Tag Archives: Effectiveness

How Do You Find and Focus on Your Promoters? Five Factors

Interview with Richard Owen, CEO, Satmetrix Systems

Situation: If you are not creating promoters of your product or service, you are inhibiting your own growth. Growth is challenging and if you don’t have positive word of mouth it becomes more expensive. How do you find and focus on your promoters?

Advice from Richard Owen:

  • Calculate and understand your “Net Promoter Score” – the percentage difference between “promoters” and detractors.” Promoters are those customers who would highly recommend your business, detractors have a negative perspective.
  • It is important to attend these two audiences – “detractors”, who create negative word of mouth, and “promoters” who create positive word of mouth. Detractors can be targeted for service recovery. At the same time, you must identify your promoters and find ways to get them to actively let others know about your business. Both negative and positive effects are being amplified today by social networks.
  • Understand what your business does that creates detractors and promoters. Gather and analyze root cause data to provide insights around the actions you and your team should take to change the balance in your favor.
  • Hold employees accountable by “stack ranking” the customer performance of each of your teams or employees. In part, this helps you to understand areas of strength and weakness and allows you to create individualized or group action and coaching plans. There is also a tendency for groups below the average to improve performance because they are being measured.
  • These are simple ideas, but making this work in practice can be a challenge. Setting up an effective system takes more leadership than leaders typically realize and is often counter to the short term realities of most companies. Success requires a long-term perspective and an external versus internal focus. And, of course, the right systems!
  • While the leadership of many mid-market companies are as sophisticated as that in large companies, mid-market companies lack the resources of large companies. A focus on action around promoters and detractors allows a company to get 90% of the value for 10% of the effort in customer experience management.

You can contact Richard Owen at richardo@satmetrix.com

Key Words:  Promoter, Growth, Word of Mouth, Positive, Negative, Cost, Data, Customer, Metric, Coach, SMB, Perspective, Effectiveness, Resources

How do you Create Performance Incentives? Four Approaches

Situation: The Company is considering options for both team and individual recognition. What have other companies found to be effective?

Advice from the CEOs:

  • One company has foremen compete on project quality, cost containment, and other measures. Bonuses are based on a mix of team performance, project difficulty and individual initiative.
  • One company uses year-end bonuses, but places more emphasis on frequent small recognitions: pedicure, manicure, going out for a meal on the company – things that let the employees know that they are appreciated on a regular basis. Any incentives paid are based on a mix of individual and team performance.
  • One company has completely eliminated bonuses. Salaries were raised to make up the difference, and individual incentives are created and paid during the year. Incentives reward specific accomplishments which are highlighted when the incentive is paid. Incentives are a mix of team and individual performance.
  • One company is very generous with bonuses – $5K to $10K at a time at the discretion of the CEO. These are paid face to face by the CEO and the individual is congratulated on their performance. However, the bonus recipient also signs a paper pledging not to talk about the bonus. If they tell others about their bonus, they are eliminated from the bonus pool. The company also uses publicly announced annual awards, performance-based monthly awards, shirts, etc. that are presented at company meetings. Interestingly, the smaller rewards and public recognition appear to have the most impact.

Key Words: Recognition, Bonus, Reward, Public Recognition, Effectiveness. Competition, Incentive