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The Effective Executive – Episode 44
Customer Surveys – Why Organizations Do Them
Net Promoter Score (NPS)
Why Customer Surveys Fail
Problems with How Surveys are Conducted
A Better Way – But the Solution Requires Change
[00:00:00] This is the 44th episode of the Effective Executive podcast and YouTube channel episode, and I wanted to let people know that I do put more a lot more content out on YouTube as I’m learning how to put YouTube together.
[00:00:22] But this week, I wanted to cover customer surveys. And more specifically, I wanted to talk about, first of all, why organizations do them, why they fail, and what I consider to be a somewhat surprising, better solution for surveys, surveys and and what to do. And I think you’ll find it interesting. So the first thing, why do organizations do them? Well, there’s a number of reasons, and these probably aren’t the only reasons, but they’re the ones I’ve picked up over the years. People want to get a sense of their of customer satisfaction with their organization. How much loyalty might they have? That’s one thing. A second thing is customer engagement for insights and perceptions of the company. A third one is potential product and service improvements that that might be available to them and having surveys go out. And the fourth one is just customer data collecting, customer data, demographics of things, it might be age, might be significant to your company, the location, so forth, and then operation operational efficiency. You know, how is your organization dealing with customers? Are they dealing with them in an efficient manner? And then the last one is benchmarking for development.
[00:02:16] So in other words, how are you performing today? And maybe you might have a new management team or you haven’t been doing any surveys and so you benchmark so you can kind of compare, are we getting better? Are we getting worse? Now, one of the common things used today that I found, especially in large organizations and probably I would say many midsize organizations are is something called the net promoter score and the net promoter score basically asked the customer to rate you on a one to 10 scale. How they performed or whatever the question may be, how good is our network if you’re in that particular area in telecommunications, but there are questions around what their performance is like. And if you are a customer and you give them a score of one to six, you’re considered a detractor. In other words, you’re not. You may be out saying bad things about the company because they don’t like your particular service. The seven and eight makes you a passive customer. You’re probably not going to knock them, but you’re not necessarily going to promote them. And then a nine and a 10 are the promoters as the people that are, you know, fans of your particular organization. And obviously you want more promoters for your company to communicate how good their brand is. So that’s kind of gives you a sense of of why organizations do them.
[00:04:01] Now, there’s a number of reasons why they fail. So let’s go through why customer surveys fail. The first reason and let’s just go for the reasons why you do them, customer satisfaction and loyalty, listening. So the question becomes, why weren’t you listening to the customer when they first contacted you that led to a poor or good score? I mean, you already know this information or people within your organization already know this information. So to me, if you’re going, it doesn’t make a lot of sense to do a survey on customer satisfaction and loyalty, because the only time you’re listening is with the survey. You’re your customer facing people are constantly in contact with customers and they already know how you’re performing as an organization, you don’t have to ask the customer. It almost seems ridiculous to to ask the customer something that people in your organization already know. They just don’t tap those people. Well, we got to go outside of because they won’t tell us the truth. And then the question becomes, well, why wouldn’t your customer facing employees tell you the truth? And so you have to to dig a little bit more into that customer engagement, insights and perceptions that they may be able to. But again, you have customers facing people talking with customers every day where they should be asking these questions about what they think about the product or the service that they’re giving those types of things.
[00:05:52] And most of the time, they already know before they even hang up the phone or leave the customer’s place where the service is being rendered. The third thing, product and service and hats, enhancements. You know, no customer ever asks for a light bulb. And that’s a famous scene from W. Edwards Deming. You have to be out in front. You have to be familiar enough with your customers to come up with product and service enhancements. And again, some of the smaller things can be done between the customer and the customer facing employee that they’ll know those. But as far as innovation goes, don’t expect your customer to innovate for you. That happens at such a rare occasion. You have to get out and in front of it by being proactive in your innovation efforts, something I’ve talked about quite a bit in videos and my podcast. Customer data, demographics, I mean, you usually already know that’s in the database, I would say you might be able to glean some additional information, but, you know, if your customers are, you know, hanging up the phone feeling like they need to take a shower because once again, they feel like their personal information has been exposed to another organization there. There’s a limit for customers operational efficiency.
[00:07:20] You should know in your organization already whether you’re efficiently dealing with customers from your customer, facing people in the way that your organization is designed and is it being able to render services effectively for customers. So I don’t think that those are good reasons to do surveys. What is a good reason to do a survey is benchmarking for development. So in other words, going out and establishing a benchmark as to maybe what their NPS score is, the net promoter score we talked about earlier, and it gives serving as a baseline so that maybe you go back in six months or a year and start to get those types of things.
[00:08:09] But there’s a problem with the way these surveys are being conducted. And I want to bring this up because I think it’s very important. Typically, what people will do or organizations will do is send out a survey and hope that somebody is going to respond back. And the problem with that is it doesn’t represent the whole population of customers that you have. The best thing to do is to randomly sample the number of the customers that you have out of your entire population. So a small percentage typically will. And I’ve done surveys for very large organizations that will respond when you just send it out and say, please respond, and then they’ll send it back. And they’re typically going to be the one on either the end of I’m really happy with your service.
[00:09:03] I really hated your service. So you don’t get a sense of the entire population and what they’re thinking in your organization. Matter of fact, it’s a lot less expensive to randomly sample the population than it is to send these kind of things back, hoping that you’re going to get a survey back and it’s not really going to tell you actionable items that you can do within your organization about how your performances and maybe what you should be working on. So surveys don’t accomplish that. So what is a better solution? Well, a better solution is to do the random sample and establish that benchmark. And, you know, you can do this for a lot less heartache than just sending out thousands of surveys every time someone has a service conducted with them because somebody’s got to accumulate it and do it. And if you got money to waste, then go ahead and do it that way. But you can be more focused about doing a random sample of the entire population, something that that I work on with organizations on. And then the second thing, which is a little bit harder but well worth the time, is designing an organization where your customer facing workers, people are coming into contact with customers every day, can clean all of this information from customers and get the feedback that you need in order to make improvements to your organization.
[00:10:44] And that is the better way to design your organization and forgo these constant surveys of people that drive us all nuts. If you’re on the customer end and obviously on the organization and, you know, they’re they’re in there and I think they believe that they’re providing some valuable information. But this can be done in a much more effective way because a lot of times in the surveys, you don’t know what’s going on. And and the other thing that will drive customers crazy as far as this whole process is, you know, I just got a survey a couple of days ago from a telecommunications firm that I deal with. I just say it’s Sprint and T-Mobile, because now they’re they’ve merged. Oh, you know, we’d like to know what you think of our network. Well, you know, I still get one bar, my phone. They probably already know this and, you know, I get one bar, my phone, you know, within my house, and it didn’t change. It was the same with Sprint as it was is now with T-Mobile. So that’s that’s information. I’m sure they’re engineers and so forth already know. The second thing that they asked was, you know, how how is their sort of service now that they’re with T-Mobile? You know, I still have outstanding issues with them on a variety of things.
[00:12:18] But, you know, of course, I gave them a three on their score and our net promoter score. And why did you give us a three and keep it brief? You know, we don’t want to spend any time on this. And, you know, I’ve listed out the things that that had occurred in my service with them. And they all thank you for your feedback. Most likely I’ll let you know if they do, but I will never hear from them again because, you know, they don’t want to deal with the problems. They’re just trying to do there. They’re part of their survey portion. So if you’re not going to do anything with the survey, it’s also just angers customers, too. So. So, again, the better solution is when I came into contact with the telephone represent telecom at Sprint or T-Mobile, they knew when they hung up the phone, I was not satisfied with the service that they had rendered me. They already knew that serving me about it is something that is just ridiculous. And this will save you time. You may have your contact center folks spent a little bit more time with customers, therefore developing a relationship novel idea and with the customer and customers then can have a conversation about, you know, what their experience and so forth.
[00:13:47] But I believe me, every contact center person knows whether they did the job or not went, you know, when they hang up the phone with the customer. Savane is, you know, information you already have is very it doesn’t promote anything. It doesn’t help you. So, yes, you can do. Yes. I believe it’s a good idea to random sample for a benchmark can be done very cheaply. But you need to get the whole population utilize those customer facing people. Are these are things that you’re struggling with in your organization as far as what to do. Set up a 30 minute call with me. You just go to the 95 method Dotcom Fortgang. Let’s talk and I’ll walk you through some things or you share what your scenario you have going on in your organization, and I’ll give you at least nothing else and 30 minutes to give you new ideas. This is in a high pressure sales thing. And as much as I can create value for you in some way, then maybe in the future sometime we’d work together. So that was it for this week. I hopefully you found this interesting as far as customer surveys, if you’re going to be an effective executive, you know, you’ve got to have knowledge about all of these different things and how you can use them to make sure that you’re working on the right things.