Voice of the Customer improving profit through customer involvement January 20, 2012

Our webinar will begin in a few minutes. “Figuring out the right things to do isn’t nearly as difficult as continuing to do them over the long term.” Our webinar will begin in a few minutes.

Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement January 20, 2012

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Voice of the Customer improving profit through customer involvement REMINDER: START RECORDING STARTING SLIDE Hello and welcome to today’s webinar, Building a Better Business Case. Today we’ll be looking at the start of any change initiative, creating a compelling business case to support change. January 20, 2012

Your Presenter Matt Lauth Managing Partner Strategy Execution Advisors Certified Business Coach My name is Matt Lauth. I am the managing partner at Strategy Execution Advisors and I’ll be hosting today’s webinar. Today’s webinar is being recorded and the presentation will be made available at the end of the webinar on our website. To minimize background noise all phones have been placed on mute. Throughout the next hour, if you have a question or comment please submit it through the “Question” pane of the GotoWebinar application that is along the right side of your screen.

Voice of the Customer Having highly satisfied customers who promote your product through their communications is where profitable growth comes from. In this webinar we'll show you what a voice of the customer program can mean to your organization and the benefit it will provide. You'll learn: 1. Understand the differences of customer satisfaction, customer experience, net promoter score and customer loyalty. 2. Which program(s) are best for your organization? 3. How to incorporate the program into your business? This is 1 hour of your time that will give you the information needed to implement a voice of the customer process within your organization. I want to take a moment to review the goals I’ve set for today’s webinar. By the end of our 60 minutes I want you to come away with clear answers to the following: 1. Understand the differences of customer satisfaction, customer experience, net promoter score and customer loyalty. 2. Which program(s) are best for your organization? 3. How to incorporate the program into your business?

‘Voice of the Customer’ Options Customer Satisfaction Survey Customer Loyalty Survey Net Promoter Score (NPS) Customer Research Market Research Getting input from your customers can come in various ways and names: Customer Satisfaction Survey – survey to assess how satisfied a customer is; often times done in conjunction with a transaction the customer recently completed. Customer Loyalty Survey – done periodically to assess the brand recognition and loyalty a customer has. Often times focused on behaviors. Net Promoter Score (NPS) – focused assessment of the loyalty of a customer related to their profitability. Customer Research – speaking to existing customers to evaluate new services, products, interests, feedback Market Research – speaking with prospective and existing customers in target market to get their input.

Poll Questions Let’s take a quick pause….I’d like to get your input on a 5 poll questions related to the topic of voice of the customer…. Does your organization have a formal, defined way of getting the voice of the customer? Which approach best aligns with your organization’s approach? Is your approach done through email, online, print, telephone or in-person? What is the frequency of your approach? What is the main reason for your approach? © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Today’s Focus Consistent way to gauge satisfaction Consistent way to gauge loyalty Consistent way to project future growth Consistent way to project future profit Straightforward, consistent & trended © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Segmenting Customers 1. Promoters are loyal enthusiasts who keep buying from you and urge their friends to do the same. 2. Passives are satisfied but unenthusiastic, who can be easily wooed by the competition. 3. Detractors are unhappy customers trapped in a bad relationship and they let others know it. © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Net Promoter Score The net promoter score is a system developed by Fred Reichheld and is detailed in his book, The Ultimate Question The one, simple, ultimate question he recommends is “How likely is it that you would recommend this company/product to a friend or colleague?” The scale recommended is from 0 to 10, 0 being “not likely at all” and 10 being “extremely likely”. During analysis of the results he scale is divided into three sections: 9 & 10s are called promoters 7 & 8s are called passives And 0 through 6 are called detractors The net promoter score or NPS, is calculated by subtracting the % of detractors from the % of promoters to get your NPS score. © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Example Net Promoter Scores NPS Leaders – US 2011 Company NPS USAA - Banking 87% Trader Joe's - Grocery 82% Wegmans - Grocery 78% Costco - Dept Store and Wholesale 77% Apple - Computer Hardware 72% © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Net Promoter Score © 2004-2007 Six Disciplines, LLC All Rights Reserved.

20% - 10% = 10% NPS NPS Example Let assume you have 2000 customers. You survey them to get their NPS feedback. 1000 respond to your survey The score results look like: 9 & 10 – 200 out of 1000 7 & 8 – 700 out of 1000 0-6 – 100 out of 1000 The NPS would be calculated as: 20% - 10% = 10% NPS (200 / 1000) (100 / 1000) © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Significance of NPS Average firms have an NPS of 5 – 10% A good NPS is above 50% High performing firms have an NPS of 70-80% NPS can be used to understand if your growth is through “good profits” or “bad profits” “good profits” – customers who are promoters and will purchase again. “bad profits” – customer who purchase, but are detractors and will not purchase again and will tell their friends they won’t purchase from you! © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Considerations © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Considerations to NPS Frequency – how often should we do it? Responsibility – who in the organization is best responsible for it? What will we do with the information once we have it? How does this align with other interactions we have with our customers? Are we committed to doing this on a consistent basis? Do we have our customers at the center of our purpose? © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Best Practices © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Best Practices of NPS Ask the ultimate questions and very little else. Choose a scale that works for your organization and stick with it. Aim for high response rates from the right customers. Report relationship (NPS) data as frequent as financial data The more granular the data the more accountable employees can be Audit to ensure accuracy and freedom from bias. Validate that scores link to behaviors. © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Barriers © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Barriers to NPS Culture – not viewed as a priority, viewed as something “marketing” should do. Expertise – don’t know where to start or what to do next. Time – don’t have time to dedicate to it. Money – too expensive. Human Behavior – I want to but don’t! There are many barriers to effectively doing customer satisfaction, loyalty and NPS scoring. Here are just a few of the barriers or reasons I’ve seen organizations not pursue finding their NPS: Culture – not viewed as a priority, viewed as something “marketing” should do. Expertise – don’t know where to start or what to do next. Time – don’t have time to dedicate Money – too expense Human Behavior – I want to but don’t © 2004-2007 Six Disciplines, LLC All Rights Reserved.

My Approach © 2004-2007 Six Disciplines, LLC All Rights Reserved.

What do I do? Annual Customer Satisfaction Survey that includes NPS. Can be done as part of annual planning, usually in the 11th month of the fiscal year. Create operational “transaction” feedback surveys that can be used throughout the year. Includes NPS Includes transaction rating Includes room for feedback comments Determine if any other feedback loops are needed based on the industry, customer base and planned activities for the year. © 2004-2007 Six Disciplines, LLC All Rights Reserved.

© 2004-2007 Six Disciplines, LLC All Rights Reserved.

© 2004-2007 Six Disciplines, LLC All Rights Reserved.

© 2004-2007 Six Disciplines, LLC All Rights Reserved.

© 2004-2007 Six Disciplines, LLC All Rights Reserved.

© 2004-2007 Six Disciplines, LLC All Rights Reserved.

2010: 82% - 11% = 71% NPS 2011: 90% - 10% = 80% NPS © 2004-2007 Six Disciplines, LLC All Rights Reserved.

How Strategy Execution Advisors Can Help Your Organization © 2004-2007 Six Disciplines, LLC All Rights Reserved.

Customer Satisfaction & Loyalty Surveying Compile list of all customers – including geography, product mix, profitability and weighted profitability. Create the survey to be used –inclusive of operational needs, execution leadership needs, Net Promoter Score and comment feedback. Manage the survey and feedback process – objective, unbiased management and execution of the process. Deliver comprehensive reports – executive level as well as detailed operational analysis of the feedback that can be trended over time.

Customer Satisfaction & Loyalty Surveying Results Loyalty and satisfaction report for customers or employees, or both. Net Promoter Score (NPS) Statistical report identifying hot spots List of customer comments Database of responses Investments 4-8 hours of your time to review and prepare 1-2 weeks elapsed time $1500 - $3000 depending on needs of survey and audience being surveyed

For more information and to register, visit: Upcoming Webinars January 20th: Voice of the Customer January 26th: Voice of the Employee February 2nd: Executing Plans for Results February 8th: 360 Degree Feedback February 16th: Performance Reviews February 23rd: Balanced Score Card March 1st: Strategy Maps March 8th: Value Stream Maps March 15th: Succession Planning March 22nd: Benchmarking Performance March 29th: Quarterly Review Process Here’s a list of the upcoming webinars. Today’s webinar, along with the PowerPoint presentation slides will be uploaded to our website and will be available by end of day today. You can visit our website to learn more and to register. Past webinars have been recorded and are available on the website at the URL listed. For more information and to register, visit: www.StrategyExecutionAdvisors.com/webinars

You can visit our website to learn more and to register You can visit our website to learn more and to register. Past webinars have been recorded and are available on the website at the URL listed.

Thank You! Matt Lauth mlauth@sxadvisors.com (419) 348-8046 Thank you for attending today’s webcast. Here’s my contact information, please contact me to discuss how we can help your organization. It’s fitting for any organization, regardless of size or industry. Now let’s answer some questions. REMINDER: STOP RECORDING Survey Questions: 1. How would your rate your overall satisfaction with the webinar? Excellent, Very Good, Good, Fair, Poor Would you recommend this webinar to a colleague? Yes, No What could we do to make webinars like this more effective for you? Essay response What topics would you like to see covered in future webinars? Essay response Matt Lauth mlauth@sxadvisors.com (419) 348-8046