Identifying business tactics that secure customer loyalty is a worthwhile exercise. Not to be confused with marketing tactics… Motivation to initially purchase a product or service is only part of the equation.
Consider all the exchanges your organization makes with prospective, existing, and past customers. Examples of such transactional exchanges include:
Scheduling Activities
Do your customers schedule appointments to complete a program and obtain services?
Enquiry Activities
How do customers reach you if they have a question?
Customer Support
Once you have initiated a service or provided a product to your customer, how do you support that purchase?
Financial Transactions
The most basic, and some feel the most important transaction, is the financial one. Customers agree on a price for a particular product or service, then they surrender the necessary funds that actions the transfer.
Fulfilment or Program Activities
In order for a customer to enjoy the products or services you provide, they may need further exchanges to follow through. This may involve the use of online services or require physical appointments to supply products and/or carry out services.
During each of the above activities, can you validate there is an exchange of value?
Your customer is continually evaluating the performance of your business. They reflect if a transactional exchange truly contained value. At first, they may simply assess whether or not your product or service met anticipated functional values like:
Overall:
- Did acquiring this product or service save me time or effort?
- Does this product/service save me time now?
- Does it reduce my effort now?
- Does it save me money now?
More specifically, does it:
- Simplify their life? Helps them avoid hassles?
- Reduce risk to their health or finances?
- Help them make money?
It’s not necessary for your product or service to do any or all of these, but determining which ones apply, will help for further step(s).
Your customers may also consider the emotional value of your product or service.
- Did your product or service make them feel good?
- Was the transactional exchange enjoyable?
An organization needs to ensure it consistently delivers value to both new and existing customers. The reward for these efforts is steady organizational growth. How do you know if your business is exchanging value during transactional exchanges?
There are at least 32 criteria in two additional value streams that customers use (subconsciously) to determine if they have received value. The flow of value goes far beyond price. It is directly linked to organizational performance throughout each transactional exchange.
When organizational performance results in the customer truly receiving the value they anticipated, the degree of trust increases.
Organizations that have declared Key Performance Indicators (KPIs) use tactics that ensure they are delivering value with every transactional exchange. KPIs are quantifiable measurements that can be used to monitor a company’s overall performance.
KPI Example
A fully defined and qualified KPI may be determined by asking the following questions: [Example tips]
- What is the desired outcome?
- To reduce the number of manual interactions it requires each client to set an appointment… By how much time… by how many interactions?
- Why does this outcome matter?
- For a transactional exchange that has functional value, it needs to save the client time and reduce their overall effort.
- How are you going to measure progress?
- Poll clients to determine if it took them less time and/or less effort to book an appointment. How much less time? How many fewer steps?
- How can you influence the outcome?
- Can you install a process that supports the client’s desired and anticipated outcome?
- Who is responsible for the business outcome?
- Who will ensure organizational performance is meeting this KPI?
- How will you know you’ve achieved your outcome?
- When results meet the desired outcome?
- How often will you review progress towards the outcome?
- Clients will be offered the poll each time they book a service. This KPI will be reviewed at least once every three months to ensure we are meeting performance goals.
Answering the above questions will provide the context each KPI needs to be effective. KPIs aren’t infallible, and progress will be made. Initial customer feedback on your KPIs may reveal causes of why previous organizational goals were not being met.
It is a good practice to share your KPIs. Staff and customers need an explanation of what you’re measuring (the exchange of value) and why you’re measuring it. Reviewing your KPIs regularly is essential to ensure you are always delivering value to your customers. Doing so will help grow your organization. It will also help your organization anticipate and remain resilient to incremental change or sudden disruptions.
Not all KPIs are successful. Early on, set short-term targets and track your progress towards achieving them. Doing so will allow you to make micro-adjustments and/or pivot if necessary. Remember, once a KPI has outlived its usefulness, you shouldn’t hesitate to toss it and develop new ones that better align with your organizational goals.