Are you listening to the voice of the customer?

Voice Of The Customer (VoC) is a term that many people use, but few people can define. That’s the type of environment in which I love to do research. So I ended up writing two research documents on the topic: Building Your Voice Of The Customer Program and Voice Of The Customer: Five Levels Of Insight (as always, only Forrester clients can read the full reports). To start with, I developed the following definition for a VoC program:

A systematic approach for incorporating the needs of customers into the design of customer experiences

This definition contains three key elements:

• A systematic approach. Most companies take an informal approach to gathering customer feedback. A VoC program should augment — not replace — those ad hoc approaches with a more structured way to gather and use customer insights.
• Customer needs. Companies often have access to a great deal of customer data — but customer insights don’t automatically surface from data. A good VoC program uncovers the current and emerging needs of key customers — and helps identify areas where those needs are not being met.
• Experience design. Gathering customer insights is only an interim step to improving customer experience. Why? Because VoC programs deliver the most value when companies actually make changes to better serve the customer needs uncovered by the research.

My research also identified five distinct levels of activities in a VoC program:

1. Relationship tracking. Organizations need to track the health of customer relationships over time. That’s why companies often ask customers to fill out surveys — typically quarterly or annually — about their perception of the firm. Using this feedback, companies can create metrics that are simple to understand and easy to trend. Why is this important? Because an easy-to-grasp report card helps align everyone in the organization around a common purpose.(Note: I won’t get into the debate between “satisfaction” and “NetPromoter” metrics in this post, but I’ll definitely be touching on that in the future)
2. Interaction monitoring. Every customer interaction — from an online transaction to a call into the call center — is important. Firms need a way to monitor how effectively they handle these customer touches. That’s why many companies do post-interaction surveys — asking customers for feedback on recent interactions.
3. Continuous listening. Structured feedback through customer surveys provides enormous opportunities for analysis. But one of the strengths of these approaches — providing data — is also a limitation. To avoid this data-only view of customer relationships, companies put in place processes for executives to regularly listen to customers. There are many opportunities to hear what customers are saying, such as listening to calls in the call center, reading blogs, reading inbound emails, and visiting retail outlets.
4. Project infusion. The following statement is probably not too controversial: Projects that affect customers should incorporate insights about customers. Despite the clear need for this type of effort, many companies lack a formalized approach for infusing customer insights into projects. To make sure that this doesn’t happen, some firms are incorporating customer insight steps in the front-end of their Sigma processes.
5. Periodic immersion. Every so often, it’s valuable for all employees — especially executives — to spend a significant amount of time interacting directly with customers or working alongside frontline employees. These experiences, which should be at least a half day, provide an excellent opportunity for the company to question the status quo.

Here’s a graphic that shows more details on the five levels…

Hopefully this helps to create some common language around the Voice Of The Customer.