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Understanding the voice of the customer

In an earlier blog post we introduced the concept of Lean Thinking to tackle the evolving needs of the Industry. At the heart of Lean Thinking is the principle that value can only be defined by the customer. In this post Jon Lindsay is back to discuss how you can develop an understanding of the customer's voice.

Understanding the voice of the customer:

Insight into value rather than satisfaction

In an earlier blog post we introduced the concept of Lean Thinking to tackle the evolving needs of the Industry.

At the heart of Lean Thinking is the principle that value can only be defined by the customer.

Usually everyone in an organisation, especially a community focused one, wants to do the best for their client / customer. If it is clear what clients value, then the organisation can focus on the activities that deliver that value.

The Community Services Industry has a slightly greater challenge than private enterprises in defining their exact customer.

Whether in education, health care, disability services, aged care or housing, there are multiple stakeholders beyond the patient or direct beneficiary. This has frequently been true in who provides the money being a different entity to the client.

Recently there has been debate as to the right term. Feel free to use any term you wish, in this article I use the words customer and client interchangeably since they both describe the beneficiary of services. 

For example: with the arrival of NDIS, the concept of client choice is understood, but there are still lots of demands set by the regulators. Funding can be linked to outputs, but the definition of these outputs are often not set by immediate beneficiary.

 

 

Who is your customer and how can you find out what they really value?

The answer to the first part of that question is based on two concepts:

 

  1. The core purpose of the organisation.
    Who were you set up to help? Who is the primary beneficiary of your services?
     
  2. For any given process or activity, there is a hierarchy of importance.
    For most service providers in our industry, the direct beneficiary is the reason for being. Stakeholders such as the regulator (government funding bodies, staff and volunteers, families and communities) will also receive some benefit.

So how can we find out what they value?

This what we mean by understanding the voice of the customer.

There are some obvious complexities in community services:

  1. In community services, some beneficiaries (e.g. prison inmates and some stages of drug addiction) are unwilling participants
  2. In dealing with the most vulnerable in society, sometimes people need others to speak for them.

In addition, the most blindingly obvious but – often forgotten – idea is that in the end the customer is a human being not an organisation or a contract specification.

Rarely is complying with a contract providing full value to the immediate beneficiary. This is an observation that seems to have been missed by scores of government procurement organisations.

To understand value, we need to have a two-way interaction of exploration.

 

Drawbacks to conventional approaches to customer feedback.

Customer satisfaction surveys

Most organisations of scale now have introduced the concept of customer satisfaction.

But what exactly does this tell us?

With most satisfaction surveys, whether online or in paper form are pre-populated with questions where we have already determined what is important.

We’ve guessed.

In addition, surveys are usually skewed negatively since more people who want complain about something respond.

This rarely provides much opportunity for the respondent or for us to learn how to improve.

We are on the defensive because we are dealing with a complaint and even when in depth feedback is provided, most organisations don't have the capability to act on it.

 

Net Promoter Score

Some organisations have developed more sophisticated feedback processes one of which is the use of Net Promoter Score (NPS).

This is a very powerful and simple tool to use. It is based on the question of whether the respondent would recommend others to use the same services with a scale of 1-10.

As an indicator of progress of improvement of an established service this is a great measure.

Still, there are limitations to NPS:

  • This is only really useful if its followed up by enquiring into why customers respond in a certain way and how the service provider can improve the service.
    Otherwise there is a danger, especially in large organisation, that a good NPS actually slows innovation because it leads to complacency.
  • A more fundamental drawback is that it focuses on how to get the existing process better rather that ask whether the process itself is providing what is needed.

Providing true insight, rather than testing satisfaction, allows your service offer to develop, it feeds innovation, identifies potentially competing approaches and highlights areas of your current activities that are no longer required.

 

The ever-increasing demands of clients

In the commercial world, the increasing demands of customers are well recognised.

In community services this changing demand may be more subtle.

Some beneficiaries are just appreciative of the help they get, others will always just demand more, whether rational or not.

This was studied by Professor Kano where he observed that discussions about value usually focus on the most obvious elements, such as performance.

Professor Kano reminded us that there are some basic requirements that don't even get discussed because it’s so obvious they are needed.

And he introduced the concept of customer delighters – service that exceeds expectations.

Over time, we become accustomed to the service. Performance elements become basic requirements, delighters become something that is expected.

 

Customer delighters

 

The Kano model

 

In the Community Services Industry, the introduction of choice means that the Kano effect will be seen constantly. This is especially true as both established players and new entrants strive to get the attention of those who are looking to use their services.

Understand which elements are of real value is not something you do once; it has to be constantly reviewed.

 

Getting started

One of the myths of market research is that you have to find a large sample.

You need a representative sample but depth of insight is much more critical than the number of data points.

This depth of insight requires a conversation, sometimes with not only the immediate beneficiary but also with others who surround them such as carers and family.

S A Partners have developed a step-by-step methodology which gets right to the heart of the voice of the customer.

 

 

Step 1 – Identify the vital few dimensions of value with selected clients

 

In the provision of your types of services to the client, ask them questions along the lines of what they think they need most importantly. Ask the question whether you currently offer that or not?

For example, someone might say: I need a carer here all the time.

Explore up to five dimensions of service – no more – we aren't writing a specification here.
 

Step 2 – Clarify what is really meant
 

Most dimensions are quite short descriptors (e.g. timely response) so they need expanding.

Ask the client to tell you exactly what they mean by their comment.

In the above example of a carer being required all the time, you can ask: Do you really mean all the time, or is it just certain times of the day and in that case when exactly is the carer needed?

 

Step 3 – Rank them in importance

 

Ask your client to tell you which of their identified needs the most important factor?”

And continue this discussion until the top five needs are ranked in order.

 

Step 4. – Establish where perceptions are
 

Ask your client the same question for each dimension in turn:

Are we better than, worse than, same as….

  1. your expectations
  2. any similar provider (perceptions if not actually used)
  3. the best provider of any other services you receive from anybody.
     

Step 5 – Clarification
 

This is where the conversations get rich.

The real gold is usually when clients talk about service providers away from the relationship they have with that provider.

It’s when they answer the question about what you do that makes them so delighted with you.
 

Step 6 – Collating and analysing


After you have completed several of these conversations you can start ranking customer needs.

Identify the different types of customers that exist in your business. Rank the identified needs of each customer in order of what is most important to them.

These will be in relatively broad headings because the input has been in their words.

Usually only about 10 main elements come through, of which the top two – four are in strong alignment.

While you can improve or develop your service in all 10 areas, this approach gives you the most immediate, describable, definitions of what your client requires.
 

Step 7 – Sharing and focusing on improvements

 

You can share this information with staff providing the services and focus on the top one or two needs can happen immediately.

The allows your organisations’ change agenda to be informed by the voice of the customer not what management wants

 


Key takeaways

 

  • Be clear who your customer is
     
  • Understanding value needs focus on the individual human being – they have a voice
     
  • Customer satisfaction is not the same as finding out about the value you’re offering
     
  • Customer’s needs and demands continue to change - don't make assumptions
     
  • Focus on the vital few elements of maximum value
     
  • The voice of the customer is an immensely powerful means of engaging staff to improve services

 


Don't miss this event

 

Don’t miss Professor Peter Hines when he visits Brisbane on Friday 24 March for a morning seminar on this subject.

This seminar is designed for you or representatives from your senior leadership team come along.

The CSIA, in partnership with S A Partners, will be holding a series of workshops during 2017 focused on different elements of productivity based on applying Lean Thinking. 

 

  

 


 

 

Jon has built on his wide industry experience as a business leader to act as a trusted advisor to CEOs and senior executives. He is a leading authority in Joined Up Leadership and in his mentoring, facilitating and speaking he draws from many of the world’s foremost business thinkers to promote those ideas based on core principles, common sense and simple models.

He is a Managing Consultant in Queensland for S A Partners, the company founded by Professor Peter Hines. As an Insurance business leader in the 2000s, Jon was one of the pioneers of the application of Lean thinking in the insurance sector.

He is also a Queensland Chair at The Executive Connection (TEC).
 

What Jon does:

  • Runs CEO peer group meetings for TEC. Members, with a wide diversity of business models, continue to provide and resolve real world issues every month. Jon is always looking for members to complement his two groups
     
  • Mentors business leaders on a regular basis; business owners, corporate leaders and CEOs of not-for-profit organisations
     
  • Leads a range of workshops in the area of Lean leadership. As a pioneer in the adoption of Lean in service businesses, he continues to seek out and support business leaders of organisations committed to Enterprise excellence
     
  • Facilitates strategy formation and implementation workshops. Engaging with an executive team to join up the strategic objectives to purpose and core values.

 

  

 


 

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