Closing the Feedback Loop
February 10, 2007
Case categories include: Leadership Operations Sales
By Robert Sher
Scaling a business is great, and is what many CEOs strive for. When the firm was small, the CEO knew exactly how satisfied all the clients were. Yet scaling up means that sooner or later, distance between management and the customer grows.
Mr. Dave Kearney, CEO of Boomerang, an e-mail marketing services and solutions firm, had scaled up and was asking if his clients were happy. At the end of each month, he’d e-mail blast feedback requests to all the customers who were served that month. Like most companies, only about 2-3% came back. Hey, people are busy—who has time to fill out the forms?
Thinking it through
Who, of course, should be filling out the forms? In dealing with increasingly complex companies, there can be several people whose feedback is important. Is it the receiving department’s feedback that is important? Or should it be feedback from the manufacturing line? Perhaps it’s the VP of Operations’ opinion that is key. Likewise, when will they be ready to give the feedback? The instant after the work-product is delivered to the client? Or would it be when the work-product has been used for a few weeks?
Mr. Kearney knew that his system needed modifications when the big wakeup call came in late 2004. In the span of a few months, they lost several key customers due to dissatisfaction. The customer care team knew they were dissatisfied, but didn’t alert management. In fact, the customers were so hard-to-handle that the team began ignoring them—setting aside the knotty issues coming from these hard-to-handle customers. This exacerbated the issue.
Boomerang, which specializes in customizing marketing messages delivered via the internet, put its programming team to work. They built a system that automatically sends a feedback form to their client as soon as their job ticket is closed. When the customer fills it out and replies, the reply is instantly scrutinized and tabulated. Low scores get escalated to management instantly. All replies are kept in a database and are aggregated so patterns can be seen. Daily, weekly and monthly scores appear on management dashboards. No more hiding.
Take feedback seriously
Every customer is valuable, and deserves excellent service. Asking for their feedback shows that you care, and that you are committed to their satisfaction. So value is created even when they don’t fill them out (which is most of the time). Even more critical is that you are committed to dealing with the ugly situations where a customer is upset, angry, or just disappointed. It takes leadership from the top to devote the resources needed, and to manage what can be a stormy internal response to problems—keeping the internal team focused on finding resolutions to problems and not on blaming people or departments.
Boomerang was ready. The first 90 days brought to management’s attention many recurring problems, and one by one, systems were fixed. Early scores started at 4.5 on a scale of 1-5, and soon rose to 4.9. Everyone on Mr. Kearney’s team now knew that their performance was completely transparent. It didn’t hurt either that the customer care team now had an incentive program based on customer satisfaction.
The feedback loop was now closed and automated. This is critical. Too many organizations put a program together to hear customer feedback only to neglect it a few months later due to distractions, overworked staff, or just internal resistance to asking for painful feedback. It is often easier just not to hear. But the easy way out is not the path to growth today. An automated system that customizes the timing and content of the feedback form going out, as well as receiving, logging, and alerting management to issues, is the only way to insure that the loop stays closed.
Boomerang’s response rate to its surveys jumped up ten-fold to 20-30% with its new system, and the high response rate has held steady now for three years. After initially fixing the most obvious problems, response rates slowly continued to rise from 4.9 to the current 4.93. Any single response below 4.2 instantly finds itself in the CEO’s inbox, who picks up the phone and calls the customer.
Mr. Kearney now has three things working for him: Customers know—from the regular and timely feedback requests—that his company cares about how good a job they do; the feedback he does get helps him fine tune his internal machine, with no hidden problems; and lastly, when there is a problem, the recovery is quick and management gets involved, which is a classic way to increase customer loyalty.
Boomerang hasn’t lost a single customer due to dissatisfaction since the feedback system was put into place, and the system they built for themselves is now a popular tool they sell to their clients.
• Closing and automating the feedback loop is a critical step to monitoring customer satisfaction.
• Companies that ask for customer feedback should be prepared to handle complaints.
• Effective customer feedback systems build trust and help build better businesses.
Robert Sher is principal of CEO to CEO, specializing in assisting CEOs and business leaders as they navigate critical passages. He is the author of The Feel of the Deal; How I Built a Business through Acquisitions. He may be reached at Robert@ceotoceo.biz.
Company and Case Facts:
Person: Dave Kearney, CEO
Alliance Member since: 2006
Business Founded: 1991
Head Count: 15
Service: Helps email marketers get superior results from their email marketing campaigns
Typical Customer: Grainger, Time-Warner Cable, BellSouth and businesses with large lists
Written: February 2007
Address: Boomerang, 2450 Embarcadero Way Palo Alto, CA 94303
Web Site: www.boomerang.com