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Net Promoter Community > European Conference Blog 2008 > Tags > brooks
 

European Conference Blog 2008

4 Posts tagged with the brooks tag

Holcim may not be a well known company on first pass, but after hearing the facts, you will wonder why you never heard of them.  A couple of interesting things:  They've grown in the last 4 years from having 44,000 to over 100,000 employees.  Their strong growth, just like Symantec's, was fueled through acquisitions plus organic growth.

 

 

Holcim's rapid growth pushed the organization to get more systematic processes and metrics in place.  As an Engineering company, Christian Birck, Head of Branding for the company, said "everything was a measurement" and that management was used to numbers.  However, they had no metrics on people or customers.

 

 

The company had another challenge in that they had a mixed model.  In some markets they were B2B; they sold to construction companies.  In others they were B2C and sometimes B2B2C.  Christian showed a great slide that said this industry was "not the sexiest, but real."  As such, one of their challenges was in recruitment.  As well, they knew they needed to keep the good talent they had, but focus on getting more.

 

 

So, according to Christian some of the key business challenges were:

 

 

  • Organic growth and threat of commoditization
  • Getting right talent and enough of them
  • Building and protecting their reputation — this is particularly important in their business

 

Because Holcim does not enter different new markets lightly, they are extremely focused on the long term.  They believe one of their key differentiators is their people — how their employees fit and exemplify the values of the company.  The list of things they wanted to accomplish included:

 

  • Making their people ambassadors for the company
  • Focusing all employees on delivering on company promises
  • Fostering a culture of customer orientation
  • Facilitating knowledge-sharing
  • Facilitating integration of new acquisitions

 

 

I thought Christian did an excellent job of explaining that "Brand does not equal logo, or advertising."  He believes that the brand promise has to be communicated in products, communications, behavior, and channel experience.  This means you really have to deliver to this.

 

 

In addition, through their complex business, it wasn't just their employees who had to live their brand promise, but their partners as well.  This was a challenging aspect for them, to make sure channel partners also were also ambassadors of the brand.

 

 

One of the programs that the company put in place was something they called "Living our Values."  This included: vision, mission, and values with some support systems.  For their industry, Holcim felt that trust was low, so the ability to differentiate on values was critical.  Christian wisely pointed out that anyone can put values in words, but it was how you get the organization to understand and live the values that was the challenge.

 

 

Holcim put in some change management processes to reinforce their message.  One of their principles was:  Enough of us for long enough.  This message went back to the earlier point about retention and recruitment.  Another key differentiator in terms of Holcim's messaging around this was "it is not just another program".  For them, the word "program" meant it was fleeting, not permanent, and they wanted everyone to take this seriously.  They focused on leadership as well, having them engage, communicate, and reinforce aligned behaviors.

 

 

One of the other enlightening statements from Christian was that you "Don't have to have a big brand for employees to believe in you."  In my experience, this is very true.  It is the extent to which you live the values as a company, and the extent to which these values also align with employees' own personal values.

 

 

From a measurement perspective, Holcim collected two types of NPS: (1) measuring recommendation of products and services, and (2) measuring whether employees recommend Holcim as an employer.  What they found was that the recommend score for products and services was very high, but scores for recommending Holcim as an employer varied dramatically.

 

 

So, this measurement of employee promoters told Holcim the extent to which they were making progress.  For their large complex business, they realized that some actions took a long period of time, and that too frequent reporting of the metric could be counter productive, in that management had to see progress.

 

 

They also found that it was difficult to sometimes prioritize empowerment drivers, as well as what things the company could actually influence.

 

 

Finally, one of the other things they realized in trying to develop trackable metrics was that there seemed to be a strong cultural bias in answering questions.  There were dramatic country-level differences.  This did not surprise me however, as we have seen this as well at Satmetrix.  Christian wisely pointed out that they don't compare scores between countries, nor did they consider normalization as this would be hard to communicate and take away the very thing they like:  the simplicity of the measurement.

 

What did I learn from Christian's presentation? Holcim's story is similar to Symantec's -- large complex organizations take time to change, but both have implemented many successful mechanisms and practices to try to help them get there.  Holcim is also somewhat similar to Travel Counsellors in that they recognized that the individual employee was critical to representing their brand.  The added twist with Holcim was trying to also reinforce their "promise" through their partner channel.  Perhaps at next year's Net Promoter Conference we will see more about this last dimension; one that I'm sure many companies are trying to get right as well.

 

Click here to download the presentation.

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Travel Counsellors is a company comprised of 900 travel counsellors in 7 countries with 20 years of experience.  They have experienced rapid growth in a very interesting marketplace; counsellors providing travel guidance out of their home offices.  Most of the motivation in being a travel counsellor is a) being well paid, but more importantly, b) getting recognition for helping and giving their customers successful, enjoyable trips.

 

 

Malcolm Hingley, Sales Director at the company, stated that "our success is our relationship with our customers, and that's what sets us apart from the rest."

 

 

The travel business has changed dramatically.  There are two components to it -- a relationship aspect as well as a transactional aspect.  Many travel businesses have traditionally focused on the transactional nature of travel, but it is a critical differentiator to also focus on the relationship (partnership) aspect as well.

 

 

It seems the travel industry in general has not established itself as a shining example of customer loyalty.  One statistic Malcolm reported was that 2 out of 3 customers would not return to their travel agency.  The reason, he said, is that many customers felt that these travel agencies were primarily out "take my money."  There was no interaction, they were only interested in the next customer.  He said other agencies' customers felt that there was no caring and that this was a very short term perspective.

 

Amidst this backdrop, Travel Counsellors was interested in engineering the experience quite differently.  Malcolm discussed the 12 golden habits.  Some of their findings were these gold habits had nothing to do with the sale, but about the unexpected moments that motivate customers to refer.

 

 

Of the 12 golden habits; it is really interesting that none of these are sales oriented.  As Malcolm put it, it was all about making the customer feel special.  Some of these include:

 

 

  1. Give the customers great reason to talk about you
  2. Have an emotional connection in everything we do; it is not enough to know about the transaction but to truly understand our customers' lives.
  3. OK sales people have customers, great sales people have friends.

 

 

I really liked this list, and especially its non-sales approach.  It focuses on the right thing -- the customer -- and not the transaction or sales event.  As well, it must make Travel Counsellors feel good that they are working toward this greater goal.

 

 

One of the things that Travel Counsellors also validated in the UK, was that NPS that was more relationship-oriented tended to produce higher scores, while convenience-based bookings through the Internet have the lowest recommendation rates.  These seemed to substantiate their 12 golden habits.  Travel Counsellors had on average a score of 82% while their competitors had much lower scores.

 

Travel Counsellor also introduced TCS (Travel Counsellor Score). They wanted to also validate the external study internally. They asked how likely is it that you would recommend your travel counsellor?  Notice that they altered the wording to be person specific, not about the company.  This was critical, because it was in fact that very personal relationship with the counsellor that they felt made the difference.

 

 

On this method they scored  94% on over 30,000 customers. To explain, Malcolm said that part of this score is based on their belief that there are no limits for what you could do for your customers.  He gave the example of one woman who owned a horse, and that she would personally ride out to each of her customers to deliver their tickets personally.

 

 

So what were some of the key messages from this presentation?  I'll summarize Malcolm's list:

 

  • Don't transact, relate.
  • Keep investing in the relationship.
  • Communication is key to keeping your customers engaged.
  • Make it personal. (This is a large part of the company's plan going forward.  One of the things that Travel Counsellors is doing is rebranding their marketing material around the name of the counsellor, so it is now person-specific.)
  • Don't oversell.
  • The power of 'thank you' is huge.

 

 

Toward the end of his presentation, Malcolm showed some great short videos in which customers gave feedback about their positive experiences with their counsellor. These customers were extremely real and enthusiastic in their praise. One thing (albeit many) that I took away from this presentation was the "make it personal" message. Travel Counsellors realized that their brand was really represented by their ambassadors; their counsellors. They were very savvy in recognizing that it was the individual personal relationships that mattered, even in terms of how they asked the recommend question. Thanks for an eye-opening presentation, Malcolm.

 

Click here to download the presentation.

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Alexsandra Alfonso, Senior Global Manager of Customer Experience Programs at Symantec, began her session by discussing the past 3 years of tracking Net Promoter at Symantec.  What was particularly interesting was the significant amount of change and transition that has happened in Symantec as a result of merger acquisitions, the largest of which was Veritas.  Alex compared and contrasted the before and after view of what this meant by revenue, acquisitions, employee portfolio, customer locations, and values.  Throughout these major transitions, Symantec was able to keep their core company values -- innovation, action, trust, and a customer driven philosophy -- intact.

 

 

Alex articulated Symantec's mission, which was to enable and empower individuals to create change in the business, to improve customer experience. I like this mission as it really brings together two key components in one mission statement, the employee and the customer.

 

 

Alex outlined the history of NPS at Symantec. She indicated that the primary concern early in 2005 was to establish a sound baseline, and from there, to look at key drivers and what impact these were having on the customer.

 

 

There were several program elements that Symantec focused on initially. One of these was a customer loyalty champion program. Employees from various business units who were passionate about customers were selected to participate. Their role evolved over time, but initially they focused on aligning products and process (not surprising given the amount of change through the merger process). Also, they focused on creating quarterly executive summaries of the results (these also transformed over time).  Finally, they realized that all employees needed to be aware of the individual role they played in customer loyalty.  Throughout this time, Alex mentioned that Symantec was more focused on operational issues and less focused on loyalty (meaning there were many competing priorities). They tended to operate from an internal point of view and perhaps lower executive involvement than they would have liked.

 

 

Today this has changed; Symantec has launched efforts around the "power of one, the power of the individual."

 

 

One of their biggest learnings from their early program was the importance of making individual business units accountable for the results.  Alex showed how their process has changed in terms of key improvement steps, which include insight, inform, action, and measure model. This happens in all areas of their complex key stakeholder relationships -- B2B, employee, B2C, and partner.

 

 

Symantec also realized that the customer loyalty champion was critical to making NPS success real.  The role has changed, though -- they are putting more structure, framework, and definition around the role, for ultimate success.  They've also reframed the executive summary process -- these now take place at the highest level and issues are really owned by the business.

 

 

Finally, employee awareness education has gone though huge change, by communicating through multiple mechanisms, including webcasts and online training, giving employees the power to make change and take action locally.  These awareness enhancements have enabled employees to participate in generating creative ideas to improve how Symantec operates.

 

 

Alex noted that now Symantec is focused more on business change and less on operational actions.  They rely on root cause analysis to really understand business change.

 

 

Their latest stage of improvement is now focused on named account surveys. This requires a very mature sales organization that has really bought in to the program. Symantec is using this feedback as part of an integrated account review process. Although there were some associated changes that had to be made, she said the benefits were huge.

 

 

Symantec has also implemented the Customer First Award. Employees are nominated quarterly, which helps drive attention around customer loyalty. I believe it is these grass root efforts that really motivate employees to focus on the customer.

 

 

NPS is now included as part of the executive compensation package at Symantec. Alex said that this action really helped solidify the belief that this was "serious." It made executives think that perhaps their staff was out of alignment with their goals, potentially pushing ownership of NPS downwards in the organization.

 

 

I thought one thing that was interesting was the clarity the company Chairman has on communicating what's important. There are 3 metrics -- NPS, market share, and ENPS (Employee Net Promoter Score).  The Chairman and COO recently delivered this message to all 5000 sales and marketing employees.

 

 

Some critical learnings from Alex:

 

 

  1. It is vital that employees understand the impact they have on the customer. To do so, you must connect individual behavior to the impact on the customer.
  2. The program must be owned by and driven from the top.
  3. Make it actionable and make it positive; both of which are critical to NPS
  4. Accountability and Reward; Compensation, if used appropriately, can help steer people in the right direction.
  5. Communicate -- This is perhaps the most critical. Communication cannot just be internal, customers need to understand this as well.

 

 

I thought this was a great presentation that connected the dots between customer and employee behavior.  As well, it was an honest look at a very complex organization that has gone through dramatic changes and has managed to keep the focus. I'm looking forward to seeing Symantec's future progression on this journey.

 

Click here to download the presentation.

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Laura Brooks from Satmetrix discussed the importance of building trusted relationships with customers and employees and how that results in the economics of word of mouth. She started with recent research in high tech, financial services and telecommunication industries that showed trusted relationships had a stronger correlation to recommend scores then product or service performance. This was true of vendors with both one-off point solutions as well as broader solutions. Product innovation is not sufficient, buyers want a trusted partnership.

 

Critical to building trusted partnerships with customers is having trusted partnerships with employees.  She referenced other conference speakers that shared the importance of engaging employees in improving NPS scores. More mature Net Promoter programs go beyond engaging employees to evaluating the Employee Net Promoter Score (EPS). Without loyal employees you cannot create loyal customers and achieve results. Employees want to be valued and know their values are in alignment with the organization. Drivers of employee loyalty include being consulted, collecting their feedback, and rewarding for results.

 

Employee Promoters are more likely to be customer facing. People feel they are valued in these roles and they feel their contribution is important in the context of the company's strategic direction. The Allianz presentation yesterday discussed how they connect the front office to the back office. Laura suggested that getting both the front office and back office people following up with customers helps the back office employees better connect to the customer.

 

Now that we have discussed trusted relationships with both customers and employees, let's connect that to word of mouth. Most of us know that the old advertising model of broadcast communication is broken: 76% of people don't trust advertising. Today's marketing is about word of mouth. According to Forrester Research, 80% trust word of mouth more than any other source.

 

Word of mouth is no longer constrained to the water cooler. Research shows that word of mouth is on the rise. The Net Promoter research data shows referrals increased 8% over the last year across all industries and in some industries as much as 18%. This is largely driven by consumer generated media and online social networking.  It is estimated that the top dozen social networking sites have over 30 million users. In this connected world, people desire dialogue with brands and with each other.

 

Next, Laura introduced the concept of NetWorked Promoters, those that are more connected and tend to have a bigger impact on word of mouth. NetWorked promoters are a special subset of your promoters.  They refer more, are more socially connected and credible and tend to be more charismatic.  When studying online communities she found that 80% of the ideas voted as most popular in the community typically come from this group.  Focusing efforts on the few NetWorked Promoters can extend reach and influence over a large number of people.

 

Let's now look at the economics of word of mouth. Customer value is made up of both referral economics and buyer economics. Net Promoter measures both loyalty and total customer worth that lead to organic growth.

 

Laura shared research from 2007 for the B2C computer hardware industry and mentioned two other studies coming out, one on the credit card industry and the other on the wireless industry. In this model Satmetrix found that the B2C hardware industry has a NPS of 27%. By contrast, Apple has a NPS of 78%. She then shared how that impacts the bottom line.

 

  • Promoters spend more. The research showed Apple customers spend 1.5 times more than the industry average and promoters spend 1.3 times more. Apple Promoters refer positively on average 90% of the time vs. 75% for the industry average.
  • Referrals. The research showed that in the B2C hardware industry, average promoters refer 78% of the time and detractors have negative referrals 29% of the time.  But detractors have 4 times the impact than promoters.

This research has been put into an economic model that would be difficult to describe on this blog.  CLICK HERE to download the white paper, titled Net Promoter Economics: The Impact of Word of Mouth.

 

The key takeaways from Laura's presentation

 

  • Today's buyers want trustworthy relationships with your organization.
  • Strategies for building trust based relationships include Employee Promoter Score (EPS) and NPS
  • Word of mouth economics are driven by buying and referral behaviors
  • Promoters spend more and refer more
  • NetWorked promoters have higher referral rates through connected word of mouth
  • The key to Net Promoter economics is TRUST.

 

Click here to download the presentation.

 

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