Newsletter

#57 – Misleading airline satisfaction articles, my compliments to Tordoffs, and more…

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Airline satisfaction headlines and data do not match. My compliments to Tordoffs. Welcome to the 57th edition of my customer strategy newsletter. The five topics this week are:

  1. Poor reporting of latest ACSI airline satisfaction results
  2. My compliments to Tordoffs for how they handled my problem
  3. Latest blog posts
  4. Notable items from other sites – 4 steps to create a survey, Ritz-Carlton employee engagement
  5. Looking forward – GDPR
Poor reporting of ACSI airline satisfaction results

A fact of life in the reporting of scientific subjects is that the headline is sometimes written by someone other than the person who wrote the article. A secondary fact is that the person writing an article about a scientific paper may only have read the title or perhaps the summary of the paper. Both of these seem to have happened in articles I have read about the latest American Customer Satisfaction Index study on the airline industry, released a couple of weeks ago.

Here is what Forbes had to say on April 26th: “Americans have a well-documented love-hate relationship with airline travel. More of them traveled more miles than ever before over the previous year but their already-low levels of satisfaction with airlines’ customer service fell even further.”

And SmartCustomerService reported as follows: “Though it’s only April, 2018 has been a tough year for the airline industry. Just in February, Spirit Airlines notoriously forbade a student to bring an emotional support hamster on a flight, and in March, United Airlines forced a passenger to put her dog in an overhead compartment. And it’s not just pet-related problems that plague air travel—ticket costs continue to rise and delays are more common than ever. It’s no surprise, then, that customer satisfaction with airlines has dropped by 2.7 percent year over year…”

So, you could be excused for thinking customer satisfaction with US airlines is poor. Here is the way I would have written the main message I saw in the report: “Despite a few high-profile incidents that exploded on social media, customer satisfaction with US airlines is the second-highest it has ever been since measurements started in 1994.” Can you spot the difference? The Forbes article author, Dan Reed, goes on and on with his personal views about everything that is awful about air travel, and how it is only getting worse. This is not backed by fact. Fake news esteemed readers… fake news.

The ACSI data on the airline industry is here.

My compliments to Tordoffs for how they handled my problem

Continuing an air travel theme, I recently had a pleasant experience with Tordoffs, a UK-based gift service company. Yes, this has something to do with air travel. When I retired a couple of years ago, I had a couple of million frequent flyer miles. The ones that I used most quickly were from Air France – KLM. I had a small amount left and decided to use the remainder to order something from their gift catalog. The various items in the catalog are shipped by third parties. I chose a particular bottle of wine, worth about $25 or so. Swiss customs charges nothing on imports with a value below about $65 including shipping, and there was no charge for shipping the wine from the Air France – KLM supplier, Tordoffs.

However, all did not go according to plan. Someone at Tordoffs made a mistake and declared the customs value to be 70 UK pounds, about $95; an amount that corresponded to a different bottle of wine. Swiss customs charged me about $45 in VAT and other fees.

I wrote an email to Tordoffs asking to be reimbursed for the error. They quickly acknowledged the mistake and asked whether I had a PayPal account. Reimbursement followed a couple of days later.

Congratulations to Tordoffs on a great attitude and quick service!

 

Our latest blog posts

Here are the latest posts. Older posts are still available on the blog page.

image The start of a long story: How I learned about ‘customer-centric cost reduction’.

Such a contrast I was looking out my office window near Charles de Gaulle airport in 1982. The phone rang just as I was watching Concorde take off on its daily run to New York…
image How do you know whether your latest relationship survey score is better than your last one?

This is not a stupid question! Last week I had the pleasure of speaking to an LA-based reader and head of customer experience for a very large company. He had his latest research results, and there had been a slight decline in scores, despite improvements he knew they had made.
image Useful if you have no NPS® benchmarks for your company – Please help me to improve this ACSI to NPS converter

As many of you know, public competitive NPS benchmarks are exceedingly rare. This article proposes an approximate solution for translating American Customer Satisfaction Index data into NPS numbers.

Notable customer experience items from other sites

Thematic: 4 steps to create a successful customer survey

Thematic is a text analytics leader and CEO Alyona Medelyan has written a great article on how to create a successful survey. She describes four steps:

  1. Plan: Plan for survey success
  2. Design: Receive authentic responses
  3. Collect: Get the most out of your survey
  4. Analyze: Find answers and insights in responses

Alyona seems to like having more questions in a survey than I tend to prefer. Otherwise, the article is both detailed and easy to understand. Essential reading. Get it here.

Forbes: How the Ritz-Carlton Leadership Center uses employee engagement to drive customer experience

Regular readers will know that hotels are one of the few industries where there is a relatively high correlation between employee and customer satisfaction. Employee engagement does not have a standard definition, though it seems to be more important, no matter what definition is used. Bryan Borzykowski interviewed Jeff Hargett, senior director of The Ritz-Carlton Leadership Center for this article. I have been a fan of their approach to employee engagement and NPS ever since listening to former CEO Horst Schulze speak in one of Rob Markey’s Net Promoter System Podcasts. Their emphasis on employees’ role in customer experience is an example all others should follow. Read all about it here.

 

Looking forward

The General Data Protection Regulation will come into force in the EU later this month. I have decided to align myself with GDPR rules. Mostly, this means no change for me, as I have already committed to all readers that I will not disclose their email addresses or other information to third parties. And of course I use your email addresses exclusively to send newsletters and blog updates.

However, there is one thing I have done in the past that I plan to stop doing. Some of you first received this newsletter because I guessed your email address, based on knowing what format your company uses. I think there are just about 60 people in this situation, but I have no idea which 60 as the records look exactly the same as for people who signed up on their own. In any case, I have been using my one-time tracking exercise of a month ago to remove most of the names of people who did not open the newsletter that week. And of course, you can unsubscribe at any time.

Here are links to all of our books on Amazon.com. Kindle versions are available in all stores. Print versions are available from the major stores only, with the notable exception of Australia, where print versions are not available from amazon.com.au.

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

Customer-centric Cost Reduction

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Color edition)

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Black & White edition)

Please share this newsletter with your friends and colleagues and encourage them to sign up for it here. I have put links to past newsletters on the subscription page. Finally, please feel free to change or cancel your subscription using the link below.

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

#55 – Facebook, recommending where you live, vodka, cognitive bias

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Facebook employee and customer satisfaction continue to be opposites. Recommending the place where you live? All vodkas are identical! More. Welcome to the 55th edition of my customer strategy newsletter. The five topics this week are:

  1. Facebook employee and customer satisfaction continue to be opposites
  2. Recommending the place where you live?
  3. Latest blog posts
  4. Notable items from other sites – All vodkas are identical, Cognitive Bias
  5. Looking forward
Facebook employee and customer satisfaction continue to be opposites

Those who read my recent articles about the (almost non-existent) relationship between employee and customer satisfaction in large American companies will remember Facebook. They made the list of companies in the top 10% for employee satisfaction, while remaining in the bottom 10% for customer satisfaction. So… how has the recent Cambridge Analytica scandal changed things?

So far… not at all. Now I don’t have any new customer satisfaction data, but I do have some new employee satisfaction data. They are now #1 on Glassdoor’s ‘Best Places to Work’ list for 2018, based on employee feedback. Here are some quotes from this month:

“Unbelievable company I’m proud to work for.”

“A place like no other.” (With a five star rating, out of five)

“Dream company!”

“Amazing place to work.”

These are representative comments. I could find nothing negative at all. I could go on, but the message should be clear. All the negative feedback from customers has no effect whatsoever on employees. They love Facebook, while American consumers continue to hate it.

Go figure.

How likely are you to recommend your town as a place to live?

Imagine receiving a survey from your local authorities. “Dear Mr. FitzGerald, we want to improve Smallville and hope you can help us. We just have three questions for you today. We promise to let you know what we learn from this research, and what we plan to improve.”

I listened to a Net Promoter System podcast about improving customer experience in a ski resort a couple of years ago. It made me think about starting a business whose purpose would be to help Swiss villages, towns and cities to improve the perceptions of their citizens. (In Switzerland, taxes are raised at federal, cantonal (= state) and local levels, so local authorities are able to make local spending decisions.) I did not start that business, but thought quite deeply about what I wanted my own village to improve.

At that time, I noted issues to do with the local garbage dump, where we sort and dispose of things that are not picked up by the regional domestic garbage collection service. I also thought they should find ways of cutting down the road noise level for people living along the main streets that have thousands of passing cars each day. That work has just started, with all the main road surfaces being replaced by low-noise tarmac. Mind you, they didn’t really have a choice, as this type of noise reduction was the subject of a federal mandate 20 years ago, and 2018 is the last year allowed for compliance.

Anyway, I still think implementing three-question NPS-style surveys for towns would be a great business. I think citizens would react well. I have not heard of anyone doing this so far. What do you think?

 

Our latest blog posts

Here are the latest posts. Older posts are still available on the blog page.

image How do you know whether your latest relationship survey score is better than your last one?

This is not a stupid question! Last week I had the pleasure of speaking to an LA-based reader and head of customer experience for a very large company. He wanted to understand how to tell whether the organization was improving or not. Here are the main points we discussed.
image Useful if you have no NPS® benchmarks for your company – Please help me to improve this ACSI to NPS converter

As many of you know, public competitive NPS benchmarks are exceedingly rare. This article proposes an approximate solution for translating American Customer Satisfaction Index data into NPS numbers.
image Yet more reflections on why corporate cost benchmarking is often evil and destructive

Regular readers will know that I am not a fan of cost benchmarking. The reason is simple. I think it is almost always misused, sometimes producing disastrous results. The primary reason is that the cost cutting takes place in the absence of clear statements and actions to spend more on the areas where companies want to invest and grow.

 

Notable customer experience items from other sites

NPR Planet Money podcast: The Vodka Proof [All vodkas are identical]

Regular readers of our books and blogs will know we are fans of behavioral economics and cognitive psychology. People (including us) are far less rational than we like to believe. I listen to every episode of the National Public Radio Planet Money podcast. The topics are always interesting and sometimes surprising. A recent episode was one of the surprising ones. They start out by explaining that almost all vodkas are identical, no matter what they cost. Indeed, the ones most likely to taste a tiny bit different just happen to include low-quality distillation residue. The identical nature of all vodkas is driven by US legislation about how it must be distilled.

As you might expect, almost nobody believes this. They pick the entertaining story of Grey Goose vodka as an example. Grey Goose is pure marketing. They do not even distill their own product. And wait until you hear the blind taste test, done live during the podcast. This all changed the way I think about vodka, especially expensive brands. If you are a major fan of premium vodka, you will hate this show. Listen to it here.

Raconteur.net: Cognitive Bias Infographic

When we listen to others expressing their opinions, and I suppose when we listen to ourselves too, we need to be aware of cognitive bias. My brother sent me an outstanding infographic on the subject. It includes simple examples of each of the common sources of bias. You can find it here. I hope it will be useful.

 

Looking forward

April looks like being our fourth record sales month in a row. Thank you! If you would like to help us, the best way is to post a book review on Amazon.

Here are links to all of our books on Amazon.com. Kindle versions are available in all stores. Print versions are available from the major stores only, with the notable exception of Australia, where print versions are not available from amazon.com.au.

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

Customer-centric Cost Reduction

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Color edition)

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Black & White edition)

Please share this newsletter with your friends and colleagues and encourage them to sign up for it here. I have put links to past newsletters on the subscription page. Finally, please feel free to change or cancel your subscription using the link below.

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

#53 – NPS benchmarks – Who is responsible for CX – Infographic – Making employees want to smile

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Useful new free source of NPS competitive benchmarks? Where should Customer Experience report? Welcome to the 53rd edition of my customer strategy newsletter. The five topics this week are:

  1. Possibly useful free source of competitive NPS competitive benchmarks 
  2. Discussions about who is responsible for customer experience
  3. Latest blog posts
  4. Notable items from other sites – Customer service infographic, and why employees smile
  5. Looking forward
Possibly useful free source of NPS competitive benchmarks

Customer experience leaders and others often ask the following question when they see the first NPS scores for their company: “Is this a good score?” The answer is that good scores and trends are those that are better than your competitors’ scores. NPS trends compared to competition explain between 20 and 60% of market share trends according to Bain research.

The ‘catch’ is that all of these scores have to be measured in exactly the same way. The only solution available up to now has been to pay a research firm for a double-blind benchmark study that already happens to cover you, or pay them even more to start to cover you.

If you happen to be among the 500 largest US companies that sell to consumers, you may be in luck. I have come up with an alternative solution. It is not completely satisfactory, but I believe it is a lot better than nothing. I have used public data from Temkin and ACSI to create an ‘ACSI to NPS translation equation’.

The American Customer Satisfaction Index covers about 500 companies, and can be found here. Bruce Temkin provides public NPS scores by industry. The latest report is here. I simply mapped the benchmarks by industry for the last three years to each other. You can find the full description of what I did here. The result is a translation equation which I will round to NPS = (1.5 x ACSI) – 88. Please try it out an let me know what you think. If you have an alternative source of free double-blind NPS competitive benchmarks, please also let me know.

Discussions about who is responsible for customer experience

I have been engaged in several online discussions about this sensitive topic over the last few weeks. Generally the people initiating the discussions hold one of two points of view. The first is that ‘everyone is responsible for customer experience’ so therefore no single leader is needed for it. The second viewpoint is that Marketing should ‘own’ customer experience. In my view, the first viewpoint is just silly, and the second one is sub-optimal. Here is why…

Customer experience improvement opportunities fall into two categories. The first category is improvements for which a single business or function is clearly responsible and for which they already have all necessary funding and people. They can just get on with it. The second improvement category covers things that cross functions and business units. These items correspond to the ‘Outer Loop’ in the Net Promoter System, for example. Unless someone is responsible for making these things happen, they just will not happen. The second category constitutes the core work of the Chief Customer Officer or equivalent. (I have blogged about the subject here.)

So, supposing the need to have a person responsible for the cross-business opportunities is accepted. Where should that person report? At the risk of controversy, I have to say that if the answer is not ‘To the CEO’, then your company does not consider improving customer experience to be a top priority. My personal view is that the corporate Chief of Staff should have the CX responsibility, if it has to be shared with other work. Marketing would be a distant #3 choice. Personally I would have sales as my #2 choice. The advantage the Chief of Staff has is that he or she sets the agenda for all leadership meetings and events, so CX can always be there. Marketing’s main ‘jobs to be done’ are demand generation and sales support. CX improvement initiatives would be a low priority for the CMO. Not zero, just low. Not optimal.

As always, feel free to disagree…

 

Our latest blog posts

Here are the latest posts. Older posts are still available on the blog page.

image Useful if you have no NPS® benchmarks for your company – Please help me to improve this ACSI to NPS converter

As many of you know, public competitive NPS benchmarks are exceedingly rare. This article proposes an approximate solution for translating American Customer Satisfaction Index data into NPS numbers.
image Yet more reflections on why corporate cost benchmarking is often evil and destructive

Regular readers will know that I am not a fan of cost benchmarking. The reason is simple. I think it is almost always misused, sometimes producing disastrous results. The primary reason is that the cost cutting takes place in the absence of clear statements and actions to spend more on the areas where companies want to invest and grow.
image Employees love these companies, and customers hate them… and vice-versa

My research this month and a year ago (see below) has established that there is little or no relationship between employee and customer satisfaction. This post simply gives the lists that should not exist: the companies employees hate but customers love, and vice-versa. If the conventional wisdom that the two always go together were true, these lists would not exist.

 

Notable customer experience items from other sites

16best.net: Infographic – 23 Awesome Customer Service Stories

Anecdotes and personal stories are powerful. They often outweigh other data simply because they are memorable. While their main business is providing users with discount coupons, 16best.net occasionally publishes nice infographics, and this one is no exception. It is massive and includes nice stories from many top American brands. You can read and download it here.

Alain Thys on LinkedIn: How do you make employees smile?

Our Belgian friend Alain Thys is ‘Chief Coach’ at Customerfit, a consulting company whose mission is to help companies become more customer-centric. Alain provides three leadership actions that he believes are key to making employees genuinely happy that they work for your company.

His article reminds me of my brother’s experience travelling from Dublin to Melbourne two years ago. He flew (in sequence) with Turkish Airlines to Istanbul and Bangkok, Thai to Melbourne, then Singapore Airlines and Lufthansa on the way back. I asked him which of the four he preferred. He answered that Turkish was his favorite, saying they smiled and seemed to genuinely enjoy their work. He said that the Singapore Airlines crew seemed to smile 100% of the time, but that it was fake. Read Alain’s article here.

 

Looking forward

I will be doing the first of what I hope will be a series of webinars for ClearAction Exchange on April 25th. I should be able to provide more details next week.

Here are links to all of our books on Amazon.com. Kindle versions are available in all stores. Print versions are available from the major stores only, with the notable exception of Australia, where print versions are not available from amazon.com.au.

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

Customer-centric Cost Reduction

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Color edition)

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Black & White edition)

Please share this newsletter with your friends and colleagues and encourage them to sign up for it here. I have put links to past newsletters on the subscription page. Finally, please feel free to change or cancel your subscription using the link below.

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

#52 – Economics of loyalty, non-relationship between employee and customer satisfaction, AI for airline customer feedback, more

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Welcome to the 52nd edition of my customer strategy newsletter. The five topics this week are:

  1. Short answer to a question about the economics of loyalty 
  2. Reactions to articles on the non-relationship between employee and customer satisfaction
  3. Latest blog posts
  4. Notable items from other sites – AI analysis of airline satisfaction
  5. Looking forward
Short answer to question about the economics of loyalty

A reader asked ‘I wonder if you can assist me in understanding the concept of “The Economics of Loyalty” with examples’. You will see that I do not pretend my answer is 100% complete. I just feel these are the most important points. Please let me know if you disagree. Here is what I replied:

… Good timing for the question as I have been trying to work out how to express the concept concisely. I am sure you have found long descriptions like the one at http://www.bain.com/publications/articles/calculating-the-economics-of-loyalty-forbes.aspx. You may also have read what I have written on the subject in my NPS book Net Promoter – Implement the System.

Reducing it all to something simple is tricky, and I am not sure that what I will write here works for all types of businesses. Anyway, here are the two points I feel may be the most important:

  1. Cost of acquiring a new customer compared to cost of keeping an existing one. In an ideal situation, your sales people bring in new customers, while the sales process for renewing existing contracts is mainly administrative and costs a lot less. Divide the total revenue from new customers by the total sales and marketing budget, and you have the cost proportion for the first part. A similar calculation can be used for renewals. The two are often difficult to separate, and you may need to estimate the proportion of sales people’s time selling to existing customers.
  2. The profit margins from existing customers, versus new customers: This probably matters as much as the first point. Happy existing customers tend to pay close to full price. Unhappy customers tend to get price reductions. New customers tend to pay less than existing customers, at least for B2B.

Reactions to my messages on customer / employee satisfaction

Thank you for the many comments whether received directly, via LinkedIn or on Twitter. I wrote four articles in all. Newsletter subscribers received a long one, with details of the methodology. Note that I had to update it slightly due to an error I found in an Excel formula. The updated article is in the blog list below. The second article gave the lists of companies who were in the top 10% for both cusotmer and employee satisfaction, and those in the bottom 10%. The third article provided the counter-intuitive lists, meaning companies in the top 10% for one factor and the bottom 10% for the other. LinkedIn and Facebook are two of the four companies whose employees love them while their customers hate them. I doubt Facebook’s latest tribulations will change that. You will also see a short summary of the new information on the blog list below.

Most people who gave feedback were positive and appreciated that employee happiness and employee engagement are two different concepts. Employees can be happy about many things that have nothing to do with customers.  Two reactions I received were in the ‘my anecdotes trump your data’ category, meaning they just did not want to believe the data. And one, unfortunately was just “My data says the opposite” without any indication of what that data is or where it comes from. I would love to have been able to see it. I really don’t want to believe that employee satisfaction counts for nothing in most businesses. However, that’s what the data suggests.

As always, feel free to disagree…

 

Our latest blog posts

Here are the latest posts. Older posts are still available on the blog page.

image Yet more reflections on why corporate cost benchmarking is often evil and destructive

Regular readers will know that I am not a fan of cost benchmarking. The reason is simple. I think it is almost always misused, sometimes producing disastrous results. The primary reason is that the cost cutting takes place in the absence of clear statements and actions to spend more on the areas where companies want to invest and grow.
image Employees love these companies, and customers hate them… and vice-versa

My research this month and a year ago (see below) has established that there is little or no relationship between employee and customer satisfaction. This post simply gives the lists that should not exist: the companies employees hate but customers love, and vice-versa. If the conventional wisdom that the two always go together were true, these lists would not exist.
image The large US businesses with the best and worst customer and employee satisfaction

Here are the large US businesses that everyone (customers and employees) love, and the ones they both hate.
image Short update on last year’s research: There is almost no relationship between employee and customer satisfaction

This article is intended for readers who remember last year’s article or have read the corresponding chapter in our book Customer Experience Strategy – Design and Implementation. Others should read the longer version below.
image New data: Does employee satisfaction drive customer satisfaction? Not really!

This article is an updated version of what I wrote on the same subject a year ago. The results continue to be surprising and to go against what most people think. If you remember the details of last year’s article, the short version may be enough for you.

 

Notable customer experience items from other sites

Thematic software: Why US airlines rank best or worst, according to passengers

Great article by Alyona Medelyan on how to use web scraping and text analytics to understand what your customers are thinking. Truly an innovative approach. You can read it here.

CMO: Businesses rate themselves two times higher than consumers on CX

An Australian article about the main findings of the 2018 Starcom Media Futures report. And that gap has almost doubled since last year. Read more here.

 

Looking forward

I am currntly trying to suggest how a large sports association with three million members should go about getting feedback from its 60 national associations. I have never done anything like this before, so any relevant experience you have would be most welcome.

Here are links to all of our books on Amazon.com. Kindle versions are available in all stores. Print versions are available from the major stores only, with the notable exception of Australia, where print versions are not available from amazon.com.au.

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

Customer-centric Cost Reduction

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Color edition)

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Black & White edition)

Please share this newsletter with your friends and colleagues and encourage them to sign up for it here. I have put links to past newsletters on the subscription page. Finally, please feel free to change or cancel your subscription using the link below.

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

#50 – Program management Speed Dating, Airline complaints and satisfaction, Top 30 CX books, more

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Welcome to the 50th edition of my customer strategy newsletter. The five topics this week are:

  1. ‘Speed Dating’ as a critical step in program management
  2. Do complaints and on-time % correlate with satisfaction ratings for US airlines?
  3. Latest blog posts
  4. Notable items from other sites – Top CX books, and the million dollar CX question
  5. Looking forward
‘Speed Dating’ as a critical program management skill

Large improvement programs present many management challenges. The biggest issues I have seen arise when sub-teams are dependent on each other, but don’t do anything to address these dependencies. When working on the integration of HP and Compaq, one of my colleagues, Paul Maguire, came up with the Speed Dating concept. I have used it many times since then, and always found it to be helpful. Here are my views on program kickoff meetings and the Speed Dating they should include.

Ideally, you should hold your first implementation meeting face-to-face. This is particularly important in large organizations with people in multiple locations. Trust is established far more quickly when you can look someone in the eyes. If you are in a large company, I am sure you will have witnessed colleagues who freely criticize those they have never met. It is much rarer when people get to know each other. Ideally, when kicking off the set of new initiatives, you should have the project teams for all approved projects get together in a single location. The primary purpose of the first workshop is to produce the first task plan; the list of work, deliverables, resources, timing and interdependencies for each initiative. The teams should also address completion criteria and risk management and do some simple ‘speed dating’.

Speed Dating is an evocative name for an essential process. It is common that project teams identify dependencies on other teams or individuals when they write down their task plans. Surprisingly, it is also common that they never discuss the interdependencies with the people concerned. Projects then get delayed or don’t succeed. Organize simple speed dating towards the end of your kickoff workshop. Each team visits each other team purely to discuss their mutual dependencies. For example, a service center may want to improve their call handling software and depend on help from IT and procurement people to make it happen. Use printed versions of each task plan to facilitate the work. You will also find some work duplication and the short speed-dating discussion should resolve it. Use a countdown timer to signal the end of each session. Ten minutes each may be enough.

And don’t forget to have some fun.

Do complaints and on-time % correlate with satisfaction for US airlines?

I have been interested in airline satisfaction since the time, over 30 years ago, when I started to travel most weeks. There is a lot of public data in the USA, less elsewhere. The US Department of Transportation has just published its consumer report that includes data for all of 2017. I decided to correlate two of the data sets with the satisfaction data published by the American Customer Satisfaction Index people. As an added bonus, I also looked at employee satisfaction, as measured by Glassdoor ratings. The results are surprising, at least to me.

So… being on time does not matter much, apparently. The airline with the worst on-time record for all of 2017 finished with the best customer satisfaction score.

Please have a look at the correlation line. What the scores mean is that the higher the number of complaints per 100,000 passengers boarded, the worse the ACSI score is. And the higher employees rate their own satisfaction, the better the ACSI scores are too. It also seems logical that the happier the employees are, the lower the number of complaints.

I have already demonstrated scientifically (last year) that employee satisfaction and customer satisfaction do not correlate, overall and across all industries. My study also showed that there are high-touch industries where employee happiness does seem to matter. Airlines are one such industry. I would love to be able to demonstrate the relative importance of different operational data for all industries, but there are very few for which it is available. Fortunately, at least some operational data is available for airlines. Surprise: operational excellence does not seem to matter much.

As always, feel free to disagree…

 

Our latest blog posts

Here are the latest posts. Older posts are still available on the blog page.

image Sometimes the best process is no process at all

Continuous improvement is a common catchphrase. It is easy to believe that making every existing process more efficient should be the focus. But what about eliminating the processes altogether? Three stories from my personal experience may help make the case…
image Choosing a benchmark research provider for NPS, CSAT or any other customer experience metrics

I am trying to form my thoughts about what criteria are reasonable when deciding on a benchmark research provider. My current thinking is below. I welcome your additions and corrections.…
image Valentine’s Day classic blog – How to stay married – to your customers of course!

It was Valentine’s Day a few years ago, and I was puzzled by the results of some HP customer experience research. The data source and volume were impeccable. However, the results contradicted a lot of commonly-held beliefs about the behavior of unhappy customers in particular…

Notable customer experience items from other sites

eglobalis: Top 30 Customer Experience books

Ricardo Saltz Gulko has put together this book list. It combines what he considers to be the best books he has read in 2017 with his list of the best forthcoming books of 2018. I was pleasantly surprised to find our Customer Experience Strategy – Design and Implementation book on his list, and of course Ricardo’s own forthcoming title is also there. You can read it here.

Ian Golding: The Customer Experience Million Dollar Question: Will my customer come back

Ian often blogs about travel and hotel experiences. This time he talks about the experiences he had with his three children, as he took them to the cinema and two restaurants. Customer loyalty to your company matters, no matter what your business. Read more about Ian’s experiences here.

 

Looking forward

I have started to work on my now-annual research on the relationship between customer and employee satisfaction for hundreds of US businesses that sell to consumers. It should be ready four weeks from now. I think it will be just as controversial as the last time.

Here are links to all of our books on Amazon.com. Kindle versions are available in all stores. Print versions are available from the major stores only, with the notable exception of Australia, where print versions are not available from amazon.com.au.

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

Customer-centric Cost Reduction

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Color edition)

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Black & White edition)

Please share this newsletter with your friends and colleagues and encourage them to sign up for it here. I have put links to past newsletters on the subscription page. Finally, please feel free to change or cancel your subscription using the link below.

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

#49 – Cost predictability, events customers, employees, partners and communities should worry about

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Welcome to the 49th edition of my customer strategy newsletter. The five topics this week are:

  1. Predictability of costs can me more important to customer than how high they are
  2. Two types of events that should cause customers, employees, partners and communities to worry
  3. Latest blog posts
  4. Notable items from other sites – CX assessments
  5. Looking forward
Predictability of costs can be more important than how high they are

My car is coming up to five years old, and it came with a five-year warranty that included all the regular services, free of charge. The garage approached me with a proposal for an extended service contract that has almost the same attributes as the OEM warranty. I plan to sign it, as soon as the contract arrives in the mail. Yet, my car has been totally reliable, and not one single thing has gone wrong since it was new. So, why do I think it is worth quite a lot of money to me to sign a 24-month contract?

A bit of personal automotive background may be relevant. Every car I have owned before my present one has had some sort of breakdown. My first few cars were extremely unreliable. (A Lancia Fulvia, a Citroen GS, a Matra Bagheera, if you must know.) I have been through Ford and Mercury models in the UK, and a variety of German and Japanese cars, including a Lexus. Perfection has eluded me up to now, but now I seem to have it, at least from a reliability perspective.

I have been accustomed to having substantial unpredictable automotive costs. The part that upsets me is not so much the expense as its unpredictability. With my new contract, my expense will be quite high (about $2800 for two years), but totally predictable.

I believe this rationale applies to a lot of businesses too, and to a much greater extent. Budgets are prepared annually. Unpredictable expenses have to be minimal. This means you can charge customers far more for an annual contract than their average costs would have been without the contract. Sure, you may lose money on one or two contracts that have bad luck and high expenses, but you will win out overall. Predictable costs, even if they are relatively high, are much better than the alternative for both customers and companies.

Here are two nasty events customers, employees, resellers and communities should probably worry about

I live not very far from the corporate headquarters of the Nestlé company. They are going through a period where they have the ‘pleasure’ of a substantial activist investor. The consequences for everyone except shareholders seem pretty negative, and feature frequently in local newspapers and the TV news. This got me thinking…

Companies that do good things for customers, employees, suppliers, partners such as resellers, and for local communities tend to have CEOs that have come from the inside and a business strategy that is quite consistent over time. Consistent can mean constant evolution and adoption of new technologies too, for example. They tend not to have sudden, major change. Sometimes major change happens when a new CEO is appointed from the outside, and sometimes there are other reasons. (In a recent Freakonomics podcast about CEOs, they discussed new research that confirms older research: CEOs from outside, on average, perform significantly worse than insiders, and cost an average of $3 million more annually.) Anyway, CEO changes may cause some major events to occur, and there may be other causes.

I believe there are two types of events that should make alarm bells go off for employees and customers. And I suppose suppliers and the local communities should be worried too. These events are:

  1. The arrival of a substantial activst investor. The underlying message of such investors is simple: ‘You are giving too much to employees, customers, suppliers and the community, and investors should be getting a much greater share.’ Company boards often react to such new investors by saying ‘By amazing coincidence, we were just thinking the same thing. Here are the major initiatives we have to double the share price.’ In the case of Nestlé, the result is a $2 billion savings plan that includes closing two-thirds of their sites here in Switzerland, and cancelling local cultural investments in Vevey, their HQ city. It also includes a number of business disinvestments that I would worry about if I were a customer of those businesses.
  2. Major merger and acquisition activity. Tiny acquisitions don’t matter much. Large ones do. When a company wants to acquire another company, the seller always believes their company is worth more than the buyer wants to pay. This disconnect is resolved by a nasty concept called ‘synergies’. The words used are often about eliminating duplication. The elimination is always one of three things: people, buildings, or payments to suppliers. Each of these has an impact on customers, and of course employees.

I have worked full-time on M&A for a number of years, and have formal training in the area. I am not making this up. Elimination of duplication seems to pass the laugh test, but in practice, I have never seen a deep discussion about the work the people have been doing, and where that work will now happen. The absence of such discussion is partly due to regulatory requirements to discuss layoffs with workers councils in some countries before details can be discussed with employees.

I say the duplication argument seems to pass the ‘laugh test’, but I don’t generally believe it, because of what I have seen when there are substantial divestments. Logically, when two companies are split up, the opposite of what happened when they were joined together should now take place. It never does. When two companies are joined together, the story includes lines like ‘We have two HQ staffs and need only one.’ Seems logical. When companies are split up, you would think the plan would including hiring a lot of people, since work now needs to be duplicated. However, such plans generally have the opposite, meaning major layoffs. ‘We have split our business up into two independent businesses, which will each be run by their current business unit staff. We will lay off all of the HQ staff.’ The laughing stops then.

While activists are active, and while major M&A work is happening, very little that is good for employees, customers, suppliers, resellers and communities is happening. Employees who are not in charge of the change projects should be preparing their CVs /resumes. Customers, suppliers and other stakeholders should be hedging their best. Shareholders can plan on making nice returns, in the short term.

 As always, feel free to disagree…

 

Our latest blog posts

Here are the latest posts. Older posts are still available on the blog page.

image Choosing a benchmark research provider for NPS, CSAT or any other customer experience metrics

I am trying to form my thoughts about what criteria are reasonable when deciding on a benchmark research provider. My current thinking is below. I welcome your additions and corrections.…
image Valentine’s Day classic blog – How to stay married – to your customers of course!

It was Valentine’s Day a few years ago, and I was puzzled by the results of some HP customer experience research. The data source and volume were impeccable. However, the results contradicted a lot of commonly-held beliefs about the behavior of unhappy customers in particular…
image Executive Sponsors and Project Sponsors – Teams you may want to implement

This is the third in a series of three articles on types of teams you may want to implement if you want to. improve customer experience. This time I cover the concept of assigning senior people to customers and projects to create the environment necessary for success.

Notable customer experience items from other sites

Bruce Temkin: The Future of VoC – Insight & Action, Not Feedback

Some of you may have received a request from Temkin Group for feedback on the state of your Voice of the Customer programs. The results are now out on the Customer Experience Matters website, and they are worth a read. His words about insight and action platforms are particularly useful. I note that ‘three-quarters of companies rate their VoC programs as successful’. I remember reading somewhere else that customer views on this are not as optimistic. You can read it here.

Net Promoter System website: NPS program self-assessment

Speaking of assessing the current state of customer experience programs, here is a way to do so on your own if you use the Net Promoter System. You will be taken through a short series of questions that cover the main elements of NPS. The result is a ‘traffic light’ assessment of your progress, meaning a red / amber / green light for each area. Take the free assessment here.

 

Looking forward

I am happy to report that February is already a new record sales month, surpassing January’s record. Thank you. Both months have featured what may be managers making purchases of specific books for their teams, as far as I can tell. I believe having a team read and discuss the same book is particularly important when they have to work together on something new that is included in the book. The reason is that the team gains a common understanding of the words and methodologies described in the book, reducing confusion.

Here are links to all of the books on Amazon.com. Kindle versions are available in all stores. Print versions are available from the major stores only, with the notable exception of Australia, where print versions are not available from amazon.com.au.

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

Customer-centric Cost Reduction

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Color edition)

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Black & White edition)

Please share this newsletter with your friends and colleagues and encourage them to sign up for it here. I have put links to past newsletters on the subscription page. Finally, please feel free to change or cancel your subscription using the link below.

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

#47 – IKEA, Cleveland Clinic, cultural differences, UK service awards and ‘wooden spoon’

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Welcome to the 47th edition of my customer strategy newsletter. The five topics this week are:

  1. IKEA and customer experience – Ingvar Kamprad RIP
  2. The customers (in this case the patients) should not always be given what they want
  3. Latest blog posts
  4. Notable items from other sites
  5. Looking forward
IKEA and customer experience – Ingvar Kamprad RIP

Ingvar Kamprad founded IKEA, lived not far from me for a long time, and pioneered all sorts of interesting things. Following his death, I asked a few people what they thought of IKEA, and what they found memorable. Here is what I retained from that, together with my own views. Yes, it is quite easy to find negative articles about Kamprad’s distant past and some poor experiments with monitoring employees, but I will spare you all of that.

My first encounter with IKEA was shortly after moving to the Netherlands in 1985 to join Digital Equipment Corporation. I moved there from my eighth relocation with the Wrangler jeans company, which was an 18-month stint in Scotland. The clothing industry did not pay very well. While I loved the Scandanavian style I saw in the IKEA store in Arnhem, I had not yet mentally adjusted to having enough money, and bought my furniture from a cheaper Dutch alternative.

IKEA’s first stores outside Sweden were here in Switzerland. While his company was greatly admired in Sweden, Kamprad made himself unpopular by seeming to move to Switzerland to avoid paying Swedish personal income tax. (Wealthy foreigners can negotiate their tax rates when they move here, even with relatively low incomes.)

One of Kamprad’s then innovative great ideas was to outsource manufacturing of his furniture to a low-cost country. In this case, Poland was that country, well before the Berlin wall came down. Making that happen was a major challenge at the time.

He was legendarily frugal. He drove around here in a 20-year-old Volvo.

He set up his stores so that the whole family family could enjoy the trip and stay several hours without getting bored. Store features include cheap food and free play areas for children, along with the considerable labyrinth inside the store itself. Personally, I still like visiting, and feel the model apartments of different specified sizes are a great feature.

Homeless and destitute people often go to the Geneva store early in the morning. For $1.50 anyone can have a croissant, bread, butter, jam/jelly/Nutella and unlimited coffee or tea. Plus the store puts no pressure on people to leave, ideal on cold winter mornings. This is part of a broader phenomenon of trying to do at least some good in the local communities where they are present.

It seems to be an attractive place to work, at least around here. Employees receive a 13th and sometimes a 14th month salary at the end of the year. And there is one day a year where all profits from sales are shared by the employees. IKEA promotes this well, and it always seems to be a busy day.

Customers / patients should not always be given what they want

I feel quite strongly about this subject and will write about it at greater length soon. The current state of customer satisfaction measurement and health fads in medicine is probably killing people. OK, this is just my view, and may be an exaggeration. However, I generally try to base my views on facts.

I write this after listening to a superficially excellent podcast by Jeanne Bliss. She interviewed the Cleveland Clinic Chief Experience Officer, Dr. Adrienne Boissy. You can listen to the podcast here. She described the work Cleveland Clinic has done to implement customer experience measurement and improvement processes.

However… I have to call out two major major (not a typo) issues. One is generic, and applies to all healthcare institutions that survey patients. The second is specific to Cleveland Clinic. (Apparently they have dropped the ‘The’ from their name.)

The first issue is that (in my opinion) measuring patient satisfaction with doctors exclusively at a transactional level is an awful idea. Cleveland Clinic went further and put the doctors’ ratings online. My views on this are based on the third of a three-part Freakonomics podcast series called ‘Bad Medicine’. Stephen Dubner spoke to Marty Makary, a surgical director and health policy scholar at Johns Hopkins. According to Makary:

 “By putting all this attention on customer satisfaction or consumer satisfaction or patient satisfaction, we’re creating a consumerist culture in healthcare. People come in, they want an antibiotic for their kid. They don’t care what your diagnosis or explanation is. They want to walk out with that antibiotic prescription. Or you’re in pain and you want that pain script. If the doctor is under the microscope for their patient-satisfaction scores, you can imagine the perverse incentive here.”

This is supported by a 2012 article in the Journal of the American Medical Association. Of course it is all made worse by people’s tendency to believe their ten-minute Google search is just as robust as a doctor’s ten years of training. I feel that everyone working on patient experience in healthcare needs to remember that the purpose of doctors is to help you, not to please you. 

The second issue is that Cleveland Clinic includes a ‘Wellness Institute‘ that practices ‘integrative medicine’. The principle of integrative medicine is to combine scientifically-proven techniques with others that have no scientific basis at all. You can read this article from the Science-Based Medicine website to get a better understanding of their Wellness Center, and even the personally-held anti-vaccination views of its leader. The issue with ‘Complementary and Alternative Medicine (CAM)’ is that outcomes for serious diseases are worse than for evidence-based medicine. Sometimes much worse. If you scroll about a quarter of the way down this article, you will see a set of graphs that demonstrate that survival rates for people who start off with CAM are far worse than for those who use evidence-based medicine right away. This (according to the biography I read) is what happened to Steve Jobs, who had a rare form of pancreatic cancer that is curable, but he rejected conventional medicine until it was too late to save him.

It should be obvious that I am against CAM, and indeed many nutrition fads that are held to be ‘traditional’. The next time someone tells you that you need to ‘avoid all the chemicals and toxins’ by switching to nutrition or medicine that is hundreds or thousands of years old, ask yourself how long people lived back then. Is that what you want?

As for patient research and doctor ratings, it should be based on outcomes. For example, three or six months after hip replacement surgery, ask the patient ‘How functional is your hip?’ and ‘Are you happy you had the surgery?’. Almost nobody does this. These are far more important questions than whether the receptionist was nice to you, or whether the doctor was in a good mood.

Our latest blog posts

Here are the latest posts. All three listed below are about types of teams you may want to implement if you are designing a new customer experience strategy for your company. Older posts are still available on the blog page.

image Executive Sponsors and Project Sponsors – Teams you may want to implement

This is the third in a series of three articles on types of teams you may want to implement if you want to improve customer experience. This time I cover the concept of assigning senior people to customers and projects to create the environment necessary for success.
image Customer Advisory Boards – One of four types of team you may want to implement

Following on last week’s article about Customer Success teams, here are a few words about Customer Advisory Boards. I provide various hopefully-useful suggestions, including that you must remember who is supposed to be doing the advising…
image Customer Success Team – First of four types of team you may want to implement

There are four types of teams you may want to implement to improve customer experience. I will cover the the membership and work of each in three blog posts. The mission of Customer Success teams is to ensure customer get the ROI they expect from their investments.

Notable customer experience items from other sites

Quora Q&A on adjusting NPS for cultural differences

This Quora question, with an answer by Rob Markey, dates back a bit, and is still informative. “Are there variations to the classic NPS survey that may more accurately account for certain cultural features of emerging markets (e.g. Africa)?” You can read it here.

This is Money article on service awards and ‘wooden spoon’

I particularly like the heartwarming story about what UK mobile provider Three did for a distressed customer. They generally found that service had improved in the UK, though Her Majesty’s Revenue Commission still finished last. Read it here.

Looking forward

I plan to refresh my annual ‘Valentine’s Day’ blog next week. I hope you will enjoy it. The versions I have posted over the last three years have been the most popular articles I have ever written. The story I tell also serves as a basis for my highest-rated speaking and training engagements.

As always, an underlying reason I blog and write newsletters is to encourage interest in our books. Here are links on Amazon.com. Kindle versions are available in all stores. Print versions are avaialble from the major stores only, with the notable exception of Australia, where print versions are not available from amazon.com.au.

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

Customer-centric Cost Reduction

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Color edition)

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Black & White edition)

Other than that, I confirm my increasing motivation to write more about how to avoid destroying customer relationships as companies go through major cost reductions.

Please share this newsletter with your friends and colleagues and encourage them to sign up for it here. I have put links to past newsletters on the subscription page. Finally, please feel free to change or cancel your subscription using the link below.

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

#46 – Artificial Intelligence and CX, sponsorship for your work, Micro Focus, Barclays, record book sales

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Welcome to the 46th edition of my customer strategy newsletter. The five topics this week are:

  1. Artificial Intelligence and Customer Experience
  2. Preserving customer experience work in times of cost reduction
  3. Latest blog posts
  4. Notable items from other sites – Micro Focus NPS, Barclays’ CX journey
  5. Looking forward
Artificial Intelligence and Customer Experience

As mentioned last week, I was the MC for a webinar about AI and CX on Tuesday. I think it went well, though I am not very objective, of course. The people providing most of the content were Dr. Alyona Medelyan, CEO of Thematic software (www.getthematic.com) and Nick Stroud, Director of Brand Loyalty at ManpowerGroup.

We started with a refresher about what Artificial Intelligence, Machine Learning and Deep Learning are, and the role of Natural Language Processing in each. We covered a number of AI examples, including how ManpowerGroup is using Chatbots in customer experience.

Alyona covered the latest relevant developments in AI, focusing on a concept that was new to me: ‘Prescriptive Analytics’. This means analytics that not alone tell you what is going on, but also provide information on what you should do about it. Nick showed how ManpowerGroup has put this into action with their two main groups of customers.

I found it all to be quite insightful, and I learned some new things, including how the Chinese equivalent of Uber has found ways to improve customer experience for people who are still in the car.

See what you think. You can access the replay by filling out the form here.

Alyona mentioned Big Blue beating Gary Kasparov at chess. This reminded my of my brother’s drawing below. (You can see lots of his drawings in our book “So Happy Here” on Amazon. And yes, he has a rather absurd sense of humor.)

Preserving customer experience work when cost cuts have to happen

Earlier this week, I spoke to a very experienced Customer Succcess team leader that I had not met before. She told me a pretty sad story that took place a couple of years ago. Her very large employer had a Customer Success team of over 50 people. A new manager came in two layers above hers, around the time the corporation needed to reduce costs. The person did not understand what the team did, and completely eliminated it. After discovering the problems that caused, the company had to rebuild a new team from scratch about a year later.

This reminded me of the key actions customer experience leaders need to take on an ongoing basis to ensure that they have good sponsorship for their work, through good times and bad: 

  1. Make sure senior leaders talk about your work. If they are not already doing so, supply them the necessary material. If someone else writes their all-employee messages and prepares their presentations, meet with that person and provide them with the necessary compelling collateral. They want to talk about customers, so will welcome it.
  2. Ensure that the names of your teams and projects are clear, and reflect what the work is.
  3. Deliver something every two or three months that is clearly worth the effort and investment.
  4. Ensure you are able to communicate your work clearly, both internally and externally.

I just call these ‘The four rules of sponsorship’, and have written about them extensively in our books and elsewhere.

Our latest blog posts

Here are the latest posts. The first two are in a series of three about types of teams you may want to implement if you are designing a new customer experience strategy for your company. Older posts are still available on the blog page.

image Customer Advisory Boards – One of four types of team you may want to implement

Following on last week’s article about Customer Success teams, here are a few words about Customer Advisory Boards. I provide various hopefully-useful suggestions, including that you must remember who is supposed to be doing the advising…
image Customer Success Team – First of four types of team you may want to implement

There are four types of teams you may want to implement to improve customer experience. I will cover the the membership and work of each in three blog posts. The mission of Customer Success teams is to ensure customer get the ROI they expect from their investments.
image The Net Promoter System® is defined and documented in one single way – Everything else is fake news

I have been trying to work out why most Net Promoter System implementation I see are missing even some basic things. The root cause, I believe, is lack of common understanding about the reference source of information about what the system actually is…

Notable customer experience items from other sites

NPSbenchmarks.com – Micro Focus and NPS

Micro Focus gained its initial success by producing a version of COBOL for the PC. I believe COBOL is still the most common programming language used on mainframes in large banks. COBOL programmers tend to be even older than me, so there will be a problem at some point. More recently, Micro Focus acquired the software division on Hewlett Packard Enterprise, where I used to work until retiring two years ago. In this interview, Cvetilena Gocheva talks to Dr. James Borderick, who leads customer research at Micro Focus. He descibes how they have implemented NPS and makes some valuable points about the importance of talking to Passives. You can read it here.

NPSbenchmarks.com – Barclays Bank

I promise this is just a coincidence. Both articles I found interesting this week are on the same website. I have no commercial relationship whatsoever with the site, or its owner, CustomerGauge.  In this article, Sarah Frasier discusses Barclays’ approach to improving customer experience. She explains the interesting relationship between their customer experience and financial goals, and you will see a photo of one of their customer interactions on a smartphone. Read it here.

Looking forward

As forecast last week, January has been a record month for our book sales, by a considerable margin. This applies to all three categories: Kindle, print, and the page reads in the Kindle Unlimited / Kindle Online Lending Library services. Thank you! And we would of course appreciate you writing a review on Amazon, no matter what you think of the books.

Here are links to the books on Amazon.com.

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

Customer-centric Cost Reduction

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Color edition)

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Black & White edition)

Other than that, I realize many companies have cost reduction objectives, and that I have not written enough about ‘customer-centric cost reduction’ recently. I will work on that.

Please share this newsletter with your friends and colleagues and encourage them to sign up for it here. I have put links to past newsletters on the subscription page. Finally, please feel free to change or cancel your subscription using the link below.

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

#45 – CX as Homeostatic System, NPS Standard, CX ROI, and more

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Welcome to the 45th edition of my customer strategy newsletter. The five topics this week are:

  1. Some CX improvements work like antioxidants and vitamins work on people
  2. Reactions to my article on the NPS standard
  3. Latest blog posts
  4. Notable items from other sites – Temkin factoids, CustomerThink on getting CX right
  5. Looking forward – Webinar on AI and its impact on Customer Experience
Some CX improvements work like antioxdants and vitamins

Many people will object to what I am about to write here. Not because of what I say about customer experience, but because of what I say about some common health misconceptions. Read on, but prepare to be offended.

WIn the past, I have written about Herzberg’s theory of motivation, and about ‘hygiene factors’. These are things that you must do reasonably well for your customers, but where trying to ‘delight’ them is pointless. Doing basic problem solving in a telephone support center is a good example. Call center interactions have four times the probability of making a customer disloyal as loyal. The best call center interaction is none at all.

I have come up with a new metaphor for all of this: the human body. There are things our body needs to avoid being unhealthy, and there are things that our body needs to be outstandingly healthy. There is not much overlap between the two. Our bodies are what is called homeostatic systems. A homeostatic system is one that is self regulating. You can think of it like a heating thermostat. You body wants to maintain certain levels of vitamins, minerals and antioxidants. If you add more than is needed to maintain this level, your body excretes the excess. So, for example, all the pseudoscientific advertising you see telling you that antioxidants are good for you so you should drink as much pomegranate juice as possble are simply false. Vitamins, antioxidants, and indeed many other things such as oxygen are ‘hygiene factors’. You have to have them to live, but having huge amounts does not make you healthier.

Exercise is in a different category. Exercise is motivating and makes you healthier. Being part of a group improves your life, as does being admired for your work, sporting performance, artistic ability or simply some of your physical attributes.

So it is with customer experience. Your customers’ homeostatic systems expect your credit card approval system to do its job, expect your people to answer the phone, expect your website to be responsive, and so on. Improving the credit card system so that approval takes half a second rather than a full second will bring you nothing. Remembering who your customers are and personalizing their experiences with you are in a completely different category. These are among the many ‘above and beyond the average’ things you can do to ensure customer loyalty.

So, I am sorry if I have offended the one-third of my readers who believe that taking additional antioxidants or vitamins beyond the basic daily requirements improves their health. They are just demonstrably and scientifically wrong, in the same way that people who believe they should invest millions to improve call center operations that are already fine are scientifically, provably wrong. The only exception I can think of is call center businesses. Feel free to disagree below.

Reactions to my article on the NPS standard

I Last week I wrote an article on how the Net Promoter System is defined and documented. I posted it here and on the main LinkedIn feed. I got quite a few reactions. Let me reiterate two reasons I think having a standard is imporant, then add something about open systems like NPS.

An NPS standard is important for many reasons. Two that particularly matter to me are software providers, and companies that compare themselves with other companies. If every company buying survey software has a different expectation for what an NPS feedback request should look like, software companies will have great difficulty satisfying their customers. If the Acme company says ‘Our NPS is 47’, but measures it in some way it has dreamed up on its own, NPS becomes discredited. OK, the same applies to all feedback systems.

The Net Promoter System has been designed as an ‘open system’ that companies are free to implement without paying any fees to the rights holders. Linux is a similar open system. Android and Linux have a standard, reference, core distribution. Companies are free to add to them, creating attractive software such as the Ubuntu desktop version of Linux, and many others. None of this changes what the core Android and Linux standards are. The same applies to the Net Promoter System. It is defined the way I set out in the article in the blog post list below. Many people have added to it, creating their own ‘skinned’ versions of the system. Others have changed it, but still incorrectly call it NPS, and this is just wrong. Please have a read below if you have not already seen the article.

 

Our latest blog posts

Here are the latest posts. The one at the top of the list is the first in a series about types of teams you may want to implement if you are designing a new customer experience strategy for your company. The second item is the article I referred to above. Older posts are still available on the blog page.

Acme Happy Customer Success Team – First of four types of team you may want to implement

There are four types of teams you may want to implement to improve customer experience. I will cover the the membership and work of each in three blog posts. The mission of Customer Success teams is to ensure customer get the ROI they expect from their investments.
NPS definition The Net Promoter System® is defined and documented in one single way – Everything else is fake news

I have been trying to work out why most Net Promoter System implementation I see are missing even some basic things. The root cause, I believe, is lack of common understanding about the reference source of information about what the system actually is…
Journey mapping Journey mapping – The Main Customer Experience Measurement and Improvement Systems – Part 7

This is the final article in a series of seven about CX measurement and improvement systems. I hope you have enjoyed them, and that you learned at least a little.…

Notable customer experience items from other sites

Temkin Group infographic: 15 CX Factoids – Customer Experience Efforts & ROI

Really nice infographic with interesting data on the ROI of various customer experience investments. You can even download it as a poster to put on your wall. Great stuff! Here.

CustomerThink – Why Can’t We Get Customer Experience Right?

Noreen Seebacher normally writes for Arke and contributed this article to the CustomerThink site on Sunday. Her main themes are: Technology isn’t everything; Put people first; Relationships drive customer experience. Well-worth the three or four minutes it will take you to read it here.

 

Looking forward

As mentioned last week, I have been invited to be the chairperson for a January 30th public webinar with leaders from Manpower and Thematic software about AI and its importance for customer experience. It will start at 11 a.m. Pacific time, which is 8 p.m. Central European Time, for example. You can read a little about it and sign up for it here.

It looks like January will be a new record month for our book sales. Thank you in advance for that. We have already reached a new record number of page reads in the Kindle Online Lending Library, which is free to Prime members. As always, the thing you can do that will help us most is to review them on Amazon, no matter what you think of them. Here are links to the books on Amazon.com.

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

Customer-centric Cost Reduction

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Color edition)

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Black & White edition)

Please share this newsletter with your friends and colleagues and encourage them to sign up for it here. I have put links to past newsletters on the subscription page. Finally, please feel free to change or cancel your subscription using the link below.

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

 

#44 – Watermelon problems, Behavioral Economics, and more

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Welcome to the 44th edition of my customer strategy newsletter. The five topics this week are:

  1. Watermelon problems
  2. New Net Promoter System podcast – Behavioral Econonomics
  3. Latest blog posts
  4. Notable items from other sites
  5. Looking forward
Watch out for ‘Watermelon problems’

While I was in LA last month, I spoke with the customer experience leader of a Fortune 100 company. He used a striking metaphor. He described ‘Watermelon problems’. These are situations where all of your performance indicators are superficially green. But when you dig deep into what is going on, you discover it is bright red.

Watermelons are quite common in deep relationship research with your largest customers. They arise when you only manage to speak to customer executives who have positive views about your company. The best way of ensuring you avoid this particular type of watermelon is to use the customer’s organization chart to list the decision-makers, decision-influencers, and of course the end users of your products and services. Make sure you get a representative set of responses. People who refuse to talk to you probably don’t have many positive things to say.

Watermelons are normally tasty and refreshing. In customer research, they are just the opposite.

For some reason, this story inspired my brother to think of a certain movie by Ridley Scott, starring Sigourney Weaver… As my friend Dr. Jamie Borderick said on seeing this “As a watermelon customer, no one can hear you scream.”

 
Drawing by Peter FitzGerald – Enjoy much more of his work in ”So Happy Here” – Available on Amazon

New Net Promoter System podcast – Behavioral Economics and CX

I recorded a series of six podcasts with Rob Markey way back in June and July. The final one just went live. Rob and I both love Behavioral Economics, and the writings of Daniel Kahneman and Dan Ariely in particular.

We cover the relevance of their work to customer experience. We give examples of when to use the ‘Peak-End’ theory, ‘Loss-aversion’, and the power of apologizing, among other things. I hope you enjoy it.

The podcast should have appeared automatically in your iTunes feed, or wherever you get your podcasts. It is also available on the Bain netpromotersystem.com/podcast page.

Our latest blog posts

Here are the latest posts. Older posts are still available on the blog page.

image The Net Promoter System® is defined and documented in one single way – Everything else is fake news

I have been trying to work out why most Net Promoter System implementation I see are missing even some basic things. The root cause, I believe, is lack of common understanding about the reference source of information about what the system actually is…
image Journey mapping – The Main Customer Experience Measurement and Improvement Systems – Part 7

This is the final article in a series of seven about CX measurement and improvement systems. I hope you have enjoyed them, and that you learned at least a little.…
image The main customer experience measurement and improvement systems – Part 6 – Proprietary systems

Various consulting companies propose proprietary measurement systems. Your company may have its own composite metric too. The Temkin Group, for example, has both the Temkin Loyalty Index and the Temkin Experience Rating. They are useful examples…

Notable customer experience items from other sites

Promoter.io – 13 Hopeful (but absurd) Customer Success Predictions for 2018

Yes, we occasionally get a good laugh. Dana Severson wrote this list to bring in the new year at Promoter.io. (You may remember them as among the first companies that provided technology to allow embedding of the NPS rating question directly in outbound feedback requests.) Personally, my favorite prediction is number 11. There are one or two I don’t understand, but maybe this is because I am not American. The predictions are here.

Quora – Useful from time to time

I regularly read and contribute to some topics on Quora. It is a site with a general principle: you have to ask a question. About half the time, the questions are asked and immediately answered by people who are trying to sell something. The other half tend to be more useful. Among others, I follow the Net Promoter Score feed, and the Customer Experience feed. Why not have a look?

 

Looking forward

I have been invited to be the chairperson for a January 30th public webcast about AI and its importance for customer experience. More details next week!

It is still January and there is still time to think about your professional goals for 2018. What about doing something for your customers? But what? Our books can help! Here are links to each on Amazon.com. If you use a different country site, you can just open the link, then edit .com to .co.uk, .de or whatever:

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

Customer-centric Cost Reduction

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Color edition)

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Black & White edition)

Please share this newsletter with your friends and colleagues and encourage them to sign up for it here. I have put links to past newsletters on the subscription page. Finally, please feel free to change or cancel your subscription using the link below.

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

 

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