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Today, companies strive to deliver the best experience
for their customers. In order to achieve that, they need
systematic ways to measure and manage customer satisfaction.
I
n my conversations with companies,
the customer topic has become
much more prominent than
ever before,” remarks
Andreas
Dullweber
of consulting firm Bain
& Company. Some ten years ago,
Bain conducted research on company
communications, looking at things like
annual reports and letters from CEOs
to shareholders. At that time, the word
“customer” appeared in less than five
percent of the cases.
Companies now recognize their
need to care about customers. However,
there is a significant gap between a
company’s self-perception on its level
of customer experience and the
customer’s perception of the same
experience. Companies tend to think
better of themselves than customers do.
The good news is that companies
which are in agreement with their
customers clearly outperform competi-
tors both in profit growth and top-line
growth. The customer experience chal-
lenge is difficult, but worth it.
GOOD AND BAD PROFIT
To become customer-centric you need
proper management. And proper man-
agement needs proper tools.
“When you look at companies and
how they manage and measure profits,
there are well established standards and
processes that everyone understands,”
explains Dullweber. “But if you look for
“
understanding what kind of experience
a company provides and the loyalty it
creates, there is very little in the way of
standard tools to measure and manage
these factors.”
With the classical accounting
approach, there is no way to distinguish
between a dollar of profit made because
value was brought to a customer versus
a dollar of profit gained because the cus-
tomer was forced to pay.
Good profit quite simply is sustain-
able profit. Bad profits are a liability.
“If you cannot divide your customer
base, or rather your profit base, into
good and bad, you cannot really tell
what the health of your business is,”
says Dullweber.
MEASURE FIRST, THEN MANAGE
It was with this in mind that
Fred
Reichheld
and his team at Bain &
Company developed the Net Promoter
Score (NPS).
“NPS was born out of the need for
a standard system that could measure
customer loyalty like the classical
account system measures profit,”
explains Dullweber. “Only if you can
measure customer experience can you
manage it.”
The goal was to create something
very simple and intuitive, something
that is meaningful to everyone, from
senior management to those who inter-
act with customers in the field.
TEXT
RANDEL WELLS
PHOTOS
GORILLA AND RAMI LAPPALAINEN
NPS EXPLAINS
UP TO 60% OF
THE VARIATION IN
ORGANIC GROWTH
RATES AMONG
COMPETITORS.
60