Editor's note: Howard L. Lax is vice president, consulting, GfK customer loyalty, at GfK Custom Research of North America, New York. This article appeared in the February 28, 2011, edition of Quirk's e-newsletter.
"You can only manage what you measure." - Peter Drucker A natural corollary to this truism is that mismeasurement will lead to mismanagement. To a large extent, this is a restatement of the garbage in, garbage out (GIGO) axiom: The wrong inputs or measures will produce erroneous results and lead to misguided conclusions. While we take this for granted with regards to computer codes, directions, formulas and numbers, it amazes me how little attention often is paid to this fundamental issue when it comes to capturing and analyzing voice-of-the-customer (VOC) data.Perhaps this bothers me more than it should, but a recent excerpt from Faster, Cheaper, Better (Hammer and Hershman, 2010) on the "seven (deadly) sins of corporate measurement" really hit me, as I have seen all of these sins committed in various customer loyalty and customer experience programs conducted by major corporations. Mismeasurement in many VOC programs threatens to totally undermine the reputed efforts of those programs to strengthen customer loyalty and improve the customer experience. Here are Hammer and Hershman's seven sins, with examples of how they have undercut VOC programs.VanityPicking metrics that are easy to hit and which make managers look good. Not happy with the percentage of top scores they receive, I've seen companies treat any nonnegative rating as a positive indication of loyalty or use scales that make anything short of the most egregious service failure look like success. This may make the dashboard results look better, but the illusion of excellence isn't excellence.ProvincialismAsking customers questions along organizational lines or using internal jargon that has no meaning to them. Operational definitions may s...