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Ultimate question, basic principles July 21, 2007

Posted by Steve Field in The Ultimate Question.
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Although last week I said I liked the premise of The Ultimate Question, I found the more I read the book, the less I enjoyed it. The second half of the book was fluffy, so even though the concept of judging good profits by the happiness of customers and their willingness to be brand ambassadors, the way that Reichheld suggests that companies become customer-focused is a bit shallow.

The recommendations Reichheld gives for for building a company that is devoted to good profits are common sense business 101. He offers tips such as:

  • Hire and fire to inspire
  • Pay well
  • Invest in training your employees
  • And others

Nothing here is revolutionary. Each of these principles is about respecting your employees, and there is a wide body of literature existing that suggests that happy employees are effective employees and effective employees create happy customers. This is more common sense that innovative thinking. All that Reichheld is doing in his discussion about internal business structures is packaging an old concept in a new way.

Second, I found his methodology for how one calculates the NPS left me wanting. I agree that sticking to the Ultimate Question and that alone is a good way to garner accurate information from customers, but the actual metrics he prescribes are old hat — a scale of 0 to 10? A 3-point scale or a 5-point scale? Again, nothing here is new. Furthermore, if the 0-10 scale is used, as he seems to endorse, he doesn’t provide any concrete standards to apply to each number. This means that the results are inherently tied to the subjective interpretations of the respondents, which makes the data less reliable.

I’m not a complete detractor for Reichheld’s thinking. I just wish that his points were a little more original and a little more thorough.

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Comments»

1. lpunzy - July 21, 2007

I agree with your assessment, Steve. There wasn’t anything Reichheld presented that really blew me away. Yes, businesses should run their operations by The Golden Rule. Yes, it makes sense to treat employees with respect and gratitude. Yes, companies should try to eliminate bad profits from their balance sheets. If anything, The Ultimate Question was a good reminder – a run down of best practices that are often abandoned in the business world.

The biggest thing I struggled with throughout this book was applying the concepts to what folks might encounter in the communications field. For instance, how do bad profits affect public relations firms? That’s the subject I tackled in my latest post – Bad Partnerships Equal Bad Profits (http://lpunzy.wordpress.com/).

2. Larry Freed - October 2, 2007

Let me take it even a little further. The concept of the power of word of mouth is good. The importance of customer centric metrics cannot be overstated. However, the ultimate question is the ultimate joke. No accuracy, no precision and misleading. Check out the details at http://www.freedyourmind.com/?p=53 and http://www.customerthink.com/system/files/netpromoter_serious_flaws_tarnish_simple_idea.pdf.

Did you know that in the book the biggest case study, Enterprise Rental Car does not even ask the ultimate question? http://www.freedyourmind.com/?p=24.

Sorry for all the links, but it is easier then retyping!

3. Maximus - December 20, 2007

I would like to see a continuation of the topic


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