Why are your customer survey initiatives failing? — Part 2
Most companies regularly undertake customer surveys; however often find it difficult to realise value from them. Here’s our take on some of the big reasons why these initiatives can fail and some practical tips on what you could do about them:
1. Culture — discussed in our first part.
2. Lack of executive buy-in (focus of this story)
3. Organisational misalignment
4. Not asking the right questions
5. Analysis paralysis
6. Undertaking surveys manually
Customer experience transformation initiatives can be difficult to implement and roll out; are time and resource consuming; and challenge the way in which people usually do things. This is why getting executive buy-in is critical. If you don’t have support from the top then it’s unlikely you’re going to get support from the rest of the organisation and your initiatives are doomed before they can even start.
88% of executives surveyed believe top management engagement with the customer experience process is essential to success — Harvard Business Review.
Executives already know and see the benefits of being customer-centric: loyal customers purchase more, they actively recommend your brand, they are less costly to serve especially when things go wrong, and will even tell you where to improve.
So, if executives understand the importance and value of customer experience, why do they usually turn down customer experience initiatives?
They often fail to clearly understand what a better customer experience is worth and how exactly it can generate value for the business. This is where people who are motivating for customer service improvements need to become good data-driven storytellers.
We’ve looked at how having a voice at the executive table can help address this problem — but what else can be done?
Poorly defined business cases
Through our years’ of consulting experience; we’ve seen that transformation initiatives fall on deaf ears, usually because there is no business case that compels them to take action. We’ve met with executives who have coached and helped shape business cases so that they speak to the executives in the right language; however, many simply may not have the time to do this.
Most business cases will not have a clear problem statement and will jump straight into the solution. Good business cases make the burning platform very clear and also quantify the problem e.g:
If we don’t fix our renewals process, it’s going to cost the company an additional KES 1.4b annually due to increased costs to serve and maintain our customers.
By framing the problem in this way, executives have a clear understanding of the problem and the consequences of not doing something about it.
Executives also expect costs, benefits and risks of transformation initiatives to be identified and quantified. By quantifying value, we don’t mean stating that the intended outcome is to increase your company’s NPS by 5 points. An executive will want to know what that 5 point shift actually means in terms of revenue increase and/or operational expense decrease to justify the cost of undertaking a transformation initiative.
You can’t motivate, if you can’t quantify
In order to do this you don’t have to be a data scientist; but you do need to get comfortable with some amount of analysis that can prove your initiatives will add value to your organisation.
Firstly start off by building your baseline — using your survey data, allocate your customer segments into broad buckets (e.g. promoters/ passives/ detractors, satisfieds/dissatisfieds, etc).
For each one of these sub segments, we now want to look at some key metrics spanning the last couple of years:
What were the average retention and churn rates?
What was the average spend per customer and total spend per segment?
What was the average and total value of referrals?
What was the average cost of serving a customer when things went wrong?
This may sound painful and a bit complicated — it isn’t. Once you’ve established the baseline; you should be able to see patterns and what differences exist between these sub segments. This will help you to link transformational change (e.g. converting a passive to a promoter) to value; and this is how you will be able to articulate what the value of an NPS increase by 5 points actually means for your business.
Focus on quick wins
Through your survey data, you should also be able to identify and prioritise your customers’ top pain points. For each pain point, you then should be able to quantify potential impact to your company.
Good business cases will focus initially on initiatives that are quick to implement and bring early reduction in costs or reduce revenue leakage.
By doing this, you’re building a self funding business case as the savings from these early initiatives can be ‘banked’ to pay for the other initiatives that follow.
Word of caution: While initial focus on quick wins is recommended, don’t take your eyes off the bigger items that could have major implications for your business and your customers:
As an example; retail banking customers increasingly want processes to be quicker, digital and self-serve. You’re going to get a far better ROI on implementing these initiatives than implementing marginal improvements to branch operations.
Get your executives more operationally involved
At Lyft, executives (including the CEO, Logan Green) regularly drive passengers so that they can truly understand the service experience from both a driver’s and passenger’s point of view. This also shows their employees how important it is to stay close to their customers and understand their needs.
We’ve seen a number of companies where the CEO and other executives take phone calls during Customer Service Week — while this is great; we recommend companies should get in touch with their customers on a more regular basis.
One of the most powerful ways you can use, to demonstrate to your executives that your transformation program is making a difference to your customers, is to get them to speak to actual customers who have directly benefited from your transformation initiatives.
