Tag Archives: Relationship

Moneyball, Metrics, and the Customer Experience

Posted on 15 November 2011 by | 1 Comment

If the customer experience profession can learn one thing from Moneyball it should be that tracking the wrong metrics can be expensive and lead to the wrong result.

Moneyball, Metrics

Part of the Oakland A’s success arose because they turned away from conventionally accepted activity-focused metrics (RBI, stolen bases, and batting average) and turned towards achievement metrics (slugging and on-base percentage).

What metrics are you tracking that are misleading you into a false sense of security?  Here are a couple to get you started…

  • Mean Time to Repair and Average Speed of Answer – Many companies track trends in ASA.  The reality is that such a measure may lead to behaviors that are inconsistent with a quality customer experience and interaction (e.g. answering quickly but immediately placing a caller on hold).  What matters more is experience consistency.  So companies would be better served to achieve smaller variance around their average.  Once they tighten the bell curve, then entire experience can be improved.  First make the experience predictable.  Customers hate surprises as much as any company does.
  • Call Duration – Zappos put an end to the fallacy surrounding this metric.  Their philosophy was to develop customer relationships (to achieve loyalty).  By shortening call duration, they realized they were limiting the likelihood of a meaningful relationship.  A more appropriate metric would be some sort of customer satisfaction measure, like NetPromoter.  Basically, “did we meet your expectations/needs?”  Not “did we get off the phone fast enough?”  The first question addresses a customer need while the second meets a corporate need for efficiency.

The pivot point is that, like the Oakland A’s, by adopting a ruthlessly self-critical look at the metrics we track, we can improve our winning percentage while reducing payroll costs.

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Posted in Customer Service, How to Deliver Customer Service

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Customer Grief is an Opportunity

Posted on 14 February 2011 by | 1 Comment

Ever had a bad customer experience?  What emotional stages did you go through?  An article about the stages of grief made me think of similarities between grief and the emotional cycle customers encounter when they have bad experiences.

Interactions with our customers are indeed relationships so it should come as no surprise when customers react with so much emotion.  In fact, if customers don’t react strongly to disappointment it is a sure sign that we are on the path to losing them.

  1. Denial – “This can’t be happening to me.”  Maybe we’re imagining the experience… we hope anyway.
  2. Anger – “Why me?”  Customers experience feelings of wanting to get even or make the supplier feel pain.
  3. Bargaining – “If you fix my problem, then I will remain a customer.”  We often wish and beg for a change in circumstances to avoid the bad situation.
  4. Depression – “What will I do now?”  This feeling of hopelessness occurs after customers realize bargaining will yield no results.  Lacking a feeling of control, customers begin to figure out how to regain control.
  5. Acceptance – “Oh well.”  The most dangerous of all the stages, acceptance is the stage immediately before defection. When customers realize the only way to regain control is by finding another supplier they move on.

One critical difference in customer experience management is that, unlike grief, the stages can be stopped.  Companies decide through their actions whether to allow a customer to move to anger, for example.  Equally true, companies that take no action are destined to enter their own stages of grief.

The twist and the pivot point is that companies who fail to: break the cycle, stop the stages, or minimize the damage soon find themselves in their own grief at having lost a customer.  If your company  does nothing, the rest of us thank you.  (Your loss is our opportunity.)

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Posted in Customer Service, Influential Factors - Harmful

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Employee Engagement and Profit – Which Comes First?

Posted on 14 October 2010 by | 7 Comments

(This is the first of three posts where I will focus on employee engagement.  Subscribe to be notified of new posts!)

A recent Gallup study proved a causal relationship between employee engagement and financial performance.  Why is the outcome of this study so important?  Because the results indicate we must invest in our employees to reach our financial goals.

The study actually observes a two-step relationship as Dr. Harter relates:

“What we’re able to do in this study is look not just at engagement and financial performance but also look at two mediating variables: employee turnover and customer perceptions. We’re able to look at the path from employee engagement to those two outcomes that then lead to financial performance.”

Engaged Employees

  • Show Up (mentally and physically) – Engaged employees stay at their jobs longer creating low turnover costs.
  • Show Off (please customers) – With low turnover comes improved customer relationships, deeper product experience and a better understanding of how customers use products in their environment.
  • Put Out (produce higher quality products) – Engaged employees do a better job because they have more experience and because they are more financially/emotionally vested in the company’s brand, reputation, and performance.

Employee Engagement –> Employee Retention –> Customer Satisfaction –> Financial Performance

None of this should be surprising since the result is analogous to investing in a business.  In this case we invest in employees in order to reap financial rewards.  What is surprising is how often short term gains “won” through aggressive cost-cutting (e.g. salaries, benefits, training time, staff) actually undermine the very health and financial strength they are designed to support.

Beware the next time your company is planning to cut past the fat and muscle into the bone.  Before you implement or endorse an idea which looks great on paper, consider the pivot point – whether or not it actually harms future profitability.

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Posted in Best Practices, Culture

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