It is common to hear from most business leaders that they follow a customer-centric approach, but many restrict themselves to company-centric measures on the ground level. If you are always busy tracking your growth, revenue, and similar kind of indicators, you measure your company’s performance only. It’s essential to switch to measure how a company performs for the target customer for organizations that want to go customer-centric.
Customers do not have any parameter or dashboard to visualize how a particular business performs for their benefit. They try to analyze a business’s response to their need, problem, purpose, and question. And companies can measure this outcome by examining a few customer performance indicators (CPI).
With the rising competitive forces in the market, most businesses these days are making efforts to follow the customer-centric approach. To do this, they are measuring, adapting, and optimizing relevant CPIs. It is high time to understand that customers are the only assets that fuel up any business growth, and the CPIs work like most adequate predictors for that growth.
Let us talk about the insurance industry. When customers ask about an individual insurance plan, they are looking for an exact answer to their query. If your business sends them a reply promising future follow-up, you may end up annoying them. The desired outcome must be the last quote for the plan for which they are looking. When your company is busy transferring queries between suitable agents by following specific rules, the customer may get quotes from your competitors. They may even have completed their purchase from somewhere else.
The primary goal of every business must be to focus on the immediate outcome desired by the customer. If your company is capable enough to handle crucial conversations, it becomes easier to set up strong relationships for the extended future.
Understanding the difference between KPIs and CPIs:
Generally, two essential elements work for CPI; first is the outcome that customers find valuable to their needs, and second, the CPI must be measurable. Many companies consider Net Promoter Score or customer’s willingness to recommend a company as their most crucial CPI, but in actual, it has nothing to do with customers; only companies value this factor, and hence, it is just a KPI.
There are a few common mistakes that companies do while defining their CPIs. First, many of them try to copy CPIs from their competitors without realizing whether these measures are valuable for their target customers. Secondly, they purely rely on expert judgment regarding customer needs and expectations; without making any self-analysis on what the target audience demands. But in real terms, identification of CPIs must be a contextual inquiry that is processed by specially trained researchers focusing on specific environments. They need to analyze customer frustrations, range of expectations, and target outcomes at different levels throughout the customer journey. Well-engineered CPIs can take your business to a whole new level.