Measuring what customers value
We recently wrote about the importance of understanding what customers value so the you can ensure your business energy and effort is focussed on delivering the right things.
The next step is to then actually measure this. It sounds so easy, but the reality is quite different.
Many organisations spend a great effort measuring financial performance, stock levels, people's productivity and utilisation, but there is no effort or priority placed on measuring the key things that the customer actually values.
As an example, one team we worked with quickly identified that in their market segment, the customers valued the understanding that the business has of them and their specific needs. The team itself was measuring the number of contacts made per week with clients and the number of new deals won. Nothing there about how well they understood their customers! Imagine the business results if they were instead measuring how well they understood the customer's needs (and then consequently acted on this).....
The first step in this process is to step out of the paradigm of measuring what we have always measured and instead spend a moment "walking in the customer's shoes" to see what they see and what they want from you.
From this you can then ask: how are my customers measuring that? Customers usually don't have a spreadsheet tracking your performance, but they certainly have a mental score-card running! Your duty is to find out what measures they keep on your performance. These measures are not the usual measures we are used to, they are typically behavioural measures like how quickly did someone return their call, how easy are you to deal with or was their problem fixed quickly.
The second challenge you will have is working out how to actually measure these new performance indicator. You can pretty much guarantee that your current systems aren't measuring it and aren't set up to provide you with the data you need....... We shall cover this one shortly!