1 Feedback: The Missing Link in Information Superiority Open Source Solutions, Inc. Conference 26 May 1999 Chuck Appleby.

1

Feedback:The Missing Link in Information Superiority

Open Source Solutions, Inc. Conference26 May 1999

Chuck Appleby

2

Overview

Setting the stageWhy is feedback so important?What kind of feedback do we need?How do we collect good feedback?Imperatives

3

Setting the Stage

4

The Current State

“The Community is starved for feedback from consumers. It has been very difficult to get busy consumers to provide useful comments on a service they regard as a free good not subject to their control.”

5

The Desired State

“…companies honing their competitive edge [must] meet the following real time requirement: Analyze customer feedback constantly--with that feedback in many instances from customers tied closely to a company’s operations.”

Regis McKenna, Real Time: Preparing for the Age of the Never Satisfied Customer, 1999

6

Barriers to Collecting Feedback

Cost of collecting feedback prohibitive

Connectivity lacking

Fear of re-engineering

Security barriers

Cultural bias (no news is good news)

Cynicism about use of data

7

Why is Feedback So Important?

8

Importance of Feedback

Differentiation AdaptationFulfillment

9

Differentiation

“How do you distinguish yourself when there is infinite shelf space?

Simple: by knowing more customers more intimately than your competitor does and by knowing how to use information about those customers as it becomes available.”

FAST COMPANY, June 1999

10

Adaptation

“Rapid and continuous adjustment based on regular sampling is the key to success in any fast-changing environment.”

Regis McKenna, Real Time, 1999

11

Fulfillment

“Don’t forget that a person’s greatest emotional need is to feel appreciated…”

Brian Dyson, CEO of Coca Cola Enterprises

12

What Kind of FeedbackDo We Need?

13

What Kind of Feedback?

Employee satisfactionConsumer knowledge and satisfaction Learning, innovation, and growthProduct/service qualitySupplier performanceProcess and operational performanceFinancial performance

14

Setting the Feedback Agenda

Balance between current performance and future direction Delivery

What capabilities do I need?How are my capabilities performing?

DirectionWhere should I focus my capabilities today?What capabilities should I build for the

future?

15

Customer Satisfaction Illusion

“Too often, measurements of customer satisfaction are like Magellan’s instruments. They tell you very little about where you are, and they can’t show you where you should go.”

Fred Wiersema, Customer Intimacy, 1996

16

Intelligence Function Drives Feedback AgendaThree basic functions of intelligence

Support to OperationsPlanning Execution

Baseline IntelligenceCurrent IntelligenceFuture EstimatesTarget Development

WarningTacticalStrategic

Unique set of feedback questions and collection strategies for a given function

17

Current Intelligence Case Feedback Tasks

Prior to Product/Service Delivery Establish Baseline Customer Profile

Share of customer, customer loyalty, basic needs

Track Order Fulfillment Evaluate Product Quality

After Product/Service Delivery Survey Customer Service Quality Determine Product Utility Determine Product Impact

18

Product + Service = The Offer

“The difference between products and services blurs to the point that the the distinction is a trap. Winners provide an offer that is both product and service simultaneously.”

Stan Davis and Christopher Meyer, BLUR: The Speed of Change in the Connected Economy, 1998

The Cell Phone Story

19

Why Do Customers Defect to Competitors?

Better Product

15%

Cheaper Product

15%

Lack of Personal Attention

20%

Service, Rude,

Unhelpful

45%

Product differentiation is becoming increasingly difficult, therefore service is now the standard by which customers are measuring performance.

Source: Forum

20

Information ImpactEye of the Beholder

“The place where information dwells, the holy moment where transmission becomes reception, is a region which has many shifting characteristics and flavors depending on the relationship of sender and receiver [and] the depth of their interactivity.”

John Perry Barlow, Electronic Frontier Foundation

21

Information ImpactIntermediate Good

“Information has economic value if it leads to the satisfaction of human desires. A small portion is final goods, which derive their value from supply and demand. By far the larger portion is intermediate goods that derive their value substantially from the value of goods and services to which they lead.”

Michael Dertouzos, Director, MIT Lab for Computer Science

22

How Do We Collect Useful Feedback?

23

Collection Strategy

Passive capture (in the intelligence) Active solicitation in surveys

Face-to-face On-line

Dialog On-line Communities of Interest Focus Groups (GroupWare enabled)

Liaison officers and Information brokersCustomer Service Centers

24

Passive Capture in On-line Intelligence

Profile Track Learn Anticipate

25

Profile

Vignette Corporation Decision support services

help you gage how effectively your content attracts and retains visitors.

You can generate reports based on customer criteria to determine what content is accessed, how often and

by what types of visitors.

26

Track

COSMOS is the database where tracking information is entered and is visited by customer service agents and anyone in FedEx ops.

27

Learn

CitibankProvides private virtual community on the web for its customers, it enables them to get closer to each other and to the bank. They get advice on such topics as investing in real estate… and Citicorp learns a lot about customer likes and dislikes.

28

Anticipate

Web-site software such as NetPerceptions is used by Amazon.com to look at a user’s past purchases, compare them to those of a broader population, and make recommendations to users

29

Information Utility

In gauging information utility through passive collection we might collection: Dwell time Revisit frequency Forwarding to another consumer Printing the document

30

Direct On-Line Questions

Hewlett Packard Web Page Do you feel you were able to accomplish

what you wanted during your visit to this site visit?

If you did not resolve your issue/problem/inquiry--what other means of support will you seek?

Has your visit to this Web Site prevented the need to make another call to HP for additional info?

31

Customer Feedback:Key Success Factors

It should minimize the inconvenience to the customer The outcome should be of some real benefit for the

customer It should influence your behavior toward the customer It is tied to both product/service and delivery of the

product and service It drives out what is truly important to the customer It is immediate It goes to the person/organization performing the

task or job Results are synthesized and easily visualized

32

It drives out what is truly important to the customer

33

Results are synthesized and easily visualized

Opportunity Areas

Continuous Improvement

Sleeping Dogs

OverkillImp

orta

nce

Low

Hig

h

Low High

Performance

Product attribute

34

Danish Bank Passive System Meets the Criteria

35

Exit Survey

UsefulNot

Useful

36

What are the Imperatives?

37

Connectivity

“The winners will be the ones who develop a world-class digital nervous system so that information can easily flow through the companies for maximum and constant learning.”

Bill Gates, Business at the Speed of Thought, 1999

38

Dialog

Creation and support of communities of interest Continuous dialog between collectors,

producers, brokers, and consumers Each party in the dialog is constantly

educating the other members on needs, capabilities, and resources

39

Selected References Stan Davis and Christopher Meyer, BLUR: The Speed of

Change in the Connected Economy, 1999 Mark Graham Brown, Keeping Score: Using the Right

Metrics to Drive World-Class Performance, 1996 Don Peppers and Martha Rogers, The One to One

Fieldbook, 1999 Michael Dertouzos, What Will Be: How the New World of

Information Will Change Our Lives, 1997 J. Philip Kirby and David Hughes, Thoughtware: Change

the Thinking and the Organization Will Change Itself, 1997 Shona Brown and Kathleen Eisenhardt, Competing on the

Edge: Strategy as Structured Chaos, 1998

40

Contact Information

Chuck ApplebyScitor Corporation2411 Dulles Corner ParkHerndon, Va 22071703 713-1829 (Office)703 713-1801 (FAX)[email protected]