Tag Archives: net promoter score

Innovation: How to Wear the ‘Uber Hat’

It all began with reports of eroding books of business, price wars and marketing dollars not accounting for conversions of prospects into customers (or not in any visible manner, anyway). Then the CEO made that big “I’m back from a conference speech” and wanted to share. Suddenly, we’ve established a deadline to implement Net Promoter Score (NPS) at the enterprise level, and a whole playbook is being designed. Sound familiar?

NPS can be used to gauge the loyalty of a firm’s customers. It measures who is promoting our brand versus who is likely to detract and therefore take their business elsewhere. We soon realize that the costs of exceeding customer expectations are high, while the payoffs are minimal. We know from experience that customers are much more likely to punish bad service than to reward good service. Having your problems resolved easily is a much better predictor for satisfaction than the exceeding of expectations.

Improving the customer experience by making the customer journey easy is of greater significance to any brand. This philosophy requires different measurements, like the Customer Effort Score (CES), which is superior to Customer Satisfaction (CSAT) and Net Promoter Score (NPS) in predicting consumer behavior.

See also: What Is the Right Innovation Process?  

In the end, consumers to have a job done and will back brands that help them get the job done faster, better and cheaper. Achieving this for your consumers not only requires meeting current needs but anticipating future needs by inventing a future that is interesting and sexy and serves a purpose.

This requires moving from data to analytics, customer segmentation to ease of doing business and ideas that sell to ideas that are bought. We have started shifting the paradigm, mental models and mindsets. The future is in its making, and the applications are only limited by our imagination.

In the world of innovation, which lies at the fringes of most organizations or fills the gaps in between, we keep asking all the wrong questions. We all want frictionless technology solutions, but the focus can’t be on which technologies are enabling us or who we’ve partnered with. The focus needs to be on why we are innovating and at what scale.

Let’s consider the value proposition for transporting people from A to B. We must ask ourselves, what are the jobs to be done before that journey, during that journey and after that journey from the consumer’s point of view. I call this exercise wearing the “Uber Hat.” The jobs to be done before the journey may include finding a driver nearby, knowing how long it’ll take for the driver to arrive and figuring out if the fare is coming out of personal or business expenses. Once on the journey, the jobs to be done may include picking up a friend or colleague, knowing how long the journey will take in real-time or sharing the ride. After the journey, the jobs are knowing how much it cost, receiving a receipt for payment (especially for expense claims on business trips) and recovery of items left behind in the car.

Uber has thought about everything! It’s even started services that assist people in emerging markets to hail a ride without the app or the need for credit card payments. Who would want to take a taxi when you’ve experienced Uber’s service and quality of care?

See also: Is Insurance Having an Uber Moment?  

When we are wearing the Uber Hat, we think and act like Uber. We are able to design solutions that are globally relevant, apply to any business or market and withstand the challenges in our way, no matter how big they may seem to others. Throw creative thinking and industry expertise into the mix, and you’ve got a winning formula for the application of human-centered design that has proven its success across borders. This is the difference between a market leader and a follower.

I’m only here to present concepts. The choice is yours. If you don’t make that choice, ultimately the consumer will.

How to Reinvent Call Centers

The landscape for customer service is changing.

New platforms are emerging that change how consumers seek service and engage with brands. In doing so, these platforms are disrupting the traditional call center model. Today’s call centers range from the ancient and decrepit to the ultra-modern and technologically streamlined. Despite the differences in capability, though, they still rely on the telephone to call and connect with customers. As we shift into the messaging era, this is going to change.

The maturing millennial generation is sparking a mobile messaging revolution across all age groups. Text-based communication is fast becoming the most-preferred communication method. And to attract, engage, acquire and retain customers in the text-based era, businesses need a customer communication strategy that incorporates mobile messaging.

Executives are facing three key challenges:

  1. Offering a mobile-native, text-based customer service solution to keep up with changing communication preferences of consumers.
  2. Satisfying the demand for always-on, 24-7 responsive service.
  3. Maintaining cost-efficiency in the call center.

A solution comes in the form of new technology: chatbots and intelligent automation.

Chatbots allow businesses to automate the 80% of general inquiries that are repetitive. This leads to a smaller volume of inquiries requiring live assistance from agents and reduces operational costs while maintaining — or even improving — customer satisfaction ratings. It’s this combination of chatbots and human agents that can usher businesses into the messaging era while reinventing the call center model.

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The Current State of Customer Service

Every business strives to provide exceptional experiences that increase customer satisfaction and raise their Net Promoter Scores (NPS). The reality, however, is that executing an effective customer communication strategy is challenging. Often, exceptional customer service is limited by the capabilities of traditional service channels: email, social media and call centers.

By 2020, customer experience will have a such a significant impact on business success that it’s expected to play a bigger role in competitive differentiation than price and even product quality. Customer experience and NPS are fast becoming the new business battlegrounds. Providing experiences that meet or exceed the ever-increasing demands of customers could be the difference between success and failure.

Call center performance has a significant impact on a company’s NPS and customer satisfaction ratings. Given the direct and personal connection a call center enables between a business and its customers, the overall experience of the interaction can have a major influence on how that person perceives a brand on the 1-10 Net Promoter Score scale.

And while call centers work positively by enabling direct connections between businesses and consumers, there are endemic problems for both sides. Businesses are faced with high operating costs and are vulnerable to changing communication trends. Meanwhile, consumers often have to deal with long hold times, outdated Interactive Voice Response (IVR) systems, inter-departmental transfers and inefficient service.

See also: 4 Hot Spots for Innovation in Insurance  

As new technology such as chatbots and intelligent automation emerges, any business that relies on strong customer service can benefit from innovation.

There is a significant opportunity to gain competitive advantage and lead the market by developing call centers that are not only technologically advanced, but also resolve issues with far greater customer satisfaction.

The ideal result is customer service that improves the relationship with customers while maintaining cost efficiency for the business.

What follows is an outline of the current state of customer service in today’s fast-moving, on-demand and customer-driven world. We also detail how the call center can be reinvented through mobile messaging and intelligent automation to deliver a win-win solution for both businesses and customers.

Connected and Demanding: Generation Z, Millennials, Gen X and Baby Boomers

There is a reason why there is so much buzz around millennials: Their generation is one of the largest in U.S. history, and they are maturing into their prime spending years.

Starting in 2017, they will have the purchasing power of more than $200 billion annually. The opportunity for businesses to drive revenue and gain market share with this generation is unprecedented.

The driving force for new technology and communication trends

Millennials are driving mobile and instant messaging adoption. Because they have grown up with technology and information at their fingertips, millennials are highly connected and expect 24/7, on-demand access to the businesses and brands in their lives.

Gen X, baby boomers

In addition, the millennial obsession with mobile messaging is influencing older age groups, with text-based customer service now an increasingly popular choice for generation X and baby boomers.

Generation Z

Millennials have also set the precedent for generation Z. Mobile messaging use is even higher among the first true digital natives; they place even more emphasis on personalization and relevance when interacting with companies.

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The Challenge of Delivering What People Want

The adoption of mobile messaging as the preferred communication channel is forcing companies to change how they approach customer service. Today’s call centers no longer meet customer expectations. From long wait times to frequent departmental transfers and ineffective IVR systems, customer service can be a frustrating experience for consumers.

Now, in 2016, with the proliferation of new technology and 24-7, on-demand services, the shortcomings of customer-contact centers are even more apparent.

The competition is fierce, and customers have no forgiveness for poor service. A sub-par experience can destroy a consumer’s relationship with a business.

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Key Business Challenges Affecting Call Centers and Customer Loyalty

The shortcomings of the current call center model and its inability to effectively meet the needs of today’s customer also represent a significant opportunity for businesses. There has never been a more appropriate time to dissect the call center and explore new ways to increase its effectiveness.

Executives and business owners need to address the following three business challenges to ensure the future success of their contact centers:

  1. Offering a mobile-native, text-based customer service solution to keep up with the changing communication preferences of consumers.
  2. Satisfying the demand for always-on, 24-7 responsive service.
  3. Maintaining cost-efficiency  in call centers.

Each of these areas needs to be explored to maintain, or even improve, customer loyalty and Net Promoter Scores.

Challenge 1: Offering a mobile-native, text-based customer service solution

One of the drawbacks of telephonic customer service is the limit imposed by the phone on call center agents; they can only answer one customer inquiry per call. This limit drives costs up. In comparison, using mobile and web-based chat, agents can effectively manage as many as five inquiries simultaneously. This significantly reduces operational costs while providing a better experience for customers.

Fortunately, thanks to mobile messaging’s rapid rise in popularity, it’s now easier than ever to incorporate mobile chat into an existing customer communication strategy to better engage consumers. Mobile messaging is the modern vehicle for businesses to deliver great customer service at significantly lower costs. The result is a better customer experience that drives loyalty while improving the bottom line.

See also: How Chatbots Change Open Enrollment  

Using an intuitive interface familiar to more than two billion people, businesses can effectively engage with customers and fans using simple decision trees for fast and convenient issue resolution.

Benefits of mobile messaging solutions:

  1. On-demand customer service that allows consumers to get the information they need, when they need it, without having to look for it.
  2. Faster issue resolution thanks to an agent’s ability to manage more inquiries simultaneously.
  3. Reduced, or potentially eliminated, hold times.
  4. Real-time conversational connections with customers.
  5. Improved customer experience with greater omni-channel service capability.
  6. Secure identity authentication and user verification.

Challenge 2: Satisfying the demand for always-on, 24-7 responsive service

The role of automation, bots and artificial intelligence in customer communication has become an increasingly popular topic. And as the technology continues to develop, more businesses are starting to realize the benefits of automated customer service and how it can drive customer service ratings higher.

Chatbots are virtual agents that operate through natural language processing, meaning they are able to absorb, identify and react to a number of different queries. These sophisticated programs and targeted automated strategies provide an efficient solution to handle the high-volume, repetitive inquiries that overwhelm call centers. Businesses are then freed to devote more time and resources to customers who need one-to-one conversations. They can deliver a far better customer service experience at a far lower cost.

As with any emerging technologies, automation and chatbots need to be approached with tact. Currently, the best strategies use both human agents and chatbots. Businesses can test bot technology and assess what’s right for them without drastically affecting customer satisfaction.

A good starting point is a website’s frequently asked questions. Today, people are more inclined to seek information themselves than engage with a human agent. Using chatbots to automate FAQs is a cost-efficient test that can form the foundation for larger automation plans as the technology develops.

Chatbots can be used as the front-line customer service interface to answer the majority of repetitive inquiries. This combination helps businesses improve efficiencies without compromising customer satisfaction ratings.

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Challenge 3: Maintaining call center cost efficiency

Businesses can improve customer communication and drive customer satisfaction ratings by following a simple five-step process to automation:

1. Opportunity Analysis

  • Review customer service data
  • Examine IVRs and CSR scripts
  • Conduct Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis
  • Identify all opportunities for automation

2. Chatbot Design

  • Sketch blueprints including flow designs for all areas
  • Identify integrations needed to enable bots

3. Engineering and Integrations

  • Receive blueprint approval
  • Develop bots for intuitive user experience.

4. User-Acceptance Testing

  • Demo bots in test environment
  • Adjust as necessary

5. Activation and Optimization

  • Conduct marketing efforts for Phase I onboarding
  • Track usage analytics and fine-tune
  • Benchmark performance against key performance indicators.

With this approach, businesses are able to automate as much as 80% of low-level, repetitive inquiries, saving call center agents for the complex and uncommon issues that require the nuanced knowledge of a live agent. This results in faster issue resolution and more efficient service.

Chatbots: An Emerging Technology

Other technologies may help improve call centers incrementally, but chatbots offer the best, most revolutionary opportunity to scale their capacity and ensure future success. If archaic call center models can’t innovate and keep up with changing consumer trends, they’ll fast become obsolete.

See also: Mobile Messaging: How to Meet Rules  

As with any emerging technology, chatbots are still experiencing growing pains. They’re not perfect; key development issues must be overcome to improve the flow of conversation. Increased investment in chatbots and NLP will help the technology mature fast. And as it does, chatbots will increase in capability and become more common, providing new opportunities for businesses across all industries.

How to Keep Goals From Blowing Up

The goals you set for your organization might be sabotaging the very success that you’re trying to cultivate.

That’s the message from Professors Maurice E. Schweitzer, Lisa D. Ordonez, Adam Galinsky and Max Bazerman – all of whom should surely win an award for the most creative titling of an academic research paper (“Goals Gone Wild” in the Academy of Management Perspectives journal).

In a recent New York Times article, the professors’ research was highlighted along with intriguing examples of the unintended consequences of goal setting.

Like this gem: An NFL team, in an effort to improve the performance of an interception-prone quarterback, added a clause to his contract penalizing him for every pass thrown to the opposing team. The result? The QB threw fewer interception — but only because he stopped throwing the ball altogether, which wasn’t the desired outcome.

See also: Your Data Strategies: #Same or #Goals?  

This goal-setting phenomenon is routinely on display in business circles, when companies focus so relentlessly on a metric that their people over-rotate on it. That ultimately drives undesirable, sometimes even awkward behavior. Perhaps you’ll recognize some of these examples from your own experience, as a businessperson or as a consumer:

  • Auto dealerships where franchise recognition is so closely tied to “top box” scores on a satisfaction survey that staff practically beg customers for an “Excellent” rating.
  • Call centers that set targets for call length, leading service representatives to be more interested in getting customers off the phone than in actually helping them.
  • B2B firms that use Net Promoter Score (NPS) as their primary gauge of performance, leading company representatives to hand-deliver the NPS survey at the most auspicious occasions (like on a golf outing with a client).
  • Companies with such laser-focus on market share targets that they acquire new business at all costs, even at the expense of profitability.
  • Human resource recruiters who are held accountable for qualified candidate “yields” from their sourcing methods, leading them to pass less-than-ideal applicants through the recruiting pipeline.

To avoid making your organization’s goals its own worst enemy, keep these four tips in mind:

1. Consider unintended consequences. In the fervor to address a business issue and rally the troops around an effort, organizations leap to embrace a metric without carefully considering all of the downstream impacts. Contemplating a new measure, or a renewed focus on an existing one? Put on your contrarian hat for a moment. Think of all the bad things that could happen if your staff focused, to a fault, on the line you’ve drawn in the sand. Based on how detrimental and probable those unintended consequences are, tweak your approach accordingly.

2. Strive for balance. Guard against over rotation on any single metric by creating a balanced system of measures. For example, if you want to encourage a sales-oriented culture, but wish to avoid staff making sales at any cost, then only reward those top salespeople who also meet some performance threshold for profitability or customer satisfaction.

3. Set Goldilocks goals. Setting goals is one management task where it’s dangerous to be cavalier. Set the bar too high, and you create unrealistic performance expectations that can disengage your staff or, worse, lead them to game the system. Set the bar too low, and you miss an opportunity to get people to stretch toward a higher level of performance. If you want to set a goal, first track the metric for a time to get a sense of its variability as well as the current performance level. That’ll help you set an informed goal that’s more likely to motivate rather than frustrate.

4. Beware the tie to compensation. Pay for performance – yes, I’m all for it. But organizations can get into trouble when they move too swiftly to tie particular metrics (especially new, unproven ones) to individual compensation. First, get some experience under your belt tracking the metric and providing individual feedback based on it. Then structure the compensation linkage in a way that reinforces a balanced approach to measurement.

See also: Integrating Strategy, Risk and Performance  

When it comes to performance measurement and goal setting, simple “carrot and stick” thinking won’t suffice. Business leaders must invest some real time engineering this piece of their workplace puzzle. It’s the best way to ensure that your organization’s goals are working for you, and not against you.

How Connected Cars Will Change Claims

There is a long road ahead before the full potential of telematics is reached, but, from an international perspective, it is clear that the Italian market has already accumulated the greatest experience in the use of telematics within the auto insurance value chain. One of the key characteristics of the Italian experience is the capacity of certain companies to innovate the way in which they deal with claims-thanks to the data collected from the black box.

The benefits of telematics data for handling claims are significant and can be divided into three main categories: a proactive approach, objective information and loss prevention and mitigation.

First, telematics offers insurance companies the unique opportunity to assume an active role that starts immediately after the incident. Traditionally, the company would wait to hear from the insured person that a crash has occurred.

Based on my experience, one aspect that turns out to be key to setting up the telematics approach is that it provides real-time data about the incident to the people in charge of claims management. Usually, this information only reaches the insurance company’s assistance department. This data is crucial for two subsequent processes:

  1. Provide a great customer experience after the crash. Think of how much information can be gathered directly from telematics data without having to ask the client for it. The whole experience delivered to the customer when interacting with the company is becoming more and more important; recent net promoter score studies show that the economic value of a “promoter client” is more than two times higher than a “detractor.”
  2. Anticipate activation of claims management. For example, the insurer can guide the client toward the preferred auto repair centers right after the accident. This maximizes the capacity to achieve savings within the context of an optimized customer experience that is meant to solve the customer’s issues.

Second, telematics makes it possible to gather a structured set of objective data that can improve the understanding of the dynamics of the claim. The data can also provide an estimate of the damage. This information improves the decision-making capacity of the claims management process. It also assists the claims manager in searching for detailed information (such as additional inspections), which further reduces the time required. The information extracted from telematics data is the main factor that improves the efficiency and effectiveness of the liquidation process. Last but not least, this information is highly valuable from a legal point of view.

These two characteristics combined allow a significant reduction of the time spent in managing the different phases of the claims process-time that has proven to be directly related to the amount the company pays. Separating the knowledge supplied by the telematics (regarding the dynamics of the claims event in the case of minor damage) and combining it with the final claim cost by car brand and model will allow the company to make a liquidation proposal just a few hours after the crash. On the one hand, there is a clear benefit in terms of costs; on the other hand, there is a significant improvement of the driver’s user experience.

Third, loss prevention and mitigation was the first area explored when telematics pilot projects began in Italy, with the focus on recovering stolen vehicles. Big data analysis has enhanced this capacity by allowing the automatic identification (based on data received from the telematics device) of a driving style that differs from that of the car’s owner.

This mitigating capacity no longer concerns only the professionally installed solutions. It has now partially extended to new self-installing solutions: The act of uninstalling the device activates an alert. Similarly, there is the value-added services option that mitigates the risks linked to the driver and his car. For example, weather condition alerts or vehicle maintenance notifications could help influence client behavior and lead to a lower risk rate for the driver.

Best Way to Track Customer Experience

Many commentators have recently debated the relative merits of customer effort score (CES) vs. net promoter score (NPS). As a leader who remembers the controversy that surrounded NPS when it first came to dominance, I find the debate concerning. I still recall the effort people wasted trying to win the battle against NPS, pointing out its flaws and the lack of academic evidence for it, when we were really looking a gift horse in the mouth because of NPS. I would caution anyone currently worrying about whether CES is the “best metric” to remember the lessons that should have been learnt from “the NPS wars.”

For those not so close to the topic of customer experience metrics, although there any many different metrics that could be used to measure the experience your customers’ receive, three dominate the industry. They are customer satisfaction (CSat), NPS and now CES. These measure slightly different things, but are all reporting on ratings given by customers to a single question. Satisfaction captures emotional feeling about interaction with the organization (usually on a five-point scale). NPS captures an attitude following that interaction, i.e. likelihood to recommend, against a 0-10 scale. Detractors (those providing a 0-6 score) are subtracted from promoters (those with 9-10 ratings) to give a net score. CES returns to attitude about the interaction, but rather than asking about satisfaction it seeks to capture how much effort the customer had to put in to achieve what she wanted or needed (again on a five- point scale).

The reality, from my experience (excuse the pun), is that none of these metrics is perfect. Each has dangers of misrepresentation or simplification. I agree with Professor Moira Clark of Henley Centre of Customer Management. When we discussed this, we agreed that ideally all three would be captured by an organization. This is because satisfaction, likelihood-to-recommend and effort required are different lenses through which to study what you are getting right or wrong for your customers.

That utopia may not be possible for all organizations, depending on volume of transactions and your capability to randomly vary metrics captured and order of asking. But my main learning point from “the NPS wars” over a couple of years is that the metric is not the most important thing here. As the old saying goes, “It’s what you do with it that counts.”

After NPS won the war and began to be a required balanced scorecard metric for most CEOs, I learned that this was not a defeat but rather that gift horse. Because NPS had succeeded in capturing the imagination of CEOs, there was funding available to capture learning from this metric more robustly than was previously done for CSat.

So, over a year or so, I came to really value the NPS program we implemented. This was mainly because of its granularity (by product and touchpoint) and the “driver questions” that we captured immediately afterward. Together, these provided a richer understanding of what was good or bad in the interaction, enabled prompt response to individual customers and targeted action to implement systemic improvements.

Now we appear to be at a similar point with CES, and I want to caution about being drawn into another metric war. There are certainly things that can be improved about the way the proposed CES question is framed (I have found it more useful to reword and capture “how easy was it to…” or “how much effort did you need to put into…”). However, as I hope we all learned with NPS, I would encourage organizations to focus on how you implement any CES program (or enhance your existing NPS program) to maximize learning and the ability to take action. That is where the real value lies.

Another tip: Using learning from your existing research, including qualitative, can help frame additional questions to capture following CES. You can then use analytics to identify correlations. Having such robust regular quantitative data capture is much more valuable than being “right” about your lead metric.