THE BLOG
08/02/2008 05:12 am ET Updated May 25, 2011

Customer Disservice Spotlight On: FedEx

Four years ago, in the summer of 2004, I decided to start writing a book. I knew it would take a while, and sure enough, it did. I was thrilled when I finally could hold a real copy in my hands a few weeks ago. The respective Battles of Spellcheck, Representation, and Publishing were finally at an end. Who knew that there would be one more epic conflict in the War on Disinformation: The Battle of Shipping.

It took me only a few minutes to pick my poison. For a box full of books, UPS wanted to charge me about $18 to ship from Pennsylvania to Ohio, while FedEx Ground was willing to charge only about $13. I gave the manufacturer my company's FedEx account number, and on May 30, 2008, more than half a ton of freshly printed books began making its way across the country in trucks painted white, purple, and green.

Of course, as soon as they arrived, there was something wrong. Every single book jacket looked as though it had been dug out of a trash can and smeared with oil. The jackets had to be re-printed, requiring additional time and shipping. Fortunately, thanks to UPS Saturday Delivery and the printer's willingness to pick up the extra costs, the new jackets arrived on schedule and in good condition, leaving me with my FedEx bills to ponder.

At first, they looked fine. My Amazon.com partnership discount with FedEx gave me anywhere from 5% to 20% off the price of each package, and my American Express bill neatly displayed a corresponding line at the end of each FedEx line item stating "YOUR FEDEX CUSTOM DISCOUNT IS..."--except when it didn't. Sometimes, the discount simply wasn't there at all. I called FedEx to find out why.

It started off with the age-old routine that customer service representatives never tire of: the runaround. The people in Revenue Services told me that I needed to speak with the people responsible for my particular discount, in Associations. Duran in Associations told me that as much as he wanted to help me, he was not authorized to access my account. Miraculously, he had no ability to see what packages I had shipped, where I had shipped them, or how much they cost. His only job was to talk about discounts. To answer my questions, he would need to talk to someone in Revenue Services. The problem was that no one in Associations had a direct phone line, and they all shared one e-mail address. So I e-mailed Duran all of the tracking numbers I had questions about, approximately 70 in all.

It was weeks before I heard anything back from Duran, and when I did hear back from him, all that I heard was that he was "looking into things." Eventually, he decided that the problem was that I hadn't used the "correct" tracking numbers.

FedEx Ground is actually the remains of a forgotten company called RPS, which was acquired by FedEx in 1997. RPS used a different kind of tracking number scheme than FedEx, such that each customer had its own numeric prefix. More than a decade after the acquisition, FedEx still hadn't bothered integrating RPS tracking numbers into its own system, and so when the book manufacturer shipped the boxes, it had made a "mistake" by using its own tracking numbers instead of mine.

"I told them to bill my FedEx account number," I protested to Duran. "It shouldn't matter. My discounts are tied to my FedEx account number, not the individual tracking numbers."

"They can't do that," Duran said. "They have to pay themselves."

"They can do that and they did," I insisted. "I'm looking at the bill on my credit card! And besides, some of these packages are ones I shipped, with my tracking numbers!" Duran said he'd get back to me.

In the meantime, I called Customer Service. Several different representatives told me that they would look into my problem. Most never called back. One told me that my FedEx account representative was the only one who could help me, so he transferred me to a voice mailbox.

The next day, as FedEx announced that it was one of many companies that had lost a staggering amount of money in the last fiscal quarter, I received a package via FedEx from -- FedEx! It was my Amazon.com discount program welcome kit -- too heavy, at 15 sheets of 8.5" x 11" paper, to provide to customers over the internet at a time when oil prices were at an all-time high -- spelling out all of the discount percentages I was supposed to receive on various services, including FedEx Ground. Some of them made perfect sense to me, with tables reading "5%," "10%," "15%," "20%," and so on. Others made less sense. For multi-weight ground shipments, the percentages read "551," "552," "553, "554," and "555," with no explanation. I guessed they weren't referring to a 555% discount, but who was I to judge?

When my supposed FedEx account representative called back, she suggested that there was no such thing as a discount program for FedEx Ground. When I told her that I was looking at the documents right in front of me, she determined instead that my packages didn't weigh enough.

"They weighed 30 pounds each," I said. "That qualifies for a 20% discount." She proceeded to read me the same tables I was looking at, twice. Eventually, I'd had enough.

"I want to talk to the President's office," I said. And so I was transferred.

Eventually, I was put in touch with Beverly in the "Corporate Office," who echoed a familiar refrain: there was no such thing as a discount for FedEx Ground because it was already a "cheap service." She was the kind of person who made it difficult to get a word in edgewise, and so I had considerable difficulty explaining to her that I had already been given discounts on some, but not all, FedEx Ground packages, seemingly at random. Either way, I had written proof in my hand that I was supposed to receive discounts on all of my shipments. She asked me to send her the documents, and so I scanned in each page of the packet that should have been provided in a digital format in the first place, and finally sent them by e-mail to a general account for executive escalations.

I then received an e-mail from John, who was my "new" FedEx account manager, and who would be helping me with my issues. Unfortunately, he never did. When I called him one week later after hearing nothing but silence, he told me that he thought the issues had been resolved.

"How could they be resolved?" I asked. "Nothing has happened!"

"Well, I got an e-mail," John said. "From Beverly."

"When did you receive it?" I asked.

"June 8th," he told me.

"You sent me an e-mail on June 9th introducing yourself!" I exclaimed, infuriated. "That was the e-mail she sent asking you to SOLVE the problem, not telling you it had been FIXED!"

Trying to get in touch with Beverly proved difficult, as she had left for vacation. When I tried to ask her boss to transfer me to the CIO of the company, or someone who knew about database software, she refused.

Later, when Beverly returned, John actually took my side on a conference call, seeming unsure as to why it took so long to fix a simple billing error, and asking for someone else to help. Beverly reassured us both.

"I'm talking to people in billing who can help us with this," she said.

And so she was. Beverly called back later to tell me that the people in billing had looked over my account, and determined everything to be in order. I almost hit the roof -- and yet, it was consistent. I had disputed every single tracking number in my account through the FedEx web site, and more than a week later, every single request had been denied. I couldn't explain any of the details or case history, because the memo field in FedEx's system only allowed for twenty-one characters per dispute: enough to spell APPLESAUCE twice with one letter left over. Even Morse code was too verbose.

"You're getting your discounts, Mr. Greenspan," Beverly told me again and again.

According to the FedEx Billing site, I wasn't. In fact, according to the FedEx Billing site, I was being charged Residential Delivery surcharges for deliveries to massive commercial book warehouses. Sometimes, I was being charged two Residential Delivery surcharges per package, as if I were shipping to a building endowed with double the essence of a typical house.

After taking ten minutes to argue with me about whether or not Amazon.com's Kentucky Distribution Center was a residence in a residential area, Beverly said she'd look into it. I turned out to be right (it wasn't), and she issued refunds for the surcharges, but the issue of my discounts remained unresolved.

For several weeks we went back and forth, exchanging tracking numbers, with me arguing that had-I-received-a-discount-it-would-have-said-so-somewhere-just-like-all-of-the-other-packages-that-I-shipped-that-received-discounts, and Beverly arguing that you-received-a-discount-it's-just-not-showing-it-because-they-didn't-code-it-right-when-you-dropped-the-package-off. Making the point that I'd used FedEx's web site to pre-pay and ship the packages each time, thereby eliminating the possibility of clerical error at any of FedEx's counters, was futile. I finally admitted that it was barely worth my time to fight the battle any more, hung up, and tried to think about something else.

Instead, I pulled up my most recent American Express statement and found one package out of many listed with no stated discount. I had shipped it, as usual, through the FedEx web site. I went back to http://www.fedex.com, got a rate quote for the same type of package, and discovered that I had, in fact, been billed $13.16--only a few cents off from the standard, non-discounted price of $13.28. When I signed in with my account number, I got a lower price quote of $10.95 with a "Matrix Discount" clearly applied, which was definitely not what I had been billed. I called Beverly again.

"You're getting your discounts, Mr. Greenspan," she repeated for the tenth time that day. "Without the discount, we would have charged you $16.07. You only got billed $13.16. We did find some mistakes in your fuel surcharges, though, so you'll be getting a credit of about seven or eight dollars."

Unsure of whether I should be happy or upset about the fuel errors, I still disagreed about the discounts. "On your web site it says that the base rate is $10.63. There's a $1.50 Delivery Area Surcharge, and a $1.15 Fuel Surcharge. That comes to $13.28 total. Then there's the Matrix Discount that brings the price down to $10.95. Now, on my bill, the fuel surcharge was only $1.03, but everything else was the same, except I got no 'Matrix Discount.' They used twelve cents less gas than they expected, but I didn't get my discount!"

We argued about this for ten more minutes, with my insisting that the problem was in their clearly antiquated and absurd Oracle-based billing software, and Beverly insisting that there was no problem at all. Beverly finally offered to conference in the toll-free FedEx telephone number to get an unbiased rate quote over the phone. The woman on the line agreed with Beverly.

"Your rate would be $16.07," she said.

"How come your web site quotes $13.28 then?" I asked.

"I don't know," she said.

"Fine, whatever," I said, admitting the pointlessness of the endeavor. "If you're just going to quote me a higher price over the phone, take 20% off, and then claim I'm getting my discount because I got billed approximately the same thing, there's nothing I can do to stop you." I hung up with Beverly.

Curious, I called the Associations department once again. "I'd like a price quote, please," I told them. I gave Tammi, the representative, all of my package details, and then asked her how much it would cost to ship.

"Ten dollars and ninety five cents," she said.

"Interesting," I replied. "I just got charged $13.16 for that package. You're sure it's $10.95?" I asked just to double-check.

"$10.95 is what my system says," she confirmed. I conferenced in Beverly, who had Tammi repeat everything. We determined with Tammi that with no account number, on the phone, the package cost $16.07 to ship. With my account number, on the phone, it cost $10.95 to ship. With no account number, on the internet, it cost $13.28 to ship. With my account number, on the internet, it cost $10.95 to ship. Since I had actually been billed $13.16, we now had four different prices for the same package, and there were seventy packages of various sizes and weights totaling thousands of dollars in fees in question.

I couldn't handle any more for the moment, and politely hung up again after Beverly started to remind me how good my prices were. Then, she called back about a half-hour later.

"I talked to some people in billing," she said. "When we were getting that rate quote for the $16.07, you were telling us the zip code to ship from, but for some reason it was putting in your billing zip code in California! I don't know why it was doing that. So we were giving you a different quote. It looks like you're not getting all your discounts!"

This is a day in the life of the United States economy. We depend utterly and completely on database systems to do an unfathomable number of tasks for us. The process of getting a boring package from point A to point B requires computers that handle timing logistics, airplane systems, billing, telephones, etc. A failure at any point along the line can cause the entire system to fail -- or not. In my case, my packages got where they needed to go, just with a 50% chance that I would be billed 25% more for them than the shipping company had contractually agreed to charge. Not many people would notice. The root cause is probably a missing punctuation mark in one line of code among millions.

FedEx is a large company, and we've all grown accustomed to dealing with large companies. When there are so many people involved in a system that it is no longer possible for one individual to actually understand the entire system, it's understandable that some errors might creep in. So what can you do?

As it turns out, there's a lot you can do. You can design better database systems. You can hire educated people to provide support who can think for themselves, instead of parroting party lines. You can grant those employees more authority because you trust them, because education is a good proxy for knowing the difference between right and wrong. You can listen to your customers instead of shouting over them. You can throw out automated phone systems that cost more money than they save because of the time they waste. You can enforce quality assurance policies that route computer-related problems to people who actually know something about computers. You can perform random billing audits to catch mistakes before customers do.

Any one of these would have made my interaction with FedEx less horrifying. Yet even when the company is losing millions of dollars per quarter, the chance of a company that large listening to such common-sense suggestions, from a customer no less, is close to zero. Why is the American economy doing badly? This is why. This is not a story in a vacuum. This is how commerce in the United States of America works today.

As it turns out, I could have written this story about the book manufacturer, or the book distributor that received the infamous $13.16 box. Upon signing for 12 books in Illinois, they recorded them as being in Georgia, where they somehow remain still. For the most basic of products, requiring no refrigeration, special handling, or unique treatment, there has not been a single company along the supply chain that has performed its job properly.

So, if you're as anxious as I am for a time when the American economy is once again the envy of the world, take a look around you. Whether you're a CEO or a call center automaton, there's a lot of work to do.

This article originally appeared on aarongreenspan.com.

Aaron Greenspan is the author of Authoritas: One Student's Harvard Admissions and the Founding of the Facebook Era.