sexta-feira, março 24, 2006: An undeclared war is raging across the business worlds – a war of companies against their customers

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So why does the war persist? Business measures success based on profits but accountants cannot distinguish between a dollar of bad, customer- abusive, growth-stifling profits and a dollar of good, loyalty-enhancing, growth-accelerating profits. When employees strive to meet their profit targets any way they can, they frequently end up taking advantage of the people who buy from them.

Conventional customer satisfaction surveys have failed to stop this war. They ask so many questions that they typically draw responses only from the bored, the lonely and the seriously aggrieved. If scores on satisfaction surveys affected growth and profitability, institutional investors would pore over satisfaction data. They do not. Bain & Company’s analysis of 8,000 US mutual fund filings from 2003 to 2005 revealed only six mentioned “customer satisfaction” as a reason for picking one of the stocks in their portfolios.

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There is good news, however, for those who would end the war on customers. A handful of leading comp­anies, including General Electric and American Express, are deploying a different kind of satisfaction metric – a hard-nosed, no-nonsense measurement that can focus an entire company on earning customer loyalty.

The key is to ask customers one simple question: “How likely is it that you would recommend us to a friend or a colleague?” A one-question survey can get response rates of 70 per cent or more. It can be conducted often enough to provide chief executives and operating managers with granular, timely, accurate data, which can also be audited. GE and the others focus on one statistic that nets the percentage of customers who are unhappy (scoring 0-6 out of 10) from the percentage who are loyal promoters (scoring 9 or 10). This Net Promoter Score provides a single number as clear and actionable as net profit or net worth.

A system very much like this has been in operation for some years at Enterprise Rent-A-Car and the effects are remarkable. More than 90 per cent of customers who receive Enterprise’s simple survey respond to it. Managers at each of Enterprise’s branches get their scores once a month, simultaneously with their branch’s income statements. They and their employees know that they are accountable for the scores, and take action to increase the number of happy customers and reduce the number of complaints. Many of Enterprise’s customer-friendly innovations, such as picking up customers at their homes or offering chilled bottles of water to shuttle riders, originated in employees’ attempts to boost scores. Branches with higher scores grow faster and are more profitable on average than branches with lower scores.

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FT.com / Comment & analysis / Comment - How companies can end the cycle of customer abuse

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