to pay on an invoice based upon the customer’s own subjective evaluation of how satisfied they feel with a product or service. Short pay is not a refund policy. The customer does not need to return the product, not does he need to call Graniterock for permission. He simply circles the offending item on the invoice, deducts it from the total, and sends a check for the balance.

1. Short-paypolicy can be a “catalytic mechanism” for realizing a company’s largergoals.
2. The company gets a lot of information from customer surveys, but there are always ways of explaining away the data.
3. With short-pay, we absolutely have to pay attention to the data.
4. We often don’t know that a customer is upset until we lose that customer entirely.
5. Short-pay acts as an early warning system that forces us to adjust quickly, long before we would lose that customer.
6. It serves as a warning system, providing hard-to-ignore feedback about the quality of service and products.
7. It impels managers to relentlessly track down the root causes of problems in order toprevent repeated short payments.