Vocalabs Newsletter: Quality Times

Issue
93

Bigger Data is Not Always Better Data

In This Issue


Bigger Data is Not Always Better Data

"When in doubt, collect more data."

That could easily be the guiding principle of business in the year 2015. Collecting data is easy and storing it is cheap. You never know what insights might be gained from just a bit more data.

But like any simple idea, reality turns out to be more complicated. Not all data is useful, and while storing data is cheap, the tools and expertise to find those hidden insights turn out to be fairly expensive. And, as companies occasionally discover to their regret, data can be a liability as well as an asset.

I see this attitude in the customer experience world, too. Often it's a lot easier to just do more customer tracking or conduct more surveys than take action. There's a lot of data collection for the sake of data collection going on.

To be effective, customer surveys should have an underlying purpose. For example: to answer a specific question (i.e. "How many customers call us after logging in to the website?"), or to support a specific business activity (such as coaching employees, or tracking customers' satisfaction with their purchases).

Often, however, I see surveys designed backwards. Rather than starting with the goal of the survey, people will begin by thinking of all the things they might possibly find interesting and add all of them to the survey.

The result is usually a mess: a long survey where most questions are never really used for anything. This tends to drive the response rate down and make it harder to take action based on customer feedback.

So before you collect more data--whether that's enlarging a survey sample or adding more questions--take a few minutes to ask yourself:

  1. Is the new data likely to tell me something I don't already know?
  2. Do I know what I'm going to use the additional data for?
  3. When I consider all the costs of collecting additional data, including reduced survey response, customer goodwill, and the effort to analyze the results, is it worth the expected benefit?

If you can answer Yes to all three questions, not only is the data probably worth collecting but you've also got a good start on taking action based on the results. But if you answered No, it may be that you're collecting data for the sake of collecting data.


Does Your Effort Have Value?

There's a lot of different activities that go into an effective customer feedback program, but not all of those activities have equal value.

Based on my experience, some of the high-value activities are:

  • Closing the loop with individual customers
  • Coaching and training individual employees using voice-of-the-customer data
  • Discovering and improving customer pain points and broken processes
  • Disseminating customer feedback throughout the organization in a way that's relevant to each business user
  • A/B testing of different ideas for business processes

Some of the activities which tend to have less value include:

  • Calculating and tracking survey metrics
  • Paying bonuses based on survey scores
  • Disciplining employees for poor survey scores
  • Building high-level survey dashboards
  • Collecting survey data with little or no free-response feedback from customers

Keep in mind that less value does not mean no value. There is certainly some value in tracking survey metrics. But there's a lot more value in having a closed-loop process--and ideally a feedback process should have both.

And yet many companies seem to spend almost all their effort in low-value activities, completely ignoring the things which are most likely to lead to better customer experiences and a more efficient business. These companies have little to show for the effort they put forth to improve their customer experience.

The common thread among the low-value list is that they are all centered on improving customer survey scores as a goal in itself. A company which focuses on improving metrics but ignores the underlying customer experiences has fallen into the trap of becoming metric-centric instead of being customer-centric.

It's easy to fall into this trap. Survey scores are concrete, quantitative, and measurable. Executives and managers can make the mistake of thinking that improved survey scores should be the goal, instead of a side-effect of achieving the true goal of becoming customer-centric.

In contrast, the activities on the high-value list are all focused on using specific customer feedback to directly improve the customer experience. Some activities, like closed-loop processes and coaching to the voice of the customer, work at the level of the individual employee or customer. Others, like A/B testing and identifying pain points, are higher level.

So just because your organization puts a lot of effort into the customer experience does not mean anything is likely to improve. You need to ask whether your activities are truly helping to understand customers' stories and improve the experience, or whether you've fallen into the trap of becoming metric-centric and spending a lot of effort on low-value activities.

Newsletter Archives