Re-Designing a Customer Satisfaction and Loyalty Program via Linkage
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1 Re-Designing a Custome Satisfaction and Loyalty Pogam via Linkage Pesented by: Lezlee Danne Roche Diagnostics IIR Linking Custome Satisfaction to Custome Pofitability Febuay 16-18, 2005
2 Agenda Roche Diagnostics Backgound Building the Case Objectives of Pogam and Causal Models Developing the Linkage Model Pulling Togethe the Data and Ceating Actionable Infomation Actions Taken fom Insights Lessons Leaned Next Steps 2
3 Roche Diagnostics at a Glance Roche Diagnostics is a division of F. Hoffmann-La Roche Ltd, Basel, Switzeland Five aeas; five geogaphic egions; six global functions. Numbe one diagnostics company in the U.S. and the wold 18,000 employees woldwide 3
4 Five Global Aeas Applied Science Molecula Diagnostics Centalized Diagnostics Nea Patient Testing Diabetes Cae New poducts & technologies Genomics & poteomics eseach & non-ivd business Industial bulk New technology All PCR based poducts fo IVD Genetics/ Genomics AmpliChip P450 Hitachi/Intega lines Elecsys Cobas Lab Integation Blood gas/ electolyte systems Uinalysis Coagulation POC Cadiac/ hematology ACCU-CHEK Infom All diabetes cae Poducts/ devices Softwae Sevice/ infomation Methods fo Ind. Testing Insulin Theapy 4
5 Roche Diagnostics Setup Regional headquates and R&D centes Bugdof Rotkeuz Mannheim Indianapolis Basel Penzbeg Gaz Applied Science Molecula Diagnostics Centalized Diagnostics Pleasanton/ Alameda Banchbug Tokyo Nea Patient Testing Diabetes Cae Bacelona Singapoe Regional Headquates 5
6 Roche Diagnostics, Indianapolis Headquates fo Noth Ameica Indianapolis is the headquates fo: Sales, Maketing, and Taining Suppot fo Noth Ameica Five business aeas Reseach and Development (R&D) Centalized Diagnostics Diabetes Cae Applied Science Ventues Healthwea, ACCU-CHEK Notify, etc. Supply Chain Custome Fulfillment (CF2) Manufactuing eagents blood glucose stips Waehouse to shipping Coe suppot functions Additional global functions and teams 6
7 Roche Diagnostic s Reseach Backgound Taditionally conducted pimay eseach that in aggegate povides the oganization with a pictue of the maket and competitive envionment Custome Satisfaction Competitive Analysis Event Diven Satisfaction (Tansactional) Although, impotant in assessing the maket and poviding snapshots in time, we identified aeas of oppotunity to achieve significant impovements. 7
8 Identify the Need fo Change We Need An Accuate Repesentation of the Voice of the Custome Continue elements of ou eseach that ae value-added and povide noticeable impovements in the finished poduct. Impovements such as Alignment with ou division and copoate level vision and objectives Updated to eflect cuent maket ealities Heightened sensitivity to potential changes in the maket Enhanced custome metics that bette quantify custome loyalty Enhanced claity on specific actions needed to impove the Total Custome Expeience Enhanced undestanding of the stategic elevance of custome feedback 8
9 Identify Clea Objectives of the Pogam Oveaching objective of eseach pogam Gathe and utilize custome insights to diect the oganization and its key pocesses so as to enhance the custome expeience FACT-BASED DECISION MAKING: Undestand and act upon the custome behavios that ae most citical to ou success. 9
10 Reseach the Validity of Causal Models Thee is a elationship between using a causal model and impoved business pefomance. A Causal Model is defined as a diagam laying out the cause-and-effect elationships between the chosen dives of stategic success and outcomes. 23% of Companies: Extensive causal modeling and validation Minimal causal modeling and validation Yet those 23%, on aveage, had 3% highe ROA and 5% highe ROE than companies that didn't use causal models. Souce: Havad Review, Nov Coming Up Shot Chistophe D. Ittne and David F. Lacke 10
11 Closed Loop Pocess to Avoid Mistakes By following the steps below, we should be able to maximize pefomance measues and minimize mistakes. 6 Assess outcomes Develop 1a causal model (Oganizational Bluepint) Most Citical and Time Consuming Step 5 Base actions on findings Pull togethe 2the data (Develop consistent measues fo the oganization) 4 Continually efine the model (Maket/competitive changes) 3 Tun data into infomation 11
12 Developing the Linkage Model: Qualitative Phase To complete this step equied a 3-phase qualitative/intenal analysis. Phase 1: Qualitative eseach Ae we asking the ight questions to best pedict business outcomes based on behavio? Qualitative phase developed the ight list of attibutes Suvey instuments must be aligned with custome equiements Custome equiements change ove time Custome equiements ae best defined by custome This phase allowed us to Gain a deepe undestanding of ou customes actual expeiences Focus on obsevations of expeiences as well as needs assessment in taditional qualitative eseach. 12
13 Developing the Linkage Model: Alignment and Linkage Phase 2: Alignment and Linkage Inceased ou undestanding of the Total Custome Expeience and capability fo acting on the data. Sepaate suvey instuments ae popely designed to povide citical infomation needed to plan business stategies and tactics. Linkage Enables Insight Oveall Peceptions & Loyalty Competition and Maket Pefomance & Relationships Event-Diven, Tansactional 13
14 Developing the Linkage Model: Identify Who Will be Affected by Change Phase 3: Oganizational Bluepint Wokshop Changes will affect pocesses and business aeas acoss the oganization. Ou goal is to ensue the Voice of the Custome is a value fo all key pocess ownes and business aeas. Best appoach is to visualize WHERE the custome fits in Voice of the Custome Aea Aea Aea Aea Aea Aea 14
15 Developing the Linkage Model: Example of Oganizational Bluepint The Bluepint aligns the Leadeship Team to the cause-and-effect elationships between the chosen dives of stategic success and desied business outcomes Goal 1 Opeations Metics (business pocess) Employee Attitude Linkage Linkage Loyalty Relationships Tansactions Linkage Goal 2 Goal 3 Oveall Roche Goals 2004 Pogam Will Focus Initially Within the Cicle 15
16 Developing the Linkage Model: Engage and Align Leadeship Team Phase 3: Oganizational Bluepint Wokshop The Bluepint seves as a famewok and futue efeence fo additional linkage effots. Enables futue linkage fom custome to business outcomes Enables futue linkage fom custome to opeations Also inceases management suppot and undestanding fo the oveall pogam. We placed custome measuement as a citical component of the oveall business plan. What ae the key business esults? What ae the key causes that detemine these business esults? Quantify all causes and focus on the custome elated behavios that need to be undestood. What ae the key custome expeiences that cause the custome behavios? Utilize the qualitative leanings to ensue that we design the instuments and collect data on these expeiences. 16
17 Pull Togethe Data and Tun into Actionable Infomation Custome Reseach Achitectue 1. What is impotant? Attibute Impact Secue Custome Index 2. How ae we doing? Attibute Pefomance Custome attibute atings evaluating Roche pefomance 3. How do we compae to competition? Competitive Issue Pioitization Assessing pefomance elative to competito pefomance, in light of attibute impact. 4. So what do we do now? Issue Pioitization Combining attibute impact with attibute pefomance to identify impovement oppotunities 17
18 Pull Togethe Data and Tun into Actionable Infomation 1. What is impotant? Attibute Impact Secue Custome Index R 2 Loyalty Highly Satisfied V. Likely to Re-Puchase V. Likely to Recommend Pimay Gateways to Loyalty Gateway 1 Gateway 2 Gateway 3 Gateway Impactes -Diect -Indiect 18
19 Pull Togethe Data and Tun into Actionable Infomation Relative Impact on on Loyalty High Modeate Low Pimay Gateways to Loyalty Index Scoe R xx xx xx xx xx 2. How ae we doing? 3. Competition? R 2 Loyalty 2 2 Index Scoe 2 Index Scoe R R xx xx xx xx xx xx xx xx xx xx Gateway 1 Gateway 2 Gateway 3 Highly Satisfied V. Likely to Re-Puchase V. Likely to Recommend Gateway Impactes -Diect -Indiect Index Scoe R xx xx xx xx xx Index Scoe R xx xx xx xx xx 19
20 Pull Togethe Data and Tun into Actionable Infomation 4. So what do we do now? Pimay Gateways to Loyalty Loyalty Gateway 1 Gateway 2 Gateway 3 Highly Satisfied V. Likely to Re-Puchase V. Likely to Recommend Gateway Impactes -Diect -Indiect Touchpoint Loyalty Dives 20
21 Pull Togethe Data and Tun into Actionable Infomation Issue Pioitization Linking Item: Loyalty Gateway 1 Gateway 2 Gateway 3 Aea Oveall Satisfaction Module Module Module Module Module Module Module Module Module Module Module Module Aea Attibutes: Impact on Loyalty Top-2- Box % Pef. Above/ Below Avg. Rank in Impact on Link Item Aea Detail Attibute High 59% 1 Aea Detail Attibute Aea Detail Attibute Aea Detail Attibute Aea Detail Attibute Aea Detail Attibute Aea Detail Attibute High High High High High High 55% 53% 40% 57% 27% 39% High Pioity: Those attibutes with High Impact to Loyalty and Below Aveage Pefomance Aea Detail Attibute Modeate 42% 8 Aea Detail Attibute Modeate 48% 9 Aea Detail Attibute Modeate 43% 10 21
22 Base Actions on Findings and Assess Outcomes Stuctued wokshop with Leadeship Team to..eview/undestand pocess-specific key insights fom VOC eseach 1 What ae the highest impact loyalty dives fo this pocess? How is ou pefomance? What ae common themes acoss poduct-lines? identify oppotunities fo impovements via 6σ Decision-Tee 2appoach What ae the key elements that compise a pocess? Whee in the pocess can/should we act fo impovements? and pioitize and agee upon key pocess impovement aeas 3 What effots ae aleady undeway that addess oppotunities identified? What ae ou pocess impovement pioities? 22
23 Lessons Leaned Must be a seamless tansition fo intenal clients Alignment with Leadeship Team is citical Povide a 3-5 yea vision Bluepint wokshop enhances the oveall pocess Vision of pogam communicated down in the oganization Closed-loop pocess that initiates action and assesses outcomes of action taken Continually efine the model - Make the pogam flexible to the competitive envionment 23 23
24 Next Steps Desied End-to-End Linkage Model Linking employees wok customes business esults Employees Wok Custome Expeience Custome Behavio Results 2006 Loyalty 2005 Employee Engagement Intenal Pocesses Relationship Shae Of Maket Shae Goss Magin Tansactions 0 On the coect path to undestand the cause-and-effect elationships between the chosen dives of stategic success and desied business outcomes 24
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