January 22, 2019

Net Promoter Scores make bad targets

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Why I hesitate to set net promoter targets
Think twice before you use Net Promoter Scores as a target

I regularly meet people who want to use the Net Promoter Score as a target in their business. I invariable direct them to the wisdom of Charles Goodhart. In the 1970s, this British economist found that “any observed statistical regularity will tend to collapse once pressure is placed upon it for control purposes”.

This statement is pretty dry and hermetic. But it is something that every customer experience professional should be aware of. Because in regular-people-speak it translates as:

“when a measure becomes a target, it stops being a good measure”.

The reason for this is simple. When presented with an outside target, humans will always seek the path of lowest effort to achieve it. Especially if the target is linked to some sort of reward or punishment.

It’s everywhere

At some point in our lives, we have all done this. In school, we were evaluated on our grades. So the ’smart’ kids knew to prioritise the memorisation of mindless facts over actual learning. And if one exam questions returned ever year, this would move to the front of the study queue.

But it's not just schools. The pressure to perform makes researchers, academics and data scientists manipulate their data (aka. p-hacking). Online targets like 'number of followers' or 'likes' have created fraudulent bots. Politicians fix unemployment by excluding categories of people, rather than creating more jobs.

And yes, employees manipulate customer happiness scores. Not because they are evil. But because for many it’s not just the easiest thing to do, it’s also the smartest.

It’s common sense

Think about it. Imagine you are a store manager or are a machine maintenance worker who visits clients. You just got the target to improve your Net Promoter or Customer Satisfaction score by 15%.

Now, especially as a front line employee, you know that customer happiness is a very complex thing. Even if you put in 200% of effort, a product flaw or a policy outside of your control can totally mess up your targets.

So you have one of two choices:

  • Option 1: you follow your company's customer experience handbook. You do your best delight customers, and accept the risk of failing gloriously because of software issues at head office;
  • Option 2: you get creative and find a way to hit the numbers, without making the effort or running the risk.

In my experience, most people start off with option 1. They actually want to do a good job and make customers happy. But this changes when they realise that their managers only care about the numbers. Then, they start shifting to option 2.

At this point, they get creative about manipulating the Net Promoter Score. They tell customers that only 9 or 10 count as 'satisfied'. They only give surveys to customers who are clearly happy. They bribe. They beg. Or they use any other gaming trick in the book.

It may only start with one employee in one week. But once people see that this gets management off their back, it spreads like wildfire. Especially if can help them get that Christmas bonus.

It’s a path of no return.

But it gets worse. Once these practices take hold, they are very difficult to end. Switching back to honest reporting could make the Net Promoter Score plummet and then everyone would look bad. Especially the managers who’ve been putting the pretty growth numbers into pretty PowerPoint slides.

So you may end up with a situation where a lot of people know that the numbers are BS, but pretends otherwise as this would upset the status quo. And while everyone is busy manipulating the numbers, the conversation shifts further and further from the customer.

No one is immune.

Now just in case you think that Goodhart's law only applies to front line employees, let me tell you the case of a country CEO and his management team I encountered a few years ago.

They were given a new set of stiff Net Promoter targets which they felt were out of their reach. So they found a simpler solution. Instead of improving the customer experience, they simply fired their unhappy customers (detractors).

As a result, their Net Promoter Score shot up and Christmas bonuses were safe. In fact, the CEO got to speak at the next global company summit. The topic: his country's customer-centric transformation.

I'm not saying that a Net Promoter target can never ever be useful. But I have learned to tread very carefully. Instead, I found it makes much more sense to measure and reward people's behaviour towards the customer. Then, the scores are a consequence, rather than a goal.

If you want the tools to make your customer voice programme hit all the 'right notes', check out the Customerfit Academy sprint pack 'Listening to and acting on the customer voice' or feel free to get in touch. I’d love to hear from you.

(c) 2019 – Alain Thys, all rights reserved.

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