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The common currency of customer-centric firms

Companies need simple, standard systems to measure and track how their customers are responding to their products and services, and then get their front-line to respond to the feedback.

Par Sri Rajan and Yaquta Mandviwala

First published on décembre 16, 2014
min


This article originally appeared on Livemint.com. It is a well-known axiom that customers are the ultimate source of a company’s value. As the competition to capture this value intensifies in India, companies are reaching out to new customers as well as trying to retain increasingly picky and fickle patrons. They need simple, standard systems to measure and track how their customers are responding to their products and services, and then get their front-line to respond to the feedback. However, even though other assets can be easily valued using standard accounting methods and are reported regularly, customer relationships are often considered intangible. As a result, few companies have developed rigorous mechanisms to assess the value of individual customers. In its stead, executives trying to understand customers often fall prey to running multiple, long and complex surveys. But do they know which the best survey is? Or how best to interpret the output? For all their efforts, they often end up swimming in a sea of data with no clear insights. Clearly, there is a need for a simple metric, one that can act as a standard currency across the firm, can be easily benchmarked with competition, leads to immediate and specific action, predicts future outcomes, and correlates to profitable growth. Can there be just one such metric? Read more at Livemint.com

This article originally appeared on Livemint.com.

It is a well-known axiom that customers are the ultimate source of a company’s value. As the competition to capture this value intensifies in India, companies are reaching out to new customers as well as trying to retain increasingly picky and fickle patrons. They need simple, standard systems to measure and track how their customers are responding to their products and services, and then get their front-line to respond to the feedback.

However, even though other assets can be easily valued using standard accounting methods and are reported regularly, customer relationships are often considered intangible. As a result, few companies have developed rigorous mechanisms to assess the value of individual customers.

In its stead, executives trying to understand customers often fall prey to running multiple, long and complex surveys. But do they know which the best survey is? Or how best to interpret the output? For all their efforts, they often end up swimming in a sea of data with no clear insights.

Clearly, there is a need for a simple metric, one that can act as a standard currency across the firm, can be easily benchmarked with competition, leads to immediate and specific action, predicts future outcomes, and correlates to profitable growth.

Can there be just one such metric?

Read more at Livemint.com