hearing voices

Hearing Voices: Linking Customer Needs to People, Products and Process

Feb. 12, 2014
Work processes are often the most disconnected to customer requirements and needs. Most organizations design their work processes for their own convenience and with an eye toward lower costs without even considering what customers want.

Companies have made vast improvements in recent years using creative techniques to determine what customers want and need. While traditional approaches like focus groups and surveys are still prevalent, data from these methods are supplemented with measurement of eye movements and emotion, psychographic interviews and social media data. It turns out that simply asking people what is important to them, or what they will buy in the future, is fairly inaccurate.

Case in point: Airline customer focus groups revealed that comfort was near the top of the list for customer requirements. Companies like American Airlines took heed and added an extra six inches of legroom to planes, hoping to gain market share and increase customer satisfaction. While it did improve satisfaction of customers, the increased leg room did not result in bringing in new customers. It turns out that price is more important than anything else to many airline customers.

People may not want to admit they are cheap in a focus group of their peers, and provide politically correct answers like my friend Ed did in a Porsche focus group where he and other participants indicated that performance was the most important variable in selecting a Porsche over other car makes. Ed does not drive the car over 70 miles an hour and doesn’t really care about performance. He bought the car to impress dates, and he likes the shallow types of girls that are impressed with such things. He would never admit this in a focus group, however. Spending over $100k on a car to get a date sounds a little silly, but I am sure car makers know that sometimes they are selling sex appeal, not transportation.

Finding the Voices

It turns out that basic things like a flight landing on time or a car being fixed right the first time are important to all customers. Poor performance on your basic job pretty much guarantees that all segments of customers will start looking elsewhere to buy one of your competitor’s products or services. If your shipments are always damaged, doctors are always late to appointments, and software does not work as promised, customers will find another company whose products and services are better.

If you look at a product like automobiles, they all handle the basics pretty well. They all get you from point A to B, have both heat and air conditioning, and even inexpensive cars have pretty good sound systems today. In order to differentiate your product or service the key is to offer some feature that is really important to your customers. Rolls-Royce has always had strong levels of brand loyalty, so when BMW bought the company and introduced the new Phantom in 2003, they wanted to both entice new buyers and encourage existing Rolls’ owners to trade in their cars for the new Phantom. It looked like a Rolls-Royce, still had the distinctive grill and imposing appearance, and had better ride and performance than any previous model.

One feature they did not count on being so important is that it did not smell like a Rolls-Royce inside. Leather supplier Connolly had gone out of business after supplying hides to Rolls, Bentley and Ferrari for over 50 years. Not only were these interiors durable and attractive (often lasting more than 50 years), they give the car a most amazing aroma, which has been implanted in the memories of Rolls-Royce owners. With a new leather supplier, BMW was able to mimic the look of the Connolly leather for the Phantom, but not the smell.

New Phantom owners complained that the car did not smell like a Rolls-Royce. Who would ever have thought that how a car smelled would be so important? After working with leather suppliers, Rolls-Royce/BMW was able to come pretty close to duplicating the odor of the Connolly leather so that a new Rolls-Royce smells like one should inside, and does not smell like a BMW that is a fraction of the cost.

Segmenting Customers: Speed Freaks and Health Nuts

Customers want different things from the products and services they buy and it is important to segment them according to their common priorities. A healthcare client, for example, found that all customers want the same basics from healthcare, but beyond that, they fell into seven different categories based on their most important requirements. One segment called “Serve me!” cares strongly about ease of getting an appointment, friendly front desk staff, having a nice waiting room, and other service quality factors. Another segment cares about getting in and out of the doctor’s office as quickly as possible and cares little about the smiles of the front desk crew.

Learning about the different segments and priorities of customers is important input to R&D, marketing, HR and other functions in an organization. I recall reading about how Taco Bell had improved customer loyalty by determining that they had three customer segments:

  • Speed freaks who care about how quickly they can get in and out of the restaurant with their food;
  • Cheapskates who care about getting as full as possible for the least amount of money;
  • Health nuts who care about eating something at least moderately healthy for fast food.

Understanding this allowed them to change their operations to reduce cycle time, introduce the dollar menu for the value-conscious consumer, and the “Border Light” menu for those looking for healthier choices. All customer segments care about basic things like good-tasting, warm or cold food, freshness, food safety, and good customer service, but going beyond the basics allowed the restaurant to really cater to additional customer requirements and drive more loyalty.

Integrating Voice of the Customer with Products/Services

Many organizations today have not taken the time to really learn about what customers want beyond the basics. Others seem to know what is important to them, and don’t care.

The voice of the shareholder (or in other words, greed) seems more important than making customers really happy. If there is one company that seems to understand what customers want and does a good job of delivering on those wants and needs, it’s Marriott. However, they seem to ignore some of the strongest voices of customers.

One thing we really want and expect when we travel is free Wi-Fi. In fact, I recently heard a Marriott executive speak at a conference and she said paying for Wi-Fi is their number one customer complaint. Duh? Apparently hearing the voices of customers is not the same as acting on them—they continue to charge for it, explaining that they have free Wi-Fi in the lobby. Who wants to go down to the lobby at 10:00 pm to check their email before going to bed? The weird thing is that Wi-Fi is free at their low-end properties, but you have to pay for it at their most expensive properties. Stay at a Residence Inn for $79 a night and get free breakfast and Wi-Fi in your room. Stay at the Marriott in Times Square for $500 a night and expect to pay extra for Wi-Fi in your room and $35 for breakfast!

Another example of failure to link customer wants and needs to your product/service is all the extra charges airlines hit you with these days. They know that people shop online for the lowest fares, so they provide a low fare and than charge so much for the extras that you sometimes end up paying as much for the “extras”—like being able to bring a suitcase on your trip—as the flight itself cost.

Paying for something that used to be included in the regular price infuriates most of us. Try checking into a Ritz Carlton (owned by Marriott) and wince at the $700/night price, but then find out upon check-in that parking is $35/day and they add a “resort fee” of $30/day to cover things that you would think would already be included at a luxury resort, like a pool, health club and Wi-Fi. Profits are important for any business, but adding hidden fees is generally not a good strategy for increasing loyalty.

Linking HR Processes with Voice of the Customer

Another big disconnect in most organizations is that the human resources department is completely disconnected from the voice of the customer research that may be done by the marketing department. A community healthcare provider in central California prided itself on hiring front-line, customer-facing staff from the local community. That way patients would be greeted by and taken care of by people from their neighborhoods that know their culture and will be more caring. Turns out just the opposite was true; while the patients and caregivers may be from the same communities, many of the employees looked down on patients who were uninsured with disdain and contempt. The general attitude of many staff members was: “I was born poor too, but I studied hard, graduated, learned English, and got myself a decent job, whereas many of you expect that the government should give you free food and healthcare!” In this organization, the voice of the customer had not been translated into a good recruiting and selection process.

One thing Marriott does do a great job of is recruiting and hiring people with traits linked back to important customer needs. Hilton also does a very good job of this. They did research that indicated that the job that has the most customer contact is housekeeper. Yet, most of their housekeepers spoke very little English. Based on this research, Hilton changed their policy for hiring new housekeepers, requiring fluency in English. They also spent a lot of money and time training existing staff to speak better English. This is a perfect example of listening to the voice of the customer and translating that into your HR policies and practices.

Linking Customer Needs to Processes

It turns out that work processes are often the most disconnected to customer requirements and needs. Most organizations design their work processes for their own convenience and with an eye toward lower costs without even considering what customers want. One set of work processes that comes to mind is the healthcare delivery process. Whether it is going to the clinic for an annual physical or going into the hospital for some surgery, the processes all seem to be designed to confuse and infuriate customers. Step 1 is to try to get an appointment, which is usually a big challenge. I tried three times to book an on-line appointment at my local UCLA clinic for an annual physical and all three times the appointment was not booked when I failed to get a confirming email the next day. I finally called, got put on hold for a while, and was told there was a six-week wait for a non-emergency appointment. I made the appointment, filled out the required forms online on their website, got to my appointment, and had to fill out the forms again in person because they did not have them. Got in fairly quickly, but sat in the treatment room for quite a while waiting for a technician to take my vitals.

I eventually got to see the doctor, who spent about 11 minutes with me, indicating no interest in seeing key trends in metrics like weight, cholesterol, and blood work that I had brought along. I left with no feedback other than “You’re fine” and had to ask to have a copy of my blood tests mailed to me. In the end, my “free” annual physical resulted in a bill for over $1,000 and after many battles with UCLA and my health insurance company, it was finally handled. I went on Yelp to later give feedback about the clinic and doctor and saw that all reviews were 1 star, so it was clear that I was not the only disgruntled customer. Nine months later I am still getting bills from UCLA for payments that were already paid by Blue Shield!

Healthcare processes today are certainly not the only ones that seem completely unrelated to customer requirements, but they are probably the most screwed up. Others have actually done a good job of changing processes based on customer requirements. In California, we can go online and make an appointment at the DMV, and then spend a lot less time at the DMV standing in lines. I love it! I would prefer not having to go to the DMV at all, but this new process seems to have made it a lot less painful.

I noticed last week that United has a boarding process similar to Southwest’s, with lots of sorting people into individual lines at the gate based on the zone they are in, with emphasis on boarding the back of the plane first. This is a big improvement over the old system where there were only two lines: a red carpet for first class and premium passengers (which is the entire plane at Dulles), and a blue carpet for everyone else.

Balancing the Voices

Most organizations have a lot of different groups they need to satisfy:

• Shareholders want profits, growth and increased share price.

• Regulators want to make sure laws and rules are followed.

• Employees want the best tools, high pay and great benefits.

• Customers want great service and products delivered with a smile.

It’s rare that an organization can achieve this delicate balance. Most seem to focus a lot more on financial results than anything else. Consider how much time and effort is put into measuring financial results on a daily basis, along with the amount of time spent reviewing and dissecting those results in meetings. Conversely, many organizations measure customer and employee engagement or satisfaction only once a year, and spend very little time looking at those results. The best run organizations understand the tradeoffs needed to balance all the voices and realize that the customer truly is king.

Mark Graham Brown has 30 years of experience consulting with organizations all over the world on measuring and managing performance. He is the author of many books, including his most recent, Killer Analytics: Top 20 Metrics Missing From Your Balance Sheet (Wiley/SAS 2013). Mark has his own consulting practice in Manhattan Beach, California. He is currently working on a new book with Ken Dean and Dr. Adam Pollard called “Reverb” about how to link voice of the customer research with products, processes and people.

About the Author

Mark Graham Brown | Principal

Mark Graham Brown has 30 years of experience consulting with organizations all over the world on measuring and managing performance. He is the author of many books, including his most recent, Killer Analytics: Top 20 Metrics Missing From Your Balance Sheet (Wiley/SAS 2013). Mark has his own consulting practice in Manhattan Beach, California. He is currently working on a new book with Ken Dean and Dr. Adam Pollard called “Reverb” about how to link voice of the customer research with products, processes and people.

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