Fred Reichheld, author of The Ultimate Question, kicked off our afternoon with a discussion of the economical ways that companies can delight customers. How do you get from a 20% Net Promoter Score to 80% without “breaking the bank”?

Fred explained that the best companies may not measure NPS any better than others. But what they do extremely well is to find systematic ways to delight the customer without spending a lot of money. He used examples from U.S. fast-food chain Chick Fil-A to illustrate the point. They do many things that are different from other fast food restaurants, including:

• having the manager work in the front of the store
• keeping umbrellas on hand for customers on a rainy day
• refreshing drinks for free
• stationing an employee outside at the drive-thru to greet people

Fred continued the discussion with a video from Internet retailer Zappos.com, which was developed to support Chick Fil-A with its own employee training. It includes some great examples of Zappos.com employees at work, having fun. And the culture was illustrated by quotes from their CEO, Tony Hsieh, such as these:

“My passion never has been about shoes. It’s about service and culture.”

And, showing his “desk,” which was an open cube, Tony commented “The best way to have an open door policy is just to not have a door in the first place.”

Tony’s comments also echoed the value of creating more Promoters in a business. Mr Hsieh’s thinking:“Let’s take all the money we would have spent on marketing, and instead, invest it in the customer experience so that customers will do the marketing for us.”

As Fred explained, Zappos.com was successful with this strategy. Last year, Amazon.com bought the business for $1.2 billion. Selling shoes online could be thought of as a commodity business. But by figuring out ways to “wow” customers, Zappos.com was able to successfully differentiate itself and grow.

Fred stressed the central role of the employee experience in making this work, with examples from U.S. airline company Jet Blue. He also shared some examples of frugal wow at American Express, which focuses these innovations at 3 specific points in their customer interaction: early engagement with the company, getting a replacement card, and making a merchant dispute.

Fred’s last example was from IT hosting company, Rackspace. He explained how Rackspace focuses its entire organisational structure around service. Not just training, but also the way they structure their service teams…in a matrix with all of the required resources to serve the customer’s needs working in a close-knit unit. We had several members of the Rackspace team in the audience, and Fred took comments from them and from other audience members who shared their own stories of frugal wow.

What’s your story?

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Deborah Eastman, Chief Marketing Officer at Satmetrix, led a discussion about different methods for motivating employees to drive customer-centric culture. The dilemma…should it be about pride or money? Deborah illustrated the importance of non-financial motivation in conversation with 3 guest speakers.

Life Financial Group: the “Wow Branch” Mentality

Deb started by interviewing Irina Chichmeli of Life Financial, a network of Russian retail banks. They survey about 3000 customers per month, and the feedback goes directly to the branch manager who is empowered to take action at the branch and escalate requests to the central processing groups for systematic process changes. Life Financial never tried to tie NPS to bonuses for the branch managers. Instead, their focus was to educate the branch managers on how NPS linked to long-term financial results, and short-term measures at the branch such as new customer acquisition. Making this connection was all it took to get branch level buy-in.

Irina also explained the importance of employee recognition programmes. They award branches for overall performance, including NPS, and they give out “Wow Branch” awards. Each branch who gets this award is given money that they can use for anything from teambuilding to improvements at their branch to support customer experience. It’s critical to give the branch autonomy in deciding how to spend the money, which reinforces the empowerment they want to convey for branches to find ways of succeeding with their customers.

They also have a programme called the “Wow Differentiating” programme. This programme’s goal is to engage employees in finding ways to delight customers. This is different from solving customer problems. It is focused instead on anticipating customer needs and doing things to delight them. Irina gave several examples, including one branch that purchased complimentary passport covers to give out to customers when they had to submit passports for copying. This little extra was so popular with customers that they introduced the practice in other branches across the company.

Experian: Customer Context “is” the KPI

Doreen Byrnes and Jock Busuttil of Experian described how they involve all parts of their organisation in the customer promise by using a common language and a common set of goals. Accomplishing this started with a broad internal communication programme, and it shows up in all aspects of the day-to-day decision making.

Jock described how his product management team uses customer feedback to put KPIs into context. The KPIs themselves are just an outcome. It’s the feedback from the customer that clarifies what is needed to really move the KPIs in the right direction.

Jock told a story of a product upgrade that put pressure on a particular customer relationship. Most customers had moved over to the new version and the company was planning to discontinue support. While the customer was contractually obliged to move, their account manager, Ben, knew that the customer was a Promoter and didn’t want to spoil the trusted relationship that had been built up over the years.

Jock and Ben visited the customer to come up with a plan for making the transition, and they made the decision to extend support for the customer in the interest of their long-term loyalty. This is one small example of how they have been able to maintain retention rates of more than 90%.

Verizon Business: “One Team” of more than 200,000!

Paul Vincent of Verizon Business described how they drive a sense of pride across more than 200,000 employees who serve their corporate and government clients worldwide. How does such a large organisation go about creating a “wow” factor?

For Verizon, it all starts with 5 service excellence imperatives:

1. Deliver service consistently worldwide

2. Proactive, responsive, reliable support

3. Best-in-class service management

4. World-class customer enablement

5. Customer-centric continuous improvement

What really struck me was the consistent approach to employee engagement that Paul described. They have a very deliberate strategy to have the same roles and organisational structure worldwide. Paul called this their “one team” approach, which allows them to deliver consistent service to customers who, like Verizon Business, operate globally. He then elaborated on a series of employee award programmes that form the foundation for motivating their “one team” of “teams” to deliver customer delight.

The results are impactful. They have seen a 23 point improvement in their Net Promoter Score and 27% increase in sales of strategic services.

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Robyn Weeda Director Program Management Office gave a very exciting and insightful presentation around how the call centre is centred around the customers.

The consumer business for unit has doubled their NPS score since 2007. A couple of years ago it was not unusual for a customer to have to wait two hours on the phone to get this issue fixed with their virus software now most customers feel they get a positive experience

Then:
1 Installation took 4 minutes and 23 seconds to install
10 boot time took 12 minutes and 14 seconds
100 foot print was 406Mb

Now:
1 installation no time at all
10 boot time less than 10 seconds
100 foot print less than 100Mb

The Symantec product range has received more than 100 product awards in 2010 compared to less than 10 in 2006.

What Symantec customers really want - which was shown in a video- is

• Access to the right person immediately who can fix their problem
• Customers want to talk to a human being
• Easy way of getting to someone who can make a decision
• Customers don’t want to talk to someone who just reads from a script
• The agent should be like a good doctor when you describe the problem the doctor knows immediately what the issue is. Can identify the problem, acknowledge and fix.

Symantec have more than 2100 people supporting their customers in 24 languages in more than 30 locations worldwide. They receive over 12 million contacts per month into the call centres.

• Symantec’s  main focus was to concentrate on first contact resolution FCR.
• Proactive resolution process for the agents.
• They implemented a reverse DSAT audit
• Agent certification and training
• Being available when the customers are
• Self service tools

FCR average in the software industry is 40% Symantec has managed and astonishingly high figre of 76%.

DSAT reverse audit process was 58% and is now 90%

Symantec have created internal videos with real customers

Invested in 50.000 hours of agent training.

Social media is playing a more and more important role for Symantec who are now using YouTube, twitter, facebook, and blogger sites.

Staff are now proud to work for Symantec and happy to delight customers.

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WHAT YOU ASK DETERMINES WHAT YOU HEAR – Putting Yourself in Your Customer’s Shoes, Steve Hewson, Managing Director of Operations, COLT

Colt knows a thing or two about managing IT infrastructure & mission critical systems in a way that creates trust with over 35,000 customers. Colt now plans to leverage its stability and move forward from flat to double-digit growth. So in an industry sector where in recent years customer expectations have grown at a faster rate than the industries ability to deliver, customer trust is a critical. Colt can only be successful if the client CEO’s & CIO’s trust us says Steve

Put the customer at the centre of what you do. Steve posed some great questions.

Have you ever met a company that says it does not listen to its customers and does not act upon customer feedback? And Have you ever met someone who states they are customer centric, yet their business challenges clearly sit with someone who is not?

Some companies say “we do a survey” to demonstrate they are customer centric. If it is not embedded into the orgnisation and it’s just an overlay then 90% of the organization will see it as ‘someone else’s” responsibility. Not theirs! With no consequences, it will be diluted.

So what are the attributes of success?

Steve suggests employees fall into the trap of seeing things largely from their own perspective and not their customers. Why? Their filters are set to internal.  Steve advocates a simple remedy. Stand in customers’ shoes. Experience what customers experience and feel the pain as your customers see things. It may feel like trying to run a business marathon in size 12 hobnail boots, but you can turn them into golden slippers.

How does Colt use customer feedback?

• Customer feedback is the primary measure to monitor performance
• It is hardwired into day to day business
• Customer KPI’s are combined with standard operational KPI’s to provide a combined index
• Negative triggers are acted upon
• It affects all employees’ compensation

Finally a few key tips that every NPS programme can benefit from:

• Be brave, do not create a programme that is just an overlay
• Its not someone else responsibility (the insight or market research team
• Don’t ask customers for feedback unless you are going to follow up (at least with detractors or weak scores)
• It must align with core values, the intrinsic DNA of the company
• Measure and link down to account level (loyalty & revenue at an account level)

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Net Promoter conferences are so often focused on highlighting success, that it was a brave and refreshing change that Arti Ots started off his presentation with the shocking reality that, despite adding NPS to compensation from the outset, Net Promoter scores dropped across the first year of measuring from +1% to -7%.

Arti Ots is the Marketing Director at Elion, the top telecoms company in Estonia. To add a little flavour around the company:

• Elion are the #1 provider of broadband, telephony and IT services
• They are the world #2 in provision of IPTV
• With a revenue of €200 million, and 1,300 employees, they belong to the TeliaSonera group of companies

The main driver for implementing their program in 2007 was the increasing cable competition and Elion wanted to focus on providing low price broadband and high quality TV.

With implementation came immediate linkage to compensation - including an annual bonus work half-a-months salary for a 5 point jump in NPS across the first year. As mentioned, this didn't happen and no-one got a bonus.

Elion quickly realised that there was too much focus on process and not enough on people. Arti and his colleague, who held the COO position, focused on an overall review of both the transactional and relationship elements of their program.

This led to a focus on:

• Awareness
  • Seeing the value chain through the customers' eyes
  • Understanding the key issues
  • Understanding key team level success factors
• Responsibility
  • Compensation was linked to weekly, monthly and annual targets
  • Quality forms introduced
  • Cross functional work groups to take hold of improvement planning

The results have been exceptional - by moving the focus to a more transactional based approach, Elion have uncovered the key pain points for customers as being Problem Solving and Sales. Despite the rough start, Elion have really learned from the insight and are making great strides in fixing these customer issues. Scores around problem-solving have risen from -12% to +17% and in sales have reached a staggering 30%.

Well done Elion! And thank you, Arti, for sharing the story - all of it!

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Travelport is a global B2B business services company. They provide transaction processing solutions to connect buyers and sellers of travel.

Travelport was facing a critical juncture in its history. Recession has hit the travel industry disproportionately, as both businesses and individuals cut back significantly on travel. The lack of business has a very negative effect on employee motivation. Not only are people fearful of their jobs, but it's just sad when business is slow. On top of that, Travelport was bought by a Private Equity company and the ownership change was a shock. Finally, Travelport bought a major US competitor. The deal was perfect from a financial and synergy point of view, but employees were struggling from a cultural view.  One side was a consensus-driven, slower decision-making culture, while the other side was an autocratic, fast decision-making culture. Both sides agreed that they wanted a different culture, but nobody knew how to get there.

Normally, HR  worries about employee engagement, but the process is slow, and often doesn't get to the root of the issue. In the case of Travelport, it was Elizabeth Harroway, Vice President of Corporate Affairs and Global Employee Communication, who decided to jump in and act. She felt that if Travelport didn't do something to engage its employees quickly, it would hurt the business. Management agreed, but as usual, they created pressure for her to come up with a solution that was cost-efficient, fast, and got results quick.

Elizabeth, together with Crispin Manners, CEO of ONVA consultants invented an ingenious application of NPS to measure the NPS of Travelport's own employees. After all, when an employee goes to work every day they are buying the promise the company made them when they were hired. Besides, Elizabeth and Crispin wanted to purposefully disrupt the way things were usually done in the company to get people's attention and jolt them out of business-as-usual.  The plan senior management agreed to was simple:

1. Listen to employees and prioritize what they tell us
2. Engage them, don’t do everything top-down, find out what they know and think we can act on
3. Create an action plan to do those things

In 2008 Elizabeth and Crispin ran a trial in one country. The questionnaire had only 6 questions and they got a 53% response rate (much higher than the typical employee engagement survey). Elizabeth and Crispin declined to share the actual score with us but gave us a hint: "It was crap."  Management was alarmed.  But at the same time, the verbatim feedback showed how badly the employees wanted to make changes and improvements in their business...they just hadn't been able to.

The two biggest surprises for management was not that employees wanted more pay or promotions.  The number one thing they wanted was for management to listen to their ideas for doing business better and act on their feedback. The second surprise was that employees didn't want to be shielded from bad news - they wanted the straight story about the business environment and Travelport's real situation.

Results

Since then Travelport has rolled out NPS internally, and now does it on a rolling basis across the functions and they have a 90% response rate. Not surprisingly, their internal NPS has improved dramatically. Employees have a greater understanding of and buy-in to the strategy. Over 60% attended the CEO's Strategy Roadshow. By involving people in the process of change, Travelport created positive internal WOM. People who were involved in process improvements and had a say in it talked to everyone else about it.

Learning points

Elizabeth and Crispin shared their learning with us:

• Counsel senior management to look beyond the score to the verbatim feedback. Management sometimes jump to fast conclusions on "scores". Good scores means nothings wrong. Bad scores means our people are no good and we should replace them...it's difficult to accept bad scores are a measure of the employees' experience of the company...as created by the managers. When they see the verbatims, they begin to understand what life is like for their employees.
• Always be sure to close the loop….just by listening to employees, Travelport's score improved by 31% in only 6 months even though market was getting worse and people were suffering pay freezes and cost-cutting.
• Turn employees into advisors. When the Managing Director communicated the a dire economic situation out to employees, he signed off with "We’re in a bad situation, if you have any ideas just email me." People loved it, they sent in their ideas, many of which were good and some of which were implemented to postive effect. Travelport also held an "idea storm" online, where everyone could share ideas openly, and rate other people’s ideas.
• Our employees are smarter than we thought. Employee Advisor Groups leverage wisdom of the masses and come up with better ideas than Focus Groups, which represent the opinions of the few.
• Employees don’t care about the score, they care about the issue. So don't talk to employees (or customers) about the score, tell them how you're fixing the problems they raised.
• It's not a bad thing when your own employees are loyal promoters of your business and expert consultants on how to do better!
• Internal feedback often addressed customer-facing issues. So now Travelport has started doing NPS with customers. They are studying correlations between what employees and customers say

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Maersk Line, Gert H.N. Laursen, Head of Customer Intelligence, Centre Marketing

By combining Business Intelligence and Net Promoter, Maersk Line has been using NPS for the past 4 years as:

1. an overall KPI for more than 16, 000 employees,
2. a dialogue tool between sales people and customers,
3. a way to share creative solutions across a decentralized organization

But perhaps most significantly, determining that every uptick in NPS translates to 7% more cargo being shipped, Maersk uses NPS as:

1. a way to improve internal systems and processes centrally, and
2. Identify and drive strategic initiatives across 52 global business units.

The most significant change made over the period has been a move to weighted feedback in proportion to the size and quality of containers, therefore allocating a percentage contribution towards NPS by each. The other change has been an increase in survey frequency moving from 3 surveys per year to monthly (with quarterly result publication).

A key lesson learned during the implementation has been the timing of communication around launch. This should be spread across the rollout and all the way up through to the initial measurement, rather than just at launch.

This approach has had a very positive impact on the organization in the following ways:

1. Moved from “Data” management to “Knowledge” management,
2. Integration of Voice of the Customer to help design the business,
3. Development of a learning library and resources to be shared globally,
4. Calculated relationship between a point improvement in NPS leading to a 7 point increase in container volume.

Overall this has enabled the organization to make far better strategic decisions based on the impact on NPS/ Customer Satisfaction and how this translates to the bottom line.

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Shaun Smith, founder of Smith + Co and author of three books on customer experience, joined Simon Groves, head of customer experience and strategy for O2 UK, to discuss the critical link between your brand promise and your customer’s experience.

Shaun opened the presentation by describing the importance of creating an emotional bond with the customer through the ensemble of your company’s interactions with them. According to Shaun, companies that are successful in creating both a functional AND emotional connection with the customer improve retention considerably.

Shaun returned to a brand we heard about this morning, First Direct. Shaun stressed that it is absolutely critical to be clear about what you promise. Here’s what the First Direct website says:

“Most banks are about money, First Direct is about people. We believe banking should fit around you, not us.”

According to Shaun, First Direct gets a new customer every 5 minutes through referral. In fact, 38% of their business comes to them through word of mouth. This isn’t just about their brand, it’s also about their people. Having employees that are passionate about working at the company is critical. He told a personal story of how a First Direct call centre employee helped him by faxing some extra documents as proof of identity when he needed a retail loan…no hassles, no waiting. When experiences like this reinforce the brand promise, you have a winning recipe.

Shaun described this as an overall shift in the marketing world from “branding and advertising” to “experience marketing.”

One First Direct competitor, Barclays, ran an ad campaign that won awards in advertising circles, but it fell mostly on deaf ears by Shaun’s assessment. “A big world needs a big bank” was the tagline. But as Shaun put it, “this just made customers feel small.”

First Direct, by contrast, asked its customers what they like about First Direct. Customers told them that they love the fact that they can get through any time of the day or night to an enthusiastic customer service agent. Many of these customers who gave feedback agreed to participate in an advertisement. By building their advertisement on these “real experiences,” First Direct not only saved a lot of money on its ad campaign, but also had a guaranteed receptivity to its message, as well as a natural link to the reinforcement they would get through organic word of mouth.                                         

The O2 Story

Simon Groves from O2 followed with a short history of the O2 brand and customer experience journey.

When O2 first de-merged from BT as BT Cellnet back in 2001 and 2002, they were on a tough road both in terms of financial performance and customer loyalty. But within 4 years they had turned things around and were purchased by Telefónica for nearly £18 billion. How did they accomplish this?

O2 has tracked a customer satisfaction index going all the way back to 2001. That also use something similar to NPS to track advocacy, but the early years of their journey were really more about getting satisfaction right to build the foundation for more advocacy over time.

During the first phase of their programme from 2002 to 2005, satisfaction was lagging competitors. Their shift to a customer-focused strategy all started with intuition and a belief that doing the right thing for the customer would pay back handsomely. Some key executives championed this, and they went through to drive operational improvements and measure step by step. This was effective at that particular point in their history.

Metrics were starting to move in the right direction, but the market wasn’t standing still. It was becoming tougher to compete. Customers were saying, “there’s no good reason for me to stay with the network I am with,” “nobody is looking after us,” “they’re all as bad as each other.” How could they differentiate from this?

They developed a customer plan in 2004 in reaction to this feedback. They were determined to invest in the areas that customers valued. They couldn’t just spend more…they had to strip out things that were low value to put money into the right areas.

They developed a new brand promise that was about putting the customer at the heart of everything they do. Then, they drilled this down to specific plans that would underpin the promise. All the KPIs and measures linked to this, and they tracked it every quarter to reinforce it throughout the company. The plan had 5 points:

1. Become the customer champion by rewarding loyalty.
2. Invest in front-line service and sales experience.
3. Have the best range of devices for target customers.
4. Engage our people by making O2 a better place to work.
5. Drive efficiencies to deliver a better experience at lower cost.

From 2005 to 2006 this strategy moved them into a leading position on their satisfaction measures relative to their biggest competitors. And they reinforced these messages in their advertising, helping to move brand perception in the right direction, too.

Since this inflection point in 2006, they have worked hard to successfully retain a leading position and have been acquiring new customers faster than their competitors.

Where is O2 headed now? O2 is now focused on creating more “fans.” They are moving toward building a more emotional connection with their customers. The rallying cry is to “create a million more fans.”

Ultimately , Simon summed it up this way: our goal is to get more customers that are happier and more loyal. That’s the heart of it according to O2.

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