Last month, I attended NAHB’s midyear meeting in Miami and had the pleasure of sitting in on a presentation by Daniel Swift, president and CEO of Des Moines-based architecture group BSB Design.
Customer satisfaction: The ultimate team game in home building
In home building, the team counts on the performance of each individual to deliver the “big win,” which is a happy customer.
Customer satisfaction: The ultimate team game in home building
Team sports analogies have long been used in home building, due to the obvious correlations. They have a common component: individual performances that roll up into team results. Home building is probably the ultimate team endeavor, made up of internal employees and external trade partners that can number in the thousands.
Most sports fans know the high-level team facts — like that the University of Kentucky won the 2012 NCAA Basketball Championship. What many fans may not know is the individual performance indicators of the team’s individual players. For example, did you know that in the closing minutes of the championship game, UK’s coaching staff played only their best individual free throw shooters? That’s right, they used their best individual shooters, based on their measured performance, to assure a team success.
All team sports have individual performance measurements — quarterback rating, sacks, 40-yard dash time, yards per carry, batting average, pitch speed, to name a few. These are all measurements of individual performance and accountability that ultimately lead to team success.
Home building is no different. All individual teammates have one element in common — the customer. The team counts on the performance of each individual teammate to deliver the “big win,” which is a happy customer. Unfortunately, many home-building companies lack an objective voice of the customer (VoC) program, with the key performance indicators (KPI) necessary to 1) identify performance/behavior issues, 2) give good training/coaching, and 3) hold staff accountable.
Let’s look at some of the most important VoC KPI by the individual roles in home building:
8 steps for best team results
1. Implement a comprehensive and objective voice of the customer (VoC) program
2. Identify the team and key performance indicators (KPI) that most correlate to customer satisfaction and referral sales
3. Assign accountability for each KPI and provide the staff with regular feedback on both the good ratings and opportunities for improvement
4. Share all KPI (by function, community, and individual) with the entire team
5. Benchmark results against the industry’s top performers and celebrate any “all star” performances
6. Consider a third party to implement a credible VoC program to give customers the anonymity necessary for honest constructive criticism
7. Expect a return on customer satisfaction, and treat the database of enthused customers as an asset for future referral sales
8. Phase in strategies to increase customer satisfaction and referral sales rates
Key Performance Indicators (KPI)
Accurately represent the builder, product, and processes
• Educate the customer on included versus optional features
• Teach and shepherd the customer through the process
• Handle customer communications and “check in” throughout the entire home-building/homeownership experience
Identify the customer’s purchasing capacity
• Match a mortgage program with the customer’s needs
• Advance disclosure of fees, charges, escrows, taxes, HOA, insurance, etc.
• Handle customer communications throughout the mortgage approval process
Educate the customer on optional features
• Help the customer personalize their home (products, colors, etc.)
• Set selections’ performance expectations (carpet levels, paint, wood floors, etc.)
• Assure selections are accurately documented
Schedule updates and key activity education (construction start, framing, pre-drywall, flooring, etc.)
• Have knowledge of the builder’s quality assurance program and practices
• Set expectations on customer interaction and question response
• Schedule updates on construction progress and delivery dates
• Deliver a clean, complete home with no “open items” at occupancy
Educate the customer on the operations, functions, and features of the home
• Provide home maintenance education, tips, and post-occupancy confidence
• Explain the warranty process, performance standards, and expected response times
• Take ownership of all warranty items (including trade partner issues)
• If something needs fixing, fix it fast and thoroughly — no repeat trips.
All of the above items should be accurately taught, measured, and regularly reviewed both individually and as a team. In team sports, the performance numbers are known by all. This should be the case in home building as well, including trade contractor performance. These numbers help home-building managers know their individual team players’ strengths, weaknesses, and performance from the most credible source — the customer.
Securing accurate, complete, and honest customer feedback is both critical and tricky. It is highly recommended that builders use a third party to implement a comprehensive VoC program. In addition to the 17 KPI listed above, a comprehensive VoC initiative usually includes 50 to 60 additional KPI covering all company roles, duties, and behaviors in the customer experience.
A good VoC program should also allow the customer to provide comments and explanations — with the option of remaining anonymous — to get the most trustworthy and truthful customer ratings and comments. Surveys that do not allow for anonymity are the worst kind of feedback; they typically cause 30 to 40 percent of the customers to give complacent, non-helpful feedback (i.e., “everything was fine”). As is true in all aspects of home building, managing with inaccurate information is often worse than managing with no information at all. Another benefit to using a third-party source is interpreting the data and providing performance benchmarks of “detrimental,” “acceptable,” and “exceptional” performance.
The purpose of the VoC program is quite simply to get objective, performance-based measurements to help managers improve their individual employees’ performance for the betterment and benefit of the overall team and customer. Using customer feedback to coach your team to high levels of individual performance rolls up into increased customer satisfaction, higher referral sales, lower warranty costs, improved employee morale, and increased builder brand equity, which are almost as good as a national championship.
Charlie Scott is a principal at Woodland, O’Brien and Scott, a customer satisfaction research and consulting firm that specializes in voice of the customer programs, customer handling/communications, operational excellence, and harvesting referral sales. He can be reached at firstname.lastname@example.org.