It's surprising. Companies still struggle to understand and meet customer requirements. And as a result, more than 65 percent of new product introductions fail despite enormous investments in market research, surveys, and interviews. This is one of the many compelling reasons survival-minded companies are fast-tracking "voice of the customer" (VOC) initiatives.

VOC programs center on gathering, understanding, and applying customers' feedback, opinions and perceptions. They create direct pathways to improved products, services and processes across the enterprise. So it's no surprise that, when executed properly, VOC programs have a profound impact on a company's marketplace success. Consider the following:

According to the results of a 2008 study by AberdeenGroup, best-in-class companies cite a 26% increase in customer satisfaction and retention along with a 19% increase in customer-focused innovation as a result of their customer feedback initiatives.
When the Product Development and Management Association (PDMA) analyzed the variables that separate the "best" performing product development companies from the "rest" of their competitors, they concluded that voice of the customer activities are one of the strongest discriminators in determining marketplace success.

What's the Connection?

First of all, voice of the customer data can be extremely valuable for improving products, services, and processes across the organization. Consider the following range of applications:

Executives can leverage VOC data in decision making and use VOC requirements as the framework for monitoring project success
Product managers can use VOC data to outline requirements and ensure that the product meets the goals established by those requirements
Sales and Marketing can use VOC requirements as the framework for value messaging
R&D, design and engineering can build a comprehensive set of requirements based on VOC data to guide day-to-day decisions related to design and development

Another connection is the emotive aspect of VOC. This is extremely important, yet often overlooked. Customers want to know their voices have been heard. Once it is clear that a company is truly listening and responding to their needs, they extend their trust and loyalty. The company improves the likelihood of retaining that customer. Therefore, proactive companies that respond to customer feedback with product, service and process improvements can experience significant gains in satisfaction and loyalty for greater profitability.

A VOC Reality Check.

So companies should capture feedback, share feedback with the enterprise, and respond to customer needs–sounds easy enough, right? But as many customer care executives will attest to (when finished laughing at the naiveté), it's downright challenging. If a VOC program was easy to position, everyone would be doing it and reveling in the results.

This prompts some key questions. Why do companies struggle with their VOC programs? Where are the major pain points? How can they prevail?

The challenge originates with processes for capturing, analyzing and communicating data from key customer interaction points:

The Contact Center.

The contact center generates extremely valuable voice of the customer insights. Using CRM and case management systems–even spreadsheets–most can report broad information about the incidences and issues that concern customers, such as how many complaints they received on a given product. The problem is that decision makers need highly detailed information to take clear, swift, and specific action to fix the root cause of a problem or to enhance offerings. Most contact centers cannot deliver in this area.

Consider this scenario:

At the headquarters of a large fast food chain, managers noticed an unusual number of complaints about a specific, new ice cream dessert. They set out to identify the root cause, and were able to quickly pinpoint sources. The complaints originated from the same restaurant locations and centered on the same issue: The containers appeared to be underfilled. After confirming the root cause, the company responded by immediately disseminating recalibrating instructions for the desert machine (to better fill containers) to the managers of the stores involved.

Most organizations cannot orchestrate this chain of events. If they can, actions are not executed in a timely manner. There are numerous reasons for this:

Their CRM system categorizes customer issues in a manner that is too broad to be useful to the rest of the organization and ineffective in showing specific root cause. (i.e. The company recevies about 1025 complaints about a new ice cream dessert, but managers can't drill down to understand exactly what customers didn't like.)
Creating reports that are relevant to specific stakeholders and decision makers is a time-and resource-intensive process. (i.e. The company doesn't have an easy way to share complaint details with product managers–they can only relay that there were complaints.)
Agents capture 'unstructured' data as freeform text notes in case records that is 'unreportable' and inaccessible by the rest of the organization. Managers have no visibility into the data making it difficult to identify trends.

While these are widespread problems to address in VOC programs, the customer feedback data captured by contact center agents is just the tip of the iceberg. In reality, only a small percentage of dissatisfied customers–about 10%–reach out to the contact center to share their feedback.

Self-Service.

Increasingly, customers bypass the contact center in favor of solving their own problems and gathering information through Web based self-service. Once on the company's site, they may search for product details, review frequently asked questions (FAQs), or navigate an IVR system (a perennial favorite for many consumers). Unfortunately, the data customers enter into these systems are often stored in vast, disparate data repositories that can't be analyzed in a manner that is useful to the organization.

Also, while some companies can generate keyword 'hits' or FAQ usage reports from these systems, they have little to no detail about the true intent of the customer's contact. They never know if the customers' needs are truly being met. The self-service channel 'feedback' they do receive is often an endless list of keywords and phrases. Identifying any pattern or trend from this data is difficult–at best time-intensive. It is an effort that fails to yield meaningful insights.

Online Interactions and Posts.

Some customers voice their comments and opinions as freeform text in email or chat interactions. And a growing number are opting to post their feedback and complaints–good and bad–to review websites, social networking and blogs. While this is a potential goldmine of VOC data, companies are struggling to find a way to collect, analyze, and respond to this freeform, "unstructured" data in an organized fashion. Some are beginning to cut, paste, and manually organize this information in spreadsheets so individuals can scan through the data to try to spot problems and trends.

With unstructured data from all of these different sources–contact center interaction notes, emails, chat session transcripts, self-service interactions, blog posts, and more–formatting becomes a tremendous challenge. There is no way to guide the analysis with structured customer surveys and interviews. As a result, a great deal of manual analysis and categorization is required. Furthermore, this data typically resides in disparate servers and databases across the enterprise, making it difficult to analyze and report collectively. It is often just overlooked.

Best Practices for transforming unstructured VOC data into action...and advantage.

Companies cannot afford to ignore valuable, unstructured data. According to multiple studies, it comprises more than 80%of the data within most organizations. Rich in detail, it often reflects the true voice and sentiment of customers, suppliers and employees.

Unlike surveys and interviews that introduce bias into customer feedback, unstructured data contain the raw, unfiltered comments and feedback that can reveal implicit and explicit customer needs and wants. Therefore, it must be gathered, mined, and acted upon to gain customer trust and advance the company's competitive position.

There are four fundamental elements that characterize a successful voice of the customer program:

Customer feedback must be gathered at multiple touchpoints and must flow efficiently and effectively throughout the enterprise
The company must leverage technology and tools to make this feedback timely, meaningful and actionable
Data should accurately represent customer wants and needs in their own words (not the company's)
Departments across the organization must have processes in place to impactfully respond to feedback in a way that is visible and relevant to customers

There are a number of tools and techniques for accomplishing this. While it isn't prudent to discuss all of the different methods here, we can summarize some of the best practices of our customers using our contact center, knowledge management, and analysis tools. These include:

Streamlining the data collection process in the contact center.

Comprehensive VOC data collection begins with the agents, so a CRM/contact center application that enables agents to capture better information–faster–is key.
A flexible interface that enables agents to capture data quickly in a conversational style (focusing on the customer and their needs–not rigid system requirements) will lead to higher data quality and a better customer experience.
A system that facilitates data capture through automation such as screen pops, keyboard shortcuts and accelerators (hot keys, text keywords, tool bars and wildcard searches) helps agents significantly reduce redundancies, data entry errors, and miscategorization of issues. This leads to better, more actionable reporting.

Gathering customer feedback and sentiments at every available touch point and analyzing it collectively. This includes data from phone, in-store, Web self-service, IVR, email, and chat interactions. In fact, a 2008 study by AberdeenGroup revealed that the "Best in Class" share several common characteristics with respect to VOC and customer feedback management implementations, including:

58% have a process for tracking customer feedback across all departments and channels
64% have a central data repository for gathering and storing customer feedback information

Leverage natural language processing and linguistic analysis technologies. These technologies enable customers and agents to input questions and feedback on the Web, via email, chat or social media in their own words, not keywords or structured survey responses. The user experience is far better. Greater insight results. These technologies can be leveraged to analyze all of customer questions, comments, case notes and conversation transcripts–verbatim. Select technologies like the Astute Solutions' RealDialog™ solution can organize and summarize all of this into human-readable categories and topics. Managers can drill down to original "conversation" transcripts for more detail, where they gain a better understanding of customer interaction patterns, their perceptions, needs, feelings and desires.

Enable agent and self-service "dialogs." With a "conversational" knowledge management system behind phone, self-service, email and chat interactions; customers are engaged in specific and relevant dialogs. The company better understands their needs, while collecting highly detailed information. Transcripts of these dialogs can be captured verbatim, analyzed, and associated with customer profiles for rich customer profiling and segmentation data.

Enable Proactive Notifications. Deploying a CRM system with a proactive 'notifications' feature enables a company to alert key individuals about critical issues based on pre-defined events/criteria. With this capability, the system can automatically send a notification via email, fax, or a page call (requires telephony integration) when an action is posted or a threshold fires. This functionality enables a differentiating level of responsiveness and aids in mitigating risks. For organizations that centralize customer service, it expedites the process of alerting remote locations of issues their customers have reported. When undesirable trends surface, it enables individuals to take action and contain/control issues before they reach a critical stage.

Providing access to the right level of detail at the right time. If they're just a "pretty face", a CRM system's reporting capabilities are not very valuable. They should provide an effective means for reporting a virtually limitless number of details surrounding issues, products, services and business operations that are relevant to the company. Key users should be able to immediately access the level of detail they need. By giving managers and decision makers access to detailed, drill-down reports (on-demand, or on a scheduled basis), they can quickly identify and respond to problems, trends and opportunities with highly specific focus.

Deploying a unified knowledgebase that supports multiple points. Not only does this ensure responsive service and accurate answers across assisted and self-service channels (phone, email, IVR, chat, and internet/intranet self-service), it also provides a centralized location for tracking and storing questions and inputs from customers, agents, employees and partners who use the knowledge base. It simplifies the process of adding and updating information for each touch point as more is learned about customer wants and needs.

Successful VOC Drives High ROI

Effectively implemented, VOC programs enable companies to differentiate through service excellence. Not only do they impact every aspect of a company's ability to build long-term customer relationships, they provide pathways for increasing sales, reducing costs, mitigating risks, and bringing targeted products to market, faster. As Astute Solutions' customers have discovered, the return on investment is tremendous:

Continuous improvements: With real-time access to insights from a wide variety of sources, our customers gain the capability to quickly identify problems, gaps and areas for improvement and opportunity. Analysis of unstructured data expands their "field of vision"–shedding light on unanticipated customer questions, and expanding their base of ideas for products, services and enhancements.
Insightful innovations: VOC data, including the transcripts from web self-service interactions, provides the type of direct, unfiltered feedback necessary to improve the design of products, services and offerings. It has provided our customers' product managers the detailed data they need to develop, launch and promote new product offerings. Without this data, they would not have recognized this opportunity, despite their ongoing use of expensive market surveys.
New business opportunities: With increased visibility and insight comes the opportunity to better identify, understand, target and service various user segments. This includes gaining a new understanding of competitive differentiators for more effective marketing and sales messaging.
Increased sales: Our customers have a better understanding of their own customers–enabling them to provide helpful, targeted information at the point of sale. Whether online, at a kiosk or in the store, this bolsters sales.
Mitigate risk while reducing costs: By having the capability to pinpoint root cause, our customers can execute with unmatched precision and responsiveness. This serves to contain incidents and minimize damages. It reduces the impact of the incident on customers, thus reducing interaction volume for greater efficiency.
Retain Customers: VOC programs enable our customers to understand how to improve the customer experience at every touch point. Exceptional, highly responsive service improves customer satisfaction and builds loyalty and retention over time.

Clearly, a commitment to a VOC program is a commitment to driving impactful change. It involves a virtuous cycle of gathering VOC data, planning improvements, implementing them in a timely manner, and measuring the impact of those improvements on the customer experience and the business. Areas prime for improvements will likely include: first contact resolution, customer satisfaction and retention, interaction costs, the product management cycle, and quality assurance.

Ultimately, the value of a well-executed VOC program is reflected throughout the business in new ways–beyond conventional metrics–every single day.

About the Author:

Lori Angalich is the VP of Marketing for Astute Solutions, an award-winning provider of CRM, contact center, and knowledge management solutions for consumer-focused companies. She can be contacted at lorang@astutesolutions.com.

Astute Observations Blog | Leverage Newsletter