Editor’s note: Lynnette Leathers is the CEO of Mindspot Research, Orlando, Fla. This is an edited version of a post that originally appeared here under the title, “Mindspot research survey doctor: key driver analysis.”
Sometimes you need more than a simple survey. Key drivers are factors which influence or “drive” the outcome for a business or organization. Often there is an opportunity to conduct a Key Driver Analysis when conducting customer satisfaction and loyalty surveys or marketing research. At Mindspot Research we often refer to this process as a “key business driver analysis.”
In addition to examining typical measures of customer satisfaction and loyalty, understanding which attributes are actually driving customer satisfaction and loyalty is the way to make the research actionable. This analysis can provide insights for improving performance and retaining customers. Although there is a notable amount of up-front work and consideration required when conducting a key driver analysis, it will pay off when analyzing the data and uncovering meaningful results.
One of the first steps in a key business driver analysis is to identify what attributes or key performance indicators (KPIs) are most important to your business. Many businesses already have a defined set of Key performance indicators KPIs which can be included in the key business driver research. Based on our experience, there are typically between 15 and 25 KPIs which are considered potentially critical to most businesses.
As an example, Mindspot Research’s tagline is: We think fast. One of the KPIs we would include in our attribute battery (the series of attributes or business drivers you choose to measure) is, “delivers results in time to meet my expectations.”
A potential way to identify business critical KPIs is to walk through the process of providing a product or service to a customer or client and write all of the steps down. Take note of all areas that are a critical path for delivering your product or service and any customer facing interactions.
Next, consider what your business goals and objectives are and if these are applicable, go ahead and include these attributes. For example, if you believe a key strength of your business – in comparison to your competitors – is that you provide the most innovative products, then you may want to include “provides the innovative products we require” as an attribute.
Once an entire list is generated, cull it down based on common sense and business logic. One of the key questions you can ask is, “Are the attributes or key drivers actionable?” If it’s not something that can be changed then don’t include the attribute. If it’s not really deemed important to your goals or process leave it out.
Generally an importance question for each attribute is included in your attribute battery. However, due to most attributes being important to most customers, there are better ways to plan and conduct the data collection and analysis. Out of respect for your customer’s time, be sure to have your customers only answer relevant questions. In situations where there are multiple important attributes to examine, you may consider including a choice format which forces the ranking of the attributes, including performance metrics in your reporting and/or conducting specific statistical analysis (there are many statistical methodologies) to determine which attributes in fact are considered key drivers. There are a number of ways to conduct a key business driver analysis once you have enough data for the analysis to be relevant.
Once the data is analyzed you will be able to identify the relative importance of each KPI and performance. In particular, you will also be able to clearly parse out the key business drivers which operate as business strengths, as well as identify the key drivers which offer opportunities to improve. Depending on the amount of performance variation for each key driver, a potential Six Sigma project may be highlighted, giving the business an additional opportunity for performance improvement directed specifically at driving cost savings.