strategy

November 13, 2024

A Big Question in AI: Build or Buy?

Maurice FitzGerald / AI, Customer AI, Customer experience, Machine Learning / Customer Experience, strategy /

AI continues to be a hot topic and just about every corporate IT team wants to be able to say they are working on an AI project. Looks great on their CV / resume. And I suppose a team that delivers even a small AI project will be rewarded more than a team taking care of that new accounting software, when it comes to annual review time.

However, if you manage a product, service, or major function such as sales for your company, the decision to build or buy AI software that will improve customer retention and growth is a big one. Should you buy something off the shelf, or have an internal team build it for you?

I could give you all sorts of data-driven, complex answers to this question and I would rather not. I like to use metaphors. In this case, let’s suppose you own a plot of land and you want a new house. Your extended family is enthusiastic about the new project, and two (of the 30 people on the list) have already worked in construction. Their message is clear “We know how to do this. We can get the whole family together to build it for you. The tools we can buy down at the DIY store are the same as the professional builders use. We guarantee that the result will be as good as what that builder you have in mind can do and we can do it a lot more cheaply.”

So . . . should you build or buy?

The questions to ask are fairly simple:

Have they built this type of house before?
When do you need it done? (You really should not believe it when they tell you can do it as quickly as external teams who have done it all before.)
Do you really think that your family using a bunch of fancy and often quite expensive tools for the first time can use them as well as professionals who have years of experience with those tools?
Does your family team understand all of the latest building regulations?
When it’s complete and you find things that need to be improved, will they still be around to do that?

Customer AI - Build or buy? — Created using Microsoft Bing Designer

The house-building metaphor has its limits in this case. An additional fact that matters a lot for your AI decision is this: According to research by Dr. Robert G Cooper about 80% of AI projects fail, mostly for “dumb reasons”.

I could keep going. The message is clear: there are things you simply should not do on your own if you lack experience and need results quickly. There are indeed exceptions, rare occasions where the level of detailed knowledge required to produce a great result is extreme and only your team has it. Such leading edge (probably meaning ‘bleeding edge’) cases are really rare. When you are planning your first major project in a new area, you generally reduce risks of all kinds by working with experienced third parties. Naturally, I am going to add that if you want to implement an AI solution that uses attitudinal, operational, and customer profile data to improve customer retention and growth, look no further than Customer AI from OCX Cognition for your first major project in the space.

Notes

OCX Cognition predicts customer futures. Our breakthrough Customer AI solution lets enterprises transform what’s possible in customer experience. Reduce your customer risk, break down silos, and drive speedy action – when you can see what’s coming, you can change the outcome. Building on more than 100 years of CX-focused expertise in our small team and thousands in teams we have led, we’ve harnessed today’s advances in AI, elastic computing, and data science to deliver on the promise of customer-driven financial results. Learn more at www.ocxcognition.com.

Maurice FitzGerald is Editor-in-Chief, Content at OCX Cognition. He retired from HP where he was VP of Customer Experience for their $4 billion software business and was previously VP of Strategy and Customer Experience as well as Chief of Staff for HP in EMEA. He and his brother Peter, an Oxford D.Phil in Cognitive Psychology, have written three books on customer experience strategy and NPS, all available from Amazon.

November 12, 2024

Sometimes, executives answering surveys have no idea what they are talking about (Discuss!)

Maurice FitzGerald / B2B, Behavioral economics, Blog, Cognition, Customer experience, Customer Satisfaction, Machine Learning, NPS, Psychology, Strategy / Customer Experience, strategy, Surveys /

There is a somewhat strange phenomenon that I have observed at an anecdotal level over the years. It is limited to B2B surveys and causes all sorts of problems. Or at least that’s what I think, and I would like to understand your views too. Here is what I want to discuss:

When we send relationship surveys to B2B customers, we always try to identify key decision-makers and decision-influencers and we ask them to answer a set of questions. This can be done in person, remotely, or by sending a link to a web-based survey, for example. Let’s imagine a situation where a company selling ERP software believes their customer’s Vice-President of Procurement is a key decision-maker. The company sends a survey request out by email and the procurement VP decides to respond. The survey follows a fairly standard format of an NPS question, a couple of open questions about what should be improved, and then a set of 12 questions asking the procurement VP to provide scores about product reliability, the contact center experience, how easy the software was to learn to use, and so on.

This person may have no idea what they are talking about

You may already see where I am going with this. The procurement VP does not use the software and really does not know what is going on. Nevertheless, they have decided to spend five or ten minutes filling out the survey, so they are going to give you scores for everything. Uninformed scores. Wrong scores. Scores that probably correspond to their overall opinion of your company rather than the actual questions being asked.

Then you decide you need to take action on the bad scores, even though your performance may already be perfect.

In this case, the VP is probably out of synch with the rest of the team, especially those using the ERP software every day. These are the people who have useful suggestions, though they may have only a minor role (or perhaps none at all) in deciding whether or not to renew the contract with the software.

Here is my current opinion

In my possibly-wrong opinion, these scores are therefore a relatively accurate predictor of attitudes and future purchasing behavior at the aggregate level (as is ther overall relationship NPS score) but are useless at the level of the individual questions, in terms of telling you which operational improvements you should prioritize to address those attitudes.

Of course you may well find purchasing VPs who have good knowledge of most operational touchpoints, but I think those are rare people in large companies.

I’m not totally certain what to do about this. Do you have some ideas?

I believe the major customer-touching teams in your company do all need input about what they could do better. This issue is that the input needs to be more accurate than it probably is at the moment. For the overall company relationship surveys that are answered by high-level executives, I doubt that adding a request not to answer the driver questions if you don’t know what you are talking about would be a good idea. Maybe we should supply the procurement VP with relevant operational data? Maybe we should accompany all relationship survey requests with the results and trends from any and all transactional surveys we may do?

For transactional surveys, the main issue we all face is that response rates are very low, so we can’t be sure they are accurate. That’s where analyzing operational data trends for all the customers helps. If the operational data numbers and trends don’t match the transactional survey results, I have to say I believe the survey results are wrong, probably because you are not getting the correct people to take the surveys.

So, what do you think? What should we CX and Customer Success experts do about this horrible situation? Yes, I have some ideas ideas. We need more solutions. Please help!

LinkedIn version of this post here

Notes
OCX Cognition predicts customer futures. Our breakthrough Customer AI solution lets enterprises transform what’s possible in customer experience. Reduce your customer risk, break down walls between teams, and drive speedy action – when you can see what’s coming, you can change the outcome. Building on more than 100 years of CX-focused expertise in our small team and thousands in teams we have led, we’ve harnessed today’s advances in AI, elastic computing, and data science to deliver on the promise of customer-driven financial results. Learn more at www.ocxcognition.com.

February 4, 2022

Don’t Look Ahead!

Maurice FitzGerald / Behavioral economics, Blog, Cognition, Customer experience, Machine Learning, Psychology / Customer Experience, Journey mapping, strategy /

Does it exist? Does looking ahead exist? Ever since PhD candidate Richard Curry and his supervisor Brian Owen created Spectrum AI software, the controversy has been growing. And the Don’t Look Ahead movement has become more and more powerful. What does this mean for the world?

As soon as Richard and Brian completed their analysis of the first live customer data, they rushed off for a meeting with Fortune 500 President Meryl Hannity. The President’s team had requested the meeting and agreed that it was critical. They were surprised to be kept waiting outside while the President celebrated a birthday in her team and met with some important social media personalities. Finally, the next morning, they met. Richard and Brian laid out their case, proving they could look ahead, predicting future customer retention and NPS with 84% accuracy.

“Ah…” said the president’s Chief of Staff Novax Jokeovich, “So you can’t prove looking ahead works. And it is inaccurate. This means it does not exist.” President Hannity nodded her agreement and then had to rush off for an extremely urgent meeting with Chief Flower Arranger Khloé Minaj.

Despite never watching television, Curry and Owen decided they would use the most popular information channel in America to get their message across. It did not go as planned. They were frustrated by the constant questions about views expressed on the topic by social media scientists and by Doctor Facebook. Did they choose the right TV network to get their message across?

As trusted science star Gwyneth Kardashian pointed out recently, the only reliable news source and indeed the most popular source on the planet is Wolf News. Here is what reliable Wolf News spokesperson Tucker Cruz had to say on the topic after the interview: “Obviously, looking ahead to understand customers is impossible. The future does not exist yet, so we cannot possibly look at it.” There you have it: the definitive answer. It simply can’t be done.

Despite the Wolf News disaster, the Look Ahead message gained momentum. More and more customer scientists demonstrated that using the technology does indeed identify customers who want to change suppliers and allows actions to be taken before they leave. The customer scientists contrast this with the use of surveys, saying that these only identify what has already happened, and then only for the small fraction of customers who respond. The reaction to this position has been strong.

Fortune 500 President Hannity’s staff united behind a public position then unanimously voted in the Don’t Look Ahead Act. The act notably includes a statement that the second amendment to the Fortune 500 constitution includes the right, even the duty, to “bear surveys.” As they say, “Surveys were good enough for our grandparents and our parents. They are good enough for us. We have a moral obligation to examine our past, and only our past. Don’t Look Ahead!”

President Hannity herself continues to rely exclusively on surveys. Yes, it is true that she is constantly surprised by clients who choose not to renew their leases with her real estate company, but as she says, “After leaving, they had the courtesy to tell us why they left, and we are working on those problems. The biggest problem is not what the customers are saying. The biggest problem is the ridiculous notion that you can look at operational data to read the minds of customers and predict what they will do before they do it. I have a great mind. People tell me mine may be the greatest mind of all time. Even I can’t do this, so it is impossible. Richard Curry and Brian Owen have published fake science, the fakest of all science. Don’t listen to them.”

Now the protests have reached the streets, chanting “Don’t Look Ahead! Don’t Look Ahead!” The future seems uncertain. Where will things go from here? Let’s use Spectrum AI to find out.

News Flash

We understand that Meryl Hannity has agreed to play all roles in the forthcoming blockbuster based on this story. “We find we make a great team, learning a so much from each other,” she explained, looking in the mirror.

July 1, 2021

#109 – Survey problems, Heidi hits the wall

Maurice FitzGerald / Customer Satisfaction, Newsletter, NPS, Strategic initiatives, Strategy / Customer Experience, Customer Satisfaction, Fortune, Net Promoter System, NPS benchmarks, OCX Cognition, research, strategy /

Welcome to the 109th Customer Strategy newsletter. This is a special one. You may have noticed that I have not sent a newsletter since August last year, mainly to avoid confusion with the writing I do for OCX Cognition. And this particular edition is an almost exact duplicate of the newsletter I have just started on LinkedIn. Please subscribe to it on LinkedIn here.

The five topics this week are:

The biggest problem with customer surveys
Heidi hits the wall (Yes, the Heidi from the children’s book.)
OCX Cognition posts
Notable items from other sites – CustomerGauge Experience Awards, omniTouch contact center article.
Looking forward

The biggest problem with customer surveys

I designed and implemented my first customer survey in 1981. NPS and suchlike had not been invented yet. Ever since then, I have been a huge promoter of using surveys to listen to customers, and of course to then design and implement the improvements they want.

Apparently I am a really slow learner. It has taken me 40 years to understand the main defect of even perfectly implemented survey processes. The problem is simple. Response rates mean we listen to a small fraction of customers and work only on what they want. Let’s suppose you have a 10% survey response rate and your Detractors most frequently complain about late deliveries. If you are like most companies that do this well, you call the upset customer and try to retain their custom by offering them a reduction voucher or a free gift of some sort. At the very least, you apologize sincerely.

I used to think that sounded great. Now I don’t. The issue is that you are only taking care of the customers who have complained about late deliveries and were among the 10% who responded to the survey. What about the other 90% of your customers who did not respond and many of whom also had late deliveries? Why have you done nothing for them? Do you really want them to leave you? There is no excuse for this. You know who they all are from your operational data. Apologize and compensate everyone who has had the problem, please!

This can be hard to do manually and customer retention issues are often caused by a combination of issues rather than just one. Modern AI software such as that provided by OCX Cognition and others can identify those situations and help you to address them.

It’s an important topic and I have written about the subject in more detail here.

Heidi hits the wall

Heidi is a beloved character in a children’s book written by Swiss author Johanna Spyri. What is less well known is what happened later. Heidi’s granddaughter apparently came down from the Alps and became a customer experience professional.

I have recently written up what happened to poor Heidi when she presented her request for people and funding to implement things customers requested in her employer’s survey process. Heidi works at a major Swiss bank with its HQ in Zurich. Like many CX professionals, including me, Heidi considers herself a scientist and believes the science should speak for itself. Heidi is not going to like what happens next.

Not good. Not good at all. Heidi and I learned a hard lesson the hard way. (Any resemblance to my own professional experience is entirely coincidental. I promise. Really.) Anyway, please read all about Heidi’s latest adventure here, and let me know what you think.

OCX Cognition posts

I am editor-in-chief for content at OCX Cognition, a CX SaaS software company led by Richard Owen, former CEO of Satmetrix. Here is some of our content that I find interesting. Note that I prepared the B2C benchmarks report myself.

The New Science of Customer Agility

Are you often thwarted by the way your organization operates, using structures that date back 30+ years? Emerging technologies let forward-thinking companies address the fundamental roadblocks to success, using the new science of customer agility to speed up time-to-action and cultivate meaningful cross-team collaboration. Download our report here to learn more about how AI and predictive customer analytics are transforming what’s possible.

The Untapped Power of Operational Data in CX

Customer surveys in a nutshell: too little, too late. To get past the core shortfalls in traditional CX approaches, a richer data set is critical. It’s also readily available, thanks to breakthroughs in data science and computing capabilities, and it delivers operationally. Watch the replay here.

NICE Satmetrix 2021 B2C benchmarks summary report

Let’s talk Pandemic. It’s been terrible in so many ways, but, from a business perspective, what is the NPS data telling us? We explored the extensive data in the NICE Satmetrix 2021 US Consumer NPS Benchmarks, using responses from more than 65,000 adults about 220 businesses in 23 industries. The report shows the general trends and then digs deeper into the airline industry. Get it here.

Notable customer experience items from other sites

CustomerGauge Account Experience Awards

Camilla Scholten and Adam Dorrell founded CustomerGauge back in 2007. They are a CX software company with a B2B focus, based in the Netherlands and recently top-ranked by Gartner in their VOC software report. I found their ‘Account Experience Awards’ announcement interesting. To be in their Leader Category, survey response rates must be above 40% and Detractor loop-closing must be at above 90% within 48 hours. The team at the DHL Supply Chain took top place this time. There’s a short video about it here.

omniTouch – What Kind of Experience Does Your Contact Center Deliver?

Daniel Ord is one of the world’s greatest contact center CX experts. He and his team at omniTouch have been providing workshops, training, and other services to contact center leaders for almost 20 years. I really like this article he has posted entitled What kind of experience does your contact center deliver? I find the positive and negative examples particularly entertaining. As Daniel says, it is a shame that it is so easy to come up with the negative ones.

Looking forward

I am happy to say that our books continue to sell well. Thank you, and a special thanks to those who have included one or more of the books on reading lists for classes they give.

On the OCX Cognition front, I have just received access to the NICE Satmetrix 2021 B2B benchmark data and expect to be able to summarize it and my insights at some point this month.

From a technology perspective, the results of OCX Cognition’s first customer implementations of Spectrum AI software have been fascinating. I have been quite surprised by which sets of operational and other data are now proving to be the best predictors of customer retention and of NPS results.

Once again, please subscribe to the new newsletter on LinkedIn here.

Here are links to all of our books on Amazon.com. Kindle versions are available in all stores. Print versions may not be available from some Amazon sites that are dedicated to smaller countries. You can find the books, or at least order them in many bookstores. If you have already read any of our books, please write reviews on Amazon.

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 feel free to change or cancel your subscription using the link below. I will occasionally use it to send you some content, but will mainly publish on LinkedIn.

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

To change your subscription, click here.

August 18, 2020

#108 – Fortune article on NPS, NPS benchmark reports, and a bit of humor

Welcome to the 108th Customer Strategy newsletter. The subjects this time are:

Happy to have been quoted multiple times in a Fortune article on NPS
Have written seven industry-specific NPS benchmark reports
Latest blog posts – CX Strategy
Notable items from other sites – Let’s have a laugh!
Looking forward

Happy to have been quoted multiple times in a Fortune article on NPS

While I had no idea Geoff Colvin, ‘Senior editor at large’ was working on this article for Fortune, I started to receive messages congratulating me on being quoted four times. The quotes seem reasonably accurate, though I am not sure where they came from. I suppose they are from Bain Net Promoter System podcasts as they are not the precise words I have used in any of our books.

I like the article a lot. It makes many excellent points about the uses and misuses of NPS. I should probably add some more material to the Wikipeda Net Promoter page based on some of the content. I have been meaning to write an update for some time as I believe I now understand exactly how the name of the metric came into existence. If you have some sort of photographic memory you may recall that Fred Reichheld mentioned neither NPS nor the three category names in his seminal HBR article The One Number You Need To Grow.

Please have a read and let me know what you think. If, like me, you don’t have a subscription to Fortune, you can find it on the Bain site here. (Geoff must have had inside information. He even spelled my name correctly.)

Have written seven industry-specific benchmark reports

In my role as editor-in-chief of content for Richard Owen’s new OCX Cognition company, I gained access to the latest NICE-Satmetrix NPS benchmark data. I have just completed the seventh of seven industry-specific reports. Everything is for B2C businesses selling to American consumers. Another team member is working on the transformation of my Word documents and Excel files into a fancy eBook format. The first three reports are live on the OCX Cognition website as I write this.

What I have tried to do is to search for the main reasons an NPS leader is the leader, as well as looking at the reasons some companies have risen or declined in the rankings. My final report, completed a couple of days ago, was on online shopping. The most striking thing was the continuous decline of Amazon in the rankings since 2017, after years of dominance. It was quite tricky to propose some explanations, using both the NPS data and other information. I hope you will enjoy it when you see it.

The full data set and full reports are available via subscription from NICE-Satmetrix. I have only been able to disclose the name of a single company in each of the free, public versions. Those of you in the specific industries should not have too much difficulty guessing the other names in some cases. A person from the auto insurance industry who reviewed a draft guessed most company names correctly.

Here is the full list. The first few have live links to the actual report. If you are a new subscriber to the OCX Cognition insights you will need to fill out a form to have access. If you already have a logon you may need to log in to see the relevant pages. One user told me they were taken to a different page after logging in. If that happens to you, simply come back here and click the link a second time.

Health insurance
Credit cards
Internet Service Providers
Cell phone services
Auto insurance
Banking
Online shopping

We will probably have a benchmarks sub-menu under the Insights heading live by next week. As always, your feedback is most welcome.

Our latest blog posts

I have indeed managed to blog a little bit. The posts on this list are a subset of a long series on how to develop and implement a customer experience strategy. Older posts are still available on the blog page.

CX Strategy (12) – The Main Customer Experience Measurement and Improvement Systems – Part 7 – Journey mapping

Journey Mapping is probably the most sophisticated and complete form of customer experience measurement and improvement. Perhaps too sophisticated. Read what follows and see what you think.

CX Strategy (11) – The main customer experience measurement and improvement systems – Part 6 – Proprietary systems

Various consulting companies propose proprietary measurement systems. The Temkin Group, for example, has both the Temkin Loyalty Index and the Temkin Experience Rating. They are useful examples as they both have one thing in common with the systems proposed by other consulting companies: they are composite metrics, aggregating customer responses to multiple questions.

CX Strategy (10) – The main customer experience measurement and improvement systems – Part 5 – The Wallet Allocation Rule

Notable customer experience items from other sites

42 Hilarious Customer Complaints And Responses That’ll Make You Laugh

I don’t know about you, but all this confinement and social distancing means I need a good laugh now and then. I laughed out loud at a lot of these. If you object to bad language you may want to skip this. Otherwise, enjoy them here.

Looking forward

Our books continue to sell well despite my lack of newsletters and blogs. I recently noticed a negative rating for one book on Amazon.com, written in Italian. The author’s main criticism is that the font I used for the book it too big and he felt that this had artificially doubled the length of the book, compared to using a small font. I suppose that criticism is technically accurate. I would have liked to reach out to him to offer to refund what he paid for the book, but there seems to be no way to do that. If one of you newsletter subscribers happens to be that person, please let me know. That criticism has of course lowered our star rating and I would appreciate it if any of you add your own reading experience to the review list on Amazon.

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.

August 18, 2020

CX Strategy (12) – Journey mapping – The Main Customer Experience Measurement and Improvement Systems – Part 7

Maurice FitzGerald / Blog / Customer Experience, Journey mapping, strategy /

Welcome to the 12th article in a series about customer experience strategy development and implementation.

This is the final article in a sub-series of seven about CX measurement and improvement systems. I hope you have enjoyed them, and that you learned at least a little. This time I will cover journey mapping and make some suggestions about choosing the improvement system that best matches your needs. The journey mapping section is a shortened version of my article on the same subject a couple of years ago, which you can find here.

Journey Mapping

Journey Mapping is probably the most sophisticated and complete form of customer experience measurement and improvement. Perhaps too sophisticated. Read what follows and see what you think.

Most companies and teams start off thinking they have relatively few customer contact points. They tend to think in terms of sales cycles. Each step in the sales journey brings the customer closer to buying your product or service. I formed my current views on journey mapping when thinking about the first step most companies consider: awareness of your product or service.

The number of possible customer touchpoints has multiplied

I feel journey mapping is both incomplete and obsolete for customer experience. Just consider the number of ways a customer can become aware of your product or service. A friend may tell them about it via Twitter, Facebook or at a social event. They may read a LinkedIn article. They could do a web search and just happen upon it by chance. Their manager may just have joined from another company that uses the product. The software industry shows how the old way of thinking of customer journeys is incomplete. In the ‘good old days’, you needed to buy hardware to run software. This meant that the central IT and procurement people were important.

The growth of Slack is an example of a different paradigm. Small groups of users typically start to use the messaging product for free on their own. It spreads to larger groups that have the authority to buy the licenses on their own, since they need no new hardware, and it all grows from there. The history of Salesforce.com is full of stories of sales teams implementing the software without the permission or authorization of central IT. The message here is that modern customer journeys contain more potential customer touchpoints than you can reasonably map and address. Creating an initial journey map takes a long time, and it will be obsolete before it is complete. In addition, whoever is funding your work will run out of patience before you have finished.

Things other than touchpoints matter

The effort involved in creating a customer journey map makes it easy to think that the analysis covers all there is to cover. It is also easy to think that all touchpoints are equal. They are not. For most industries and companies, brand image attributes have close to the same importance as experiences customers may have when they contact you in some way. For some businesses, your perception as environmentally friendly or socially responsible can be critical. An example where the environmentally friendly image is important is the Whole Foods chain in the USA, now owned by Amazon. How does your public image compare to that of your competitors? It is certainly more important than some individual administrative touchpoints like issuing credit notes.

Don’t bother with comprehensive maps. Be tactical. Think in terms of ‘episodes’

Consistent with the rest of the messages about strategy in our books, I recommend doing customer journey maps exclusively for areas that have been identified by customers, partners or employees as needing improvement. This means you should do very few journey maps, and will probably only work on improving one or two at any given time. You do not have the resources to do everything everyone wants to do at the same time. Prioritize, using customer input. When your colleagues come to you saying they want to do a journey map for an area nobody has identified as needing improvement, be clear why you are saying no, and perhaps give them the opportunity to work on a journey map in a more important improvement area. A metaphor that may help is the one of ‘episodes’. If you think of the entire customer journey as a TV series, a focus area would be a single episode. An episode should be defined in terms of the customer outcome, rather than just the name of a process. More on this in a future blog post.

One situation where you need a comprehensive map

There is one situation where comprehensive journey mapping is essential, and that is when your company is replacing its existing management systems by new software designed to help customers and employees manage every interaction a customer has with your company. If you forget something important that your competitors have not forgotten, you will probably suffer. The customer experience team can help by supplying data about customer satisfaction with existing processes as you design new ones.

HP example

HP’s software business grew through acquisitions, and we had many different ordering systems in place. When we decided to go for a single system, we used journey mapping to prioritize and understand the effort. Based on the satisfaction metrics for the different processes, everything to do with ordering and obtaining license keys that worked correctly came out at the top of the improvement priority list. In addition to working on how to improve those processes, we determined how to eliminate the need for customers to deal with the keys at all. The diagram at the top of this article is an example of a customer journey map for a software company. There are items where customer interaction is rare. When using the map, you would use your own customer and competition research to indicate which items most need improvement, and which are the ones where you have a competitive advantage that you need to sustain.

Conclusion

Journey mapping is a complex technique that takes a lot of time to do well. Be selective. Only use it for the small subset of process that your customers say you need to improve.

Deciding which improvement system is best for you

While a number of systems have been described here, the one that is best for you may not be the one whose features and benefits you personally prefer. What follows are some additional decision criteria.

Your CEO’s experience

Meg Whitman came to HP from politics, after an unsuccessful attempt to become governor of California. She had been CEO of eBay before that, and worked at Bain earlier in her career. eBay used NPS. Bain invented NPS together with Satmetrix. Nobody could conceivably have persuaded Meg that NPS should not be used at HP. She insisted that it be implemented across the company. If you have a new CEO and are implementing an improvement system for the first time, find out what the CEO used in the past and whether it was considered successful. Don’t bother proposing anything else without a really good reason. Of course I am picking the CEO as an example of an important person. There may be others in your management chain who matter more to you.

Cost

If you have a limited budget, you may want to use whatever system costs the least, avoiding anything that carries licensing fees or needs substantial upfront investment. In principle, this would drive you to the Net Promoter System for general use, or Customer Effort Score for service centers. There is lots of free and inexpensive software available to support NPS implementation, somewhat less for CES. If you have just a small number of customers and want to get started with surveys, the free version of SurveyMonkey has certified NPS templates in a number of languages, as do some other companies. You should be able to find at least some NPS benchmark scores for your industry without cost. There are many online forums that discuss NPS and indeed other methods.

Sponsorship

If you have done your research and found that customers are not currently mentioned among the top formal priorities for your company, you may want to pursue a highly selective approach. If other things matter more to your CEO at the moment, you should implement something that is easy to communicate, such as NPS, and run it explicitly as a pilot. There is an advantage in lack of current sponsorship in that you may have more time to gather data and prove the financial ROI before you are in the spotlight.

Your views are welcome

As usual, this article is a modified version of a chapter of one of our books, in this case Customer Experience Strategy – Design and Implementation. All of our books are available on Amazon only, in Kindle and paperback formats.

Your views on are welcome below.

August 18, 2020

CX Strategy (11) – The main customer experience measurement and improvement systems – Part 6 – Proprietary systems

Maurice FitzGerald / Blog / Chief Customer Officer, Customer Experience, Proprietary systems, strategy, Surveys, Temkin Experience Rating /

This is the 11th article in a series about customer experience strategy, and the sixth in a subset about CX measurement and improvement systems.

Temkin Loyalty Index

From the Temkin website, “The Index is based on evaluating consumers’ likelihood to do five things: repurchase from the company, recommend the company to others, forgive the company if it makes a mistake, trust the company, and try the company’s new offerings.”

Temkin Experience Rating

Again, from the Temkin website, “The Temkin Experience Ratings are based on evaluating three elements of experience:

Success: How well do experiences meet customers’ needs?
Effort: How easy is it for customers to do what they want to do?
Emotion: How do customers feel about the experiences?”

The Temkin Experience Rating report is available free each year on the Temkin site. An Excel file with all the data costs $395. Within the report, they state “To improve customer experience, companies need to master four competencies: Purposeful Leadership, Compelling Brand Values, Employee Engagement, and Customer Connectedness.” It should be obvious and it is indeed stated that customers would never come up with such a list. The improvement suggestions come from a completely different study. The Temkin Experience ratings are calculated using an average of the answers to three rating questions. Customers are not asked what should be improved. There is no claim that you can predict revenue from the experience ratings, though there is such a claim for their Loyalty Index. The diagram at the top of this article shows the questions asked, copied from the Temkin site with permission:

It is not at all evident that these are the perfect questions to ask in a study of customer experience. I don’t dispute that they are valid questions. I would just find it difficult to explain and defend them in front of an audience.

Compaq and HP: The Account Loyalty Index

The Account Loyalty Index was a metric from HP and Compaq’s deep-relationship survey and is now part of the HPE Relationship Assessment Process. It is a composite of three individual metrics and is an excellent predictor of customer spending. All three are on a 1 to 5 scale and they are averaged to come up with the ALI number. The component metrics are ‘Overall satisfaction’ (CSAT), ‘Likelihood to repurchase’ and ‘Likelihood to recommend’. ALI scores of 3.5 or more always lead to increased spending. We loved the metric, though things gradually got more complicated. When HP merged with EDS, EDS brought its own composite metric from their Voice of the Client process. We never merged the two measurement processes, as they served different purposes. The EDS business was mainly long-term outsourcing contracts. VOC measured customers’ views on the performance of individual agreements, while the Compaq / HP process was at the overall relationship level. The ALI and VOC metrics both took quite some time to explain to new audiences. The HP PC and Printer business had a different set of high-spending customers and its own different process and metrics. Once Meg Whitman came in as CEO, she found this all too confusing and imposed the Net Promoter System throughout the entire company.

Advantages and disadvantages

The use of composite ratings has advantages and disadvantages. The principal advantage of well-designed composite metrics like the Temkin Loyalty Index is that they should be better predictors of future market share than metrics based on answers to a single question. The major disadvantage of composite metrics is that they are difficult to explain and understand. It is hard to overstate how important that difficulty is. If you are not able to explain your metric in 10 to 20 seconds, I don’t believe it will ever be completely trusted. Composite metrics all take too much time to explain. Unless the people to whom you are presenting work in customer experience full-time, you will have to start every presentation by explaining it again, as they are really difficult to remember. Too many audiences will start to doze off while you are explaining how the metric works. Those who have heard it before or who think they already understand it will just start to look at their phones or do their email while you are speaking.

Conclusion and personal opinion

The following is a personal opinion. You may have a different experience, and I would enjoy hearing about it if so. It is also possible that my views arise from the communication difficulties that are typical in large organizations. Anyway, here goes:

The relative accuracy of composite metrics is irrelevant. They are close to impossible to communicate concisely and consistently. Do not use them.

Feel free to agree or disagree below.

This article is a slightly modified version of a chapter in Customer Experience Strategy – Design & Implementation, one of four books written in collaboration with my artist / cognitive psychologist brother Peter. The others are Net Promoter – Implement the System, Customer-Centric Cost Reduction, and a book of Peter’s illustrations, with learning points: “So Happy Here” – The Absurdist but Essential Guide to Better Business.

Next time: Journey Mapping

August 18, 2020

CX Strategy (10) – The main customer experience measurement and improvement systems – Part 5 – The Wallet Allocation Rule

Maurice FitzGerald / Blog / Customer Experience, Net Promoter System, NPS, strategy, Surveys, Wallet Allocation Rule /

After a bit of a break, here is the 11th instalment of our series on customer experience strategy. This is the fifth article in a sub-series on CX measurement and improvement systems.

Authors Keiningham, Aksoy, Williams and Buoye describe the system in the book of the same name. Its focus is a composite metric that combines the list of brands that a customer thinks of and their relative satisfaction with the same brands. Their research on the metric is sound and predicts share of wallet well in consumer businesses. While they focused on consumers, it seems reasonable to believe the same logic would apply to B2B situations. Even though the book documents some incorrect assumptions about how the Net Promoter System works, the conclusions are still valid. I consider this as one of several composite metrics that should indeed have better predictive value than NPS in specific situations. All share the same issue of being relatively difficult to communicate, in part because they are not as simple or popular as NPS.

Six-step measurement and improvement process

Here are the six steps in the Wallet Allocation Rule process:

Survey your customers to find out how they rank you and the competitors they also purchase from. The ranking is based on their satisfaction, NPS or a similar metric. Since this ranking is the numerator, it is fair to say that the overall equation represents a sophisticated manipulation and improvement of the satisfaction or NPS score. Note in passing that the authors disagree strongly with what I have just written, but I believe no other logical conclusion is possible.
Apply the Wallet Allocation Rule to establish the share of wallet for each competitor.
Determine how many of your customers use each competitor.
Calculate the revenue that goes from your customers to each of your competitors.
Identify the primary reasons your customers use your competitors.
Prioritize improvement opportunities.

Let’s consider these steps in more detail, comparing them to other methods.

Survey your customers to find out how they rank you

While the authors did this initially as a one-off high-volume exercise, it is hard to get this step to work well if you do the surveys yourself. If the survey goes out in your name as the authors suggest, the respondents will be biased in their responses. That bias will only affect the answers about your own company. There is no reason to believe the bias would affect the other competitors’ scores relative to each other. You could of course use double-blind benchmark surveys administered by a third party. This is identical to the benchmarks survey method used for other improvement processes.

Apply the Wallet Allocation Rule

First, what precisely is the Wallet Allocation Rule? The formula at the top of this article shows how it is defined in the book.

This should work as a predictive metric providing the customer continues to split their purchases among the same brands. There are industries that are relatively stable and where that logic is sound. There are industries with low barriers to entry, such as SaaS software, where it does not work at all. In fast-changing industries, you are better off using the relative NPS rank in the market, rather than by customer. IBM, Computer Associates and HP learned this the hard way. For many years, the three companies shared the majority of the market for system-management software. Then one fine day, Service Now came on the scene with a new type of software that required no new hardware to run it. They went from nothing to a market-leading position in just a few years, despite awful customer satisfaction at the start. Indeed, with the satisfaction ranking numbers they had in their first couple of years, the Wallet Allocation Rule would have predicted their quick demise. The Net Promoter System, with its focus on trend, correctly predicted the opposite. The source for this statement is double-blind benchmark studies carried out for HP by IPSOS.

Determine how many of your customers use each competitor and the revenue share for each

This exercise is useful in any case, if you want to understand what you have to gain and lose financially. One challenge is making sure your sample is representative of your customers as a whole. Are very large customers adequately represented? Do the people who responded to the survey actually have decision power?

Identify reasons customers use competitors and prioritize improvement opportunities

The processes described in the book for this have the merit of using a reasonably strong financial basis for justification calculations. There is a lot to be learned from reading the explanations. The belief that you will get the predicted financial result is based on a debatable premise, which is that competitors will do nothing while you are driving improvements. If competitors improve at the same pace as you do, you don’t gain share, but at least you don’t lose share. These issues are common to all improvement systems.

Conclusion

I don’t believe the Wallet Allocation Rule method to be fundamentally different to the Net Promoter System. I like the fact that it relies on competitive rankings, and these should be part of a good relationship survey process in the Net Promoter System too. The calculations make the Wallet Allocation Rule more difficult to explain. The book makes questionable references and assumptions about NPS. The most fundamental issue is that it states repeatedly that NPS does not use relative rankings, whereas The Ultimate Question 2.0 repeatedly states that future market trends are predicted by NPS trends relative to those of your competitors. The difference between the two methods is that NPS takes a supplier-side view and the Wallet Allocation Method takes a customer-share-of-wallet view. They should produce similar predictions in stable markets. In software and other dynamic markets, I believe NPS will produce better predictions because it counts competitors that customers may not currently be using.

For reasons that escape me, the authors of The Wallet Allocation Rule disagree with just about anything negative that I have written about their system. I have a feeling that the objections are based on their theory that research done by companies is of less good quality than that done by academics, though they have not directly said that to me. Of course I believe that objection is invalid. I recognize that academics do not have access to the many millions of company-confidential responses that companies have received from double-blind competitive research, so there may be an element of frustration about that. I don’t know really.

Recommendations

While I recommend their book, I do of course have to recommend my own books too. This article is a slightly modified part of a chapter in Customer Experience Strategy – Design & Implementation, one of four books written in collaboration with my artist / cognitive psychologist brother Peter. The others are Net Promoter – Implement the System, Customer-Centric Cost Reduction, and a book of Peter’s illustrations, with learning points: “So Happy Here” – The Absurdist but Essential Guide to Better Business.

And as always, feel free to comment on this article below. Next time: Proprietary systems.

March 13, 2020

#106 – OCX Cognition, Rob Markey in HBR, Unified Data Analytics

Maurice FitzGerald / Customer Satisfaction, Newsletter, NPS, Strategic initiatives, Strategy / Customer Experience, Customer Satisfaction, Net Promoter System, OCX Cognition, research, strategy, Thematic /

Welcome to the 106th Customer Strategy newsletter. I can finally talk about why I have not had the time to send any newsletters since the end of November. The reason is simple: I have had the privilege of working together with Richard Owen, former CEO of Satmetrix, co-inventors of NPS. Richard launched OCX Cognition last week. As you might expect, the main work my brother and I have been involved in is writing. I am using the title ‘Editor in Chief – Content’. I have to say that I have not entirely completed my work on the content strategy. Your suggestions will be most welcome. More below. The subjects this week are:

The New NPS Manifesto, as proposed by Richard Owen and the OCX team
The first ‘Insights’ content is live on OCX Cognition
Latest blog posts – CX Strategy
Notable items from other sites – Rob Markey in HBR, Thematic on Unified Data Analytics
Looking forward

Read this newsletter online instead

The New NPS Manifesto – Modernizing CX and NPS for financial success

Richard Owen has been pretty silent ever since NICE and Satmerix merged. It is not at all like him to be silent. He and a few other people have been working in stealth mode for two years. The veil was lifted on this work last week, revealing quite a humbling story and a new approach to CX work, now called NPS Outcome Engineering.

The humbling story I refer to is quite simple. Richard reflected on the more than one thousand enterprise customer experience implementations he and his team have been involved in over the last 15+ years. I found the conclusion quite startling: If we consider CX success as the delivery of growth or improved financial results then over 95% of these implementations have failed. I suppose it has to be said that in most cases, improved financial results were never an explicit objective. They were more of an implicit belief that never became reality. In any case, that is simply an unacceptable result.

It took time to identify the main problems with the implementations and more time to trace the issues back to three root causes. And of course, even more time was needed to propose practical solutions to issues that nobody seems to have been able to resolve consistently.

I could keep going but I think it will be more effective if you just go to the new OCX Cognition home page to look at the videos explaining this. There is also a presentation you can download. The material is primarily targeted at those who want to achieve financial results from the work, meaning senior executives, CMOs and senior CX leaders. I hope you enjoy it. If you have comments and suggestions that you would like me to relay to Richard and the team, please write to me at maurice.fitzgerald@ocxcognition.com. If you want to make comments that you would prefer me to keep to myself, please send them to mfg@customerstrategy.net.

The Manifesto content is here. I suggest starting with the videos.

The first ‘Insights’ content is live on OCX Cognition

Continuing on the same subject, I have been concentrating on the Insights page on the new website. You will probably recognize our writing style in the majority of what is up there for the launch and new content will arrive regularly. Within the existing structure you will see more innovative material on analytics and on the financial impact of CX. Richard and I are both students of behavioral economics and you will continue to see such content in the ‘Cognition’ section. I consider that content to be essential to effective communication.

The first piece I wrote in the financial section puts forward a proposal for an accounting standard for Customer Lifetime Value. Note that I wrote it back in November, long before Rob Markey’s HBR article and podcast on the same general subject. My new thinking came from reflections about my years working on mergers and acquisitions. At that time I received formal training at Kellogg in the area and learned how to correctly value a company. Once I had that thought, it was just a short step to working out how to value a customer over their entire lifetime. See what you think. I am working on a spreadsheet that will support the methodology. That particular article is here. Note that you have to register to read it and please tick the checkbox asking you whether you want to receive regular updates. The updates will include a newsletter when we get to that point.

My other current favorites are probably those in the Cognition section, particularly the one about poor Heidi’s experience.

Our latest blog posts

The main customer experience measurement and improvement systems – Part 4 – The Net Promoter System®

Fred Reichheld wrote his landmark article The One Number You Need to Grow and published it in the Harvard Business Review in December 2003. Over time, his work with Satmetrix and his colleagues at Bain developed into the Net Promter System.

CX Strategy (8) – Measurement and improvement systems – Part 3 – Customer Effort Score

The Customer Effort Score is the metric described in the excellent book The Effortless Experience by Dixon, Toman and Delisi. The primary focus is service-center work and the associated metrics.…

CX Strategy (7) – Measurement and improvement systems – Part 2 – CSAT / Customer Satisfaction

When you are asked to rate your ‘overall satisfaction’ with something, you have entered the Customer Satisfaction rating system. The most common way of doing this is to ask you…

CX Strategy (6) Measurement and improvement systems – Part 1 – Smiley Buttons

There are quite a number of customer experience measurement and improvement systems in use around the world. They are not all equal. This post is the first in a series…

CX Strategy (5): Start with a Situation Analysis

Whether in business, the military, government or indeed non-profit organizations, the first step in generating a strategy is a comprehensive analysis of your current situation. This is primarily focused on…

Notable customer experience items from other sites

Rob Markey in HBR – The Loyalty Economy

As you should know, Rob is the co-author of The Ultimate Question 2.0, with Fred Reichheld. He has written an excellent HBR article about how companies should be valuing their customers. He makes a number of different points. One of them is about the way companies publish customer satisfaction scores. It is certainly true that companies have been mentioning their NPS numbers more and more often in their quarterly and annual reports. The issue is that there is no agreed standard for what the numbers mean. In the financial reports I have read myself, they just say “Our Net Promoter Score is 72, the best in our industry” or something very similar. There is no indication at all of where the number comes from. Perhaps it is a call center score and they are comparing it with other companies’ numbers that come from a different type of research.

In this HBR article, Rob suggests how companies should provide basic financial information about customer loyalty and how they should report NPS trends. Separately from the article, Rob has written to the Federal Accounting Standards Board (FASB) with a proposal for how companies should be required to represent NPS scores. So, be prepared for a great read here.

Thematic on Unified Data Analytics

Alyona Medelyan founded Thematic software in New Zealand and moved the company to the Bay Area a couple of years ago. Regular readers will know that I consider them leaders in text analytics. Theirs was the first software I tested that was able to recognize that two customer phrases in survey responses could use completely different words but still mean the same thing. Thematic software can recognize this without tagging or other human intervention and group them into a single theme. That is the most sophisticated level that Natural Language Processing software can currently reach.

Like some other companies, Thematic recognizes that NPS research gives you a really good view of the past and that other data is needed to get a better view of the present and then predict the future. They propose a rich model of customer data from a variety of sources. I still consider this model to be highly sophisticated, though more of a company’s own ERP and other operational data could also be useful. Alyona’s article is here.

Looking forward

Our books continue to sell well despite my lack of newsletters and blogs. November and December were both record months, though January and February have slowed down a little. Still very satisfying.

Most of my writing will now appear on the OCX Cognition website. While all articles there are anonymous, regular readers should be able to recognize articles in the writing style Peter and I manage to achieve together. Again, I encourage you to go there and sign up to receive the OCX Cognition newsletter. More about this quite soon.

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)

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

To change your subscription, click here.

December 31, 2019

CX Strategy (5): Start with a Situation Analysis

Maurice FitzGerald / Blog, Customer experience, Strategy / Customer Experience, strategy /

Whether in business, the military, government or indeed non-profit organizations, the the first step in generating a strategy is a comprehensive analysis of your current situation. This is primarily focused on what is happening outside your company. For most companies, it should cover the six areas below and lead to deep strategic insights. ‘Insight’ is a powerful word. Done correctly, you will understand the environment better and more quickly than your competitors, and make superior investment choices.

Set up the analysis

Ideally you will run the situation analysis in parallel in each of the six areas. I suggest using small teams of people from different businesses or functions. In a small company, a single person could do each one. The most important rule is that you can only get new answers by asking new questions. If you ask and answer better questions than those your competitors are asking, you will win.

People who implement must do the planning

A fundamental rule of any successful project is that the people who will have to implement the new strategy should also do the planning. This means that the people who represent each relevant part of your company should do so with the full authority, delegation and agreement of the person leading that entity. If you do not take this approach, critical stakeholders will reject the results of the analysis and you will be unable to implement.

Let’s consider each of the six areas in a little more detail. I have used the development of a customer experience strategy as an example. The principles and analysis areas apply to all businesses. I have included just a few questions for each area below. I will supply a more comprehensive list if your feedback to this article suggests it would be useful.

Customers

This team asks and answers questions about what customer experience expectations your customers have had up to now and how you expect them to change in the future. Here are some sample questions that may help get you started:

What experiences do your traditional end-customers want at the most important customer journey points? How reliable is your evidence for this?
How and why are the expectations of your traditional customers changing over time?
Are there useful ways you could segment customers and provide differentiated experiences to each segment? Should all customers of all sizes and from all industries be treated exactly the same or should you tailor a specific experience for each?
Do you have any information on how your traditional customers consider their experiences with you compared to what they experience with competitors?

At least half the day-to-day work of most customer experience teams is about listening to customers and partners, then summarizing what they want you to improve. This means that much of the necessary situation analysis information is directly expected from, and controlled by the customer experience leader. Naturally, in small companies, there is no single central reference point, except perhaps the owner or CEO.

Partners

The majority of companies have partners for at least some of their business. The three main categories of partners available to most businesses are resellers, implementation partners, and subcontractors. While you may have some partners who do not work with anyone else, it is more likely that you compete for their attention. Here are some possible questions that may help you to get started with the partner analysis:

What are the critical touchpoints for your resellers, implementation partners and subcontractors? How have these been changing over time? Are these three categories useful, or is there a better way to segment your partners from a partner experience perspective?
Should the top few partners, in terms of revenue generation, be treated differently from the rest?
How does your partners’ experience with your company compare to that with your traditional and emerging competitors?
Who are your potential new partners, and why?

Competitors

There are two main categories of competitors: traditional and emerging. The emerging category includes companies you do not know about yet, but who may be about to take over your market. There are industries such as steel manufacturing where barriers to entry are high, and you are unlikely to be surprised. There are also low-barrier industries such as software, and pure import-export businesses. Here are some questions that may help analyze the competition:

Do you have competitive benchmark survey data that lets you understand where your competitors provide a superior experience and the situations or touchpoints where you lead. If so, how do you compare with traditional competitors and are new competitors emerging with differentiated customer experience?
How have competitors’ customer experience strategy and results changed over time? What investments have they been making in people and systems? (Going to their website to look at their list of job openings may help with this.)

Customer experience industry trends

All industries change over time. Customer experience itself has been changing, from at least two perspectives. First, the products and service offerings that help companies to provide better customer and partner experience change over time. Second, there are industry-specific customer-experience changes. For example, ‘Customer Success Teams’ have been implemented by most large software vendors over the last five years or so. These teams help customers to install and understand software, free of charge. Here are some questions that should help this part of the analysis:

What is happening in the customer experience industry? What ways of listening to customers are most popular? What new improvement processes and technologies are emerging?
What is the impact of social media on customer perception of your products and services? Do you know what is being said about you on social media, and does it matter?

External environment

These questions are about the environment in which your company, your competitors and your customers live. It includes government regulation and general concerns and hopes of the people in countries where you operate. You may find these questions useful:

How does government regulation affect the way you want to go about measuring and improving customer experience?
What current and emerging rules about data privacy affect your current and potential survey processes?
Do you know what surveys are being run in your company and whether they respect relevant laws?

Internal realities

While the first five areas are all about what is happening outside your company, you are unlikely to be able to sell and implement every conceivable idea within your company. These questions may help establish what you can achieve:

What is the state of executive sponsorship for your current efforts?
How likely are you to be to get any additional funding and people you may need to implement?
What can you do to prove the value of your work?
How can you secure enduring sponsorship for your work; sponsorship that will survive leadership changes?

Insights

The result of the situation analysis in each area should be a short list of insights. Each team should aim to have one to three insights and potential initiatives ready to explain and propose at the end of the analysis cycle. If a team has more than three ‘top priorities’, they have probably not put enough thought into it. As French philosopher René Descartes said when writing a letter to a friend (and this is often mis-attributed to Mark Twain), “Please excuse me for writing such a long letter. If I had had more time, I would have written a shorter one.”

Useful insights often take the form of “so therefore…” statements. “We looked at the industry benchmark data from Temkin Group and saw that Acme is outperforming us in this area. We believe we are stronger than Acme here, so therefore here is what we need to do…”

The quality of your insights depends on the quality of your questions

The quality of your insights depends on the completeness of the questions you ask. If you do not ask questions in a critical area, your strategy will be defective. A good question to add in each working session is “What questions have we forgotten to ask?” Before looking at customer research results on a particular topic, you can reduce bias by asking what factors could matter for a decision. It will then be easier to spot things that may be missing from the research. It is even better to do this before you decide what to research. If you have a customer advisory board or simply a set of friendly customers, you may like to ask them the same question.

Conclusion

Situation analysis is quite easy to communicate and understand. It takes about six weeks to do it in depth in a medium to large company. The process described here has been adapted from the one Willie Pietersen describes in his book Strategic Learning. If you like this sort of article, be sure to sign up for our newsletter here.

Next time

The next article will be the first of a set on various different measurement and improvement systems. (There is no single universal system that works for everything all the time.)

As is often the case, the above is an edited version of a chapter in one of our books; in this case Customer Experience Strategy – Design and Implementation.All of our books are available in paperback and Kindle formats from Amazon stores worldwide, and from your better book retailers.

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