In this series of posts, we examine some of the top mistakes companies make in their customer experience management efforts. This post examines mistake #9: Falling In Love With A Metric. Companies often get enamored with a metric like Net Promoter Score (NPS) and lose sight of what’s really important, making improvements.
Customer experience efforts absolutely need metrics and measurements. While there’s value in collecting that data to measure or track customer experience, the true power comes when it provides insight into where and how to make improvements. But some organizations over-emphasize the metric. Companies going down this path can run into problems when they:
- Rush into compensation. Tying business results to metrics can be a good thing. But tying too much compensation too early to any metric can also cause a lot of problems. If people have a significant part of their pay tied to a metric they don’t understand or don’t know how to affect, then they will either ignore it, get bitter about it, or find ways to “game” the system. Customer experience doesn’t improve if salespeople are calling out to customers and begging them to give higher ratings on a survey.
- Can’t answer “why.” Reporting on a metric can highlight the strengths and weaknesses of a company’s overall customer experience. So it’s understandable that some executive teams push for widespread use of those metrics without caring about the overall set of information collected from customers. But if the company does not understand “why” customers are either happy or unhappy, then they can’t systematically improve customer experience and positively affect the metric.
- Overuse a metric. Understanding if a customer is happy overall with an organization is quite different than understanding if her needs were met during a specific service call. But some companies blindly use the same metrics for each of those areas. A metric like NPS, for example, might be appropriate for examining relationship strength, but it’s necessarily good for evaluating interactions.
- Forget their uniqueness. Every business has a unique set of strengths, weaknesses, goals, and ambitions. But when it comes to customer experience metrics, companies often want to use the same measures as everyone else. While this may enable benchmarking comparison to other firms, it does not necessarily measure how the company is progressing towards its unique goals.
Here are some tips for avoiding this mistake:
- Treat relationships and interactions differently. The questions you ask a customer about how they view your company can (and often should) be quite different than those that you ask about an interaction. Think about different questions and methods for five different types of insights: Relationship tracking, interaction monitoring, continuous listening, project infusion, and periodic immersion.
- Deploy shadow metrics before making large incentive changes. To help leaders in your company understand the impact of customer experience incentives, put in place the metrics you are thinking about for a couple of periods before actually making them “live.” That way people can see how it will affect them before actually does affect them.
- Establish performance bands, not absolute targets. Customer feedback metrics can be a bit jittery. Sometimes it can be very hard to explain small movements since there’s always some variance due to sampling limitations. Rather than establishing “a number” as the goal, set targets for high and low scores. Success comes from consistently exceeding the low band.
- Measure relevant attitudes and behaviors. Businesses aren’t in the business of getting random people to recommend them. They hope to get that type of loyalty from successfully executing their mission. Develop measurements that test the attitudes and behaviors of target customer segments, making sure they line up with your specific business and brand strategy.
- Build a robust voice of the customer (VoC) program. Creating isolated metrics will not drive change in an organization; especially when people don’t understand what drives the metric. Companies need to develop a voice of the customer (VoC) program that continuously shares actionable customer insights across the organization.
The bottom line: Use metrics to improve the experience, not just measure it.
This blog post was originally published by Temkin Group prior to its acquisition by Qualtrics in October 2018.