One of my partners at Bain & Company asked me to summarize the most important lessons I learned at the San Francisco Net Promoter Conference. That was a tough request because there were so many impressive sessions, so many insightful case studies, and so many examples of barriers encountered and problems solved. Distilling everything down into a succinct summary of a few key lessons required some time to reflect.
Now that I have had time to ponder, I would say that the most important lesson is the remarkable level of progress that can be achieved with NPS. Walt Bettinger, CEO of Charles Schwab, showed us that his firm achieved a 50 point improvement in NPS between 2004 and the end of 2008. In that same period, Schwab’s retail business moved from a position of negligible growth—indeed, it was one of the weakest performers among large brokerage firms—all the way to top of the industry. In 2008, Bettinger added, Schwab’s net new assets exceeded the combined net new assets for all of its major competitors. Now that is impressive progress!
John Heyman, CEO of Radiant Systems, described how his company transformed its culture through its implementation of Net Promoter. Radiant Systems supplies retailers and hospitality firms with automated cash registers and related front-of-shop systems and is the leader in its industry. Heyman described how his team managed to improve NPS from negative 37% in 2005 to plus 38% in 2008, while growth accelerated to more than 25% per year. We heard similar stories from senior execs at Zappos, Logitech, and Intuit, among others.
What did all of these success stories have in common?
- The CEO owned the NPS initiative personally and made sure it became a top priority for the entire leadership team.
- A process for closed-loop learning was established for front line teams. Executives engaged directly in conversations with detractors and promoters to fully understand root causes and likely solutions.
- Bad profits were identified and eliminated.
- Reliable measurement processes were developed to establish accountability for front line teams and for executives.
- Net Promoter implementation was viewed in terms of transformational change management, not simply a process for continuous improvement
- NPS became more than a report card for the customer experience; it became the practical scorecard for how well the firm was living up to its core values.
Yes, the most important lesson I learned in San Francisco is that when leaders follow these rules, they can generate remarkably impressive results.
