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Jeanne Bliss' Blog

3 Posts tagged with the usaa tag

Increasing your customer loyalty, and NPS, by investing in your front line employees

 

The latest US Net Promoter Benchmarks for 2012 are in! USAA, Trader Joes, and Wegmans, all topped the list with some of the highest scores in their sectors. So what makes these companies so effective at creating a loyal, happy customer base? A common thread between these top-scoring companies is not just how they treat their customers, but also how they treat their front line employees. Here are three ways these companies work with their front line to ultimately increase their customer loyalty, and achieve some great NPS as well.

 

1. Employees who know your customers’ lives can better serve their needs.

 

USAA was again one of the top brands in this years NetPromoter Benchmark study, with an NPS of 83 percent, the highest NPS recorded across all brands and industry sectors. One of the factors behind their success is USAA’s commitment to understanding the unique lives of their military customers.  USAA invests heavily in their new hires’ orientation, so they can truly “describe a day in the life of their customer”, even if they are not from the military or military background. USAA does this by requiring all new hires to go through basic training, right down to eating MRE’s, wearing a military helmet and feeling the weight of the soldiers packs during their extensive orientation program. 

 

2. Invest enough time in training your front line to trust them, and free them, to do the right thing. 

 

Wegmans decided to eliminate the behind the scenes rules that interfered with the customer experience when the frontline staff had a restrictive list of “do’s” and “don’ts” when serving their customers.  Wegmans instead decided to invest heavily in training their frontline, over 40 hours per year for employees, with the skills to take action on their own, free from management oversight. There is simply one rule: that no customer is allowed to leave unhappy. The result? Low employee turnover, and a NPS toping the list of the grocery sector.  

 

3. Involve your front line in your products.

 

Trader Joes develops an enthusiastic, and committed, sales force for their products by directly involving their front line in product tastings and development. Frontline employees enthusiastically run “tasting huts”, talking candidly with customers sampling new products. When the front line feels passionate and about what they are selling, they pass this passion and commitment along to the customers they serve.

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Companies who have grown in this economic downturn did so because their customers become an army of advocates who grew their business for them.  They made decisions in business that were congruent with the decisions they would make in their personal life – in other words, golden rule decisions.  They “earned the right” to their customers’ rave and the growth that ensued because they deliberately made decisions that moved their operation in the direction of their customers and employees.

 

Here are ten resolutions companies should follow in the New Year to move toward earning financial business prosperity and “beloved“ status in the eyes of their customers:

 

1. Believe in the integrity of your customers.

The majority of business policies and rules are created to protect business from the minority of customers. Be bold, like Connecticut Griffin Hospital who began sharing hospital records with patients and saw claims against the hospital drop by more than 43%!  Take a leap of faith and believe that trust is reciprocated by customers when they feel that you trust them. Find one rule or policy to relax and watch what happens.

 

2. Invest in employee trust.

Show your employees that you believe in them. Beloved companies Wegmans and The Container Store invest in their employees by training them in the skills that remove rules, regulations, policies and procedures that pen employees in. This enables Wegmans to throw away the rule book and live by this: “no customer goes away unhappy.” As a result their margins are higher and profitability more steady because they turnover only 7% of employees versus the average in their industry of 19% employee turnover.

 

3. Practice democratic decision making.

Make sure the best ideas of your company have a way to see the light of day. Give good ideas a chance to prosper no matter what rank they come from inside your organization chart. Innovation and marketplace differentiation comes when employees are respected as part of achieving a mission greater than their set of tasks, and that their voice counts. W.L. Gore has become a $2.7 billion dollar company; named by Fast Company as “pound for pound, the most innovative company in America;” and earned a place on Fortune Magazine’s best companies to work for list since its inception because of how they unleash the spirit and ideas of its people.

 

4. Grow and invest in customers as a primary asset of your business.

Talk about customers lost and gained in real numbers, not percentages, to bring home the vast number of lives your business impacts. Understand what drives customers out your door, and begin the relationship by investing in your customers by realizing their long term potential. Zane’s cycles in Connecticut has experienced 23% Growth every year for 29 years, with 45% percent margins because they never lose sight of the fact that their average lifetime value is $12,500. And they manage relationships bearing that in mind. Valuing customers makes it easy to make decisions about how to treat them.

 

5. Know your power source for bonding with customers.

Regularly connect with customers as they experience your products and services. Surveys and reports are great – but the beloved customers are also avid “customer watchers.” Take a page from Trader Joe’s who use employee taste buds at their testing kitchens to determine what items should first make it to their shelves, but employ customer “tasting stations” inside their stores combined with sales to determine what items stay.  This closeness contributes to Trader Joe’s ability to generate $1300 in sales per square foot – twice the supermarket industry average.

 

6. Have clarity about how you uniquely serve customers’ lives.

Unite your operation to ensure that decisions connect to deliver an experience customers want to repeat and tell others about. This ties cross-silo decision making together and releases the organization from excess bureaucracy.  IKEA for example, designs the price tag first because they know that they serve customers who have less money in their pocket than sweat equity to put together their items themselves at home. Across IKEA, the understanding that the price drives design, innovation, and what they will and will not do drives their growth…sales that increased even in 2009 by 7.7 percent.

 

7. Deliberately walk in your customers’ shoes.

You need to know your customers’ life to serve their life. Yet as people rise through the ranks or even join organizations, orientation is often more about process and policy than learning about the customer at the heart of the business. Be deliberate in establishing a process for new hires, such as USAA, who require new ‘recruits’ to wear the flak jacket, and helmet many of their enlisted customers wear and to read their letters. All this is done so that at USAA when calls come in, they begin with connecting with the customer first then the process of the business second. 98% of their customers stay with them year after year.

 

8. Hire partners – make employee selection one of your most important decisions. 

Select your employees as you would customers – for lifelong value. At Chick-fil-A, operators and employees are selected based on their values, ability to build grow and sustain partnerships in all areas of their lives, and then their technical skills.  As a result, Chick-fil-A has operator turnover of just five percent, and they just achieved 43 years of consecutive sales growth.   Hire people who you want to become a part of the story of your business and then watch how your social media story improves.

 

9. Proactively solve mistakes when they occur.

When mistakes happen (and they will) get out in front of customers and admit the flaw – then make peace with your customers. Repair the emotional connection, reduce the concern, and solve problem. Southwest Airlines reviews every flight every day to know when they interrupted their customers’ lives, whether it was their fault or not. And they contact customers to explain what happened and when warranted send out LUV bucks for a future flight. Being proactive earned them a net revenue increase from those bucks of $1.9 million in 2010.  What can you be proactive on?

 

10. Accept the order and the accountability.

In a world where customers are holding a megaphone in their hand where they broadcast on the internet the experience you are delivering, invest in reliability. Don’t make the customer wonder where the order is, how long ‘til it gets there or what happens when it backorders. If a customer can’t tell another customer what they get from you, how they get it or how it feels when they receive it, they you don’t have a story to tell (at least one you want heard). Invest in reliability…earn the right to grow.

 

Beloved companies never lose sight of the people affected by everything they do. Their reward is an army of beloved customers who urge friends and colleagues to try these companies and embrace them as well,” notes Bliss.

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Understand Customers’ Lives to Serve Their Lives.

 

At the upcoming Net Promoter 2.0 Conference, one of the esteemed presenters is USAA. USAA (United Services Automobile Association) is a San Antonio company offering auto and home insurance to a customer base of military members and their families. While new hires are not required to be from the military, they must understand military life. So new USAA employees wear the military helmet and feel the weight of the backpack and  flak vest as it is strapped to their backs. And they eat the same meals, the MREs—“meals ready to eat”—that soldiers eat in the field. They get to know the people behind the uniform by reading letters from soldiers and their families. As orientation ends, USAA’s intent has been realized. They have made their customers’ life a reality for their new recruits. And that sets the stage for how customers will be served.

 

Company Profitability Increases with Customer Growth.

 

USAA knows that an empathetic and caring workforce that understands the unique lives of their customer base is fundamental to their ongoing success and profi tability. That means walking in their customers’ shoes, literally. USAA calls their approach to connecting employees’ lives with customers’ lives “surround sound.” Elizabeth D. Conklyn, USAA’s former executive vice president of people services, said, “We want to cover the light moments, the heartwrenching moments, what it’s like to be bored in the field.” The company takes that understanding beyond orientation. For example; USAA call center reps are called “troops” and use military time on the job. And they commit to ongoing training with military precision and follow-through. Hourly employees receive seventy-five hours of training per year. Salaried employees receive at least thirty-seven hours.

 

USAA Retained 98 percent of Their Customers in 2010.

 

By walking in the shoes of its customers, USAA breaks down the impersonal barrier that often exists between companies and customers. As a result, USAA customers love and reward them with growth and validation; 98 percent of USAA customers stayed with them in 2010. And they have achieved an 82 percent Net Promoter Score, meaning the majority of customers are passionate supporters. What is your version of receiving orders and wearing a flak jacket so you can recreate your customers’ lives during employee orientation? Beloved companies have their new hires (no matter what job they’re hired for) work in retail or in their warehouses or wherever the customers are at so they can understand customers and get to know their lives. Do you?

 

Customers shoes.jpgDo You Walk in Your Customers’ Shoes?

 

Walking in the shoes of the military personnel and families they serve keeps USAA delivering the service they are known for. New hires get “orders” to their assignment and eat the “ready to eat” meals served to enlisted personnel.

  • Can you describe a day in the life of your customers?
  • Do you know what keeps your customers up at night? You need to understand their lives to serve their lives. Do you?
  • How would you rate your intent and ability to walk in your customers shoes?
  • Do customers rave about how well you understand them?
  • How does your decision to walk in your customers’shoes compare with this beloved company?
  • Do your decisions for understanding the lives you serve earn you “beloved” status today?
  • Can you identify your version of wearing a flak jacket so you can re-create your customers’ lives during your employee orientation?
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