The (powerful) Voice of the Customer – Customer feedback based management systems and programs: The 10 most important success factors
Numerous companies have defined customer orientation as a strategic imperative for more growth. More and more of these companies are implementing KPIs in their control and management systems that are based on customer feedback measurements (Voice of the Customer; VoC).
In addition to the KPIs, these VoC approaches provide a wide range of information that is transferred via VoC programs into continuous improvement processes for building and expanding customer relationships. Regardless of whether these KPIs and VoC programs are based on classic satisfaction measurement concepts, market research approaches such as TRI*M and the Conversion Model or modern Net Promoter Score-like approaches, the question arises as to the most important success factors of such programs.
Here are our top 10 from literature, projects and studies:
1. focus equally on KPIs (control) and change (management)!
Customer relationships do not improve in quality and do not lead to more growth just because we measure them. Just as pigs don’t get fat just by being weighed. KPIs are important, but the big leverage lies in recognizing the causes and drivers for the KPIs and therefore the customer relationship. It’s not just about KPIs and VoC is not a project, but a program: a permanent management tool and a journey to value creation through customer orientation.
2. link customer relationship KPIs with financial KPIs at an early stage!
Create economic checkpoints. Create business cases and understand the economic value of different customer segments to your business. These calculations can be simple or difficult, but can usually be done within a few months of launching a VoC program.
3. closing the loop – at all levels and in all directions!
Close the loop at all levels within (top management, middle management, front line) and outside your organization (customers, service providers). Innovate and improve bottom up and top down. Give every customer feedback on their feedback (and don’t forget to say thank you).
4. implement the right governance!
Establish a dedicated program team and program organization, technology and processes. Define clear responsibilities and ensure cross-functional commitment and collaboration on customer relationship KPIs and the VoC program. Make the KPIs an integral part of your reporting and management process at all levels.
5. communicate rigorously and permanently internally and externally!
Set goals and communicate them. Pick up your organization, your service providers and your customers and keep them constantly informed about issues that drive customers and what you are doing about them. Reward and celebrate small and large successes and link large programs and achievements to the VoC program. Make it clear to your customers that you have heard and understood them. Share results and measures with all employees in the company and also with your customers. Start your VoC program with a strong opening statement from the top of the company.
6. create the right incentives!
Use the KPIs as a management tool – but use them correctly. Agree on targets at the beginning that are primarily based on the introduction of the program. If your measurements are stable and watertight and the management process works, you should include changes to the KPIs, drivers and improvements in the target agreements. Pay attention (as always) to relevance, influenceability and acceptance. Make annual industry benchmarks. Caution: Absolute targets are only very rarely suitable as targets for KPIs that are based on direct surveys, and only at very few levels!
7 Consider organizational maturity and readiness!
Do not introduce a VoC program if your organization is already “sinking” due to other projects, such as the introduction of a new ERP system. Even if you do not meet many of the customer’s basic requirements and you know them: do your homework first (if you do not know them or are not really sure what they are: the VoC program will identify them first). A VoC program is a promise to your customers, but also to your organization. Don’t make it if you can’t keep it.
8. have patience and staying power!
Change takes time. Take your time. Listen to your customers and employees. Look for the magical elements in the open questions. Make a plan. Start with a pilot, roll out the program, gain experience and optimize your program. Observe how your organization changes and give it time to do so. Avoid actionist behavior and panic. Focus on operational changes and trends.
9. be really serious about customer orientation: Walk the Talk!
Ask yourself the crucial question: do I really want this? Am I really serious about customer orientation or am I just paying lip service to the mission statement, the website and other media? Is the customer really the focus or is he actually in the way? Are you prepared to forego bad profits (short-term gains at the expense of the customer relationship)? Yes? Congratulations: your VoC program will provide you with lasting support. No? Don’t have a VoC program!
10. have (at least) one strong promoter!
Without the (total) support and involvement of the company management or at least one person from this circle, it is not possible. Management must understand the philosophy of the methodology, make the KPIs part of the corporate strategy and create a holistic plan for the customer management strategy and organization. Although VoC programs can also be implemented in individual areas to create value in isolation, they bring the greatest added value at the overall company level.
There are many other aspects that need to be considered in order to exploit the potential of a VoC program, but these are primarily of an operational nature. The ones listed here are the ones that are most frequently encountered in practice and in studies and which, taken individually, significantly determine the success of the overall program. The introduction and operation of a VoC program is not rocket science, but it should not be underestimated.