Article

Feedback-driven improvements

Name: Implement Consulting Group
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How to optimise your feedback loop processes

Published

9 June 2020

When working with process optimisation, it is common to focus on the core processes delivering value to the customer (Order to Cash, service processes, development processes etc.) at the centre of the business. These processes are well understood, have performance metrics, status meetings etc.

This, however, is rarely true about the feedback loop processes. By feedback loop processes I mean a structured approach to listening to the customers and the employees facing the customers, to process the information and design solutions that elevate your business to meet the demands even better. The approach to this is often fragmented and especially the service agents have a hard time getting heard in the business development process even though they have the most frequent interactions with the customers and receive all the critique when things are not working.

According to a survey among product managers (PMs), input from actual users and customer support is vastly underrepresented in the decision-making process, yet according to the PMs those two groups provide higher-quality input and are more trustworthy than input from executives and the sales team who usually dominate the decision process¹.

Definition of feedback loops

A feedback loop is a process in which the outputs of a system are circled back and used as inputs. In business, this refers to the process of using customer or employee feedback (the outputs of a service or product) to create a better product or workplace.

Note that the feedback loop can be both positive and negative. When positive feedback is received, this obviously points out what you should do more of, but it can also trigger events that make the positive feedback spread (email: We are happy that you liked XXX. If you recommend our product to one of your friends, we can offer you 20% discount on both your and your friend’s next purchase).

Why feedback loops are important

Feedback loops are quite simple. It is all about collecting, processing and implementing solutions. However, a study² lays out the challenge well. The vast majority (95%) of companies collect customer feedback, but only 10% implement the recommendations and only half of those tell the customers. Another Gartner study³ shows that growth companies are more likely to collect CX data, again emphasising the value of a good feedback loop.

Build your feedback process

So, let us be as diligent and aware of our feedback process as we are about our core processes. We must construct a process that is robust, speedy and reliable. Feedback is not a one-off project.

A few ideas about how to get started …

Collecting data

Remember that this is the easy part, but if the foundation is wrong, the whole effort is of no use. In addition, it needs to be frequent and sustainable.

The common feedback loop approach of sending managers out to the call centre or out with the salespeople to collect input may create momentum in the early phase or signal customer centricity as the new buzzword, but is it really sustainable? The similarly common way of having biannual customer surveys gives great input the first time around, but a lot of the feedback relates to water under the bridge once it gets processed.

I am not saying that these tools are of no value, but they do not make it as feedback loop tools. Think instead about:

1. Collecting input from the frontline:

Engage your frontline by having them provide improvement ideas. Employees often need a bit of training and nudging to overcome the culture of “just answering the customers”, but it is worth the small effort. A traditional approach with paper cards or Post-it notes on a board can be used, but great tools are available today such as Viima or UserVoice, which can be used to capture the input and circumstances and engage the employees in selecting the best ideas to move forward with.

2. Real-time customer feedback:

NPS is mostly viewed as a measuring system but is really a feedback loop. Do not wait for a fancy report but reach out immediately to detractors and promotors to learn how you can improve. Set up structures where managers or peers reach out to resolve the customer issue and collect ideas for how to improve even further.

3. Data collection tools:

The computer power and the ability to process huge volumes of data is increasing. Using voice and text analytics tools to identify the “hot” topics seen from the customers’ perspective, scraping data from social media to know what is happening in society and process mining to see the true customer processes are some of the options.

Where data collection tools will require some initial investment, the collection of ideas can be done with very limited investments.

Processing and implementing

These two steps in the process are quite interlinked and thus treated together. The challenge is analysis paralysis. You must move to action to keep everybody engaged in the identification of ideas and desire to improve your business.

Management ownership. All process work requires management involvement and ownership, and the feedback loop process is no exception. Specifically, management needs to make improvement work part of the daily work. It does not work if it is overtime activities.
Get people involved. Most ideas cannot be resolved within a single team or department. It is cross-functional. You need to involve the organisation broadly, because improvements will be needed everywhere from frontline through product management to finance.
No blame culture. All the employees I have ever met show up to work to do a good job, but we all still make mistakes. Do not pass blame but honour the input as improvement opportunities to keep people engaged.
Avoid bureaucracy. Most improvement ideas are usually of the “just do it” type and common sense. Spare the business case and documentation requirement for the major investments and know that high customer satisfaction has driven growth throughout history.
Establish tracking mechanisms. Do not attempt to track cost savings etc. on the individual improvement, but track your progress on the implementation like how many ideas you implement per day, how long it takes to implement ideas etc. Set at target of implementing a few ideas a week in the beginning, but you need to move towards 1-2 a day to really get going.
Celebrate the success. It is an old trick, but it still works. Recognise good ideas, fast execution, idea number 100 implemented etc. This enforces the involvement and engagement of your employees.