Gary Fox, Director of Global Customer Experience at Dell, told the story of their transformation and the role that NPS played in that at the Net Promoter Conference in London on June 17. At 26 years old, Dell is today a $53B revenue company with roughly 80% of that revenue coming from enterprise and 20% from consumers.
The appeal of NPS to Michael Dell was grounded in its simplicity. Everyone understands Net Promoter, and under Michael's direct leadership, improving the customer experience has become one of the top goals of the company. NPS is on the executive team's scorecard, and improvement goals are shared. On their intranet, Dell has posted their Net Promoter Score right next to the share price. This symbolic co-location is meant to emphasize the importance of balancing the customer experience against financial goals. Every leadership team meeting that Michael Dell holds begins with a discussion of the Net Promoter Scores and what is driving them. This cascades down the leadership ladder into each business, another important way Dell works customer focus into the business rhythms of the company.
Net Promoter Scores are collected for all the different customer segments. "We listen, and we learn, and we push ourselves to improve," says Fox. He leads a central Customer Experience team that creates consistency in measurement and feedback, and creates a strong closed-loop feedback system in each business. They listen through multiple channels, soliciting feedback not only through their NPS surveys, but also through customer events, social media, the voice of the agent and other informal settings. (About a year ago, I took a Dell web survey, which was decidedly NOT in line with the principles of customer advocacy. You can read the prior post here.)
Back in 2005, when Dell was generating tons of bad press and negative word of mouth from customers in all segments, all the customer dashboards they had in place were showing positive results. Customers were saying, in the satisfaction feedback, that on average they were satisfied. There was no real indication of a problem. But when they dug into the customer relationships they had, the Dell team started to discover that a de-averaging of the customer base revealed sources of deep frustration and that Dell was falling short of its potential to meet customers' needs.
Eventually, they decided to adopt the NPS approach to improving the business, including true closed-loop feedback. For their consumer business, they have a survey they believe takes no longer than roughly five minutes to complete. They ask questions about choosing the product, placing the order, communications, and so on. There are five different elements of the experience around which they solicit feedback, including choosing the product, placing the order (phone or web), waiting for and receiving the product, owning and using it, and resolving questions/problems.
Interestingly, they learned that roughly 70% of consumer customer NPS is determined in the "owning/using" and the "resolving queries/issues" part of the customer experience. It's not that the other elements aren't important. But if you want to create more Promoters, emphasis must be there. Even within each component, there are huge differences in the sub-drivers. For example, 2/3 of the difference in outcomes for those placing orders on the web comes from customers' perceptions of how easy it is to place the order (versus other elements of the web experience). Similarly, a drill-down on customer support revealed that it had higher potential to create Detractors than to create Promoters. The vast majority of customers came out of support experiences as Passives, but a sizable minority (26%) were Detractors. Very few Promoters were created.
This relatively detailed understanding of the drivers of Promoters and Detractors allowed Dell to model out the impact of potential improvements. In turn, this enabled them to prioritize initiatives based on their impact on NPS and, in turn, on longer-term revenues and profits. Moreover, it helped them think through end-to-end transformation of all the elements of Dell's business that contribute to the customer experience, including everything from product design through supply chain to service and support.
As a result, they they changed the ways they designed products, simplifying the product line and choices for customers. They are even considering adopting one of Logitech's best practices, in which they won't allow any new product to launch unless its test results show that it will achieve a higher NPS than the product it is replacing. They changed the expectations setting they do with customers regarding product delivery and service visits. They invested in a "first 60 days" early engagement program to help new customers get up and running with their new products -- the time during which customers have the greatest potential to become Promoters or Detractors in their use of the new product. They changed the way they set goals across back-office teams, aligning the interests of even support organizations to help them all work toward the same end of creating Promoters among customers and stop working at cross-purposes.
Dell is also pursuing experiments in social media. They are participating on Facebook, Twitter and YouTube, for example. Reps listen to conversations across the web, looking for opportunities to resolve issues, close the loop with Detractors, or incorporate constructive suggestions. Fox believes this is an important area of exploration and development. They have been able to have positive impact on their reputation and on the experiences of some customers, and he believes this trend will continue into the future.
As the leader of the central Customer Experience team, Gary is responsible for helping the leadership keep customer experience at the top of the business agenda, enabling learning and improvement by providing reliable feedback and empowerment tools, and training front line employees how to serve customers better. Fox believes that Michael Dell's direct, personal leadership is an important contributor to the successes they have had so far and is highly optimistic about the trajectory they are on.
It's worth a lot to succeed. Every point of NPS improvement is worth tens of millions of dollars. But Michael Dell believes that's not the reason to improve. "It's just the right thing to do," he says. It reinforces what he believes is the core purpose of the company, helping customers succeed. "If a brand is the promise you make," says Fox, "the Customer Experience is the promise you keep."
Over the last year or so, they have made a roughly 45% improvement in NPS. Will Dell ultimately succeed? Will they be able to use the customer experience as a competitive weapon? Time will tell. But they are certainly focused on the effort and much of what they're doing feels right.
Rob Markey