Gartner: "Predicts 2009: CRM Customer Service and Support", Jim Davies, November 2008
Customer Feedback Management is clearly a hot topic. Companies are being challenged to grow without spending on marketing, larger sales forces or other infrastructure. Naturally, many are turning their attention towards their existing customers as a strategy to grow within the constraints imposed by the environment. As a result many companies appear to be “Getting Serious” about customer feedback management – the topic of this article. If you are operating in a resource constrained environment and are looking to your customers for growth opportunities we think this article will help you organize to leverage customer insight.
Revisiting feedback management maturity
In our last column we introduced a framework for characterizing a company’s effectiveness with customer feedback management: The “Feedback Management Maturity Curve”. We defined three stages along the curve: “Getting Started”, “Getting Serious” and “Reaping the benefits”. We pointed out that becoming more mature was an evolutionary process. We outlined how customer feedback is used by companies at each stage and pointed out that the higher up the curve the greater the benefits. Lastly, we observed that most organizations today appear to be in the “getting started” stage along the curve.
Specifically we observed that companies with successful feedback management efforts often shared certain characteristics:
1. Senior management commitment, sponsorship, involvement.
2. Willingness to invest necessary time, resources, budget.
3. An empowered team with the right functions represented (including outside help if necessary).
4. An internal communications plan to get employees on board, to disseminate results.
5. A feedback management tool that meets the organization’s needs.
6. A “start small” and “prove- the-benefits” approach. Don’t take on too much initially.
7. Commitment to see it through.
In this column we’ll discuss how to organize a customer feedback management effort. The list above shows seven sets of observed characteristics of successful customer feedback managers. But for our purposes we’ll group them into four categories: Management Commitment, Feedback Objective(s), Process and Tools.
Management Commitment
Management commitment is essential. As in any business function customer feedback management requires a senior management sponsor - someone in the organization who can determine priorities, allocate and spend money and determine objectives. Here’s our list of things your sponsor should be prepared to commit to:
- Budget for out-of-pocket expenses (outsourced customer survey help, purchased tools, etc.).
- Personal leadership – to guide objectives and responses to feedback, to prioritize staff, for acquiring internal resources including things like I/T support, data access, etc.
- Staff time – both for providing input into the design of your customer outreach and for acting on results of the outreach effort.
- Project management – You should pick a resource (either internal or external) to manage the project.
- Multiple feedback cycles – In customer feedback management cycles matter. You need period over period comparison data to know if your feedback based actions are having an effect on the objective(s) being measured. Keep in mind that feedback management benefits accrue over time. We recommend at least three customer feedback cycles (more is even better).
Feedback Objective(s)
Obviously you’ll need an objective for your first feedback management effort. If you are still reading this article you may have one already in mind. Choosing an objective is normally a fairly simple matter. In your business there is likely a metric that will point to future behavior of your customers relative to their purchase or re-purchase of your offering(s). Some examples of feedback management objectives with this characteristic are: Customer loyalty (per Reicheld), Customer satisfaction, Customer support effectiveness or perceived value versus competition. All these are useful metrics and any one of them would make a good customer feedback objective. You may eventually want to try and track all of them.
Note: The key aspect of the objective you pick is its relevance to your success as a business. Customer loyalty is often chosen by “mature” feedback management organizations because it is a proxy for the overall perception customers have towards their company, for their intentions to re-purchase and likelihood of referring new business.
Picking a customer feedback management objective can have its challenges. In many companies lots of different business functions “touch” customers. Some of those functions may also gather customer feedback as part of their processes. Your customer feedback management effort may potentially highlight problems in the way other parts of your organization handle customers. It may be one of your goals to identify these kinds of issues. We think you would be well served to think about and involve representatives of other organizations in your planning process.
Process
Managing anything requires a process and customer feedback is no different. At a minimum you need to determine what to do with the feedback that you collect. This means some analysis of feedback is required and some set of actions will need to be taken based on the analyses performed. People will need to be assigned to both analyze and act on customer feedback. You will need a communications process both for disseminating feedback results (different analyses to different constituencies) as well as to communicate regarding actions to be taken. How much process you need depends on how much feedback you are collecting and what you want to do with that feedback. We recommend limited objectives and limited actions initially because it simplifies things, keeps cost low and improves chances for success. At the same time objectives and actions need to be designed so that improvement in the metric you choose can take place. Keep in mind that one of the objectives for your feedback management process should be to make customer feedback management a formal part of your company’s business culture. Communications planning is a key to doing this.
Tools
The right tools make organizing and implementing your feedback management process much easier. Using tools that support more of the entire feedback management process (rather than less) is a good idea. Using tools that also integrate or interface with your other systems (CRM, Sales automation, etc.) can be helpful as you get more “mature” with feedback management and you begin automating your feedback management process.
At a minimum, we think your feedback management tool set should support:
- Survey design and implementation
- Results analysis for aggregated response data
- Results analysis for comparison of response data against customer profile data (e.g. How do our most profitable customer’s responses compare to the aggregate reponses)
- Results dissemination
- Follow up action
- Period over period comparisons
There are many tools available that support one or more of these capabilities. There are relatively few that support all of them. Price ranges are from a few hundred dollars per user to several thousand dollars per user. We believe there are middle tier products available that support all these capabilities and which are available at reasonable cost. There are merits to both low and high end solutions. As a general rule, choosing low-end tools will require you to use suites of products and to manually perform a number of tasks. Higher end tools will do more within the tool and require less manual effort.
Note: We have observed that companies in the “getting started” phase of feedback management maturity often use low-end feedback tools. These tools offer low cost but typically require substantial manual effort to create analyses, do comparisons versus customer profile data, disseminate results, do period over period comparisons, etc. In fact most of this type of work is actually done using Excel spreadsheets or Statistical analysis packages (SPSS). More advanced feedback management tools have higher out-of-pocket costs but typically offer much better cost/benefit profiles in the context of an on-going feedback management effort as they often include analytical tools and other types of feedback management process support as part of their offering.
As vendors of a customer feedback management product we are probably biased towards tools – like our own – that are designed to support a customer feedback management process. That said, we believe the right tools are vital to making customer feedback management an automated (or at least automation supported) process, and we’ve attempted to outline the trade-off you will need to make as you choose tools to support your customer feedback management effort.
Conclusion
If you organize well, focus on limited initial objectives, define a team and choose the right tools - achieving success with customer feedback management can be surprisingly low in cost and powerful in results. You can do this kind of project yourself. Very often many of the skills required already exist in your company. For instance, if you have market research (MR) people you can call on, they often know how to design surveys and have experience using survey design tools. You’ll need to coach MR people on the “management” aspect of feedback management as they are mainly “feedback” oriented. You also may have access to business analysis (BA) skills and products. Again you’ll need to coach them on analysis for management of feedback. And lastly, it’s likely that you have access to project management people. So if you try and do it yourself use the people and skills available – but orient them to the purpose of the effort, to enable the business to take advantage of customer insights operationally.
If you don’t have easy access to these skills, or if you want all of the skills fully dedicated to your project, companies like Customer Centricity can take them on for you. It often makes sense to get help and guidance with organization and planning, objectives and process definition, survey design and implementation, results analysis and actions – all centered on your feedback management objectives. If you have MR and BA skills available you can always bring them on as you add feedback cycles over time and your process stabilizes.
So getting down to getting serious isn’t hard or necessarily expensive and help is available. Doing it has a great many benefits. We hope we’ve helped you understand the path to “getting serious” with customer feedback management.
