Image courtesy of kreg.steppe

What are your company’s desired business outcomes? How did you determine what they would be?

First, what are outcomes?

They’re basically the result – or the consequence – of something, of doing something.

In our case, outcomes are the result of putting forth all of this effort to improve the customer experience.

Forrester says outcomes are:

  • an achieved end state that can be verified through measurable results
  • tied to a funded top-level initiative
  • defined through the lens of the person accountable for the end state
  • colored by the interests of related stakeholders, and
  • reached over time, not always on a “point A to point B journey”

Examples of business outcomes include: increased retention rates, improved acquisition rates, increased revenue, reduced costs, process improvements or efficiencies, culture change, increased profitability, increased word of month, increased conversion, and more upsell and cross-sell opportunities. To Forrester’s point, they are or should all be measurable and quantifiable.

Let’s set aside outcomes for a moment and focus on the “measurable and quantifiable” piece of this. When NPS (net promoter score/system) was introduced, the reception was mixed on the consultant side, but businesses embraced the concept and mostly the metric as simple and easy to understand. It was touted as the one number on which you need to focus; the one number that determined loyalty;  the one number to help you grow; the one number that was tied directly to profitability.

Keep that in mind.

So then I read a March 2016 McKinsey article (Linking the Customer Experience to Value) that stated: At a recent roundtable, fewer than half of the customer-experience leaders present could say what ten points of net promoter score would be worth to their businesses.

I typically take the stance that you shouldn’t focus on the metric and what moves the needle – instead, focus on improving the customer experience and then watch the needle move. I, obviously, stick by that mantra.

The part I find interesting is that so many companies have adopted NPS as the key metric, with the key outcome being increasing word of mouth/recommendations to increase growth and profitability, and yet they have no idea how they’ve impacted the business or what that’s worth to the business.

Know why?

The article calls out a huge problem with NPS: the mistake that many companies have made is that they’ve rallied around the metric instead of around the customer. And they forgot that if you’re choosing a metric, it really does need to be tied to two things: what matters to the customer and what matters to your business (and how you’ll link the metric back to outcomes).

Why does the metric matter if you don’t understand the outcome… for the business or for the customer?

If you focus on results, you will never change; if you focus on change, you will get results. -Jack Dixon