Fast Fast Forward

Voice of the Customer: The ultimate fuel for business success

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By Gary S. Kaplan, President -North America Construction

Most people know that I’m big on project management. It’s the engine for North America Construction’s Leadership, Planning & Execution (LP&E) Model, and a core part of how we’ve achieved our success over the last seven years. Throughout our team, we’ve adopted project-centric leadership to focus our efforts on what matters the most.

However, one thing I’ve learned in my 38-year career is that while you can manage your business through projects – you can’t treat your customers like projects.  Instead, it’s all about listening and learning from them, and building long-term relationships. We call this the “Voice of the Customer” and it’s the foundation of our business model and how we operate.  

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KEY STEPS

  • Identify your customer
  • Gather customer needs & relative value between them
  • Translate needs into metrics on how well we succeed
  • Communicate the needs, metrics, our performance across all functions in the value chain
  • Prioritize & respond through improvement work. Measure how well we are succeeding and identify adjustments needed.

 

Voice of the Customer: A Journey

A “Voice of the Customer” (VoC) business model doesn’t happen overnight. It’s more like a journey. And it’s not a day trip. It’s a multi-step, continuous improvement process that can take years. You need to dig in for the long haul and be willing to make disruptive changes in the day-to-day business operations that shift the focus entirely on the customer. Over time, when you do this right, it’s what builds trust and long lasting, profitable customer relationships. The model also helps us focus on doing the things (projects) that create the most value for our customers.

Investing in the team

To build an effective Voice of the Customer business model, it takes investment and it takes time. It’s not a light switch that you can simply turn on or off in your organization. It requires taking actions to shift the mindset of your people, help them to think differently, and to see the customer as the center of their everyday work and processes. This might sound easy – but it’s not. People are people. And most people don’t like change.  One way to approach this is to invest in your people to build skills that can deliver positive changes in your organization – the type of changes that can have positive impact for your customers.

Throughout the last seven years, we’ve invested heavily in our North American Construction team to embrace the VoC thinking to deliver what our customers want from their insurance company partner.  We’ve had onsite training, webinars, and presentations on everything from listening skills, consultative selling, relationship building and value proposition development to Myers-Briggs assessments. Together these collective activities have fostered customer-centric thinking and a customer-focused culture across our team.

Getting Started

Back in 2011, one of the first things we focused on was getting our people to act as Relationship Leaders. This means truly understanding the customer’s business from a broad perspective not a specific insurance product perspective.  It’s about challenging your people to think outside their “comfortable box”, and shift the thinking to solving customer problems. By adopting this Relationship Leader strategy and a supporting rel="noopener noreferrer" series of projects (called Rapid Results Initiatives)  we’ve been able to achieve huge cross-sell results, up to $100M each year in new business. All of these projects were data-driven. We used ‘heat maps’ to identify top opportunities and figured out how our entire team, including risk engineering and claims, could tackle them. This approach has allowed us to bring more expertise and value to our customers and to view their business in a holistic way.

Listen Up

The key to relationship building is effective communication and building trust. How you speak, how you interact in person, in email or text – it’s all important.  However, when it comes down to it, the most critical communication skill is listening – especially when you’re working with customers. No one likes anyone who talks too much or only talks about themselves or their product. It has to be balanced – a give and take. You have to actively listen to not only what your customers are saying with words, but what their body language is saying, and their tone of voice.  There’s a statistic that 90% of communication is non-verbal. This is critical to pick up on during all interactions with customers. It’s the stuff that can make or break business relationships. Over the years we’ve worked with expert communication firms, like Clear Communications, to train our entire team to become better at communicating and enhancing listening and presentation skills. We’ve used these skills to listen for opportunities and to make customer commitments. More importantly, we follow up on those promises by taking action. This is what builds trust in the relationship.

 

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...when it comes down to it, the most critical communication skill is listening – especially when you’re working with customers."

 

Make it RAIN

Another key area we invested in our team was with consultative selling training. In partnership with our HR team, we developed training based on the book, Rainmaking Conversations by Mike Schultz and John Doerr. The underlying principle is that all conversations can make or break everything in sales. Every conversation you have is an opportunity to find new prospects, win new customers and increase sales. And to optimize all customer conversations, the focus is on ‘making RAIN, using the framework “Rapport + Aspirations & Afflictions + Impact-->New Reality. 

It begins with building Rapport with customers through open, honest conversation. It’s about being a genuine human being, not a pushy salesperson. This happens through active listening. And by listening and asking the right questions, this is how we discover our customer’s “Aspirations and Afflictions” – or simply put – where the customer wants to go, and what problems they’re facing that are holding them back. Some of the ways we do this is asking the customer about their strategic plans. For example, where do they see themselves in 3 - 5 years?  What are the challenges and obstacles they identify for getting there? We also ask about the services they need from their insurance carrier partner and are they getting the attention they need right now.

Next, we help our customers understand the Impact” of their current aspirations and afflictions. If they’re aspiring to grow their business by 20% over the next three years, what happens if they don’t reach that strategic goal? On the other hand, if they’re facing an ongoing job site safety issue, what happens if this doesn’t get resolved? How will these problems/afflictions impact their bottom line?  This brings us to the “New Reality” conversation. We discuss how partnering with XL Catlin can work to resolve the challenges they’re facing and help them reach their strategic goals.

Flexing your Personal Style

We also recognized that to be successful in making ‘RAIN’, it can’t be a one-size-fits-all approach. Our customers and team members all have different personalities. Some are extroverts, some are introverts. With decision making, some people are big on deep analysis, while others go with their gut. And all of this needs to be incorporated into how we communicate.

Based on this, we invested in Myers–Briggs Type Indicator (MBTI) assessments for our entire team, along with some of our customers as part of our annual Customer Council meeting. The MBTI is an introspective, self-report questionnaire designed to indicate psychological preferences in how people perceive the world around them and make decisions. I have to say this was a fun exercise that allowed our team to better understand each other and most of all, better understand how this plays out with our customers. We discussed the importance of “flexing” your own personal style to adapt with customers. For example, if your customer is more of an introvert, you need to build rapport at a slower pace, giving more time and space. On the flip side, if you’re dealing with an extrovert, you need to bring your high energy and be ready for louder, faster conversation and talking things out.

Know your value. Flex your value.

Along with learning how to ‘flex’ our styles, we also focused on refining and flexing our value proposition. Every company has their “value story” that they like to tell. But it’s critical to make sure that your story resonates with your customers. Do they actually care about the things you’re telling them? We decided to test this out. In 2016, we focused our strategy update on evaluating our competitive advantage. We based our work on the book, Creating Competitive Advantage, and it became the foundation of our new value proposition, Join the Club”.  We used an ‘all-hands’ approach in developing the materials, gathering input and ideas from underwriting, operations, claims, risk engineering, HR, and finance.  By incorporating our entire team, we developed key messages focused on building partnerships and how our customer-centric approach differentiates us in the market place. And it wasn’t just fluffy words, we dug into the hard numbers and real proof points to back it up. For instance, we don’t say that we have a high client retention rate – we’ve done the analysis to prove that we have an overall 94% client retention ratio. And we don’t just say that we work with a lot of the biggest construction firms, we share the facts: we’ve insured over 2000 projects in the last five years, have had a 40% annual growth rate, and issue over 95% of policies and endorsements within 30 days.

Before rolling this out, we tested the new materials with our customers and brokers for feedback. We needed to make sure it resonated with the things that they value in a construction insurance partner. Also, this wasn’t a ‘set it and forget it’ approach. Our underwriters are now trained to ‘flex’ our construction value story – focusing on the differentiators that are most important to customers. We have asked our team to continue to share ongoing customer feedback and develop new/improved proof points to update our material.  We then incorporate all of this as part of our overall annual strategy update.

Feedback: The VoC Fuel

With projects being the “engine” of our VoC business model, customer feedback is the “fuel” that we use to keep driving us forward. Everyone on our team is charged with listening to the Voice of the Customer.  Each year we also have set opportunities to listen for customer feedback. It’s important to take advantage of every customer and broker interaction opportunity including industry conferences (AGC, CFMA, IRMI), our Key City events, customers meetings, claims reviews, and risk engineering sessions, and our annual Customer Council meeting.

Team members collect this feedback from customers and brokers and feed it to our Construction leadership team through both regular team meetings and 1:1 discussions. We share the feedback information at monthly Construction staff meetings, to incorporate into our review of the ongoing Operational Plan. We also discuss any new ideas or innovations that can be considered and prioritized against the current portfolio of projects. This way we’re continuously improving based on what we hear and we’re able to focus our innovation efforts  based on what our customers are telling us. 

What we’ve learned

With a feedback loop as the foundation of our business model, we’ve learned a lot and we keep learning every day. Several of the challenges clients are facing are ones we’ve been talking about with them. Some of the challenges are around talent – from the aging workforce and brain drain issue to how to attract/retain millennials in the construction industry. Other key issues are on managing the risks with a bilingual workforce and the consequences of the national opioid epidemic. Lastly, we’re hearing a lot about the impact of new technologies in the industry and how contractors need to adapt. From incorporating artificial intelligence to drones, it’s all changing fast. As partners, we listen and we learn from our customers, and then roll up our sleeves to develop the right insurance solutions or services that can respond to these challenges.

Looking ahead: Keep Listening & Learning

As we head into 2018, we continue to look for new ways to gather feedback. One project we just rolled out is around capturing the data around “why we win”. It’s a simple, low tech solution. We pick up the phone and call our brokers and customers following every win. It’s an easy way to say ‘thank you’ for the business, and it’s an easy way to capture this information. We’re compiling this input and will conduct an analysis after several months to identify trends. We’ll dig in to see if there are gaps and see what we can do better. It’s all about Voice of the Customer feedback – the ultimate fuel for our business success.

Have you adopted a Voice of the Customer business model at your company? How’s it going? VoC is all about listening and learning and I’d really like to hear from you. Seriously, I mean it. Send me your thoughts at email: gary.kaplan@xlcatlin.com

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About the Author

Gary Kaplan is president of XL Catlin’s North America Construction business.

 

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