Will it be positive?  Will it be negative?  Or worse yet, will it be nothing at all?  Will your customer, instead, be silent, listening carefully what’s being said by others while internally running down a list of comparisons of your company versus your competitors? 

It’s a given that customers are thinking about you and the service or products your company provides.  Even if they aren’t talking about you to other business owners, they are evaluating your firm every time they walk in your door or deal with you in any fashion.  They’re also evaluating your company every time you answer the phone, return a call, or send out an invoice or other correspondence. 

Ironically, it’s often the non-technical aspects of what you do that are noticed most by customers.  We know that customers often leave a firm not because the company was technically incompetent or the product was inferior, but because of the way they were treated.  It comes down to the issue of perceived indifference.  A Ford Foundation study recently revealed that 68% of customers leave a business because of perceived indifference.  They feel that your business is indifferent to the patronage that they are providing to you. 

What are the potential areas of perceived indifference?  Your phone procedures?  Your billing procedures?  The way you deliver your product or service?  The amount of contact you have with your primary customers?  The attitude of one of your team members?  Accessibility?  Timeliness?  Whatever your issues of perceived indifference, you owe it to yourself to find out what they are and fix them now.  Every day you wait you risk losing a customer who feels unheard or uncared for.  They are suffering from perceived indifference. 

How do you determine your issues?  I found the best way to reveal what those issues are is to ask.  You ask and you must really listen to your clients.  Then you must make changes based on what they tell you.  They already have the answers and are more than willing to share them.  We call this a customer advisory board (CAB). 

The usual structure for a CAB is a ‘focus group’ or panel comprised of a representative sample of customers, chaired by an independent moderator that poses topics for discussion and facilitates the group’s answers. The feedback obtained is transmitted to the company’s management for inclusion in considerations about the future of the business.

The CAB is a tested and proven solution that can eliminate dangerous management blind spots.  It can be used to obtain customer perceptions on subjects as diverse as which new products should be considered to the best way to handle customer complaints.

Viewlocity, a US-based firm that markets its products worldwide, describes itself as “the global leading provider of visibility, event management and optimization software for the adaptive supply chain.”  Product development at Viewlocity is guided in part by an independent Customer Advisory Board comprised of a select group of customers.

Customer feedback is seen as critical to the Viewlocity product lifecycle and has considerable influence on the direction of Viewlocity and the company’s futurebusiness opportunities.  Viewlocity management representatives on the CAB include the Chief Executive Officer and Chief Technology Officer.

Allen Systems Group Inc. adopts a similar ‘listen and learn’ approach.  The company uses a CAB as part of its product development structure.  The board is seen as a forum that brings together strategic customers and key ASG product strategists. Its members participate in:

• Identifying and sharing best practices in their organization
• Identifying strategic problem/enhancement areas and their business priorities
• Discussing and challenging ideas where value is not clear
• Identifying potential new products required for future business initiatives

All members of the CAB are customers of ASG and serve on the board for a minimum of one year.  The benefits of membership for customers include their ability to influence the company’s corporate initiatives and product directions and early access to ASG’s new products.
 
A CAB isn’t an expensive exercise and can actually build loyalty and commitment from the customers on it.  “You now have a team of dedicated customers dealing with you regularly, keeping an eye on your business, and helping you keep an eye on your competitors.”

We have used CABs locally and found them capable of providing a wealth of information.  At one CAB we did for a product supplier the customers told us how much price elasticity they had for their product.  They specifically told us that this business had a 10% advantage meaning that as long as their bid was within 10% of their competitors they would stay with them.  If the gap was greater than 10%, it would cause them to look a little closer!  Imagine how valuable that information was to the business!  At a minimum the customers invited to a CAB report they feel very honored and recognize the business inviting them as a superior customer service type company.

Consider a CAB for your business as a way of demonstrating to your customers how important they are and also to get some very insightful reconnaissance on your customers.

The CAB is a win-win situation for most everybody and should be a part of the thinking of every business.

By John D McQuaig, CPA with McQuaig & Welk, PLLC and RanOne, an international Group of Consultants serving small to medium enterprises

John McQuaig