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Rewarding the Right Behavior

Rewarding the Right Behavior

in Trends in the Marketplace

Despite the growing recognition that customer experience matters, most employee compensation programs continue to be based on revenue targets. Andrew McInnes, customer experience analyst at Forrester Research, believes that as more companies acknowledge the effect that customer experience has on their bottom lines, they will begin to add customer feedback scores to their incentive structures along with the more traditional business performance metrics.

According to McInnes, the process of establishing customer experience-based employee incentives has to start with building awareness of the reasons why customer experience is important. For example, employees need to understand that positive customer experience can result in an increased share of wallet and repeat business. They also need to realize that repeated negative interactions can cause that same customer to take his or her business elsewhere.

Obviously, companies will need to track and measure customer satisfaction in order to identify key performance indicators. To ensure that the right things are being measured, companies should conduct qualitative research to identify key measures or attributes of what’s important to customers. McInnes recommends that managers clearly explain the metrics that employees are responsible for, how those metrics relate to their jobs, and how employees can impact key measures through their daily work. After all, if employees don’t agree that the measures are valid and accurate, the program could fail to yield the desired operational and behavioral changes.