As I watch the Summer Olympics, I am in awe of the athletes’ physical and mental strength. The difference between medaling and going home empty handed often comes down to hundredths of a second or tenths of a point. It struck me that these competitors are always being measured against a benchmark that is either an ideal score or challenging their own personal best.
Setting Goals for Improvement vs. the Competition
Olympic competition is an appropriate analogy for the metrics that our clients use to measure the customer experience. Oftentimes, we are asked to help clients set appropriate corporate goals for improvements in Net Promoter Score (NPS), satisfaction, loyalty, etc. Invariably, that conversation includes a discussion around what is the best in class (gold medal performance), the industry norm and what would be meaningful improvement for their company.
If no swimmer ever completed the 100M freestyle in less than 46 seconds, and the winning time in the Olympic finals is 47.1 seconds, then that could be considered the industry “best in class,” with the norm probably being closer to 48 seconds. Similarly, if no company in a particular industry ever scored higher than a 75 on the American Customer Satisfaction Index (ACSI) standardized customer sat metric, then that sets a standard that will be difficult to exceed since industry competitors typically operate with similar business models. Expecting to exceed “best in class” is probably unrealistic unless there is a disruptive business model in the works.
For a swimmer or a company that is already operating near the “best in class” threshold, further improvements will be measured by hundredths of a second rather than whole seconds. But for a swimmer or company falling well short of “best in class” or even the industry norm, then setting more aggressive improvement goals is realistic because there is more upside potential for change.