‘Tis the Season to Ruffle Some Feathers

September-October is typically the time that most organizations begin their strategic planning process.  Most will focus on answering the following questions:

  • Where are we now? (current state)
  • Where are we going? (future state)
  • How will we get there? (strategy & tactics)
  • What resources will we need? (people, money, technology, etc)
  • Who will do what? (strategy owners, participants, etc.)
  • How will we know when we get there? (measures of progress)

Many will follow a process that looks something like this:

  1. Gather necessary data
  2. Discuss process, expectations, and strategy prior to developing plan
  3. Planning meetings or retreat to develop strategic/action plan(s)
  4. Build process/reports to measure progress toward plan

Pretty standard stuff, eh?  With any process, the success of each step relies on how well you complete the prior step.  If you do a poor job of data gathering, then your whole plan could be suspect.  When it comes to gathering data about your customers, it’s not just the ‘gathering’ that is critical.  It’s also what you are gathering in the way of quality data that is most critical.

Question Your Customer Data and Definitions

Each organization has some standard customer data and metrics.  If your company has been around a while (> 3 years), it’s time to question the accuracy and source of the data, and what is really meant by all those fancy terms you use when discussing customers:

  • Take the time to understand how you calculate customer growth, retention, or profitability, and to see if adjustments are needed.  Many times data sources are inappropriate or the method of calculation needs to be adjusted.
  • Review your customer data to confirm that your metrics have the right mix of leading (predicting performance) and lagging indicators (measures performance).  Does an increase in satisfaction or Net Promoter score correlate to an increase in customers, or revenue, or profit? Do you know what causes those measures to go up or down, and what changes to make?
  • Define those terms everyone uses, but not all agree on the definition – such as customer experience, customer insight, or social media strategy.
  • Challenge widely held customer “beliefs” to see if they are true for your organization.  For example, does it really cost you six times as much to acquire a customer as to keep one?

Take nothing for granted.  Challenge your data, your assumptions, and your beliefs about customers.  It may ruffle some feathers for some people, but failing to do so can turn your strategic plan into nothing more than a 3-ring binder that serves as a hefty bookend on your bookcase.  BTW – do we still print strategic plans?

Picture Credit


The Big D’s – The Two Keys That Make or Break a Customer Initiative

block-d.jpg  After years of working on “customer” projects it always seems to be the same two “keys” that get a project to show results quickly, or force us into endless meetings to discuss these two mysterious “keys.”  With all the thoughtful strategy, market analysis, and product development that happens around “customer” projects you will hit a wall if you don’t deal with these two items up front and with painstaking detail. 

Can you guess what “D Keys” I’m talking about?  Here they are:

  • Definitions
  • Data

Think about it.  If the people in your organization don’t agree on the definitions of the words you use, and don’t trust the data you use to define those terms, you’re bound to have a bit of mess on your hands.

For example, ask your colleagues to define these terms for your organization and see if you all agree:

  • New customer
  • Retained customer
  • Loyal customer 
  • Lost customer

I recently had fun with a credit union as we looked at data for closed accounts.  As we dove deeper into the data we had to reconcile what a member (customer) really is.  When we say member do we mean a household, an account, or a share?

Which takes us to the second D – data.  Once you have defined your terms, what are the sources of the data you are using to measure those terms or types of customers?  Do you have a single source for data, or do you rely on multiple data sources to give you a complete view of your customer?  If you have multiple sources of data, is each field defined the same?  In the credit union example, one data source was stored as household information, the other data source had it stored as accounts (a household can have more than one account…).  If all the people trying to work on this project didn’t realize this, we would be talking different languages.

I know this may be basic for some of you, but time and again, and to this day, I come across these Big D’s constantly.  If you don’t know to look for them, you can go pretty far into a project before you have to back-track and deal with them.  So deal with these Big D’s before you get a double dose of disaster. (OK, enough with the D’s)

How to Grow a Professional Association

bar_chart_biz_people1.jpg Over the years I have served on the Boards and Committees of several professional associations.  It’s great networking, and the meetings are usually great learning opportunities.  I often get asked to serve on the Membership Committee due to the nature of my ‘customer relationship’ work.  The challenge facing associations is often the same – how to grow and maintain financial stability.

With each association I typically go through a very basic exercise as a starting point for understanding the membership.  Keep in mind that most of the people that run these groups are volunteers, with limited resources, so I need to keep things simple.  Here are the steps I typically go through:

  1. Ask for a list of all current members and the data fields in the membership database.  This should have fields such as name, title, contact info, company, start date, renewal date, etc. 
  2. Next ask for monthly data that includes the total number of current members, past members, and new members. 
  3. Ask for a list of all past members, including contact info, start date, and end date of membership. 
  4. Ask for monthly meeting data such as number and names of members and guests at the last several monthly meetings. 

Next, my goal is to use this data to get a quick “pulse check” of the health of the membership, improve our retention rate, and grow the membership.  Here is how we will use the data I have requested:

  1. The current membership list will be used to calculate average tenure of the membership.  I will do the same with the list of all past members to see if we are currently losing long-term members or short-term members who may have signed up for a membership and then realized the organization is not for them.  If you have captured the reason why members don’t renew, consider yourself very lucky!
  2. The current membership list will then be sorted by renewal date.  This can be used to implement a variety of contact campaigns to alert members that their renewal is coming due, and to remind them of the value your association provides.
  3. The monthly data will allow you to see trends and calculate a churn rate.  Is your membership count increasing?  Is it coming from more new members, or fewer lost members? 
  4. The dropped member list can used if you have the appetite to undertake a “win-back” campaign.  Your organization may be re-branding itself or refining it’s direction.  Once this is done you can contact past members and invite them back.
  5. The breakdown of members/guests at meetings will help you understand the financial impact of a membership.  This will allow you to calculate the average number of meetings a member attends.  Using your cost/member/meeting you can see if you need to adjust membership fees.  You can also see what guests attend each meeting and suggest that a membership may be a better deal for them.

Once you nail your reporting needs, and measures of performance, you can get everyone on-board with growing your association and enjoying the benefits of all your hard work.