August 25, 2011

News & Opinion: Would You Recommend This?

By: 800-CEO-READ @ 8:27 PM – Filed under: Management & Workplace Culture

Earlier today, I spoke at a PRSA panel on blogger/publicist relationships. Publicists want bloggers to recommend something, and bloggers either do just that, or ignore them. The discussion then focused on how publicists might communicate with bloggers in order to reduce ignored pitches. Ironically, I returned to my desk and picked up the revised and expanded book, The Ultimate Question 2.0, by Fred Reichheld. The "ultimate" question referred to in the title is: "Would you recommend our product or service to a friend?" For companies, asking that question leads to a process, or system analysis. If customers would not do that, then Why? And What steps need to be taken to correct that? Reichhold addresses this analysis via implementing the Net Promoter score - which reveals how companies are faring on the customer-relations front. This process can track that score on a weekly or monthly basis, similar to how a business already tracks its financial performance. It's good data to have. A variety of companies have started using this: Charles Schwab, Apple, Progressive, Virgin Media, and more. Check out the book and see how to use it for your company. Here's the author's explanation why:
Our accounting systems - both financial and management accounting - don't have anything to say about feelings of loyalty, enthusiasm, repeat purchases, referrals, and all the other emotions and behaviors that determine the economics of individual customers. Executives and employees know how to meet their immediate financial goals, and they know they will be held accountable for doing so. But customer loyalty and the company's mission, as objectives, are soft, slippery, seemingly impossible to quantify. In the rush of daily decisions and priorities, of budget pressures and sales quotas and cost accounting, the gravitational pull toward short-term profits is powerful. And so companies, despite the best of intentions, drift into a vortex.
So, there's a theme for me today: "Would you recommend this?" is indeed an ultimate question for many aspects of business, and when the answer is, "no," we do need to understand why. Conversations in one case, and data (backed by action) in the other, are the keys to getting to positive ground.