- Customer Satisfaction and ROI
- Value is More Valuable
- Productivity or Exploitation?
- Are those bad old corporations exploiting the proletariat again?
- HR Leadership � 2010 and Beyond
- Regional HR Leaders have spoken
- The Leadership Challenge of the 21st Century
- Baby-Boomers make way for the Baby Bust
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Social Media and All That Online Jazz: How to increase profits, build relationships and avoid wasting time A presentation by Chad Barr, President of CB Software Systems Inc.
January 7, 2010 |
Value is More Valuable: Customer Satisfaction and ROI
The LinkedIn discussion exclaimed, �Please help! I need white papers on the relationship between Customer Satisfaction and ROI.� The person indicated in her profile �customer satisfaction is a top priority for any private, non-profit, or academic organization that wants to succeed�. I didn�t disagree but I responded that she probably won�t find the whitepapers she needs because they don�t exist.
Metrics of customer satisfaction have shown little or no relationship to conventional metrics of business performance such as revenue growth, market share or profitability. As my colleague Reg Goeke of Market Value Solutions points out, customer satisfaction is an emotional response that ignores the complex interaction of quality, image, and price that occurs in business transactions. A customer can be very satisfied but not feel that the product or service is �worth it�. Satisfied customers walk all the time. As a result, it�s difficult to generate a return on an investment by improving satisfaction alone.
If you want a return on an investment with customers, focus on investments that improve perceived customer VALUE in target markets versus customer satisfaction. Value and satisfaction are two very different things. Customer satisfaction is an important outcome that�s simple to measure but predicts or affects very little. Customer value is a more complex measure but is related to customer loyalty, market share, and revenue growth. If you want to make an investment that has a payoff, measure customer value and improve the processes in your business that create and deliver that value.
For more information, check out Eric Reidenbach's article, Why Customer Value is More Important than Satisfaction, on the Resources page of our website.
Productivity or Exploitation?
I recently fielded an inquiry from a Nightly Business Report reporter about national survey data that says work productivity is up because employees who were not laid off are now doing the job of two people. The assumption was that this was a bad thing. My point to the reporter: There is more behind this data than to just assume that people are now burdened and stressed by more work.
I�ve worked with small, medium and large companies on restructuring during the economic downturn. In all of the work, our goal was not just to downsize but, as one of my client CEO�s said, �to power through the downturn and come out stronger on the other side.� We assessed their talent and assured they had the most capable, most flexible, highest potential people in mission-critical roles. This assessment sometimes included an identification of work that could be put on hold or eliminated.
I�ll admit that employee engagement can be an issue after a year like this. Therefore, it is also important to develop plans to assure that you retain key talent during and after restructuring by looking at compensation, recognition, promotions, etc. Regular communications and opportunities for feedback are also important.
For these companies, it�s not the case that those left after a downsizing are being taken advantage of and have to do the work of two people. In reality, they are capable and willing to do so because they are just more productive. There is plenty of research that shows that the productivity of �A� players (flexible, learning agile, engaged talent) is significantly higher than �C� players (change-resistant, narrowly skilled, disengaged).
A hallmark of this economic downturn, compared to previous cycles, was that companies were much more creative and thoughtful in their efforts to restructure so that they would not jeopardize their futures. I encouraged the reporter to recognize this change in her message. Productivity improvement has been the USA�s savior in past downturns; let us not ignore the positive impact of our ability to innovate in this one.
HR Leadership � 2010 and Beyond
Michael Couch & Associates, in conjunction with Diagnostics Plus, was pleased to sponsor the 1st Annual HR Leadership Survey for the HR leadership Forum of Western PA. The Forum wanted to start tracking the issues and interests of strategic HR leaders in the region so that they could provide programming that would make a difference. The response was larger than expected as we heard from over 200 leaders from a wide variety of industries and from companies of all sizes.
The full results will be presented at a special HR Leadership Forum event on January 21. You can register and get more information about the event on their website, www.hr-leadership-forum.com. Along with the survey results, you�ll have the opportunity to network with strategic HR leaders and thinkers from the region, to find out what the HR Leadership Forum has in store for 2010, and to enjoy a wine tasting, great food and door prizes.
I don�t want to steal any thunder but here�s a small preview of the survey results . . . . . What do you think the HR Leaders identified as their top business challenges for 2010? The survey said:
- Expansion into new geographic markets
- Expansion into new product or service lines
- Significant expense reduction
What, no force reductions?
See you on January 21!
The Leadership Challenge of the 21st Century
By Al Schnur, Ph.D.
PCI Human Resource Consulting, Inc.
The corporate ladder to which motivated managers and executives have traditionally aspired is not what it used to be. Until recently, the succession planning success was due to there being more motivated and qualified corporate climbers than rungs. However, as the �Baby-Boomers� move into the twilights of their careers, there are more than a few business leaders looking at their companies and wondering to whom they will pass the torch.
Despite the realities of the changing demographics, there are proactive steps that organizations can take to ensure that they will have the right people ready to take over when the current leaders step aside. Companies that conquer the coming leadership challenge will likely have used one or more of the following strategies:
- Identification and Development of Existing Talent: The larger an organization is the more difficult it is for executives to have a good idea of what talent currently exists. Successful organizations take stock of their �Human Capital� by not only measuring manager�s objective results, but by assessing their potential and motivation to take on additional responsibilities through peer and psychological assessment. High Potential managers go through structured performance management, coaching, mentoring and other developmental experiences to build on strength and address skill and experience gaps. Some organizations go so far as to assess all their employees to identify hidden talent and, as a by-product, create an overall organizational assessment and development plan.
- Effective Hiring and Promotion Systems: Many high performing companies are not satisfied to hire employees just to �do the job�. Rather, they are more concerned about hiring those employees that have the right personality and potential for advancement and these companies are willing to invest in assessing these traits prior to making a job offer. Further, these organizations do not promote based on time in position or other factors, but hold internal applicants to the same standards as external candidates. The benefit of having consistent hiring and promotion standards is the assurance that there are employees with the potential to advance continually moving up and through the organization, thus combating the career ceiling situations that are often the case in haphazard hiring and promotion systems.
- Retention of Key Talent: If companies do a good job with the previous two areas, they will be a long way toward keeping key talent in the organization. Hiring people who fit with the organization and have the potential to advance will improve results and eliminate unwanted turnover. However, the days of one-company careers are long gone and there will always be competition for your best people. In addition to competitive pay and benefit programs, organizations need to pay close attention to the personal needs of every key manager and employee. Progressive companies use creative programs to encourage community and professional involvement (e.g., community board membership, professional sabbaticals, family developmental experiences) that helps to bond employees to the organization. It is well established that those who feel valued and are challenged in and out of work are less likely to look for other employment options.
In addition to the use of effective hiring, development and retention strategies, companies must be willing to objectively evaluate their existing talent pools and make the sometimes-difficult decisions. After gathering performance and assessment data on the employees that could potentially take the organization through its next era, executives must be willing to look outside the organization and bring in talent in areas where it does not exist. In addition, executives need to make the hard decisions when managers are identified that do not have the skills to be successful in their current role and/or advance in the organization.
The Leadership Challenge of the 21st Century will get worse before it gets better as the �Baby Bust� generation leaves more leadership openings than there is talent available to fill. Many companies will simply decline due to a lack of leadership. By learning from and implementing the best practices of companies with effective succession planning systems, you can increase the likelihood that yours will not be among them.