Friday, October 11, 2013

NPS and Collective Ownership

As a coach, there are two primary outcomes I'm trying to help my clients achieve - optimal value flow and great teams.  To optimise value flow, of course, one must first have a way of measuring it.  Lead time is easy to quantify, but value often not so easy.

A year ago, one of my clients was struggling with measuring value.  Their organisation was heavily focussed on customer advocacy and was transitioning from traditional customer satisfaction measures to Net Promoter Score (NPS).  Curious to see if that might provide us with a new lens to examine value in the customer's eyes, I decided to find out how NPS worked.  So, I picked up a copy of The Ultimate Question 2.0 and found it hard to put down.

A decent explanation of Net Promoter Score can be found here, but the summary version is this.  You want your customers to be so happy with you that they tell others.  Traditional complex questionnaires are replaced with 2 questions:

  • On a scale of 0 to 10, how likely are you to recommend us to a friend or colleague?
  • What were the primary factors in the score you gave us? (or "What would we have to do to get a 10?")
Responses are then divided into 3 categories:
  • Promoter - 9 or 10.  Highly loyal, certain to promote you to others
  • Passive - 7 or 8.  Satisfied ... for now.
  • Detractor - 0 to 6.  Unhappy, likely to defect and spread negative word-of-mouth feedback.
A final score is then calculated by subtracting the percentage of detractors from the percentage of promoters.  For example, you receive 15 responses:
  • 6 promoters (40%)
  • 8 passive (53%)
  • 1 detractor (7%)
Final NPS score is then +33 (40% - 7%).

The other thing that came through in the book was that most companies who measure customer NPS also measure employee NPS.  The question in this case is formed on the line "How likely are you to recommend working here to a friend or colleague?"  I was sold!  Customer advocacy is surely a good indicator of value delivered, and employee advocacy of your journey to creating good teams.

These instantly became my two favourite system level measures.  My client also bought in and was very happy with the insights generated, and they went straight my coaching toolkit.

I found out yesterday that I'd missed something vital in the implications.  As well as coaching, I train.  I've probably delivered over 200 courses over the years.  Until this year, they were always for someone else.  They provided the materials, the venue and the students and I turned up to deliver.  Every course finishes with a feedback questionnaire.  Most have 5 or 6 questions, each asking for a rating and a comment.  They generally cover the venue, the material, the knowledge and style of the teacher and so forth.  I always looked forward to the last student leaving the room so I could check out responses. And, of course, I ignored every rating except the ones about my training :)  I didn't care if they gave the venue a 1, that was out of my control!

This year, I started to run my own SAFe courses.  I was still using someone else's material, but all of a sudden I was responsible for producing the workbooks, finding the students and choosing the venue.  And I paid attention to new things.  I discovered students cared if I put tabs in the workbooks (I never had!).  I found out how important natural lighting in the room was.  Ownership bred attention.

Inspired by +Bernd Schiffer, this week I decided to eat my own dogfood and start collecting NPS responses on my courses.  And I learnt some things.  Firstly, the value of setting the bar high.  I wanted an NPS of at least +70 - I got +33.  Having to call a 6/10 a detractor made me cry.  And those 8's made me scream!  80% is an 'A' in highschool for goodness sake.  The comments were full of praise, why couldn't they have made it across the promoter bar?

I have to tell you, I pored over those passives obsessively.  I read them each 3 or 4 times.  And they gave me the subtle hints.  The hints were largely about stuff I viewed as outside my control.  But accepting that boundary wasn't going to create promoters for me.  To create not just happy but delighted customers I had to care about everything and challenge my constraints.

Which leads me back to what I missed about NPS - the value of making everybody care about everything.  Looking at that one number is gold!  When you stop measuring the parts and just look for the delighted customer and the passionate team member shared ownership can't help but follow.