A COLLECTION OF BLOGS FOCUSED ON TAKING ACTION ON CUSTOMER INSIGHTS

B L O GBOOK

TAKING ACTION

TAKING ACTION

Taking action tops the list when customer strategists are asked about their greatest obstacles. To really take action you have to deal with a lot of people, many departments, and a ton of details as well as a corporate culture that may not be ready to change their ways based on input from their customers.

While there may not be a precise formula, we can learn a lot from each other. That’s why we searched our collection of more than 800 blogs from a variety of Walker consultants, and selected the top ten on the topic of taking action.

Let us know what you think. Share an idea or suggest a topic at solutions@walkerinfo.com.

Check out our other blog books below and the rest of our blogs at blog.walkerinfo.com

THE LOYALTY MATRIXCOMMUNICATION

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FOUR ELEMENTS TO DRIVE VoC ACTION

Patrick Gibbons

Taking action is the most commonly mentioned obstacle when discussing voice-of-the-customer strategies. In many organizations, particularly those that are large and complex, it is incredibly difficult to weave through all the obstacles to turn customer insights into action and results.

Sometimes it helps to think of the key elements that make action possible. Here are four key elements that would apply to almost any organization:

ORGANIZATION – You need the right team structure to effectively deploy your customer strategies. This refers to everyone involved in the process of collecting, analyzing, reporting, delivering, and acting on customer insights. A solid structure needs to be in place to make sure voice-of-the-customer strategies are actionable.

PROCESS – Organizations must have systematic ways to improve customer processes. Customer advocates must develop procedures, methods, and tools to ensure customer insights drive improvement, whether it is to correct a problem, discover a new solution, expedite a procedure, or grow a relationship.

COMMUNICATION – Effective communication needs to ignite the right action. In today’s business environment there’s an incredible amount of clutter. Any business has a multitude of initiatives making it difficult to ensure voice-of-the-customer strategies are seen as important and relevant. Effective communication has become critical to make sure people are aware of customer initiatives, understand their role, and believe in them so they will ultimately take action.

MOTIVATION – Customer strategists must provide the right motivation for action. In some cases incentives are involved. Other times it’s driven by operational metrics. Whatever the case may be, understanding how to motivate the users of customer feedback is a key element to any voice-of-the-customer strategy.

Large organizations can quickly get bogged down and distracted. Keeping these four elements front and center can help customer strategists stay focused on driving action and results.

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THREE REASONS STRATEGIES FAIL

Mark A. Ratekin

I was recently with a business strategist from a Fortune 500 company who stated there were ultimately three reasons corporate strategies fail. Even though he was speaking of overarching corporate strategies, the three reasons align with what I have seen related to customer strategies:

1. You measure the wrong things – Good strategy is the result of careful, intelligent analysis; however, the old maxim “garbage in, garbage out” applies here. In customer strategy consulting, this can be the result of jumping on the bandwagon of the latest killer metric without a full analysis of whether or not the metric actually applies to your industry. One way to avoid this shortcoming would be to conduct a pre-program strategic assessment – this step will allow you to learn not only the key customer touchpoints, but also identify the critical needs of key stakeholders in the process. It will also help you make certain you are profiling the customers the right way and focusing on the most critical.

2. You make the wrong decisions – E ven if you measure the right data, there is no guarantee you will make the right decisions. Some of this is related to the data itself – in customer strategy consulting, using statistical methods that allow us to determine which areas of focus will have the greatest impact on customer loyalty will provide some insulation against focusing on the wrong areas. There is, however, another source of potential error – and that is the direction of where the market in total is heading. Every decision is framed not only by the data you observe, but also by your outlook on the competitive environment in general. To ensure you get it right, there are three recommendations I would make:

• Include competitive assessments in your loyalty measurement program – Having an idea on your position relative to the competition can help fine-tune your analysis. You can read more about benchmarking options in this series.

• Commit to ongoing measurement – This does not necessarily mean an ongoing data collection effort; rather, it is about knowing when to re-assess the customer landscape to ensure you are accounting for all the relevant issues. Most clients do this every 18 to 24 months at a minimum.

• Build macro and micro-level strategic plans – The overall strategy that emerges from the statistical analysis is best used in the context of focal areas that have the greatest impact on the greatest number of customers; however, building more micro-level, customer-based action plans will ensure you are accounting for the individual differences that exist among customers.

3. You do not take action – This is the one we tend to see the most. I once worked with a person who was prone to saying “strategy is cheap; execution is hard.” When I first heard him say this, I thought he was saying that strategy was simple; I now realize what he meant was that even though strategy can be hard, it is infinitely more difficult to

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execute on a plan of attack you know is correct. The phenomenon of acting in ways that are not in your best interest is less about intelligence and more about discipline. I tend to use diet and exercise as an example – I know I should exercise more and eat less, but it is far easier to do the opposite. We at Walker have designed a framework to help navigate the key disciplinary elements needed to take action – namely, organization, process, communication, and motivation.

Certainly there are many reasons strategies can fail; however, I suspect that most of the reasons would fit into this framework. Being mindful of the potential pitfalls that may exist can help you be more proactive in building a plan that will maximize your probability of success.

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THREE LEVELS OF VoC ACTION

Patrick Gibbons

Acting on the voice of the customer doesn’t (or shouldn’t) happen in just one department or one area of the company. I like to think of it in levels. For simplicity sake, here are three common levels where VoC action should be taking place:

CORPORATE – At the corporate level, action should be very strategic. Based on customer insights, action plans should address issues such as overall retention, forecasting future revenues, projecting attrition, and considering customer perceptions on topics such as brand reputation, ethics, market position, and how you stack up against the competition.

FUNCTIONAL – Action at the functional level action becomes more tactical and involves specific areas such as business units and key departments. This middle level is the most diverse of the three. It refers to all groups throughout your enterprise that can benefit from the voice of the customer. These include departments such as service, account management, sales, and product development, R & D, marketing, and many others. In each case customer strategists should provide each group the customer information they need to improve their specific operation. What’s more, they should implement a prioritization process to ensure the most important issues are escalated to require action.

CUSTOMER-FACING – This is when action takes place one customer at a time. This is most common in business-to-business organizations where action is critical at the account level. To effectively manage at the account level customers advocates must work closely with strategic account managers and sales managers so highly customized information is provided to their people and they are trained on how to use it to drive business with specific accounts. Action at this level should be focused on improving account relationships to boost retention and grow revenue.

Too often voice-of-the-customer strategies are focused on one area or one department. Or, companies may do a good job of acting on customer insights at one level, but they don’t fully leverage insights across the organization. Customer strategists are wise to occasionally take inventory to determine the areas where customer insights could provide a well needed boost.

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Kitty Radcliff

Once again, Willow Creek Association put on a tremendous Global Leadership Summit last week. As soon as Len Schlesinger started his presentation, I knew I was in for a whirlwind of new ideas and different ways of thinking. As President of Babson College (ranked #1 business school for entrepreneurship by U.S. News & World Report); former Harvard Professor; and noted author, he is an entrepreneurial genius.

In the 1990’s, he and his co-authors helped us better understand how to build profitability in a service business via The Service Profit Chain (1997). Per Harvard Business Review, the service-profit chain established relationships between profitability, customer loyalty, and employee satisfaction, loyalty, and productivity.

More recently, Len Schlesinger has been focused on using entrepreneurship in all kinds of settings to create economic and social value. His book Action Trumps Everything (2010) makes the case that conventional approaches to problem-solving don’t work as well in an uncertain world.

Instead, a very simple framework used by successful entrepreneurs can be more effective: Act. Learn. Repeat.

1. Act: Take a small step forward.

2. Learn: Pause to see what you have learned by doing so.

3. Repeat: Incorporate that learning into what you do next.

At Walker, we know that taking action can be one of the biggest challenges faced by customer strategists. I suspect that is due in part to our tendency to set aggressive, stretch goals that may at times seem unachievable. This can lead to inaction. But, what if we didn’t try to solve world hunger from the onset?

What if we make a decision to just do something that might have a small impact?

1. Act: Take a small step.

2. Learn: After taking that first step, see what customers think and say about it in your customer feedback program.

3. Repeat: Then, incorporate that learning into your action plan and take another step forward.

Do we make the idea of taking action more difficult than it needs to be?

ACTION TRUMPS EVERYTHING

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FINDING TIME FOR ACTION

Melissa Meier

I don’t know about you, but it sure has been a busy first quarter! While I personally enjoy a fast-paced environment and like having my days filled with activity, the downside can be all of the different areas competing for my attention. I find myself constantly having to make choices about where my time gets spent. This can lead to tough choices regarding mission-critical vs. secondary priorities, as well as focusing on a good work / life balance. I am certainly not alone and I know that this is something that all of us are faced with on a daily basis. Earlier this week, the White House hosted a “Forum on Workplace Flexibility” to address the challenge that Americans face when balancing the demands of jobs and families. If you are interested in reading more about this, click here.

So, how is this relevant to our roles as customer advocates? One of the most common challenges we hear from our clients is engaging their organizations to take action on customer feedback. Functional areas and customer facing teams often view VoC activities as just one more thing they need to do, on top of an already overwhelming to do list. We are competing for their time, and this is a competition that we are hard-pressed to win unless we demonstrate the value of taking action. Here are some ideas on how to align customer feedback and make it relevant within the organization:

• Providesalesteamswithopportunitiestofollow-upwithcustomerswhoindicatetheyare likely to increase wallet share

• Tellstoriesintheorganizationaboutsuccessthatthatteamshavehadingrowingrevenue by taking action on customer feedback

• Haveaninfrastructureinplacethatmakesiteasyforpeopletoviewcustomerfeedback and document action plans

• Tailorcommunicationmessagestomakecertaininformationisrelevanttotherecipient

The more we integrate VoC into the culture of our organizations, the harder it will be for people to push it further down their to do list.

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Leslie Pagel

A recent blog post discusses two primary reasons companies do not achieve business results from their voice of the customer (VoC) program. They are:

• Lackofprocessesfortakingaction

• Lackofaccessible,relevantinsights

One of the essential elements for achieving world-class VoC outcomes is “Action.” At Walker, we define world-class action as:

• Havingacentralrepositoryofintelligencetodriveongoingactionandtosupportthedecision making process at any level of the organization.

• Keepingactionplansupdatedregularlyandconstistentlytrackedthroughtocompletion; ultimately showing a ROI.

• Customersand/orpartnersacknowledgethattheyhavereceivedfollow-up.

In order to become world-class at taking action on VoC, there are three necessary steps.

1. Tailoring: Everyone does not need everything. Tailoring the information to each audience ensures the information is relevant, aligned with their responsibilities, and the actions are within their control. In general, we see companies do a great job at tailoring the information for executives and account teams. For these companies, we’d recommend extending this focus to functional and/or geographical areas.

2. Training and templates: Delivering results is not enough. Several companies leverage trainings or workshops, and action plan templates to simplify the process and ensure effective action. Don’t forget to include a way to monitor progress on any agreed upon actions within your training and templates.

3. Tying it all together: The vision for customer focused organizations is a central repository of all relevant customer metrics. This would include data gathered from multiple sources (e.g., financial, operational, perception, employee, customer engagement, etc.) that can be aggregated and filtered for the appropriate audience. The information would be accessible throughout the enterprise and would be used to improve the efficiency and effectiveness of the decision making process.

If your company is not receiving the business impact from its VoC program, consider these three steps. They have helped many leading companies achieve world-class outcomes.

NEED HELP ACTING ON VoC? TRY THESE THREE STEPS

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Krista Roseberry

PROCEED WITH ACTION, NOT CAUTION

Today’s management tip-of-the-day from Harvard Business publishing was titled: Ready to Use Social Media? Proceed, with Caution, which was distilled from a full article on the same topic. Naturally, I wondered... what are they cautioning me against? Here’s the synopsis:

“In 2006, McDonald’s launched its first blog, Open For Discussion, signaling a desire to engage with customers. Less than a year later, the blog was flooded with customer complaints about the company’s decision to include toy Hummers in Happy Meals —and McDonald’s was slow to respond. When your company decides to venture into social media — by starting a group on Facebook, launching a blog, or Twittering — be prepared to truly hear what your customers have to say, and act on it. Providing a forum for people to share opinions about your products and services is a great way to build customer relationships, but only if you’re ready to engage. If your customers are Tweeting that your products aren’t durable, maybe they have a point. Demonstrate that you hear them and take their feedback to heart.”

It turns out that their caution is just like that of any other voice of the customer program: We need to be ready to listen and ready to take action! Gathering and distributing customer insights is one part of the job, but truly listening and evolving our companies based on the good, the bad and the ugly experiences of our customers is what it’s really all about – no matter what type of forum we’re using.

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Patrick Gibbons

Taking action is widely mentioned as the top challenge in a customer listening initiative or voice-of-the-customer strategy. One method to making customer loyalty more actionable is to begin with a good framework.

The Loyalty Matrix is a very practical framework that segments customers into four groups based on their responses to a small battery of questions. The two axes in the matrix represent the two key aspects of loyalty – behavior (what a customer plans to do) and attitude (how they feel about working with your company). This forms the following four quadrants:

TRULY LOYAL – These customers have every intention of continuing to do business with you and they have a positive attitude towards your company. They like working with you and are more likely to increase their spending and recommend your company to others.

ACCESSIBLE – These customers have a good attitude about working with you but do not plan to continue their relationship. Since this is a rather odd combination, it’s not surprising that it is often a very small percentage of customers. It typically means something has changed in their business and they do not need your product or services any longer.

TRAPPED – These customers show every indication of continuing business with you, but they’re not very happy about it. They feel trapped in the relationship. This is common among organizations that are locked into a long-term contract, lack a suitable substitute, or find it too hard to switch. Eventually, trapped customers will find a better option.

HIGH RISK – As the name implies, these customers do not intend to return and don’t really like working with you anyway. Typically, they’re halfway out the door and not only will they no longer be a customer, but will also talk poorly about your company in the marketplace.

Many organizations use this framework and find it to be more versatile, more practical, and much more actionable than satisfaction scores, NPS, or other approaches. Here is a link to a short paper on the Loyalty Matrix if you would like to learn more.

MAKING LOYALTY ACTIONABLE

AT

TIT

UD

E

BEHAVIOR

ACCESSIBLE

HIGH RISK

TRULY LOYAL

TRAPPED

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TAKING ACTION CAN BE SIMPLE

Brad Harmon

Acting upon the feedback customers provide doesn’t have to require a complete overhaul of a process, product, or communication vehicle. One great example of this came rushing back to me the other day when having a Reese’s Piece (is one just a ‘piece’ or are they still ‘pieces’?) with my wife. We discovered that we hadn’t won their latest sweepstakes in conjunction with ‘Night at the Museum: Battle of the Smithsonian’, and this reminded me of one of the weirder things I recall about my high school days.

You see, Mr. Johnson, my sophomore English teacher was fanatical about two things – the power of the English language, and candy. During that time, and based on the Charlie and the Chocolate Factory premise, I’m sure, Hershey’s was sponsoring a sweepstakes contest, giving away $50,000 if you found the lucky game piece stashed in one of their packages. The intentions were good; get consumers to buy more of our candy for a better chance to win. However, they failed to realize that they were alienating this one particular consumer, Mr. Johnson the English teacher.

You see, on every game piece that didn’t reveal a prize, the message read simply:

YOU ARE NOT A WINNER.

Read quickly, it communicated that the consumer had not won a prize in this game. But, read literally, it struck a blow to a person’s self confidence. This might have gone on for some time, had Mr. Johnson not had a weak spot for chocolate. When reading that he was not a winner, it sent him into outrage, sparking an impromptu project for his sophomore level English class.

We each were required to write a letter to Hershey’s expressing our concern that they were essentially calling us losers by not having won their little contest. The test was to see if the company would a) listen to us and apologize, or b) not acknowledge us, thus forcing us into boycotting the chocolate giant (and settling for an inferior brand of candy) for the rest of our lives, given our aspirations of being winners in life?

As it turns out, within the span of a few weeks (within that school year), Hershey’s did respond to Mr. Johnson and our class, apologizing for the poor wording on their game pieces. In fact, they went further, by changing their packaging to address the feedback that they heard from our class. I believe he also got a coupon for some free candy, which was also appealing, of course. But most satisfying for Mr. Johnson was that Hershey’s had heard his feedback, and taken immediate, but very simple action on it to address his concerns. What could’ve turned into a lost customer became a loyal one for life (despite the fact that I never heard of him winning one of their contests).

He, and his class of sophomores learning about the power of the written language, had indeed become winners by persuading the Hershey’s Chocolate Company to change its way of communicating. So, when checking to see if my wife and I had one a free night’s stay at the Smithsonian, I realized that the feedback that my classmates and I had

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provided nearly twenty years ago was still in play today, which made me realize how powerful it can be when a company listens and acts on what they’ve heard.

It may not have been a change that many people noticed, but today, every time I participate in a contest, I pay close attention to how they’ve worded the message if I didn’t win, and always think back to how we made a difference in how these messages read today.

Are there simple things that can be done to address your customers’ feedback that don’t require much effort? What are some simple ways that you’ve changed that have paid off in ways greater than you could’ve imagined?

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MAKE IT EASY

Melissa Meier

Have you ever had a situation that you were dreading, but turned out to be not so bad? That happened to me recently when I needed to take my son to a local flu shot clinic. We weren’t having any luck with the flu shot supply at our doctor’s office, so we loaded up the family and went to a flu shot clinic. I expected it to be a torturous experience. I imagined a line of people hundreds deep, with a wait time that was measured in hours, not minutes. Much to my surprise, the event was very well coordinated and staffed, which resulted in us getting right and out. When leaving, it struck me how easy the whole thing was.

What lesson is there for us as customer advocates? In order to motivate our organizations to take action, we must make it easy for them to participate in the process. If we don’t, employees will view it as just one more thing that they need to and will be looking for ways to avoid it. Think of your company when answering the following questions:

• Isthereanefficientprocessinplaceforsalesteamstoprovidecustomercontactnames?

• Dopeopleknowwheretogotogetfeedbackthatcustomersprovided?

• Iftheydoknowwheretogo,isiteasyforthemtoretrieveit?

• Isthereaneasywayforpeopletodocumenttheactiontheyhavetakenwithcustomers?

If you are like most organizations, the answer to one or more of the questions above is “no.” When designing the customer feedback system, focus on making the process easy for people to participate in. Think about how the process can be embedded into existing processes and management systems. Use technology to enable efficiency around program administration and documentation activities. If successful, I bet you find that the uphill battle on getting employees to participate won’t seem so steep.

THE WALKER INDEX™

ABOUT WALKERWalker specializes in customer loyalty and related customer strategies, including innovative approaches to segmenting, valuing, obtaining, serving, and growing customers. Walker’s diverse team of consultants provides tailored, comprehensive solutions to help companies achieve their business objectives and, ultimately, grow shareholder value. Walker’s consultants regularly conduct workshops and assessment programs to help organizations improve their ability to administer customer listening programs.

The Walker Index is a stock index comprised of current Walker clients. Companies are included in the index only during their tenure as Walker clients. Companies attracted to Walker are committed to using the customer perspective as an impactful management tool. The Walker Index indicates these companies outperform the broad markets.

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