NPS and the search for accountability
31st October 2011
Closed Loop Feedback or Net Promoter programs, to use one of our most overused cliches, are "journeys not destinations". However, compared to many other transformation programs they have one important advantage - an evidence-based measurement system that tells you whether your journey is broadly headed in the right direction - or after a while, even worth taking at all. There is no where to hide with these programs - they either work or they don't.
So what does work, I hear you ask?
Well, there are general principles and a growing body of practitioner knowledge; and to be sure, there are many case studies where organisations have been successful with these programs. However, there is no detailed proven recipe for your organisation or industry and essentially it is up to you to "test-and-learn" - to discover what works.
I have just finished reading "The Ultimate Question 2.0" (Fred Reichheld) a book which aims to update the thought leadership and practitioner knowledge around these types of programs. Given our experience with clients, one of the principles referred to by Reichheld that stuck me as particularly critical was that of establishing accountability.
Reichheld draws a parallel with management accounting by referring to the precision and granularity of profitability measures by business unit, product line, region, plant, store and so on. This is a fine aspiration but, as Reichheld reminds us, accounting is also supported by several centuries of know-how.
The challenge is how to bring the same level of accountability to Closed Loop Feedback or Net Promoter programs.
If you are lucky enough to have transactional NPS cleanly established against a specific business unit (like a retail store) you can generally drive home accountability to the business unit manager and sometimes the specific team members serving a particular customer.
More often than not, businesses are not as simple as we would like. And creativity is required to establish a measure that will support accountability.
The connection between NPS and sales can throw up some interesting obstacles: grudge or habitual purchases in industries with limited competition (i.e. where convenience and "bad profits" can dominate) or "fixed asset" businesses (e.g. airlines, hotel accomodation, equipment hire) where increased demand has to be matched by increased capacity to find expression.
The bigger challenge I believe is driving NPS accountability back to individuals.
An interesting example here is where the customer feedback relates to an episode or event where different teams are assembled each time. This could be a airline flight, the installation of a broadband service, an engineering project or a hospital patient case.
Reichheld refers to Cancer Treatment Centers of America (CTCA) where a single patient may interact with a case manager; professionals in nutrition, oncology, anesthesiology, physical therapy and radiology; multiple nursing shifts; and administrative services.
In reworking its patient-care tracking system it was able to track all employees involved in the care of a specific patient. Scores gathered from the patient and, where appropriate, from the family caregiver at the end of each hospital stay then enable an attributable NPS for every one of its physicians.
"Ultimately, like a basketball team that compares its points-for and points-against when given player is on the floor and when he or she is on the bench, a hospital could rank teams and individual memebers by an NPS that is the average of all the patients they have served."
By the way, CTCA has achieved NPS ratings of over 80 and has four consecutive years of double digit revenue growth in a mature industry.
