Summarize the primary overarching objectives organizations are using to assess effectiveness, including customer satisfaction and variations of it, net promoter score (NPS), and customer effort. Identify pros and cons of each, and hear recommendations on how to avoid common traps when using measures.
- Is it a good idea to establish an overall measure? I believe so, but there are some cautions, some traps to avoid. Let's turn to that issue here. The rationale behind establishing an overall measure is to have an easy way for anyone to see how we're doing. To use a sports metaphor, quality standards define and help guide what we do on the field, the overall measure is the score. The three most common overall measures include customer satisfaction, net promoter score, and customer effort score.
Measures of customer satisfaction, or C-sat as it's often called, are based on variations of the survey question, how would you rate your experience? An advantage is that your organization is probably using this approach now. It's by far the most common. And its legacy has created staying power. Some companies have years worth of data that serves as a baseline to see relative trends. The biggest disadvantage is that the methodology's usually different enough from one organization to the next that it can't be used for apples to apples benchmarking.
The scale can vary. It's often based on five points. In fact it usually is, that's what you see everywhere. Five being very satisfied. But it can be a 10 point scale, it can be four or some other number. And the nature of the question tends to vary. Some research suggests that customer satisfaction as it's often collected and used anyway might not be a robust enough indicator of loyalty. Net promoter score or NPS was created by Fred Reichheld, and is used by over 2/3 of Fortune 500 companies.
Net promoter score is a specific methodology based on the survey question, how likely is it that you'll recommend us to others? Inputs provided on a 10 point scale, with 10 being very likely to recommend. In calculating the score, nines and 10s are considered to be promoters. Sevens and eights are neutral, and sixes and below are detractors. So scores appear on a scale from minus 100, where you have all detractors, that's not a good thing, to plus 100, where you'd have all promoters.
Scoring higher than zero is good, and 50 or better is excellent. Critics of net promoter score question whether it's really better than other measures in predicting loyalty or whether it's prescriptive enough in identifying improvement opportunities. The advantages include being widely adopted and based on well-defined methodology. So that you can readily benchmark results. As with other measures, net promoter score is much more valuable when it includes specific customer feedback on scores provided.
And that's true for any of these measures. Customer effort is emerging as an alternative to customer satisfaction and net promoter score methods. Research by the Corporate Executive Board, CEB, shows customer effort to be a strong predictor of loyalty. Scores are based on the question, how easy was it to handle the issue? With responses captured on a seven point scale. Seven being very easy. An advantage of customer effort is that it's based on a characteristic of service that's very important to customers, was it easy? That's why it's so strongly tied to loyalty.
Proponents like how specific it is in gauging the effectiveness of customer service, and uncovering improvement opportunities. Disadvantages are that it's limited measuring overall perceptions of the brand, and it's not yet as widely adopted for benchmarking purposes. Some organizations establish more than one overall measure, seeing advantages and limitations of each. The trade-offs are the additional time and effort required to produce them, and perhaps whether focus is diluted.
I suggest starting with one and get it working well before making a decision on adding a second. There's another option however, and that's using different measures for specific purposes. For example, if you produce an event for your customers, you could measure overall satisfaction with the event and have a question on ease of registering and logistics. If you'd like to explore these topics more, the resource guide in the Exercise Files directs you to additional information on measures and surveys.
Let me offer three recommendations on using an overall measure. First, ensure that it's not the only thing senior executives look at. No one measure, no three measures, can reflect the many aspects of customer service that build or erodes your brand. Second, understand the sample. Yes how you survey's important, but it's also essential to remember that effective customer service captures insight the organization can use to improve products and prevent unnecessary work.
So the issues reflected in the surveys are of an increasingly difficult nature. The sample itself is evolving. You might even see scores drop at least in the short-term due to better products and services. Third, whatever overall measure you choose, it should tie back to the specific quality standards that you use at the individual and operational level. Illustrate and communicate how each standard supports the overall objective you focus on. With these cautions in mind, an overall objective can be very helpful in establishing and using quality standards.
Watch and learn how to establish quality standards in customer service, and improve loyalty, revenue, customer satisfaction, and employee engagement. Brad Cleveland divides the lessons into three chapters, covering quality and customer service definitions, quality standards for individuals, and quality standards for the overall organization. Along the way, he shows how to implement a process, measure progress, and effectively coach employees.
- Defining quality
- Ensuring standards count
- Measuring individual performance
- Coaching customer service professionals
- Creating quality standards for the service organization