How the Front Line Affects the Bottom Line

James Kasberg, Senior Manager, Progressive Companies

1 Billion Dollars in 30 days was not a new offering from Bernie Madhoff Investments, but rather it was the title of the presentation by Jim Kasberg of Progressive Insurance. In our second breakout session of our track on ‘Developing Customer Focus in Service Operations’, Jim Kasberg showed the audience what made the Progressive Companies true believers in customer delight.

We heard throughout the conference about the importance of the economics surrounding NPS. Jim explained the title of his presentation very simply. Customer retention is a primary goal at Progressive and keeping customers for just 30 additional days translates into 1 Billion dollars of additional value. That would certainly get my attention and apparently it has done the same for the CEO  of the Progressive Companies. As we have seen over and over, getting C-suite buy-in is one of the key success factors. The correlation between higher NPS scores and the 30-60-90 day retention rates were impressive. If 30 days was good, 90 days was even better and the higher the NPS score, the more likely the customer would be retained after 90 days.

Progressive asks the “Ultimate Question” to get a numerical score but then also asks an open ended question and uses the verbatim comments from the customers to create new or improved products as well as improving day to day operations. This helped with the employee buy-in as people feel more connected to their customers. Clearly they have driven a passion for their customers throughout the organization.

It was also clear from Jim’s presentation that Progressive has used extensive technology and sophisticated analytic systems to not only evaluate tons of data but to also be able to push the data in meaningful ways to each and every employee. This is an important connection point. People can see their scores and see the direct comments associated with the data. The data displays make it easy for everyone to slice and dice the information, ensure proper follow up etc. I had to cringe a little as I hoped that those in the room did not interpret the need for extensive technology as the only way to create good results from using NPS methodologies. I work with clients who do not have these resources and success is about the process and not the technology.

The key take-aways from this presentation for me were:

• The economics behind improving customer experience are huge.  NPS is an enabler.
• Happy customers are retained and represent a valued asset to Progessive
• People at all levels in the company are best when they can connect with the customer; NPS facilitates this connection very well.
• Customer oriented cultures are a wonderful thing!
  

Again, I think that we saw the concrete results of a positive customer focus and how NPS methodology can simply and dramatically improve your business results.