Thursday, March 27, 2008

A Loyalty Check List

I have written a number of blogs about metrics but most of them have been focused on the customer. I have also developed a rather comprehensive checklist that provides an in-depth assessment of a company's commitment to loyalty. I have included a simplified and reduced version of this assessment below. Please note that this checklist has a copyright; however, it can be used by anyone as long as the source is noted.

To Assess Internal Loyalty Components in a Company

[Directions: respond to each statement using a rating of 0 = not at all; 1 = minimally; 2 = moderately;
3 = significantly]


A. Identify homogeneous customer segments to determine the kind of customers to whom you can deliver superior value. ___

B. Understand your target customers and determine specifically how you will retain them. ___

C. Identify specifically which, where and how often customer expectations have
been met, exceeded, or not met. Remember, whatever the customer says is a
problem, is a problem! ___

D. Determine accurately your company’s ability and willingness to handle customer questions, inquiries and complaints effectively. Identify specific procedures for
each customer question. ___

E. Determine accurately the extent to which your recovery process reduces defections and/or retains customers whom might otherwise switch to the competition. ___

F. Identify the percentage of your customer base at risk. ___

G. Maintain programs to ensure customer retention throughout the product or
service lifecycle. ___

H. Establish specific vehicles and opportunities for multiple levels of interactive communication with your customers. ___

I. Articulate specific examples of how your company earns the personal trust,
respect and loyalty of each type of customer. ___

J. Assess the meaningful reciprocal loyalty between your company and your
customers. Identify specific ways in which each feels and demonstrates some
obligation to the other. ___


A. Identify specific new products and/or services based on your customers’ changing needs, desires and expectations. ___

B. Identify the process by which you anticipate evolving customer needs and
wishes through intelligence-gathering and analysis. ___

C. From your customer’s perspective, scrutinize your products and services to determine the gap between their expectations and experiences. ___

D. Specifically how do you keep customers actively involved throughout your
product or service lifecycle? ___


A. Understand and can state clearly the share purpose between the company and
each employee. ___

B. Employees have integrated the company values and priorities into their work life. How do you know? ___

C. Ensure that management decisions and behaviors are congruent with the stated vision and goals of the company. ___

D. Design operating structures and incentives to empower front-line staff to take the initiative to serve and delight your customers. ___

E. Implement an effective retention strategy aligning employees’ enlightened self-interest with the company’s interests. ___

F. Ensure that every employee understands thoroughly their personal contribution, their role and responsibilities in the overall activities of the company. ___

G. Articulate specific examples of how the company earns the trust, respect
confidence of its employees. ___


A. Track and understand the market and revenue impact of poor quality, customer problems and priorities. Determine the percentage of your customer base at risk then set priorities accordingly. ___

B. Determine the gap between what the customer expected and what the customer actually received. ___

C. Evaluate each critical incident with your customer and determine accurately the nature and extent of the problems where they occur. ___

D. Measure each priority area accurately and continuously. Review the results regularly with top management. ___

E. Identify core causes of defections rather than triggers. ___

E. Determine your company’s ability to handle customer complaints and inquiries effectively (recovery process). ___

F. What is the net present value of your customer base? ___

G. How much is a new customer worth? ___

H. How much is it worth to keep an existing customer? ___

I. Determine the actual payoff for problem prevention and resolution. ___

• Review your scores by section to determine categories of strength and/or weakness. If your average ratings overall fall within the two-to-three range, CONGRATULATIONS!
• If you have 6 or more of the 9 measurements scored at 2 or higher, CONGRATULATIONS!
• Otherwise, you may want to get more directly involved with specific problem areas.


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