You are the owner of a small business providing personal care services. A lady purchases a gift certificate for her fiancé for Valentine’s Day. She returns to you 3 months later asking for a refund as he died.

What do you do? Give her the full refund? Stick to your policy manual and remind her that gift certificates are non-refundable?

Most businesses strive, or say they do, for great customer service and their policies are geared to that. It is in instances like this, however, that the quality of customer service is tested. These are the moments which one did not foresee and which therefore have neither precedent nor manual. These are the exceptions. And they are not simple decisions. The challenge is that there are 2 points of view here – a person (customer) experiencing a highly emotional experience, and the business owner, who is coming from a rational place of building their business. Emotional vs. rational. Can there be a winner? Or better yet, could there be a win-win?

Making the decision requires that one works through the consequences:

  1. Full refund – customer gets her money back. The business owner loses revenue. But wait – does she? She loses this sale. But she has created an exceptional experience for the customer, one that she just might speak about to friends, family and all who might listen as she works through her grief. Goodwill created, and maybe even future revenue.
  2. No refund, consistent with the stated conditions of sale – business owner maintains her revenue. In this scenario, she has also created an exceptional experience for the customer, one that she WILL speak about to friends, family and all who might listen to her as she works through her grief. For we are much more likely to speak about poor service experiences than good ones. From this one experience, the hard work the business owner has put into her business is imperilled. Revenue, and certainly goodwill is likely to suffer.

So the decision is simple (#1). End of blog. But wait. What if the business owner is strapped for cash, and, with the best will in the world, just cannot afford to refund the money? Most (all?) business owners experience this at some time or other. And what about precedent? What message is she sending to her staff about dealing with unusual and unforeseen situations? Does she run the risk of giving them carte blanche to hand out refunds in all situations not covered by policy? And where does she draw the line – should she give a refund to someone who broke up with her fiancé, still living, but now ex?

One lesson I am drawing from this is that exceptional service lies in the exceptions. No plan, procedures manual or system can account for every situation. Each customer is unique, with different perspectives, needs, emotions, beliefs. One customer may not even have thought of asking for refund in this time of grief, too devastated to focus on such minutiae. For another, it’s the little things, like a refund, that help them to cope. How one treats with the exceptions are tests of the values that underlie the service philosophy, systems and procedures. Once one is clear on what these values are, then the decision becomes easier. In my experience as a consultant, this is where leaders often fall short, in not explicitly aligning their values with their procedures. Culture (which is the manifestation of our values, stated or unstated) and structure (systems, processes, regulations) are not separate – they are intertwined and co-dependent. But we tend to view them independently and not work through how they affect each other. When they are aligned, then decisions such as the above are clearer. And further, it is easier for our team members to make the right decision i.e. the decision that aligns with and reflects the values underlying the business.

In a heartbeat, I know what I would do in this situation. Do you?


Review a key customer service procedure and determine the extent to which it aligns with your values, or the values of the organization (for business owners, they are the same). If not aligned, adjust.

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