Cadillac Leads the Way

Congratulations Cadillac. The GM brand scooped first place in BusinessWeek’s first-ever ranking for the best provider of automotive related customer service. Overall, the wreathed ones placed third, surpassed only by insurance company USAA and Four Seasons Hotels and Resorts. From its lofty perch near the top the elite twenty-five, Cadillac can look down upon such notable companies such as Starbucks (tenth), Southwest Airlines (thirteenth), and Apple (eighteenth). Caddy’s kudos offer beleaguered GM supporters a much needed glimmer of hope.

Of course, Cadillac is not the only automaker on BusinessWeek’s Customer Service Elite list. Lexus ranked seventh. Porsche staked its position on the leader board in seventeenth position. Buick and Lincoln round out the list in twenty-fourth and twenty-fifth places. Cadillac trumped its rivals with an A+ score for process (i.e. warrantees, service policies, etc.) and an A+ for its staff’s friendliness and conscientiousness.

BusinessWeek’s scoring system was based primarily– but not exclusively– upon data provided by J.D. Power & Associates. BusinessWeek aggregated 2006 J.D. Power customer service scores with their own survey data, weighted each company’s score based upon their prominence within their respective industry, and eliminated niche players and small-time operators. Companies such as Jetblue were also eliminated from the list based on recent unfavorable information.

As TTAC contributor Michael Karesh will tell you, that’s a lot of statistical tomfoolery. Even so, BusinessWeek’s conclusions are legitimate enough for water cooler analysis.

When not engaging in automotive floccinaucinihilipilification, I work in an industry highly dependent on top-notch customer service. I know first hand that providing class leading service is no accident. My company pays research firms to contact our customers to determine whether or not they’re satisfied with our service. Each month survey results are tracked, analyzed and acted upon by all layers of management.

Cadillac achieved distinction because their service organization is committed to world class customer service. Cadillac developed a strategy for delivering upon that commitment, and executed it.

To wit: last year, Cadillac took a page out of Lexus’ playbook. They empowered their dealers to decide for themselves if The General should honor warranty repairs after the warranty had expired. Additionally and at long last, Caddy now provides loaner cars to all customers while their ride is in the shop.

On the corporate level, Cadillac provides its dealer with large financial incentives– up to $100k per quarter– for maintaining high levels of customer service. Cadillac General Manager James E. Taylor says the program is worth the expense. He says buyers are five times more likely to buy another Caddy if they have a good service experience over a bad one.

You don’t have to be a Corvette owner abused by a Chevrolet dealership to know that Cadillac’s elite customer service status is evidence that there’s healthy tissue amid the gangrene afflicting the General’s seven other domestic limbs. Yet BusinessWeek’s survey results hint at the storm clouds gathering around this silver lining.

While Caddy scored 47 points higher than the auto industry average for customer service, only 51% of survey respondents said that they would definitely recommend the brand to other prospective buyers. By comparison, 79% of USAA customers said they’d recommend the brand. Seventh place Lexus and seventeenth place Porsche outscored Cadillac at 55% each.

This statistic is telling. It examines the composite buying and ownership experience, rather than just satisfaction with service. A person will only recommend the brand if they were also satisfied with the quality, reliability and prestige of the product, and are satisfied that they got a good deal (value).

While there’s no doubt Cadillac dealerships are vigorously pursuing customer service on the sharp end, the brand’s recommendation score is lower because their overall experience is compromised by the oft documented design and (perceived?) reliability woes that continue to plague General Motors.

Cadillac customer service is proof positive that [at least] one cylinder in GM’s corporate engine block is firing, but the company needs to be firing on ALL cylinders to reverse its terminal trajectory.

Customer service honors do nothing to relieve GM from constricting union contracts and burdensome legacy obligations. They don’t cure The General’s dependence upon light trucks. Or improve its ability to produce profitable small cars. Or eliminate its bureaucratic morass. Or prevent corporate bean counters from neutering innovative designs with cheap components. Or help the company divest wayward brands. Or focus its product offerings. Or increase the speed of product improvements.

Anyway, never let it be said that TTAC is incapable of giving any automaker– foreign or domestic– the respect it deserves. Cadillac’s customer service is a shining star in America’s automotive firmament. If General Motors addresses all its other problems with equal determination and commitment, the company might just pull itself out of its death spiral. We can only hope.

[To read the whole "Customer Service Elite" click here.]