The Outer Loop
The Outer Loop
The Net Promoter System's outer loop creates confidence that the company’s priorities support customer centricity—and that leadership is putting its money where its mouth is.
The outer loop’s explicit purpose is to prioritize and support the kind of customer-friendly changes that employees and teams can’t make on their own. But there’s an implicit purpose as well. An effective outer loop makes employees feel supported. It gives them a voice in the firm’s priorities. It creates confidence that the company’s priorities support customer centricity—and that leadership is putting its money where its mouth is.
An outer loop must employ a rigorous, well-defined and transparent process for addressing issues. A team—usually led by the customer advocacy office, or CAO—gathers input from a variety of sources. That team uses clear and explicit criteria to prioritize opportunities for improvement. The CAO makes recommendations to senior executives about which opportunities to address and who should be accountable for leading the charge against each one. The assigned team then investigates root causes and develops solutions. Throughout the process, the CAO makes sure that both customers and employees are informed about progress whenever doing so is relevant or required.
The data that feeds the outer loop begins with input from customers, but it doesn’t end there. The central team should review four distinct sources of information to identify issues.
Customer data from inner loop feedback reveals patterns, trends and changes in frequency. For instance, if a complaint crops up repeatedly—and the front line can’t address the issue—it’s grist for the outer loop mill.
Operational data can affect, or indicate opportunities in, the customer experience.
Frontline teams’ daily or weekly huddles often identify issues that can’t be resolved within the team, providing a rich source of opportunities for improvement.
Competitors may have addressed an issue or opportunity in a way that merits consideration. But direct competitors aren’t the only businesses worth looking at—a bank can learn from Disney, an insurance company from Amazon.
In the prioritization phase, the team creates a portfolio of initiatives with the most important ones at the top. For each initiative the team has to ask itself four critical questions:
But there’s also the “X factor,” or the symbolic impact of the initiative on employees and customers. It can shoot a seemingly secondary initiative to the top of the list. A given change might hit just a few customers a month and have a modest economic impact, but it resolves a longstanding irritant for a vocal subset of employees or customers. It might be largely meaningless to most employees, but have a significant impact on the company’s reputation in the marketplace.
A CAO team that takes all these factors into account should be able to produce a carefully constructed portfolio of initiatives, one that is high impact yet entirely manageable and practical.