Net Promoter Community

Rob Markey, Partner and Head of Global Customer Strategy Practice with Bain & Company, spoke about using NPS to drive organizational learning at three levels:

1. Executive or strategic
2. Management or process
3. Front-line employee

At the Executive or Strategic level, NPS results can be used for strategic segmentation to help pin-point a target market. Mapping customer segments by NPS and profitability, one can see which segments are profitable and loyal and which may warrant additional investment. The example was a top accounting and consultancy firm, which mapped clients on the NPS / Profitability grid and found that clients with complex business models were more loyal than simple businesses. This company used this data to focus resources on a more attractive target market.

At the Management or Process level, NPS results can be used to identify those touch-points along the customer corridor that have most impact on loyalty. Investments in these loyalty drivers can create a competitively differentiated experience. A frequently cited example is the "card-replacement" process for a credit card. This example also showcases the need for multiple functional areas to act in concert, ensuring the process is seamless for the customer.

The third is the Front-line Employee level. Here NPS results can be used to monitor and improve performance by reinforcing the feedback received through the NPS survey and the closed-loop follow-up process. NPS results at the granular level are a key coaching tool.

The overarching theme is that customer feedback can and should be used at multiple levels in an organization to improve performance -- at each level, employees can take action within their span of control.

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Kip Knight, VP of Marketing at eBay, talked about how eBay built an online community and how they are using NPS. eBay started in 1995 and now has 248 million subscribers from 37 countries around the world. It is now "The World's Online Marketplace." About 1.3M people make part or all of their living off eBay. eBay thinks of community as anyone who has a relationship with eBay Inc. Community is core to eBay. It is a strategic differentiator, a unique asset to eBay, builds loyalty and retention, and community members are more valuable.

Kip says they constantly think about keeping their community vibrant. They have a set of community values that have existed from the beginning. eBay stays involved with the community by many different means. Online has forums and a Voices program, as well as member workshops and news and blogs. Offline has Voices (in-person/calls) and town halls, in-person visits, and radio. Voices is probably the most unique program. It is an ongoing advisory group that was begun in 1999. In-person sessions are held with members of the community about 4-6 times a year. The attendees sign NDA's, so all topics are fair game. Over 400 members have been involved since 1999.

One key loyalty tool at eBay was the feedback system. It is very simple and effective. So, why does eBay need NPS? The feedback system wasn't really telling eBay what was driving loyalty and what they needed to focus on to keep growing loyalty.

They expect NPS to be a global best practice. It could also be a *red alert* system for their buyers. They think it will heighten competitive awareness, and help focus investments on the right areas. It will also help with root cause analysis on promoters and detractors. In summary, NPS helps eBay go places the other tools don't.

eBay will implement top down and bottom up feedback. Top down is to all customers, bottom up is focused on key segments that eBay wants to focus on and when they interact with eBay. They tried the "recommend" question, but it didn't work across sellers and buyers. They finally decided on "Intent to buy" for buyers and "Intent to sell" for sellers.

One challenge they have is how to make employees able to participate and drive loyalty. Globally, they are going to look at trends, and not compare regions. It also will drive a Red Alert program focused on the top buyers. If they rate 6 or lower, then actions will be kicked off.

Kip waited a year before he rolled out, and he doesn't regret waiting at all. He used that time to make sure that the program and company were ready.

I think the key message from Kip's presentation is that, even for a customer-centric company like eBay, you can always improve and this is really a continuous journey. The fact that eBay is just embarking on an NPS journey shows how we all continue to evolve all the time. It is also interesting that they found a question that works for their business, but will leverage some of the best practices around the Net Promoter discipline. I wish eBay the best of luck on its journey!

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Jeanne Bliss, Net Promoter blogger and author of Chief Customer Officer, and John Abraham, General Manager of Net Promoter Programs for Satmetrix, chaired a discussion session driven by questions from the audience largely focused on program implementation issues. For those who missed the session you missed the opportunity for free books!   

An early question kicked off the discussion (and the first book give away) related to top management commitment. The case was presented of a committed top management but a somewhat confused middle management. Jeanne made the case that if top management is really committed they will change incentives for middle management. Middle management will be caught in the middle if the NPS program is a top management and front line philosophy without a complete look how it changes cost and operations.

One participant questioned why there was not a greater focus on employees. How do employees fit into an equation dominated by NPS measurement and operational improvement? While Jeanne gave examples of companies that built branding around "being a good place to work," a process for how you build employee engagement into an NPS program was not addressed. However, earlier in the discussion Jeanne had talked about getting front line employees connected to the CEO and top execs and had discussed the importance of closing the loop with the front line to build confidence that change was happening as a result of their input. In my earlier coverage of TD Canada, we did discuss how recommendation of TD as a good place to work correlated with the branch banks' ability to deliver a great customer experience. 

Jeanne discussed the importance of creating a cultural environment where "it's good to work together" in order to lay the foundation for an effective environment that focuses on customer value. Come to agreement on the stages of customer experience. Discuss how does the customer feel at each stage. Prioritize moments of truth for the customer in order to create organizational focus.

The session demonstrated a growing appetite for interactive discussion on the down to earth issues around building NPS programs.

Deb Eastman, Chief Marketing Officer of Satmetrix, covered how managers can design a Net Promoter Score (NPS) program for action Friday afternoon. The well attended session included B to B and B to C Net Promoter practitioners from a wide variety of industries, including Financial Services, Business Advisory Services, and Telecommunications. In her ebullient style, Deb captured the attention of this audience, focusing on the topic of driving action at all levels within an organization.

She identified three levels of action taken within an organization to improve the customer experience, and that all three must be present to take full advantage of the NPS program. These are:

1. Executive Team: Executives are required to identify and support changes to strategy that will have an important impact on the customer experience. Executive leadership makes such changes possible.
2. Management: Managers must be involved in the process of optimizing the performance of their people and processes to enhance the customer experience. Managers also are involved in the role of monitoring and coach groups to improve overall performance of individuals.
3. Customer Facing Roles: Customer facing employees, whether sales, service, or support teams, must be given direct customer feedback about their individual performance.

Executive Team

The Executive Leadership will review customer feedback about the overall customer and identify the key areas for improvement or differentiation. Specific initiatives can be identified which will make important improvements to all customers, or to large customer segments. These initiatives are typically identified and discussed in annual, or bi-annual customer experience meetings where analysis and recommendations are presented from an accumulation of NPS and other Customer Touchpoint data.

For example, BT InfoNet identified that their implementation process showed room for improvement. By improving the initial customer installation process, overall growth of the company exceeded double-digits, which outpaced their industry.

Management

Managers are responsible for monitoring the NPS results of their teams, identifing best practices among top achievers, and coaching low performers. Many organizations utilize a system of real time dashboards, that can be configured for each manager's role and scope. These dashboards typically integrate customer feedback information with other operational Key Performance Indicators (KPIs).

Deb gave the example of how Experian was able to double their NPS and achieve double digit revenue growth by providing Department and Sales Leaders with dashboards of results and the ability to make and track action plans.

Customer Facing Roles

Deb discussed how providing Customer facing teams with real time customer feedback enables these employees to change their behaviors and deliver an improved customer experience. Closed loop follow up processes also provide the front line with the ability to solve the issues of detractors. These are the fastest improvements any company can make to their NPS, as your teams are interacting with customers every day.

Companies such as Sodexho have been able to improve client retention rates by 46% through closed loop action plans that involve the front line. Client retention is hugely important to many firms with high customer acquisition costs or long contract cycle times.

Questions about this blog can be sent to Paul Pakalnietis by emailing to: paulp@satmetrix.com.

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Vivian Hairston Blade, Master Black Belt -- Marketing at GE Consumer & Industrial, gave a lively presentation on the GE experience with Net Promoter and leveraging Six Sigma and LEAN to improve the customer experience. In summary, GE leverages customer insights to identify unnecessary and non-value add processes and touchpoint experiences, and applies LEAN to attack the "waste" -- which results in improvements to internal processes and customer loyalty.

Vivian kicked things off by providing an overview of GE's commitment to NPS as an enterprise initiative. NPS is central to their objective of promoting organic growth, and it is the discipline used in both B2B and B2C business units. As a short video demonstrated, NPS "makes GE listen to customer cues" to identify where change is needed, and business units strive to build promoters and hear positive testimonials from their customer base. At GE, the focus is not on managing to a score, but rather to continuously improve the experience.

Vivian introduced GE's simple and straightforward "listen, act and measure" framework for customer experience management.

"Listen" entails

• Capturing both "experience" and "expectation" attributes around the brand and core product performance
• Identifying key differentiating aspects of the experience and make changes that really WOW the customer
• Follow up: close the loop with customers by acknowledging their feedback and listening for clues to root causes
• Segment customers -- understand how they differ in their business models and interactions, and ensure these segments are included in your NPS analysis

"Act" includes:

• Taking both tactical and strategic action: tactical includes critical feedback that you need to close loop with customer quickly; while strategic involves identifying "what's broken" and prioritizing change
• Apply LEAN Six sigma to enable continuous improvement.  Through LEAN, you identify unnecessary and non-value add activities, and remove the waste! Focusing only on what truly impacts the customer

A short video provided an example of LEAN in action: for GE Money, the process for enrolling new dealers previously took 63 days! An analysis of the process showed numerous inefficiencies, such as paper based processes and manual hand offs, and only 2 ¾ hours of actual value add work involved! The enrollment process was a drag on revenue and a source of frustration for dealers.  GE leveraged its Voice of Customer data to make dramatic improvements. GE automates the process, including online forms and even redesigning the office layout of the applications department. They also improved the usability of their dealer set up kit, which helped get new dealers up and running faster.

Not only is the experience better, but speeding up enrollments increased transactions (sales) by over 20%.

"Measure" includes capturing the customer-facing metrics that matter to help GE "realize the growth." Customer metrics include NPS, quality, transaction time, etc. By identifying the key moments of truth in the customer lifecycle, cost to serve goes down, referrals go up, as well as improved sales, referrals and repeat purchases. This was illustrated in a closing video showing GE Commercial and Industrial leveraging LEAN to map out current processes in order to identify and attack the waste.

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Audience expectations seemed quite high as it was standing room only. Taking a practical approach as a result of his practitioner experience, Dr. Vince Nowinski, Principal Methodologist of Satmetrix, began by addressing the who, what, and when of data collection. He explained how the underlying validity and content of the data collected is what will ultimately impact the "actionability" of the information in your organization. (Yes, that is a made up word, btw.)

In addressing the "who should be surveyed," Vince pointed out that it varies greatly in B2B environments from B2C environments. A key element of measuring what matters is "Voice according to value." Vince went on to contrast B2B and B2C approaches. B2C segmentation is used to inform the organization as to the nature of the core customers, those using the strategic elements of what is delivered to customers. In most organizations these are the customers who drive the bottom line. The goal is to optimize loyalty, not to just drive it up.

In B2C settings, it's important to segment by value too. The wrinkle in B2B is that there are multiple decision making influences who can be fundamentally characterized as end users, influences and decision makers. It's important to realize that all voices are not equal and to recognize the relative importance of these various roles in the decision making syndicate.

Now on to the issue of sample versus census. Often times, the driver of the sampling strategy is statistical significance. In fact it's as important that the right targeting and recruiting of respondents is key to making the results believable and usable in the organization. In a B2B setting, census is the preferred approach, whereas collecting a statistically significant sample is the right approach. But what does this mean in practice? In order to deliver meaningful comparisons between customer groups and other segmentation variables, these must be decided first to drive the correct sampling so the resultant analysis can withstand the questions and criticisms that will come about in most organizations.

Another consideration is to put in the right recruitment and communications approach to prevent potential gaming by the generation of a skewed sample. What data to you collect? There is a controversy regarding the number of questions to ask? In order to answer the questions there a couple of key considerations. One is the impact of length of survey on response rates and the second is how to quantify the drivers of Net Promoter scores.

A two question survey will reduce survey fatigue and tend to be more exploratory in nature. Response rates will be higher. Multiple question surveys will deliver more underlying driver data, but response rates will drop. With a two question survey, the analysis of comments is time intensive and category based to perform root cause analysis. Multiple question surveys are less resource intensive to analyze and yields readily to statistical analysis. However, the development of the additional questions needs to sound in order to generate valid results.

How does one select the appropriate method for your firm? It turns out that while survey length does impact response rate. But after digging into the data, the data revealed there was a large difference in response rates with a two question survey from one to thirty eight percent. What are the steps that impact response rate? Engagement is the underlying driver of response rates, much more than survey length. The comparison was a ten to twelve question survey to a two question survey.

The underlying factors that developed included:

• Auditing the contact list
• Communications to clients around the program
• A relatively short survey that is focused and personalized
• Use standard text to avoid spam filters

To continue that comparison, the question of determining drivers and the categorization of comments versus the collection of driver questions yield different results. There were common themes but the ranking of the longer survey yielded more statistically valid results. Comments are frequently what's top of mind, but it may not reflect actual importance. Promoters tend to make less comments then detractors, skewing the result towards the negative and as a result, driving less information about what delights customers.

Ultimately, your firm's change strategy should inform your approach. Two questions are useful for customer recovery. A multiple question survey will reveal the customer recovery issues and support valid strategic analysis.

Vince is a great presenter. He was peppered with questions for 45 minutes afterwards in a very lively session.

Phil Clement, CMO of Aon Corporation, had an interesting story based on his company's NPS program. It shows how you can scale a program around gathering NPS and drive it down into the operational level. Aon has 43,000 employees out of 425 acquisitions! Companies that grow through acquisition have some challenges: they buy versus recruit talent and buy vs home grow products.

Aon has grown to be number 1 in size, but more importantly, customers rate Aon number 1. Phil showed a comparative chart that showed Aon's growth and NPS. Aon's growth and stock price are above its peers. "It helps our clients or helps our people help our clients" is the Aon mantra.

All Aon people and processes need to focus on customers. Aon uses NPS to help them to do the right thing - to help cut through the anecdotes and understand the issues so they can be fixed. The goal is to drive organic growth - from trust and credibility with clients.

Aon uses a 5-step process:

1. Local market planning
2. Client focused marketing
3. Revenue management
4. Increase client facing presence
5. Product development and innovation

Aon picked NPS because they felt it was proven. They do it via an online survey. Aon also uses client advisory groups, third party partnerships, win/loss analysis, client surveys as well. They want to get participation in the NPS survey to 95%. Getting scores to field stirred some angst about what to do next... where to get time and what to do. The team helped by providing 3 strategies for detractors, passives, and promoters. They do not filter on high or low margin clients.

Doing this globally presents some challenges; e.g., Germany. Its labor and privacy laws create some hurdles, but if you focus on what the purpose is, you can overcome them. Accountability rests with Country Manager and rolls up to a region. On embedding this into the Aon culture, Aon is driving up its participation in the survey from 17%. They just did a pilot that got participation up to 75%. It requires the Regional Managing Director to own it. They reward high participation.

It was a great story. The punch line is that in 2 years Aon has gone from not having a system to having one that is embedded in their culture globally. This is no mean feat given the scale of their offices and employee base, as well as complex operations resulting from acquisitions. Well done Aon!

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