Issues with Managing Actions on Customer Feedback

I've been posting recently on "Customer Feedback Action Management".  My thought is that by better managing feedback based actions, enterprises can do a better job of "Closing-The-Loop" with customers.
What I've found in discussion forums, personal contacts with experts in the VOC field, my survey on the subject and my personal experience is that the "Managed Alert" process that most companies use is really insufficient to ensure that the feedback loop gets effectively closed. And, that the managed alert is more of a beginning of the action management process rather than a process unto itself.

To be sure, certain types of feedback can be effectively managed using a CRM case management based process. Examples are product or service complaints, low satisfaction or loyalty scores, expressions of desire for more products/services, etc. Things that are, by definition, resolvable by front-line (Sales, Support, Administration) or near front-line staff (their management). These staff tend to be daily users of the CRM platform and are able to incorporate "managed alerts" follow-up into their daily activities.

Where the CRM based process seems to break down is when loop-closing requires input from non-front line parts of the business. Some examples might be contract terms the customer doesn't like but which the finance department insists upon. Who closes that loop? And how? Other examples: Product capabilities desired but not yet available, Needs for services that aren't offered, needs for solution integration or partnering with other entities. These are issues that require a management decision or action and that take time to implement and communicate back to the customer. But, in truth this type of feedback occurs regularly yet is hard to pull together and act upon. And, these are just some examples which I can think of or have heard of. I'm sure there are others.

One of things I'm finding in my research is that in addition to the hard-to-manage feedback I've talked about, a percentage of "alerts" that get entered as "closed cases" are improperly "closed".  Another is determining if the action taken, and which "closed" the case, actually had an impact on the customer who provided the feedback.

A couple of thoughts occurred to me about how to validate the effectiveness of "loop-closing" activities.

My first thought was, why not simply re-survey everyone who responded to the original survey? As it happens, some advanced organizations already do this. It seems to me that asking a couple (2-3) of follow-up questions within 30 days of a survey being responded to would be a good idea. Especially for certain categories of feedback like: service or billing problems or expressed need for more or updated products/services, but in just in general to get a sense from customers about their perception on the effectiveness of loop-closing actions.

My second thought was why not survey the employees who are assigned loop closing actions to see how they perceive its effectiveness. It seems to me that it would be useful to learn quickly if staff feels they were able to really "close-the-loop" on an instance of feedback, or if they feel they were unable to address the issue effectively.

A third thought: Does it make sense to cross reference the results of both follow up surveys to see if any expressed issues were being highlighted by both customers and employees as being a challenge to get the loop closed on.

I'm sure there are other issues with managing actions to close-the-loop on customer feedback.

Issues vs. Cases for managing Actions on Customer Feedback

Sophisticated enterprises have long employed “Case Management” within their Customer Relationship Management (CRM) platforms to document and resolve customer support / service issues. But, today many of these organizations also use CRM Case Management to manage customer relationship feedback. The question is: Should they? And, is there a better way to structure the action management process spawned by customer feedback?


Most Enterprise Feedback Management (EFM) systems can generate an e-mail “Alert” based on input from customer survey respondents. The the most obvious way to “manage” these alerts is to create “cases” in the CRM system, where the system then assigns tasks to relevant people in the enterprise – usually in sales and support.

It seems to me that CRM based Case Management is inefficient for managing customer feedback driven actions. Though certainly some customer feedback should spawn a "Case". 

First of all, a lot of survey based customer feedback doesn’t really require management with a “Case”.  It may only require a simple follow up call or e-mail from a sales representative, or an accounts receivable clerk. An EFM system “Alert” that creates a task or event which is then tracked and managed probably would be more effective as well as less a costly approach. Especially since significant parts of an organization (accounting?) may not even have access to, or be trained on, the use of CRM systems.

Secondly, there is the difficulty of changing customer surveys after they've been integrated into the CRM system. This "hard coded integration" of customer surveys makes changes (a necessity as the business changes) complex, expensive and driven by the information technology organization. An exact opposite approach to how customer feedback management is typically deployed.

Is there a way to create a simpler, less expensive and more flexible process for managing customer feedback driven actions? I think there may be. And, the technology is called Issue Management. Issue management currently is mainly employed by software engineers for managing the change process for software during development. It is a “Case Management Lite” approach both from a technology as well as a cost perspective.

There are a number of low cost commercially available issue management systems that I believe would work well as action management tools, if integrated with EFM systems. The cost to achieve a fully managed “closed loop” customer feedback process using this approach would be much lower than it is today, in the neighborhood of $20,000 per year versus the current cost of $50,000 and up (sometimes way up).

Commentary on Temkin's 8 Customer Experience Trends for 2011

I closely follow Bruce Temkin's Customer Experience Matters Blog (http://experiencematters.wordpress.com/).  Earlier this week Bruce posted some updated thoughts on his report - 8 Customer Experience Trends for 2011.  Since I'm on an Action Tracking and Management thought path these days, I immediately interpreted his blog post through that prism. 

When looking at Temkin's eight trends and reading his more recent remarks, what struck me was how closely related all eight are to the concept of taking action on customer feedback.  And, especially so for the first four:

- Customer Insight Propagation.  Why propagate customer insights unless you're trying to facilitate action taking?
- Unstructured data appreciation.  The purpose of doing a better job understanding unstructured feedback is again, is to generate actions.
- Customer Service Rejuvenation.  An action in and of itself.  Designed to facilitate imporoved action taking on feedback.
- Loyalty Intensification.  Which relys almost entirely on actions taken on customer feedback to produce the loyalty level changes business executives seek.

So, are companies deploying solutions or process improvements for acting on and managing customer feedback data streams?  Except in certain processes - mainly customer support - the answer seems to be mostly - No.  Outside of CRM supported transactional feedback, it seems to me that enterprises generally don't have systems in place to accumulate, propagate, assimilate and act on the myriad types of feedback they get.  Some of which will be rapidly increasing in volume over time. 

Doesn't necessarily bode well for a lot of the spending these companies are going to be doing within the 8 trend areas. 

Some early returns on Action Tracking and Management Survey

In my last post I included a link to a survey I'm doing on action tracking and management practices employed by enterprises.  The survey is a non-scientific poll of several hundred people in organizations I've worked with, who mainly have mechanisms / processes in place for gathering feedback from customers, employees and other constituents or stakeholders.  In addition, I've made the survey available to a couple of LinkedIn groups where customer surveys are a regular topic of discussion.  My assumption is that the data I collect will be a reasonable representation of the practices businesses employ for tracking and managing feedback.  But caveat emptor.

So far, and based on a very limited sample, a couple of things stand out. 

-  About 70% of the respondents consider their feedback process to be a "feedback management system".  This number surprised me a bit.  It seems low, given the widespread use of web, and phone based surveying systems.

- Of the 70% who indicate they have a feedback management system, roughly 70% indicate their FMS has an "Alert" capability.

- Of those, a little more than half indicate that their alert process is "Valuable" or "Extremely Valuable".  Versus the entire surveyed group, this sub-group represents a little less than 40% of the total.

-  The sub-group indicating that they receive significant value from their Alert Process also indicates that their FMS generates "specific alerts that auto route to specific individuals".  So, the value of feedback based alerts seems to correlate with their placement into the hands of an assigned individual. Which isn't surprising to me. 

-  Of the group indicating they have a feedback management system, slightly less than half indicate that they "track all actions taken".  Other data I've collected in the past has indicated that "closing-the-loop" on customer feedback had a variety of challenges.  It would seem to me that one of those challenges is clearly the difficulty of keeping track of actions taken subsequent to receiving feedback.

When I get more data from the survey I'll be posting a link to the data.

Learning more about Action Management in EFM procesess

Action Management and Tracking in EFM systems

A number of EFM tool vendors and consulting organizations have really been beating the drums lately on the topic of Action Management.  So, I thought I'd post on the topic and ask for feedback from interested parties.   So, I've built a survey on the topic.  If you click the link below you can take the survey.

https://web.questback.com/demo_nash_stewart_qbbostonusa/action_mgt/

What is Feedback Action Management? 

My definition:  "Any process designed to follow up, track, report on, or otherwise manage alerts and associated feedback generated by a feedback management system."

So, what constitutes an "Alert"?

My definition: "An alert is an automatically generated message or event coming from a feedback management system that is based on specific feedback from a survey respondent (or other "inputter of feedback")."

Research from Gartner Group and others has consistently shown that organizations generally are ineffective at taking action on customer feedback.  Typically, the research shows 10% or less of the organizations polled as taking any follow up action on customer feedback.  Yet, industry marketing touts the benefits of taking action on customer feedback.  And, the EFM industry is undoubtedly growing at a fairly rapid pace.  And, has been for several years. 

Clearly, taking action on customer feedback is a desired course of action for businesses.  But, there must be a major challenge with it for so many enterprises to not be doing so.  In my experience, enterprises struggle with managing customer feedback generally, except where that feedback is very focused.  Customer service processes for instance, where most businesses today do some type of post-interaction survey related to completed transactions.  In my opinion, the reason this application of Action Management works is that it is typically driven by the enterprises CRM system and is managed using the CRM system's tools.

In more complex feedback processes where action taking is harder to assign or the action that might be taken is harder to determine, I think enterprises still have major struggles managing feedback.  The reason is lack of system support for the management of Actions. 

It's my belief and experience that EFM tool vendors are working to add useful Action Management capabilities to their tool suites, so that action management can be effectively applied beyond the customer service domain.  I'll be very interested to see what the survey produces for results.

Comments on Gartner's VoC Thinking

  

Gartner recently published a research report (# G00201380 if you're interested) outlining their CRM team's thoughts on the importance of VoC initiatives to the various constituencies that make up the CRM universe (Sales, Marketing and Customer Service). After reading the report I thought I'd share a couple of comments.

Of Gartner's 5 "Key Findings", two stand out as being closely related to "closed-loop" feedback processes:

• "Over 90% of organizations fail to get back to the customer after a customer service survey".
• "Failure to act on the customer's voice defeats the point of listening".

Of Gartner's recommendations one seems particularly relevant to these two key findings: 

• "Create a mechanism for the timely distribution, tracking and action of relevant insights from aggregated VoC data to each stakeholder in the organization, from the frontline customer agent to the CEO".

In my opinion, A "mechaninsm for timely distribution, tracking and action of insights" is a Feedback Management System.  Gartner implies that you have to create your feedback management system.  Or, have one custom built by an integrator / consultant.  However, and fortunately, there are a number of commercially available feedback management platforms that are relatively easy to set up and implement with internal resources and minimal vendor assistance.

Customer Engagement - Reaching Point of Value (PoV) with your customers

The phase of customer relationship development where businesses most often fail, and where customer feedback can be enormously helpful is Customer Engagement - The time between purchase and receipt of value from the purchase by the customer.  Bruce Temkin in an insightful post at his blog: Customer Experience Matters documents the phenomenon and suggests that businesses pay much closer attention to post purchase customer interactions, with a view towards accelerating the time between Point of Purchase and Point of Value.   Click here for the article

Adding our input to Bruce's (Full disclosure - QuestBack and Customer Experience Matters have no relationship business or otherwise), Customer Feedback Management can add enormous value in this phase of the customer lifecycle by helping to:

• Identify customers who are not achieving value from a purchase
• Understand "root causes" for not achieving value
• Propagating information about non-value achieving customers to relevant "actors" in your business (Account Manager, Customer Support, Sales or Product Management, etc.)
• Monitor progress towards value achievement by customers over time (validating the actions your "actor" are taking or not taking)

As vendors of a Feedback Management platform designed to facilitate the propagation of customer feedback to relevant internal actors and the monitoring of actions taken on customer perceptions over time, we see how well designed customer feedback programs can help businesses ensure more of their customers reach Point of Value.  Of course, customers who reach PoV are more likely to be loyal, provide good word-of-mouth reference and stay customers longer than those who do not.  So, ROI from customer feedback in this relationship development activity is very high.

QuestBack has a defined process for supporting this kind of post purchase customer feedback.  If you Click Here you'll be brought to a QuestBack web page documenting the process (Graphic below if you don't want to visit).

As you can see, our perspective is that customer engagement is but one of several customer relationship lifecycle phases that should be monitored with feedback management.  By carefully doing so, a great many insights can be attained about how and why customers are attracted to you, how and why they purchase, engage and possibly leave over time.

Customer Experience Megatrend #1

Propagating customer insight remains a major challenge for most enterprises.

Bruce Temkin, in his latest publication "8 Customer Experience Megatrends" lists "Customer Insight Propagation" as #1. We agree. In surveys we've done over the last year - in which many of our readers have participated - we've found that a high percentage of organizations report challenges with using customer feedback effectively. Some of these challenges were attributed to customer feedback management process, some to architecture / technology and some to organizational issues with customer feedback ownership.

Temkin's report is available here: 8 Customer Experience Megatrends

It makes a lot of sense to us that Customer Insight Propagation would make the top of the list. Businesses have made large investments in CRM and Data Warehouse technologies, as well as in market research, in order to accumulate customer data on purchase history, preferences, buying process and much more. What often lacks is an ability to combine these stores of customer information dynamically with Voice of the Customer data in ways that make resulting customer insights easy to distill and distribute.

In our opinion, the majority of the value to be had from Customer Feedback comes only after it is filtered or distilled into actionable insights.  Actionable insights that are dynamically distilled from customer feedback are especially value adding, because they are actionable immediately and the benefits of immediate action are often very large. 

A quick note on the value of metrics when combined with dynamic feedback distillation and delivery.

When you have the infrastructure to distill and deliver customer insights dynamically to key internal actors, metrics can be very powerful.  This is the value premise behind Net Promoter and other customer loyalty / advocacy metrics.  They simplify the process of insight distillation by the design of the metric question and answer scales.  By combining a given net promoter answer with other data like customer value, region, products, etc., distillation of feedback gets relatively easy and doesn't require sophisticated statistical analysis to create actionable insight.  Adding "internal actor" information provides someone to deliver insights to for action. 

QuestBack is especially valuable if you don't have infrastructure to distill and deliver customer insights to internal actors.

QuestBack offers an out-of-the-box solution to this challenge. By feeding QuestBack data from your CRM or Data Warehouse prior to launching customer surveys, you can easily contextualize Voice of the Customer information based on any characteristic your data stores contain about your customers. We then provide built in mechanisms to dynamically propagate the insights produced to people in your business that are most able to use the insight.

Note: Temkin Group is not affiliated with QuestBack Boston. We just find a lot of what he says to be really insightful.

To learn more, visit our website at: www.questback.com

Doing Closed Loop Customer Feedback Management Right

Thoughts on doing "Closed Loop" Feedback Right

Lots of "good news" is associated with "closed loop" customer feedback processes.   Loyalty, retention and better insights into customer behavior are high amongst them.  Yet closed loop processes turn out to be stubbornly difficult to implement. In the past I've talked about the 5 challenges enterprises face in trying to implement closed-loop feedback processes. 

1. Corporate hierarchies and information flows.
2. "Ownership" of the customer.
3. Out of context data.
4. Customer survey processes and platforms not designed for "loop closing". 
5. Managing the feedback itself.

All five challenges have to do with managing customer feedback.  Collection of feedback is, today, a given for most enterprises.  So, organizing the business to utilize feedback, designing processes that "close-the-loop" and selecting the tools and technologies to use for feedback management has become the real challenge. 

The new question:  What is the appropriate level of process for your enterprise to ensure the maximum advantage from customer feedback?

The answer:  It depends.  And, some of the dependencies are:

- Size of your customer base
- Value of a customer relationship (revenue, profit, reference ability, etc.)
- Dispersion of customers (Geographic, market vertical, etc.)
- Size of your enterprise
- Diversity of your enterprise (#business units, products, markets served, etc.)
- Dispersion of your enterprise (geographic, market vertical, etc.)

Generally speaking, the less complexity inherent in your customer base and enterprise, the less customer feedback management process you'll need.  As a consequence less resource will be needed for managing customer feedback, as well as for acquiring tools and technology.  The opposite is also true.  More complexity equates to more CFM investment.

How to organize for CFM?

• Define your KPIs, potential actions based on those KPIs, ownership of the actions and tracking of the effect on KPIs based on actions taken. 
• Segment customers based on revenue, geography, profitability, reference ability, and other descriptors you have in your databases
• Segment the people in your enterprise based on role and responsibility so you will know who potential "loop-closers" are.
• Determine who gets what customer feedback
• Design loop-closing actions (i.e. tasks based on specific feedback)
• Monitor your KPIs over time for change

For big, multi-business, multi-product, multi-location enterprises this process is very involved and often facilitated by management consulting firms like Bain, Accenture, IBM consulting and others.  It’s also a very big ticket item. 

For mid-size firms it can be much simpler, though still complex and consulting assistance may or may not be needed.

For smaller firms this process can be an in-house or a vendor assisted effort.

Some additional thoughts

Keep in mind that feedback collection processes may already exist and could be providing much of the data you need.  It may also be that existing data collection processes will need to be revisited.  Many data collection tools (survey monkey, zoomerang, key, and others) stop at data collection and don't really support implementation of loop-closing processes or management of feedback.  If you are using such products now and want more feedback management capability you may want to considering upgrading to more sophisticated CFM platforms.

CRM systems can play a valuable role in managing customer feedback.  But, they also present a set of challenges when combined with CFM tools.  Specifically integration.  And, often the CRM system itself will need redesign (new fields for feedback data, new processes for tasking).  The CRM system will likely need to be adapted to accept specific data streams from your feedback process and then kick off tasks for the people assigned to close the loop.  You should expect to use a fair amount of I/T support if you plan to use CFM in conjunction with CRM.

QuestBack and some other vendors - offer CFM systems that perform data collection, analysis, and action assignment / management capabilities.  These vendors offer a less complex and typically more cost effective approach to upgrading data collection processes to CFM processes.  They are especially valid for smaller firms with less complex customer profiles and organizations, less I/T capability, and smaller budgets.

A final thought

To be successful with CFM, like with any other business process, it's important to understand what you want to achieve within the context of who you are and your existing capabilities.  Selecting relevant KPIs is also important.  Much has already been written about CFM KPIs (see anything on Net Promoter), so I won't go into that here.  But, if you think through your customer feedback needs, your ability to manage using feedback and the capabilities of your CFM tools, you can overcome the challenges and begin closing the loop with your customers more often and to good effect on business growth. 

Contextual Insight - The Basis for Taking Action on Customer Feedback

Don't do statistical analysis based Customer Feedback Management. 

Every now and then someone produces a really insightful analysis that is both relevant to business managers  and captures the essence of your particular company's solution, in this case QuestBack.  Bruce Tempkin of Forrester Research - via his Blog, Customer Experience Matters, has done just that. 

In the post below, Bruce makes the point that contextually relevant customer feedback doesn't necessarily need to be proven statistically significant to be both highly valuable and immediately actionable.  In fact his point is that contextually relevant feedback, when delivered to precisely the right individual, is both very valuable for its insight and immediately actionable, without any statistics based analysis focused on key drivers.  It's a great read.  I encourage you to visit his blog for the whole article.

http://experiencematters.wordpress.com/2010/02/08/market-research-needs-less-statistical-analysis/


"Contextual Insight" - The Key to effective feedback management systems

Bruce Tempkin - The respected Forrester Research analyst coined this term in a February post on his blog - "Customer Experience Matters".   He defines it as:

Business Context + Relevant, timely data = Actionable insight

Some examples of contextual insight might be:

• An indicator on an information request form suggesting a short term need by a prospect, when delivered to a salesperson
• A "detractor" rating given by a client on a net promoter survey and delivered to an account manager
• An "unsatisfied" rating given by a visitor to a web-site, when viewed by the web master

Contextual insight is always feedback, filtered by some characteristic in the data giving it business context. It is always insightful to a specific role in your enterprise, if delivered in a timely fashion to that person.

Achieving Contextual Insight without in depth statistical analysis.

Customer insight has typically been the province of market research organizations. But, market research organizations aren't often equipped or structured to rapidly generate and deliver highly granular, context relevant, data to business end users. In fact their processes often mitigate against doing so.

But, Business still needs actionable, context relevant and timely insights about customers and prospects.

Feedback Management technology makes Contextual Insight actionable. It allows businesses to pre-determine who should receive specific of feedback and when. Techniques include automated role notification (alerts) and CRM based task assignment. Most feedback management applications include some analytics capabilities which enable rapid, though not automated, action taking on feedback. Most feedback management applications dovetail with more traditional market research tools. And, therefore can be viewed as complementary to the marketing research function.

Some applications (like QuestBack) include the ability to synch up survey based feedback with customer profile and actor profile information.  This allows really powerful alert processes to be fully automated once a survey process is in place.

The Loyalty Effect from Customer Surveying

Research shows, experience validates: Systematically surveying customers and then "Closing-the-Loop" increases customer loyalty

A QuestBack user that regularly surveys their large global customer base found in a recent survey that for those customers who had responded to prior customer surveys, Net Promoter Scores were 19 points higher than for customers who were 1st time survey participants.  We have long believed that a multiple cycle and action supported customer feedback process based on e-mail delivered customer surveys would have loyalty enhancing effects.  Our experience with this process validates a number of earlier research efforts undertaken by different groups.  Our customers' NPS score differentials are in the chart below.  Other research is listed and attributed further on in this post.

The Feedback Management process implemented by this client included action taking based on daily reports during the duration of the survey, which routed dissatisfied customers - i.e. those dissatisfied with various elements of the customer experience - to appropriate internal actors (Support Staff, Account Managers, Product Managers, etc.) at the client for follow up.

Prior surveyed participants had all experienced some form of "loop closing" action in response to their earlier feedback. In this case, surveying and "closing the loop" clearly helped to build a more loyal customer base.

Some research these results appear to validate:

In the second year of a two-year study conducted by Development II, Inc. of Woodbury, CT, researchers found a noticeable increase in the top-box overall satisfaction scores from those customers who took the survey again in the second year when compared with new customers. For repeat customers who received a follow-up call after the first year’s survey, satisfaction levels in their second year increased to 24%. Respondents who believed the company is taking substantive action based upon their feedback, total satisfaction increased to 41%.

And there is the 2002 Study by Dholakia & Morwitz - Published in the Harvard Business Review titled:   "How Surveys Influence Customers"

The research shows that simply asking customers their opinion can increase their profitability over the long term.

The full article is available at:
www.neokoncept.com/onlineSurvey/pdf/How_Surveys_Influence_Customers.pdf

Some excerpts from the article:

• Marketers have long appreciated that surveys engage people; a single yes-or-no question on a direct-mail envelope can induce them to look inside. But can a company survey influence customers’ loyalty or buying habits? Research over the past two decades has shown that it can, but the studies have been narrow–looking at how surveys affect attitudes in the short term or influence one-time behavior, like a single purchase.  We set out to study the scope of this survey effect, and we were astonished by what we found.
• A year after the survey was conducted, the customers we surveyed were more than three times as likely to have opened new accounts, were less than half as likely to have defected, and were more profitable than the customers who hadn’t been surveyed. These differences reached their maximum levels several months after the survey was done and persisted throughout the year. Even at the end of the year, surveyed customers continued to open new accounts at a faster rate and defect at a slower rate than the people in the control group.
• Several theories of consumer psychology might apply. The simplest is that satisfaction surveys appeal to customers’ desire to be coddled, reinforcing positive feelings they may already have about the surveying organization and making them more likely to buy its products. Surveys may also increase people’s awareness of a company’s products and thereby encourage future purchases.  More subtle is the idea that the very process of asking people their opinions can induce them to form judgments that otherwise wouldn’t occur to them–that they really do like a company’s estate-planning services, for example.  These so-called measurementinduced judgments, the theory holds, can influence later behavior.
• Our findings may dismay marketing researchers, who strive to gather information untainted by their survey instruments.  But they raise the compelling possibility for marketers that conducting surveys, especially when customers are satisfied with the organization, can also enhance loyalty and profitability.

5 Reasons "Closing the Loop" on Customer Feedback is Hard to do

In practice, it turns out that "closing the loop" with customers who provide feedback is often a challenge.


In this post, we hope to provide some insights on why.

Some data from our recent survey:
87% of respondents chose "customer loyalty /satisfaction" as the #1 (75%) or #2 (12%) priority for their customer feedback.

• 74% say "closing the loop" is "Critical" or "Important" for their business' success.
• 54% rank "prioritizing customer feedback for follow-up action" as their Top or 2nd biggest challenge with respect to "closing the loop" with customers.
• 44% rank "determining the appropriate type of follow-up to provide" as their Top or 2nd biggest challenge with respect to "closing the loop" with customers.

Clearly, survey respondents believe their customer relationships are key to being successful. Yet, they often report struggling with using customer feedback to generate relationship improving actions. We think there are several reasons for this, some which are institutional and some more practical. Our thoughts follow.
5 Reasons "Closing the Customer Feedback Loop" is a challenge.
Five contributors to customer feedback not being employed optimally for improving customer relationships.

• Corporate hierarchies. Known as inhibitors of information exchange. Information flows up the hierarchy from analyst to manager to executives. When it flows back down the hierarchy, it's usually in summary form and attached to some new Standard Operating Procedure. Hierarchies tend to remove the individual, actionable, components of customer feedback. And they also add a timing element the process that inhibits relationship improving action taking. It takes time for information to flow up and down the hierarchy, which often delays or makes irrelevant subsequent actions.
• No centralized "Ownership" for customers. Enterprises often organize around functions like accounting, marketing or operations. Customer feedback collected by these business functions tends to be "silo-serving" and not necessarily about the broader enterprise need to holistically understand the customer relationship. Information collected within silos often stays there, or is presented in such a way as to make it difficult to interpret and act on outside the silo.
• Out of context data. For example, many enterprises - and especially those with automated CRM platforms - collect much of their customer feedback based on transactional surveys. To conserve resources they try to measure customer relationship quality using the same survey and process. Data collected in this way is often biased by the transaction. Even worse, "ownership" for action is often unclear when the feedback is not about a transaction. Out of context data is also a characteristic of silo based customer feedback.
• Customer survey processes and platforms that are not designed for "loop closing". Many organizations use web-based survey tools that are not designed to enable "loop closing" and when deployed make it needlessly challenging. These tools often lack embedded analytics, mechanisms to identify customers, necessary workflow automation, etc.
• Management practices. Perhaps the biggest challenge of all. Most organizations don't currently align management incentives with customer relationship quality. Therefore customer relationship is always subordinate to other operational metrics, as well as typically being "someone else's" problem.

What you can do to implement "Closed Loop" Customer Feedback processes:
Some of our thoughts....

1. Be sure to look at customer relationship in a broad context.
2. Establish executive ownership for the customer relationship.
3. Choose a customer relationship metric like: Loyalty, Satisfaction, etc.
4. When designing your customer surveys, plan for "loop closing" based on combinations of response and customer profile attributes.
5. When planning for loop closing activities - determine internal ownership for the various types of loop closing activities that you will undertake.
6. Use a survey platform that enables and facilitates the necessary analytics and workflow your loop closing activities will require.

Many firms need help establishing a "Closed Loop" Customer Feedback process. It's what we do at QuestBack, so if you'd like help please call us.

"Closing-the-loop": Critical for Success, but hard to do

Closing-the-loop on customer feedback is considered "Critical for Success" by many people in customer facing roles. Yet, in practice it seems to be difficult to do effectively and consistently.

A couple of statistics from our recent survey:

• 87% of our respondents chose a relationship metric - "customer loyalty/satisfaction" as the #1 (75%) or #2 (12%) priority for their customer feedback.
• 74% say "closing the loop" is "Critical" or "Important" for their business' success
• 16% say they "always" close-the-loop on relationship feedback

Organizations seem to be particularly challenged with "closing-the-loop" effectively on relationship feedback. We think process issues are inhibiting effective follow-up on feedback and we infer from the data that two process issues are contributing factors:

- Connecting customer feedback with other customer data: i.e. Profile data, Customer value information and "Responsible internal actor" information.
- Determining an action to be taken on customer feedback, then routing the feedback data to the "Responsible internal actor" for action.

When we examined these issues some thoughts occurred to us about why they might occur:

• Many businesses collect customer feedback centrally via one or two internal departments, very often product marketing or customer support. But, "loop-closing" activities must be performed by other departments (Sales, Marketing, Shipping, Accounting, Etc.).
• Often, data collected is not designed to facilitate a "closed loop" process (i.e. market research), may have a very specific type of "loop-closing" process attached (closing a support case, for instance) or requires a decision from another department prior to loop-closing actions taking place.
• Relationship feedback in particular seems to suffer from these challenges, as its a simple matter to insert a satisfaction or loyalty question into a multitude of surveys. But, based on the feedback provided, complex to "close-the-loop".

In our opinion, solving these "Loop Closing" issues begins with a better planning process. When feedback is solicited a process with ownership for follow-up should be defined for each key piece of feedback collected. And, mechanisms should be employed that facilitate getting feedback data to the correct internal actors in a timely fashion. This is especially important in the case of relationship feedback, where "Closing-the-loop" is often not only respectful, but is a known driver of higher customer loyalty.

Experience: Closed Loop Customer Feedback Processes

We recently surveyed a group of mainly customer facing business people regarding their practices and processes for "closing-the-loop" with their customers who provide them with feedback. We asked respondents to categorize their experience on three dimensions of customer feedback - Transactional, Relationship and Product/Service. Some interesting data came back from the survey.

• 75% report customer relationship quality (loyalty/satisfaction) as their main feedback objective.


• 74% view “closing-the-loop” with customers as “Important” or “Critical for Success” to their businesses.


• Three main challenges surfaced to “closing-the-loop” with customers providing feedback:
  - Prioritizing customer feedback for follow-up action
  - Determining the appropriate type of follow-up to provide
  - Following up with customers in a timely fashion


• ~25% indicated they had well automated processes for “closing-the-loop” with customers providing feedback.


• 19% of respondents “Always” close-the loop” on Transactional customer feedback
  - 16% and 13% respectively report they “Always” close-the-loop on Relationship and Product / Service customer feedback
  
• In all cases, survey respondents reported more effective practices and processes for "loop closing" with customers when transactional feedback was referenced.

A couple of thoughts:

In interpreting the data, there appears to be a gap in customer feedback processes that inhibits effective “Loop Closing” activity. While most respondents realize the importance of, and measure for, customer relationship quality, they don’t regularly take the loyalty/satisfaction building step of “closing-the-loop”.

Three main challenges were identified to closing-the-loop activity. All three suggest process issues in dealing with customer feedback after it is received, especially when the feedback isn't transactional in nature. Significantly, over 20% of respondents report their main challenge as just identifying whom to follow up with. We think that these challenges speak to an inability to truly identify who feedback providers really are, as that information would make determining follow activity much simpler.

The survey shows that over 50% of all customer feedback is collected via internet based technologies (web forms, web survey, e-mail surveys) across all three dimensions measured. So, identity shouldn't (and the survey shows it isn't) be a primary challenge. However, it appears as though two issues exist:

1) Connecting customer respondent identity to other information about that customer that helps to determine how to best "close-the-loop".

2) And, once connected, getting the feedback information to the right person so prompt closing the loop action can take place.

Since a majority of respondents report they either "struggle with analyzing customer feedback for action" or use manual feedback analysis methods (spreadsheets), it would appear that for most organizations, better "loop closing" processes will need to start with combining feedback and feedback analysis into a more automated process.

The summary read out from our survey can be viewed at the link below.

https://webreports.questback.com/isawebrep/webreporter.aspx?auth=E0AD8A0B7A0D30BFE7929E04571BDEB20372E901&rid=1991386