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Is that the voice of the customer I hear?

Posted on 25 May 2011

May 24, 2011 – Southlake, TX. In a earlier article, Doing the Right things vs. Doing things Right, I made the point that one element that must be considered in defining both strategies and tactics is the voice of the customer. A major input in the development of a business plan and strategy is input from customer feedback.

 

How do I obtain the voice of the customer?

 

Well, it is not as easy as one might think! Most small and medium enterprises (SME’s) do not have the luxury as their larger counterparts who use customer forums to obtain critical customer input. However, having the option of conducting a customer forum is not the panacea that it might appear. Customers who come to these type forums are typically large enterprises (LE’s), and normally have a long-term relationship and pre-existing contracts in place with the host of the forum. As such, customers who participate in and provide feedback in these forums can and do suffer from the LIFO principle. LIFO is an inventory control method…last in first out! The opposite would be FIFO, or first in first out. LIFO feedback normally reflects the most recent experience the customer had with the company and thus the feedback can be current but may not reflect the true voice of the customer one may be looking for.

 

There is a larger issue that must be understood when conducting a customer forum. I am reminded of a LE’s desire to hear the voice of the customer and thus decided that hosting a customer forum would be a good business decision. Twenty-five (25) of this LE’s top customers were invited to attend the forum at a very nice venue (i.e. one with golf courses and tennis courts). During the two-day forum, four customer sessions were conducted mixed with speeches from executives of the LE. During the customer sessions, customers were divided into working groups and asked to address differing issues that were gathered by the LE’s sales and marketing department prior to the customer arriving at the forum. These customer working groups had to select a spokesperson who then presented the consensus of their group to all other customers and the LE. In the audience was the company’s cadre of personnel representing sales, marketing, R&D, manufacturing, and product development who were taking copious notes of the meeting. What the LE did not realize was they were providing a forum for customers to complain about things not relevant to the information the company was hoping to obtain. Additionally, the company provided a forum for customers to jointly and collectively make demands of the LE for specific new products and features, increased product reliability standards, improved volume pricing, and shorter availability dates. Of course, the LE could not meet any of these requests as they were not prepared to launch any new products nor the new features being demanded, and certainly not by the dates being requested. The LE explained these facts to the customers which caused attendees to ask “then why did you ask us here if you are not going to listen to us?”.

 

The lessons learned from this experience were…be careful what you ask for as you may get more than you expect. Also, be very cautious and specific in setting expectations, And, last but not least, control the forum very carefully so that you don’t agitate the very customer you are seeking to assist you in obtaining the voice of the customer!

 

Another forum, where SME’s can obtain the voice of the customer is to attend an industry association annual conference or regional meeting. Most associations invite customers to be part of a panel where key industry leaders ask customers of their buying habits, needs, wants, and input on products and services received through association membership. Customer who attend these conferences/meetings and participate in panel discussions provide a key source of information that can be used in members own businesses. However, be sure to separate information made available which apply to SME’s versus LE’s. Applying the voice of the customer targeted toward LE’s by SME’s could produce less than satisfactory results or more importantly catastrophic results for the SME! Also, be cautious of how the information obtained at an Industry tradeshow or conference is used. Blanket industry perspectives are good, but most likely will require refinement when used within a SME’s business model.

 

A friend, who is in sales and marketing with a luxury hotel chain, attended a Financial and Insurance Conference Planners Association (FICP) annual conference in Mexico. During the conference my friend walked away with some very good customer information. Approximately 250 planners who attended the conference were asked; do you plan to cancel your upcoming meetings and incentives in the near future? Interestingly 75% said no, 25% yes. Whereas this information appears to be good news, it might reflect a microcosm of the overall Financial and Insurance Industry.

 

Another question was asked at the same FICP conference; what is the best manner for suppliers to call on you? Over 75% requested they be contacted via email, and 15% by telephone; Conclusion gained from the responses to this questions…don’t waste your customers time as it is their most valuable asset.

 

A customer satisfaction survey is yet another method to obtain the voice of the customer. However, as many SME’s have found out this method can be very frustrating. Customers, when presented with a customer satisfaction survey, sometime file them in the “round” bin! For differing reasons, not all SME’s employ customer satisfaction surveys. Some SME’s do a very good job with their surveys. Yet, others do not believe surveys provide value, some feel it is a waste of their time. Other SME’s do not believe the voice of the customer can be obtained via a survey. I believe there is some truth in these perspectives…not from the survey point of view but rather the way the survey is developed and administered.

 

The major problem I see with customer satisfaction surveys is that they are not “sold” to the customer from the onset. There must be a human “set-up” to implore the customer to complete and return the survey in a timely manner. In a timely manner cannot be overstated. At the conclusion of my last automobile purchase, the salesperson explained that his ability to increase his annual compensation was predicated on my cooperation in completing and submitting a customer satisfaction survey. This survey was not presented to me at the time of picking up my new auto at the dealership, but was later emailed to my office. Not only was the survey emailed, but I was given a website where I could complete the survey online. Given the set-up by the salesperson, I took the three minutes required to provide feedback regarding the manufacturer, dealership and salesperson service levels I received during the purchase of my new automobile. I noticed with great interest the skill with which survey questions were developed and the possible response choices provided. The survey, albeit it brief, did provide me ample room to write my own comments without “leading the witness” as the survey questions did.

 

Furthermore, when was the last time you took the time to fill out the water stained survey placed on a hotel nightstand, or the linen stationary survey stuffed in your folio envelope? For me, never. Why, there was no human set-up or impetus for me to do so. Also, to be honest, there have been times where a human set-up was employed, and I complete the survey. However, the company requesting I complete the survey never “thanked” me for my input, nor did they give any indication my comments would be taken into consideration and that action(s) would be taken! Do you think I will provide feedback to these companies in the future? Absolutely not!

 

Most customer satisfaction surveys are requested at the conclusion of a product or service being delivered. Another more effective approach would be to make the satisfaction survey an annual ritual.

 

Another method of obtaining the voice of the customer is to be prepared with probing question as SME’s make their annual customer sales calls. I consult with a number of Destination Management Companies (DMC’s), and it is not uncommon for DMC’s to annually visit third party incentive houses and/or direct customers. This is especially true if the DMC is a preferred vendor of the third party incentive house. The key here is being prepared. All too often I have observed that critical information could have been obtained if the person doing the sales call had just been better prepared. Additionally, if the person making the sales call is not trained or expected to obtain the voice of the customer…a golden opportunity is lost!

 

If you find yourself overwhelmed or do not have the time to obtain the voice of the customer, then hire a professional who has the knowledge and experience in how to obtain the voice of the customer for you. There are a myriad of companies and/or individuals who can perform this work. In addition, these same professionals can assist you in the use of the information in business planning and strategy development.

 

What does the voice of the customer sound like?

 

Sometimes their voices are muffled and confused, and at other times are loud and clear!

 

Yes, the voice of the customer can and will be very confusing and hard to understand at times. Reasons for this vary, but let’s examine some basics.

 

First, some customers have a difficult time distinguishing between wants, needs, and expectations. A customer has to ensure they separate the three when making their voices heard. A customer may want an incentive program with a budget of $3000 per person, but in reality they only have the budget for a $1500 per person program (the need). Likewise, a customer may need a $1500 per person program, but they expect the vendor/supplier to provide a level of service matching their wanting of a $3000 per person program! Sound familiar?

 

Second, let’s clear up two common myths. 1. Customers always know what they want, and 2. Customers can always communicate what they want.

 

Often, as a consultant and coach, I receive client request for assistance in reviewing a request for proposal (RFP) they have received from their customer. The client will ask that I read the RFP and comment on the details they are missing. The fact is, most customers don’t know what they want, need, or expect which can make their ability to communicate information difficult. In fact, most customers will not know their needs if and when they see them either!

 

It would be intuitively obvious to even the most casual observer that a customer who has taken the time to write an RFP would be very specific as to what they want. A logical person would assume that a customer would have a specific delivery date as well as the terms and conditions (T&C’s) they desire. Without a doubt the company responding to the RFP has to make judgment calls as to what is being requested in order to respond to the RFP in a timely manner (which is all in all too short).

 

One reason I believe the RFP does not effectively communicate what is needed or expected is because the customer has plagiarized a RFP from within their own company or from another company. They take the path of least resistance for expediency sake, and the specific details (and voice) take a back seat at that point.

 

On the other hand, I have observed numerous RFP’s which were very well written and detailed. In fact, some have been so well written that it is even harder to determine what the customer needs or wants. I have observed numerous customer RFP’s that would require a Dick Tracy decipher kit to establish what is being requested.

 

Remember earlier in this article this quote “don’t waste your customers time as it is their most valuable asset”. Well the voice of the customer applies when trying to decipher a RFP. If you phone the customer in an attempt to verify or determine their needs and wants documented in the RFP…they sometimes will not return the phone call. This causes the proposal process to slow down considerably, and more often than not requiring a request for an extension in order to respond.

 

I think if we refer back to what attendees at a FICP conference stated, we would hear what the voice of the customer sounds like when they responded to the question; what is the best manner for suppliers to call on you? Response, over 75% requested they be contacted via email, and 15% by telephone! Point being, the voice of the customer indicates (by a margin of 3 to 1) that a phone call is less desirable. However, given a very short response time normally provided by the customer, most company personnel will, for expediency sake, call the customer rather than waiting days for a response to an email. I would think a few days waiting for a return email is better than no return phone call!

 

There is a catch twenty-two here. If calling the customer is less desirable from their perspective, and the RFP is not written with clarity the response/proposal normally is delayed. Then a request for an extension (in writing) is requested. This will not make the customer happy either, and they will let you know on you next attempt to obtain the voice of the customer from them. On the other hand, if you assume what the customer is requesting in the RFP, and are wrong, the customer will not give you the business. The customer may elect not sending their next RFP to your company as well.

 

Examine how as consumers we communicate our wants and needs differently. If I want or need new blue jeans, I know exactly where to shop for the brand, style, and color of blue jeans I wear all the time. I drive directly to the store, walk inside, tell the salesperson my current size and present a credit card for payment. On the other hand, I know of a person who, if needing or wanting jeans, will walk up and down a mall visiting boutiques and department stores alike. Trying on several jeans along the way in differing colors. More often than not, they will return to the first store visited to purchase the jeans! Some call this shopping, I call it being undecided with what you want. Now mind you, we both started with a need or want for jeans, however, I wanted BLUE jeans and could communicate it very clearly. I did not want to see other colors nor did I want to try them on. I wanted the transaction for buying jeans to be quick and smooth, with no distractions like shoes, shirts, belts, etc.

 

Now that I have obtained the voice of the customer what should I do with it?

 

As previously discussed in “doing the right things vs. doing things right” article the voice of the customer is very important. In “doing the right things” the voice of the customer is used in establishing the long and short-term strategies for the business.

 

What must be understood here is when developing strategies for the business that one not stray too far from their core competencies. I am reminded of a client who acted on feedback from a very large customers and strategically proceeded to become a vertically integrated company. This transformation from a service company to one that designed and manufactured products previously used in the services provided to customers took almost three years. The transformation costs were enormous. By going beyond their core competency the company had to abandon their vertical integration initiative due to poor service being provided to the same customer who posed the voice of the customer in the first place. Three years and millions of dollars down the drain, the company developed a strategy that had them reverting back to being a service company and developing a strategic partnership with another company for the outsourcing of new products customers were needing.

 

Sometimes the voice of the customer is provided in more obscure ways. I was speaking with a good friend recently and he told me of the plight of a new hotel in his area. It seems this hotel, which is a high-end independent hotel, is having difficult time attracting guest. Well, by just listening to the news media or reading the newspaper… today, the voice of reason would indicate that business travelers have drastically reduced their travel.  Additionally, the discretionary income of individual travelers is becoming non-existent. Every day we read about the next round of company layoffs, home foreclosures, and the economy we are in. So family vacations and leisure travel have taken a backseat to family essentials.

 

The hotel’s answer to their problem of attracting guest was to layoff staff, and hire a prestigious advertising agency to improve the hotel’s image. Notice, I said nothing of a negative image in the first place…just that it was a NEW hotel. These actions are band-aids to the short and long-term problem this hotel will be facing.

 

Here is some food for thought. Sure, the hotel needs to evaluate staffing levels, but before discharging people, use their knowledge to become more efficient and effective. What the hotel is doing is letting institutional knowledge walk out the door. What should they be doing? Look for continuous improvement by developing better processes to serve future guest. Secondarily, if you are going to attempt and change the target market of the hotel, you might want to consider doing so locally and regionally before addressing the national market through a prestigious advertising agency.

 

A blue ocean strategy might include partnering with a local DMC to put packages together for broader marketing effort to the meeting and incentive markets.

 

Tactically (“doing things right”) speaking, this is what should not be done in responding to a well written RFP; open an existing word document (containing a previous developed customer proposal which reflects what one thinks the new customer is requesting), click select all, click copy, click new document, click paste, open the new/old document, change the pricing, click save, and send electronically to the new customer. All too often I have observed client proposals that plagiarize proposals which have been written for one customer (let’s say ABC Company) which is to be sent to a new prospective customer (XYZ Company) without even changing the NAME. This is crazy!

 

Let’s say you receive considerable and consistent feedback through the voice of customers. What should you do with this information?

 

In the Figure 1 is a process previously used by a national fast food restaurant we are all familiar with. Examine the flow diagram or process mapping of the environment at the time…it starts with “Customer drives up to Sign and decide what they want to order”.

 

                                                Figure 1

 

Seems like we all have been there and done that. Well, you are right. Although their food received minimal complaints, customers to this fast food restaurant were far more critical its store/restaurant operations and provided the following input;

  1. Lines are too long
  2. I had to wait too long
  3. I cannot understand the order taker
  4. I received wrong change
  5. I received an incorrect order

 

Armed with this feedback, the restaurant headquarters operations staff conducted a root cause analysis of store operations Figure 2. A root cause analysis is the dissecting of a business problem to gain the systemic cause for customer dissatisfaction.

 

                                                Figure 2

 

As you can see in Figure 2, numerous areas were identified and analyzed. The customer, employee, time element, and technology were all evaluated as it related to the voice of the customer (time and errors) which was provided. Let’s follow the “fishbone” which is what Figure 2 is called (and looks like).

 

The customer was considered part of the problem. Notice the unclear directions, or maybe the customer did not know what they wanted. Also, the language of both the customer and employee posed a potential problem. We all remember the intercom issues (see “technology”) that has been a joke of many.

 

The employee had some issues as well. Their attention could have been drawn to other duties in the kitchen. Because of possible intercom problems they failed to understand the customer request for “hold the lettuce and pickle” . Training of employees was also considered as they must have a complete understanding of company and store policies and procedures.

 

Time. Special request possibly took too long to process…especially there was a language problem and/or if the order taker did not understand the customer directions. Also, the employee might have been assigned too many task which might have been the cause for both being overloaded and/or their inattention.

 

Lastly, the equipment or technology used was also evaluated. Lack of employee training on the point of sale (POS) terminal could have been the cause of the negative feedback from customers. We have already spoken about the antiquated intercom systems that sounded as though someone was speaking with their hand over their mouth.

 

After all things were evaluated and analyzed, the operations staff proceeded to look at their store process (Figure 1) for improvement. This is called continuous improvement of an existing business process.

 

                                                Figure 3

 

In Figure 3 you will notice the highlighted areas that were improved within the store/restaurant process. One of the improvements was increasing the number of people involved in the fulfillment of a customer order…as they now have two people becoming involved. Additionally, another improvement included major renovations to the restaurant…the double window concept that we know today. In the newly mapped process, as the customer pulls up to the electronic sign and provides his/her order, Employee #1 takes the order, repeats back to the customer exactly what they believe the customer ordered, and the order is the displayed on a new electronic board that was installed. Employee #1 processes the order, and collects payment for the order. Employee #2 is responsible for the fulfillment of the customer order and presents the packaged order to the customer.

 

What annoys me most is, even today when I get home, I sometimes have a wrong item in my bag! Point being, even with the best of processes, human error can and will occur. Personnel turnover at fast food restaurants is extremely high which requires continuous training on the part of store management. They should employ a very well developed recognition program (notice I did not say incentive program) for restaurant employees.

 

I would like to highlight several key points. When doing business process mapping, huge improvements will be realized in efficiency and effectiveness. As processes are implemented by company personnel, they will find areas that need to be reviewed and modified. This is normal. Keep employees involved in making changes to processes they implement. Additionally, the voice of the customer should be a key driving force behind continuous improvement of business processes. Doing a root cause analysis of a business process is hard work. This is where most paradigms come into play. The comment which is normally heard during root cause analysis is “I have been doing it this way for twenty-five years”, and needs to be left at the conference room door. Re-mapping of a process following a root cause analysis can be difficult, and sometimes a “clean slate” would do wonders in the design of a new process.

 

Summary;

 

Find the most appropriate and effective means to obtain the voice of the customer. Analyze customer feedback, and incorporate the feedback into your business plans, strategies, and processes. What must be understood is the customer may not always be right, but they are the CUSTOMER!

 

© 2008 The Cypress Group – All Rights Reserved

About the Author

DOYLE J. GIROUARD

CEO and Senior Managing Partner

The Cypress Group

Suite 1101,

150 Creekway Bend

Southlake, TX 76092

Phone: 817-421-4774/visit; www.thecypressgroup.com/Cell: 817-307-7577

email; doyle@thecypressgroup.com

 

As a builder of strong companies and leaders, a consultant, coach, facilitator, trainer, lecturer, and over 35 years of business experience, Doyle J. Girouard, CEO and Senior Managing Partner of The Cypress Group, has coached numerous CEO’s, business owners,  entrepreneurs, and managers on the integration of strategy, people, and processes which leads to business performance improvement. He has assisted clients achieve sustainable strategic competitive advantage by intersecting strategy, business processes, and organizational behavior.

 

Before founding The Cypress Group, Mr. Girouard had a dynamic twenty-eight year management career, with a Fortune 500 company, leading organizations through the critical stages of start-up, turnaround, crisis management, and high growth. Since 1996, he has worked extensively with destination management companies, hoteliers, and incentive houses. He is a member of SITE and ADME.

 

He has also led the design, development, and delivery of customer executive education and training programs focused on informing senior executives of Fortune 500 companies on attaining strategic competitive advantage.

 

In addition to attending the University of Southern Mississippi, majoring in Political Science/Pre Law, Mr. Girouard also attended Northwestern University’s, J.L. Kellogg School of Management and is a graduate of the Executive Development Program and the Advanced International Executive Management Program.

 

NOTICE – PROPRIETARY INFORMATION
ALL RIGHTS RESERVED

 

This article and its contents are the property of The Cypress Group. Because it contains confidential information proprietary to The Cypress Group, no copies may be made whatsoever of the content herein, nor any part thereof, nor should the contents be shared with any party without the express written consent of The Cypress Group. This copy must be returned to The Cypress Group upon request. The Cypress Group reserves all rights to ownership, use, reproduction, distribution, and publication of this document and the intellectual property therein. Some parts of the document are reprinted from other sources

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