Voice of the Customer / VOC (+ 15-Page Lean PDF)
The “Voice of the Customer” (VOC) is the collective information that an organization obtains from or about its customers. This information comes in one of four basic ways, as shown on the image below:
Organizations can either actively request information from a customer, or can seek out information that is already flowing on its own. Likewise, the information can be either highly quantitative, as with sales figures, or can be qualitative opinions.
The primary purpose of listening to the VOC is to gain a clear understanding of the customer’s wants and needs, and then to translate those requirements into a plan of action.
Another significant benefit of paying attention to the voice of the customer is to actually determine who the customer is. On occasion, a company might realize that the organization is missing the mark on who they are really serving. More commonly, though, diving into the VOC will show logical splits about where customers should be segmented. Treating different types of customers the same generally results in all of them being unhappy. But cater product offerings to specific groups of customers, and you will have a much better chance of delighting them.
Keep in mind that this approach to learning about customers is not limited to just external customers. It is also highly relevant to how internal customers are handled. Be careful when catering to internal customers, though. If they are acting in the best interests of the external customer, you may be delighting your coworkers at the expense of the people actually paying the bills.
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The average person practicing continuous improvement will, in all likelihood, be more of a recipient of VOC information about external customers than a driver of the VOC data collection effort. Most commonly, they will offer up their observations or participate in data collection efforts driven by the marketing team.
Despite this insulation from the nuts and bolts of VOC for the average Lean practitioner, it is important to understand how the company goes about gathering knowledge about its customers. And it is also important to know how to use VOC information to make customer-facing decisions.
Let’s start by looking at the sources of VOC data that the company is likely using.
Ear to the Ground
As you may notice, many of the methods listed above can take years of focused training and experience to master. Typically, because of the risk, most employees are not asked to take on external customer facing VOC tasks as part of regular continuous improvement efforts.
For example, line managers dealing with a quality problem at an auto manufacturer would probably not arrange a customer focus group, but they would certainly try to act in accordance with the company’s view on what customers want.
That is possible because sophisticated companies combine all the VOC from different sources into a concise lists of requirements about the customer segments that they serve. And they make sure that those needs are communicated throughout the company and that day-to-day operations take those customer requirements into account.
The high level voice of the customer process is relatively simple. Obviously, the actual data gathering can be complicated, but the overall intent of VOC is easy to grasp. The company opens a channel of communication with the customer and tries to get an accurate interpretation of the customer’s perception about their needs, desires, and the performance of the company.
The company takes the information it collects, and distills it down into a set of customer requirements, which, in turn, end up as product specifications or service standards. These spec then drive the company’s behavior.
Ultimately, the company’s actions close the loop and start the cycle all over again. Every behavior by the company is watched by the customer.
If you are a marketer, you may be actively involved in planning this VOC loop. But most people doing continuous improvement on a day-to-day basis are impacted primarily in the ‘Company Actions’ area.
The metrics that drive their improvement plans, for example, are the results of the VOC effort. And the way that teams act to meet their targets determines how the customer will perceive the company in the future.
But when the focus on the customer turns from external to internal, frontline employees and leaders are on their own in developing the VOC that will clarify how to best serve their coworkers.
There are four basic challenges when trying to gain a deeper understanding of how to meet internal customers’ needs.
The first point is relatively easy to understand. If you have never conducted a focus group, or learned about how to mine data from a database, or developed a customer survey, it is hard to do so effectively.
The second point is more subtle. With external customers, it all really comes down to money. For example, customers may clamor about losing meals on flights, but they flock to the low cost carriers that don’t provide them. Or they may complain about long lead times, but choose the cheapest, slowest shipping options. When it comes right down to it, customers primarily show what they really value with their spending patterns. Of course, the VOC data helps make the decisions that drive spending behaviors, but the ‘Check’ step of PDCA generally focuses on whether sales went up or not.
For internal customers, though, there is no invoice. So, internal customer can ask for everything, and never have to prove that the value they get from the activity outweighs the costs to deliver that service. It is even more complicated when the costs are borne by the supplier, and the benefit is felt by the customer.
That concept leads to point number 3 above. Each organization in the company likely has its own metrics. Each manager is also likely responsible for meeting budgetary requirements. So, imagine the potential for conflict when, for example, the customer process’s manager can save some money, but it will add to the costs borne by the supplier process. It is easy to see how this sets up the potential for conflict.
The last point comes from a conversation I had with a Japanese consultant years ago in my Lean infancy. He asked why we let our internal suppliers treat us worse than our external suppliers did. He said we were on the same team, so we should be treating each other at least as good as we treated the end customers.
The most effective way to begin resolving this potential conflict is to start from a unified position. Generally, this entails taking a flight up to 30,000 feet and looking at the whole flow of value from an external customer’s perspective, and seeing what each process does to contribute to the entire values stream.
This is one of the reasons that it is important to have a value stream manager that oversees the entire series of processes from initiation to completion. When there is a need to reallocate resources, or to adjust metrics upward and downwards as work is rebalanced, a value stream manager wants the best global results. He or she sees the benefit of spending 5 extra minutes doing something in one area to save 20 minutes somewhere else. When organizations are set up in a functional manner, actually applying voice of the (internal) customer information can be inhibited by boundaries. Many managers act in a way that preserves benefits for their own team, even if it increases costs in other areas.
Of course, not all organizations are set up with value stream leaders, and even those that are will still have areas where work crosses leadership boundaries. Acting on VOC data in those cases can be particularly challenging.
Every organization is different, and will have its own unique set of requirements, so no step-by step approach will work perfectly in all situations. That said, the framework provided below can help you organize a plan on how to better understand the true needs of your internal customers and separate out the ‘nice-to-haves’ that cost a bit too much.
One thing to keep in mind before you get started: You need to strike the balance between the amount of effort you spend on nailing the VOC, and the benefit you will get from having near perfect information versus pretty good information. There is often an inflection point after which the costs go up more than the benefit does. When millions of dollars of sales are at stake, and the competitive sharks are circling, you’ve absolutely got to get the external VOC right from the start.
But with internal customers, you still want to get the VOC right, but you are operating under a different cost-benefit framework. For a small process you might only save a few thousand dollars in a year. You probably won’t be bringing in a focus group expert to meet with Sally in accounting for 3 days. So, as you follow these steps, keep the projected gains in mind.
You are the eyes and ears of the company, and as such, you have the best opportunity to identify customer needs. This is especially true for those of you with customer facing jobs.
Try to read between the lines on what the customer is saying. If they comment on the music while they are on hold, they may really be saying that they feel like they were waiting on the phone for too long.
Also keep in mind that as your company becomes more customer-centric, you’ll be asked to do more things. Whether it is actual work for the customer, or supporting work like data collection, try to be accommodating. But also make sure that your boss is not just adding work. Discuss the process, and ask the hard questions about capacity. If you are asked to do more, you’ll need help. That may come in the form of more manpower, or it may be improvement support. Either way, though, your boss should show you respect and make sure he or she has a plan on how you will handle the additional responsibilities.
One of the problems with leaders is that they are often the victims of their own success. They have ‘made it’ and tend to feel that their experience and expertise have been validated by their promotion. As a result, they tend to act in the absence of facts and data.
Get in the habit of doing a voice of the customer exercise for each process you oversee, and translate the results of that exercise into operational metrics.
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