White Paper

Capturing the True

Voice of Your Customer

Six Sigma Qualtec

WHITE PAPER Capturing the True Voice of Your Customer

Capturing the True

Voice of Your Customer
A White Paper
Six Sigma Qualtec
© 2004 Six Sigma Qualtec

This is the first in a series of four executive briefings designed to provide a step-by-step approach to capturing
the Voice of the Customer in retail banking and systematically putting it to work for superior business results.

Most retail banks invest in obtaining customer feedback. They may maintain a special customer service phone
center that records individual customer interactions and flags complaints. A separate phone center reports and
resolves problems. When new customers open an account they receive a ‘How Did We Do?’ survey. Focus groups
provide specific reactions to an advertising campaign or new service. Some banks even conduct a fairly compre-
hensive customer satisfaction survey annually. And then little or nothing substantive happens.

Why? Such attempts to capture the Voice of the Customer often amount to little more than sound bites out of the
customer’s total experience with the bank. Piecemeal information measures customer response to a one-time
experience or to one delivery channel. Moreover, the information tends to stay in the department that collects it.
The result: fragmentary and often distorted customer feedback.

Such disjointed feedback fails to capture a comprehensive view of customer expectations – the customer’s total
experience or expectations at every point of contact with the bank and with every business process. More impor-
tantly, it fails to measure the gap between expectations and reality. The problem is compounded when there exists
no predictable, corporate-wide distribution of critical customer information and no one with a complete picture of
expectations and experiences. Improvement initiatives are prioritized in terms of the squeakiest wheels, instead of
according to the true Voice of the Customer and the information that is critical for retaining customers and
expanding your relationship with them. Where, then, to begin?

Listen … and Learn to Talk the Talk

The first step in communicating with your customers is listening. Assuming that you know what’s important to
them because you talked with them a year ago is a risky proposition. You must speak to them often and give them
the opportunity to express themselves in their own words. Understand how customers describe their environment
and recent experiences so that you gain emotional insight into their decision-making and behavior. Above all,
communicate with customers in their own language to create an immediate bond and to establish real trust.

For example, if you refer to the place where they do most of their banking a ‘banking center’ and your customers
call it their ‘branch,’ which word should be used when communicating with them? Does it matter? What happens
when your customer describes fast loan approval as ‘within five minutes after submitting an application’ and you
describe ‘fast’ as same-day approval? Will the customer’s voice be heard? Will some other bank meet your cus-
tomers’ desires first? Does ‘fast’ mean the same thing to your ‘High Net Worth’ as to your ‘Up and Comer’ group?
How is ‘fast’ defined when customers are banking online versus in a branch? If you don’t really know what ‘fast,
accurate, knowledgeable, friendly, responsive, and caring’ means to your customers and in their language, you
may not be listening effectively.

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WHITE PAPER Capturing the True Voice of Your Customer

Exploit the Power of Qualitative Research

The most effective technique for listening is Qualitative Research. Qualitative Research, in which a moderator
guides discussion, helps uncover multiple definitions of experiences. You can then test those definitions
‘quantitatively’ to determine your customers’ expectations and measure their experiences in a statistically
reliable and predictable way. It is the closest you can come to having a real conversation with your customers
– where you do all of the listening and they do all of the talking.
In general, the moderator asks broad questions that encourage customers to express themselves in their own
language. However, not all customer groups are alike. Expectations and needs vary by product, by depth of
relationship with the bank, by life-stage (‘single, out of school’ versus ‘mid-career, empty nester’) by
geographic location, wealth, and other demographic, social, and behavioral factors. You must therefore
conduct enough research to capture all of those unique voices and to be sure that the particular qualitative
method is appropriate for the individuals.
For example, a one-on-one in-depth interview may be the best way to solicit feedback from High Net Worth
customers, who expect a customized, personal banking relationship. The interviews can be conducted by
phone or in person, with the conversations recorded or videotaped to preserve the customer’s exact words.
Entrepreneurs and business executives may also appreciate 30-45 minute phone interviews that don’t
require them to leave their offices. By contrast, when interaction between customers would yield a greater
understanding of their needs, the qualitative research is conducted among a group of 7-10 participants or
smaller mini-groups of 4-6 participants. But no matter the type of conversation, the goal remains the same:
truly capturing the Voice of the Customer.

Put the Results of Research to Work

The results of Qualitative Research can be leveraged throughout the organization. Once you have captured
the true Voice of the Customer you can use it to:
Build more effective customer/prospect communication: Understanding your customers’ language enables
your advertising agency to develop ads that reflect the emotions, desires, and experiences of your customers.
Your marketing and communications people can use real customer language in marketing materials, on
your website, and in direct mail and public relations communications.
Strengthen employees’ understanding of customers’ perceptions and needs: Organization-wide dissemina-
tion of research results – through video excerpts, for example – enables the entire organization to under-
stand how customers feel. Testimonials often emerge from qualitative research that can be used internally
to show employees how customers describe the ‘ideal banking experience’ or ‘worst banking experience,’
and what they expect and how they feel when their bank falls short in any area. This is particularly valuable
for employees who aren’t on the front line and who may not understand how problems in their business
sub-process really affect the customer.
Generate opportunities for improvement: With greater understanding of your customers, you can uncover
problems, such as ineffective distribution channel processes. You can more readily identify unmet needs,
leading to new product ideas. You can better understand your brand image and how you are perceived ver-
sus your competitors. And you can uncover hidden strengths and spread them more widely in the organization.
Develop an effective measurement tool for prioritizing customer needs: With your new-found understand-
ing of your customers you have the basis for designing a far more penetrating quantitative customer survey
that will enable you to prioritize customer needs accurately.

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WHITE PAPER Capturing the True Voice of Your Customer

Case Study
Truly Capturing the Voice of the Customer
Consider a bank that really listened: After years of measuring customer satisfaction among its retail customers,
the performance of a major U.S. bank still lagged retail customers’ expectations in areas that drove overall
satisfaction. Customers reported low satisfaction with ‘being responsive to my needs,’ and ‘online banking.’
To improve performance, the bank needed more detailed definitions of these critical requirements. A
series of focus groups with three targeted customer segments and in-depth in-person interviews with the
bank’s affluent segments were conducted in the bank’s four market areas throughout the country.
Interviews and focus groups with non-customers were also conducted to provide a framework for under-
standing competitive dynamics.
A pattern emerged among the bank’s entire customer base: competitors had raised the bar, creating expecta-
tions for faster, easier, and more consistent service at every point of contact. Some customers defined ‘fast’
loan approval as an answer ‘within 5 minutes of applying for a loan.’ Customers also expected to be able to
apply by phone, online, or in person and instantly get a yes or no. The bank’s target, however, was to provide
an answer within 24 hours. Whether this expectation was shared by the majority of the bank’s customers
would be answered in the next phase, the quantitative survey research.
‘Responsive to my needs’ was also defined as ‘resolving my problem in the first contact.’ However, most
respondents had experienced a frustrating pattern: inability to find the person who could resolve the problem,
multiple phone calls, waits of weeks or months for resolution, and no follow-up by the bank to see if the
customer was satisfied. Most customers said they did not expect to avoid problems but that they did expect
the bank to resolve them quickly (the same day), efficiently (one contact), and in a way that showed that the
bank ‘valued their business’ (follow up the day after resolution, extra benefits if it was the bank’s fault).
The banks’ affluent customers defined ‘responsiveness to needs’ in language that conveyed how they
defined ‘relationship banking.’ In essence, these highly valuable customers said: “I want a bank that assigns
me one, competent person who cares about me, knows my financial profile, knows the bank so that I don’t
have to call anyone else, and looks out for my best interest. Looking out for my best interest means that my
contact alerts me to problems before they happen or resolves them before I know about them. This person
considers every possible product and filters it through a thorough understanding of my needs before pre-
senting it to me and doesn’t waste my time by trying to sell me things I already have or don’t need. I expect
the bank, considering the length and the value of my relationship, to waive those ridiculous fees they charge
everyone else. With the amount of money I direct their way, there should be no fees for any service.”
Online banking had also created new expectations. Customers said they wanted to be able to do ‘everything
online they could do in a branch.’ ‘Everything’ meant opening accounts, applying for loans, reporting a
problem, seeing their entire relationship online, communicating with their banker, accessing the bank’s phone
directory, learning about new products, and paying bills quickly and easily. Because large gaps existed
between these customer desires in online banking and the bank’s services, management conducted additional
in-depth interviews to understand these needs in greater detail.
The results of this phase of the VOC process were dramatic. New requirements emerged that would redefine
customers’ expectations and focus the entire organization on the right measurements to increase satisfaction,
retain the most valuable relationships, expand those relationships, and generate more referrals from a more
loyal customer group.

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WHITE PAPER Capturing the True Voice of Your Customer

Quantifying the Results

The second phase of the VOC process, treated in the second in this series of Executive Briefings, encom-
passes quantifying the results of the initial phase. Such quantification enables you to answer these impor-
tant questions:
• What are the essential drivers of satisfaction that enable us to move our customers from somewhat satis-
fied to very satisfied?
• What are the customer-driven priorities for improving our performance?
• If we meet these customer expectations consistently, what will the financial impact be on our revenues,
market share, and profitability?

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 Six Sigma Qualtec
Six Sigma Qualtec, Inc.
1295 W. Washington Street • Suite 215
Tempe, AZ 85281-1210
phone (480) 586-2600
toll free (800) 247-9871
fax (480) 586-2586
email info@ssqi.com
website www.ssqi.com

Copyright © 2002 Six Sigma Qualtec, Inc.

All right reserved.