It’s Hard to Please Europeans

It’s Hard to Please Europeans

Back to one of my pet topics: What is a ‘Good’ Net Promoter Score? 

More specifically, what’s a good Net Promoter Score score for a sports team? OK, I know NPS wasn’t designed as a sporting metric but bear with me as I try to illustrate a point about how Net Promoter Score works and how NPS scores are almost always significantly lower than most people think they should be.

I first looked at NPS for sports teams way back in 2020. That year, Liverpool won the Premiership for the first and only time and did so with a Net Promoter Score of -45, based on the player ratings of the Liverpool team.

To illustrate the point this time, let’s look at the performances of two great rugby teams that battled it out in their opening match of the 2025 Six Nations rugby tournament at Dublin’s Aviva Stadium last weekend: England and Ireland.

The Irish were favourites to win. It was a home game for the 2023 and 2024 Six Nations champions, who are currently ranked #2 in the world behind South Africa. England are ranked #7 in the world – a placing they were desperate to improve upon after a poor run of form in recent years.


How did England score in NPS terms?

Based on last weekend’s performance, Steve Borthwick’s England team has a Net Promoter Score of -60

That’s not my view. It’s based on the player ratings for the starting 15, as compiled by The Guardian’s Luke McLaughlin following their 27-22 defeat to Ireland.

Now here’s the thing. Luke is not being particularly harsh. Most English – or European – sports commentators adopt a similar approach to rating player performances. 

It’s not that England were dreadful last weekend. They come strongly out of the starting blocks. Cadan Murley scored the opening try on his debut after only 10 minutes. The Irish struggled to keep England at bay and England led by 10 points to Ireland’s five at half time.

The second half was a different affair, with some commentators claiming it was one of the best 40 minutes that Ireland had played in many a year. The game was over as a contest well before the final whistle was blown. Ireland were 27-10 ahead with five minutes to go. Then England scored a couple of late tries to put a more respectable gloss on the scoreline.  

NET PROMOTER SCORE

A quick recap on the NPS scoring system: Scores range from 0 to 10. 9s and 10s are Promoters. 7s and 8s are Passives. 6s and below are Detractors. The Net Promoter Score itself is the percentage of Promoters minus the percentage of Detractors. It ranges from -100 (all Detractors) to +100 (all Promoters).

Have a look at Luke McLaughlin’s player scores for England’s starting 15 in the Box below. 0% Promoters; 40% Passives; 60% Detractors. That’s how England’s -60 NPS result is calculated: 0% – 60% = -60.

The highest-scoring English players were Ollie Lawrence and Tom Curry. Both scored 8/10. In Net Promoter Score terms, not a single English player got into ‘Promoter’ territory. But that’s not how Luke’s player summaries read. He’s actually quite praiseworthy towards many of them. It’s just how us Europeans score. It’s a cultural thing.

ENGLAND PLAYER RATINGS

Freddie Steward Solid but unthreatening. He won some important aerial battles, but England’s lack of attacking spark was notable. 6

Tommy Freeman Crossed for a late try to earn a losing bonus point. Did his best with little service: England’s attack never consistently fired. 6

Ollie Lawrence Muscular carry led to the opening score and always looked a threat – extremely strong on both sides of the ball. 8

Henry Slade Classy touches all over the place in first half. Exquisite grubber to create early try for Murley a reminder of his enduring ability. 7

Cadan Murley Quickly snaffled a try on debut, but later invited pressure on teammates twice with a serious lack of composure in defence. 5

Marcus Smith Bright and breezy as usual, but not always as effective as he needs to be. Does he maximise the talents of his backline? 6

Alex Mitchell Decent kicking from hand, but fell off a tackle against James Lowe after England had worked so hard to keep the hosts out. 6

Ellis Genge Played a part in a big forward effort. Carried with purpose and added weight in defence but gave away key scrum penalty. 6

Luke Cowan-Dickie Another England forward who performed admirably in the first half, but the pack collectively ran out of steam after the break. 6

Will Stuart Unspectacular around the field but did his bit defensively and performed his scrummaging duties competently. 6

Maro Itoje Communicated well with the referee, at least early on, and brought his usual physicality but his influence waned. 6

George Martin Mostly invisible but only because he was mostly doing the dirty work where it counted. Another quality day’s graft. 7

Tom Curry Sensational turnovers seemed to justify Steve Borthwick’s back-row plans. Rarely gave his opponents time to settle. 8

Ben Curry Just like his brother, did not deserve to end up on the losing side. Hurried Ireland up at the breakdown but limited in attack. 7

Ben Earl A quality display overall. Punishing in attack and defence, ran a perfect line to capitalise on a fizzing pass from Smith. 7


The Irish performance: NPS = +7

It was an epic victory for Ireland and that second half performance was sublime. Tries from Bundee Aki, Tadhg Beirne and Dan Sheehan put the game out of England’s reach well before the end. So what was Ireland’s Net Promoter Score? Remember the maximum score is +100 so surely Ireland’s performance deserved a score of +50 or higher?

Actually, Ireland‘s NPS was a mere +7 out of 100.

So how can that be? How does a team that blew away the English in the second half only manage to get a net promoter score that’s only slightly above zero.

The answer is pretty simple. Net Promoter is an American scoring system that rates advocacy on a 0 to 10 scale and only recognises scores of 9 or 10 as excellent. Americans tend to score more positively than Europeans. Europeans – particularly northern Europeans –  are particularly tough in the way they score. 9s and 10s are generally reserved for extra-special performances.

As I said, it’s a cultural thing.

Look at the player performance ratings below. Only one player, James Lowe, scored 9 out of 10 and he was the Man Of The Match according to Luke McLaughlin. Everybody else on the Irish team scored 7 or 8. In other words, 14 of Ireland’s 15 players are ‘Passives’. Their scores don’t count in the NPS calculation. No player was rated 6 or below so zero ‘Detractors’ in the Irish team.

Overall Irish NPS = 7% – 0% = +7.

IRISH PLAYER RATINGS

Hugo Keenan Exceptional covering tackle on Tommy Freeman in the first half, and joined in the attack with intelligent support lines as usual. 8

Mack Hansen Big hit on Cadan Murley in the opening seconds was impressive and he bounced back well from an early injury. 7

Garry Ringrose Kept a little quiet overall by the dynamism of England’s defence but as always a key cog in the champions’ machine. 7

Bundee Aki Quiet by his standards until a fantastic second-half finish after being fed by Prendergast, crashing past three defenders. 8

James Lowe Rock solid under an early high ball. Muscled through Mitchell to create hosts’ first try and also created key score for Beirne. 9 (man of the match)

Sam Prendergast A mixed bag. Endured a difficult first quarter but grew into the game. Missed conversions looked like they might be costly. 7

Jamison Gibson-Park A model of consistency – popped up on Lowe’s shoulder to get Ireland off the mark and typically effective elsewhere. 8

Andrew Porter Scrummaged well and is always an intimidating physical presence in the loose. Played his part in the second-half surge. 8

Rónan Kelleher Lineout functioned smoothly despite some recent concerns about the Irish set piece. Snuck over for a disallowed try. 8

Finlay Bealham Competed well in the scrum, winning a penalty from Ellis Genge, and contributed to the attack with his usual quality. 7

James Ryan The lineout went well and like the rest of the pack it was largely a different, better story for the lock after half-time. 7

Tadhg Beirne Cynical holding of Maro Itoje at a ruck led to a disallowed score. Always a massive presence and took his late try with aplomb. 8

Ryan Baird One strong carry in the first half that led to Marcus Smith’s yellow card. Grew into the match after the break like the others. 7

Josh van der Flier Slick hands, strong carrying and crushing defence. The back row is one of Ireland’s most consistent performers. 8

Caelan Doris Perhaps upstaged by the Curry twins in the early part of the game but grew into it along with the rest of his teammates. 7


The average B2B Net Promoter Score in Europe is not much above zero

Let’s get back to my main point here.

Many B2B companies claim very high Net Promoter Scores. +50. Maybe +70. Maybe higher. The reality is quite different. We have been measuring NPS for B2B companies for over 20 years and based on our database of results, we can confidentially say that an average NPS result for a Northern European B2B company is barely above zero.

Close to half of all European B2B companies will have negative NPS scores. Rarely will they score greater than +50. That’s a truly exceptional performance.

So if you’re about to measure your NPS performance in 2025, don’t set your expectations too high. And don’t believe everything you read on the Internet!


UPDATE (9 FEB 2025): Ireland score another 7 NPS points against Scotland

Week 2 of the Six Nations championship saw Ireland travel to Murrayfield in Scotland, while England hosted France at Twickenham.

The Irish stormed to a 32-18 victory after Scotland lost a couple of players early on (including their mercurial captain Finn Russell) following a nasty clash of heads. The English stormed back to a rousing 26-25 victory over Les Bleus with a last-minute try in what was an extraordinary match.

The NPS scores told a different story.

Ireland repeated its +7 performance when Jamison Gibson-Park received a 9/10 player rating from Johnny Watterson at the Irish Times. (The Guardian failed to provide ratings for me to share!). Every other Irish player was rated 7/10 or 8/10 and as we now know, ‘Passive’ scores don’t count in the net promoter score calculation. One ‘Promoter’ of of 15 = 7% hence the +7 NPS score for Ireland.

Gerard Meagher from the Guardian did provide player ratings for both England and France. England had three ‘Detractors’ (Marcus Smith, Luke Cowan-Dickie and George Martin), nine ‘Passives’ and three ‘Promoters’ (Fin Smith, Tom Curry and Ben Earl all received 9/10 player ratings) so the overall England NPS score was exactly zero, as the number of ‘Promoters’ equalled the number of ‘Detractors’.

The French, on the other hand, ended up with a -80 NPS performance. 12 out of the starting 15 received player ratings of 6/10 or less (‘Detractors’) and there were three ‘Passives’ and zero ‘Promoters’. Even the dazzling Louis Bielle-Biarrey could only manage a 7/10 player rating.  With 80% of the team identified as ‘Detractors’ and zero ‘Promoters’, France’s NPS score was -80.

Europeans are genuinely very hard to please!

“Excellence in CX” Awards 2024 – That’s a Wrap!

“Excellence in CX” Awards 2024 – That’s a Wrap!


 

Congratulations to our 2024 Winners

2024 is the third year of Deep-Insight “Excellence in CX” Awards.

These awards focus on companies that we have worked with in 2024 that have embraced our Customer Relationship Quality (CRQ) framework and methodology to make meaningful change for both their customers and their employees.

That makes us very proud!

Before we talk about the winners, let’s answer the following question:

 

What do we mean by ‘Excellence in CX’?

Deep-Insight is a small team of Customer Experience (CX) consultants who work extremely closely with our customers. The single question which drives us in each engagement is “will this programme inspire transformation in our client organisations?”.

Transformation does not need to be, and usually isn’t, a huge significant event in itself. When done well, transformation is a series of small, well thought through changes and improvements. Transformation is only worth it if it leads to growth, and it always does when it is inspired by the customer.

Also, we are not interested in vanity projects! We are focused on our core mission of Inspiring Transformation i.e. effective, growth-oriented use of Customer Experience (CX) and Employee Experience (EX). This is what excellence in customer experience looks like and it is the foundation on which our customers build their CX and EX programmes.

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AND THE 2024 WINNERS ARE…

 

Six Degrees has been a client of ours since 2020 and it has been a privilege to work with the team for the past four years on their journey to greater customer centricity.

Fiona Lynch has been the Deep-Insight CX consultant working most closely with Chris BlofieldConley Newall and the Six Degrees team to improve their Customer Relationship Quality (CRQ) scores this year.

Fiona has been hugely impressed by the strategic response from the leadership team, starting with their commitment to ‘Customer First’, a core value to place the client at the heart of organisation. Fiona adds:

“The response from Six Degrees right across the organisation to last year’s CRQ assessment was incredibly well executed and their jump in scores really reflects their efforts. We’re delighted for them.”

Six Degrees appointed Vince DeLuca as Chief Executive Officer in 2024 as it sought to distinguish itself as the UK’s leading provider of secure, integrated cloud services. Vince commented on this year’s award:

We’re incredibly proud to be recognised for our commitment to our core value of ‘Customer First.’ At Six Degrees, actively listening to and acting on our customers’ insights is fundamental to driving meaningful change and delivering exceptional outcomes.

This recognition reflects the dedication and hard work of our entire team over the past year. With the continued support of Deep-Insight, we are excited to carry this momentum forward into the year ahead.”

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Everybody in Ireland knows open eir.  You’ve seen their distinctive green and white “Connecting Ireland with superfast fibre broadband” vans on the streets, installing fibre lines into business premises and into homes across the country.

You’ve probably also seen vans from Circet (pronounced “sur-say”) who are open eir’s key partner on the ground. We have to mention them in this award as they are an integral part of the open eir teams who operate at the coalface and meet customers on a daily basis.

2024 was our second year working with open eir. What impressed me the most about their approach to implementing a Customer Relationship Quality (CRQ) programme was the extent to which they embraced the whole CRQ approach – taking the feedback at face value, closing the loop with the customers, putting in detailed (in fact, very detailed!) responses to all of the feedback, and kicking off a transformation programme that they are committed to for the long haul. They know it’s not a 12-month initiative. It’s a journey.

Una StaffordManaging Director Networks, and Maeve O’MalleyManaging Director, Wholesale, have been leading the charge on open eir’s CX transformation journey over the past two years. 

Both Una and Maeve are industry veterans who understand the challenges of a cultural transformation in large complex telecommunications environments. However, their real skill has been to convince hundreds of people in both open eir and Circet to embrace Customer Relationship Quality (CRQ) as a way of life.

*        *        *        *        *

Vreugdenhil Dairy Foods conducted its first Customer Relationship Quality (CRQ) assessment in 2022, impressing us with their smooth adoption of the CRQ process, as if it had been a long-standing practice. What stood out most was their commitment from the outset. They dived into the process with enthusiasm and maintained a strong momentum throughout all the phases of the CRQ process.

In 2022, strong client relationships were identified as a key strength. Determined to build on this foundation, Vreugdenhil developed an internal training programme for all colleagues who have contact with customers, to enhance their client communication skills. They employed a variety of creative formats like interactive training sessions customised for different departments. These ‘customer contact training’ sessions emphasized proactive client engagement and addressed the nuances of dealing with different customer types.

Leonie Soetendaal is a Commercial Project Manager who has been working at Vreugdenhil Dairy Foods for nearly 10 years.

Together with Commercial Director Gerben van Schaik, and colleagues Jeroen de Kunder and Erik Bulthuis, Leonie has been the driving force behind Vreugdenhil’s CX journey since 2022.

Leonie commented on this year’s award:

At Vreugdenhil Dairy Foods, we believe in the power of connection and lasting relationships. This award is a wonderful recognition of our commitment to open and meaningful communication with our customers. Together with our partners, we make a difference!”

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We have been privileged at Deep-Insight to work with BT Ireland since 2008 when they first started on their journey towards becoming one of Ireland’s most customer-centric companies

It has been a long and successful Customer Relationship Quality (CRQ) journey for them. Initially, the BT Ireland leadership team worked hard on identifying and addressing its clients’ major service issues. Then they progressed to the more enjoyable part of the journey – collaborating with clients on new innovative technology-based programmes.

In recent years, the BT Ireland leadership team  took a more commercial focus to CRQ. They used detailed customer insight, along with externally validated propensity to buy, to identify clients where they could develop further solutions to their business problems.

BT Ireland discovered that the excellent relationships they had built over years was critical to driving revenue growth with clients that continued to be delighted by their offerings. Not an easy task in an industry where, every year, customers expect better telecommunications solutions for less cost.

The BT Ireland leadership team were helped by an army of service managers, account directors and engineers. They were also guided by a CX team led by Barry O’SheaMary McDonagh and Deirdre Tyrrell whose great CX efforts have been recognised globally in recent years. Shay Walsh, Managing Director, BT Ireland (left) commented on the Deep-Insight award:

“We are absolutely thrilled to be recognised in the category of ‘Using CRQ for Growth’. Working with the team in Deep-Insight we challenged ourselves collectively to convert our top quartile CRQ scores to income growth. This brought a focus on widening our contacts base within our client base and creating a watch list of customers who needed more focus from our customer-facing teams. The additional insight and broader awareness informed how better to serve our customers and ultimately how we achieve the dividend of growth from CRQ.”

open eir wins the “Embracing CRQ” Award for 2024

open eir wins the “Embracing CRQ” Award for 2024

Everybody in Ireland knows open eir.  You’ve seen their distinctive green and white “Connecting Ireland with superfast fibre broadband” vans on the streets, installing fibre lines into business premises and into homes across the country.

You’ve probably also seen vans from Circet (pronounced “sur-say”) who are open eir’s key partner on the ground. We have to mention them in this award as they are an integral part of the open eir teams who operate at the coalface and meet customers on a daily basis.

2024 was our second year working with open eir. What impressed me the most about their approach to implementing a Customer Relationship Quality (CRQ) programme was the extent to which they embraced the whole CRQ approach – taking the feedback at face value, closing the loop with the customers, putting in detailed (in fact, very detailed!) responses to all of the feedback, and kicking off a transformation programme that they are committed to for the long haul. They know it’s not a 12-month initiative. It’s a journey.

Some of the specific actions that open eir took in 2024 included:

  • Improvements to the appointments process, and planned upgrades to their Unified Gateway (UG) system;
  • Implementation of new quality processes in partnership with Circet;
  • New CX roles created; 
  • Reviewing processes and systems to understand where automation could be implemented to free up time to devote to client-facing activities.

Our Deep-Insight CX Consultant managing the open eir relationship is Kate Casey. She knows the team intimately and had this to say: 

“Following last year’s results, the entire open eir team – from the leadership team down to Customer Service Managers (CSMs) and networks engineers – jumped in and took decisive action. No messing around with these guys! They have managed to figure out how to embed customer centricity into every aspect of their daily operations. Their commitment to embracing change and prioritising customer-focused principles has been exceptional.

What was fantastic was seeing such impressive improvements in their CRQ scores this year. That’s proof of just how deeply these values have become embedded into open eir. This award is a recognition of their hard work and commitment to making a meaningful difference for their customers.”

I fully agree with Kate. On a personal note, it has been both a pleasure and an honour working with the open eir team over the past couple of years. I’m absolutely delighted to see them win the “Embracing CRQ” award this year. It was thoroughly deserved.

John O’Connor

Una Stafford, Managing Director Networks, and Maeve O’Malley, Managing Director, Wholesale, have been leading the charge on open eir’s CX transformation journey over the past two years. 

Both Una and Maeve are industry veterans who understand the challenges of a cultural transformation in large complex telecommunications environments. However, their real skill has been to convince hundreds of people in both open eir and Circet to embrace Customer Relationship Quality (CRQ) as a way of life.

In accepting the award, Maeve O’Malley has this to say:

“Working with Deep-Insight has given us the quantitative data we need to understand the areas we need to work on, to improve our operators’ experience with open eir. The findings from last year created the foundation for our 2024 plan and this year’s assessment is now helping us understand what’s working and where we still have gaps.

“The data has also helped galvanise our teams with a shared understanding of the transformation required.  The insight from the team has added huge value, not only in helping us understand the challenge ahead but also supporting us in developing and prioritising our plans.”

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About open eir

At open eir, we’re building Ireland’s fastest-growing full fibre network. Our network reaches far and wide, transforming the way individuals, businesses, and communities experience the digital world. With over 1.3 million homes and businesses across 26 counties now able to access faster speeds through any one of our 29 trusted retail service providers, we are the architects of a brighter, more connected future for Ireland.

Find out more about open eir at www.openeir.ie.

About Deep-Insight

Deep-Insight is a leading European B2B Customer Experience (CX) company founded in 2000 by a small team of ‘magicians’ with one goal: researching a way to read customers’ minds. Today, Deep-Insight supports customers all over the world with the skills, tools and methodologies to establish and operate world-class Customer Experience (CX) and Employee Experience (EX) programmes.

For more information, go to deep-insight.com or email us at sales@deep-insight.com.

 

 

“Excellence in CX” Awards 2024

“Excellence in CX” Awards 2024

It’s that time of the year again!

At Deep-Insight, we have the privilege of partnering with some amazing organisations who work hard to ensure that their customers – and employees – have their voices heard loudly.

Good companies use the Voice of the Customer to drive strategy across all areas of their business. We are proud to work with customers who align with our mission to ‘Inspire Transformation’ based on open and honest feedback from customers. That is what our Customer Relationship Quality (CRQ) framework and methodology is designed for.

With these awards, we want to showcase some of the great CX work that we have seen in 2024.


4 Award Categories in 2024

Each year, we ask our Deep-Insight CX consultants to reflect on the ordinary and extraordinary things that their clients have done over the previous 12 months. We ask them to nominate any client that has taken a different or unique approach, or that has simply done the basics customer experience tasks really, really well.

We then have a series of discussions to decide what awards should be given, and which clients should be nominated for those awards.

This year, we have decided to make four awards in the following categories:

 Using CRQ for Growth

 

The layers of CX maturity are many and varied. As with any methodology, the value from CRQ is only as effective as the teams who use it. The most mature organisations not only use CRQ to inform strategic decisions. They also use it as an integral sales tool to validate, support and drive revenue growth.

Best CRQ Response

 

When customers share their views with you, they expect you to respond. The surprising this is that the leadership teams in many companies struggle to respond effectively. A good response requires decisive action and an ‘execution’ mindset to follow through with decisive strategic decisions.

Embracing CRQ

 

Many people view customer experience as a set of tasks: customer journeys, mapping, surveys. Steps in an overall programme. Few companies embrace it as a way of life. It’s not easy, and requires leadership. Companies that  embrace CX invariably receive strong recognition – and more business – from their customers.

Best CRQ Comms

 

Customer Relationship Quality (CRQ) is not just about sending out surveys. It requires active involvement from customers, and it needs all employees in a company to embrace it wholeheartedly.  Communications – both internal and external – are key to a successful CX programme.

In the second week of December, we will announce the winners, just in time for Christmas.

We can’t wait!


A Reminder of Last Year's Winners

open eir wins Best CRQ Newcomer 2023 award

open eir was awarded Best CRQ Newcomer in the Deep-Insight Excellence in CX Awards for 2023. 

Insight won the award for Best CRQ Engagement last year. They contacted 203 key decision makers, influencers and operational contacts across their strategic clients in Europe. 100 of the 203 responded – a whopping 49% engagement rate. 

DWF, a long-standing customer of ours, has been awarded Best CRQ Score with a a CRQ score of 6.0 (as well as a Net Promoter Score of +62).

Pelican Self Storage was awarded the Best Focus on ERQ prize for its ongoing commitment to Employee Relationship Quality (ERQ), the sister methodology to CRQ.

 

Avoiding the CX Rat Trap

Avoiding the CX Rat Trap

Goodhart's Law


A story of rats, cobras and economists

This is a story about rats, cobras and economists (and no, they’re not the same thing!) but it’s primarily a blog about a British economist called Charles Goodhart and his take on target setting, key performance indicators (KPIs) and the law of unintended consequences.

Goodhart is a man whose musings are worth reading if you’re struggling to make your customer experience (CX) programme work. All CX programmes involve the measurement of customer satisfaction (CSat), Net Promoter Score (NPS) or similar KPI. Companies will sometimes incentivise their employees to achieve a particular CX objective: “If we hit our NPS target of +50 this year, all sales staff get an additional bonus of £1,000.” This is not an uncommon practice. It’s also not a good one, as we are going to find out shortly.

Charles Goodhart is best known for Goodhart’s Law, which is neatly summarised in the Sketchplanations cartoon above. Setting targets can result in unintended consequences, particularly where incentives are involved.

Before we delve into Goodhart and his famous law, let’s start with a couple of stories about rats and cobras.

The Great Hanoi Rat Hunt

In 1902, the French ruled Indochina, a region in South East Asia comprised of modern-day Cambodia, Laos and Vietnam. The capital and administrative centre was Hanoi.

That year, the French administrators introduced a bounty on rats after it was discovered that rats played a significant role in transmitting the plague. The Third Plague Pandemic was a pretty serious issue in Asia at the time. It had spread from China in the late nineteenth century and by the time it was finally eradicated in the 1960s, more than 10 million people had died from the plague.

A bounty seemed to make sense. To claim it, the locals simply had to bring in a bag of rat tails. There was no need for piles of dead rats clogging up the corridors of power in Hanoi – tails would suffice. Within weeks, the bounty was working. Hundreds of rat tails poured in. Then thousands. It seemed too good to be true, and so it turned out to be.

It didn’t take long for French officials to figure out what was happening. The bounty had created an entirely new industry in Hanoi where rodent tails were brought into the capital from the countryside. Worse still, entrepreneurs in Hanoi started to breed rats in order to increase their bounty revenues. The number of rats in Hanoi was increasing, rather than decreasing.

Eventually, the bounty was discontinued. This story of administrative failure and unintended consequences is told in Michael Vann’s book The Great Hanoi Rat Hunt.


The Cobra Effect

It’s not just the French who were outwitted by their colonial subjects. A similar case happened under British rule in India, and documented in Horst Siebert’s book Der Kobra-Effekt.

At the same time that the French were grappling with a rat epidemic in Hanoi, the British were dealing with a cobra explosion in India. Cobras were viewed by the British administrators as deadly pests and a bounty was introduced in Delhi for every dead cobra handed in to the authorities. Many cobras were killed and handed in but, to the bemusement of the British rulers, the cobra population seemed to be on the rise.

It’s the same story of simple economics: the cost of breeding a cobra was significantly lower than the bounty, so entrepreneurs started to breed cobras. When the bounty was stopped, the breeders released the remaining cobras into the wild, further exacerbating the situation.


Goodhart's Law

Charles Goodhart is a British economist. He was born in 1936 and spent nearly 20 years of his career at the Bank of England, working on and writing about public and financial policy. In 1975, he wrote a paper containing the line: “whenever a government seeks to rely on a previously observed statistical regularity for control purposes, that regularity will collapse.”

The comment was specifically about monetary policy but would later be generalised as a law about targets, metrics and key performance indicators (KPIs). In 1997, the anthropologist Marilyn Strathern expressed Goodhart’s Law as follows when she was investigating grade inflation in university examinations:

When a measure becomes a target, it ceases to be a good measure. The more a 2.1 examination performance becomes an expectation, the poorer it becomes as a discriminator of individual performances. Targets that seem measurable become enticing tools for improvement.

Marilyn Strathern’s interpretation that has become the most widely used today.

When a measure becomes a target, it ceases to be a good measure

The basic message from Goodhart’s Law is a simple one: beware the law of unintended consequences when you set targets for people to achieve.

This is equally true when companies set targets in the field of customer experience (CX). If senior leadership teams incentivise their sales people and account managers to hit Net Promoter Score (NPS) targets, they will be achieved come hell or high water. In a previous blog, I outlined how CX programmes are often ‘gamed’ to achieve ridiculously high NPS targets which bear no relationship to the company’s actual performance. Common actions taken to game the CX system include:

  • Selecting only those clients who are Ambassadors for you and your product or service, when you are looking for customer feedback
  • Within those clients, selecting only those individuals who you know will score you 9/10 or 10/10 (these are ‘Promoters’ in NPS terminology)
  • Making sure to deselect any client that is likely to give you a poor score, using excuses like: “Now is not the right time to ask their views” or “We’ll only antagonise them if we approach them now”
  • Refusing to send a survey to anybody who doesn’t know you really well, even if it’s a senior decision maker that you’d love to have a conversation with. Why? The chances of them scoring you 9 or 10 are slim
  • Not outsourcing the NPS survey process to a third party that can give the option of confidentiality to survey participants – confidential surveys are likely to elicit lower scores even if they provide a much more realistic and honest view of your product or service

In many cases, employees and leadership teams are unaware that they are gaming the system. They simply believe that they are doing the right thing for the company.


Avoiding the CX Rat Trap - 5 Rules

Rule No. 1: Do not incentivise employees to achieve CX targets. It’s that simple. If you do, you’ll end up with more rats and cobras than you can handle.

Rule No. 2: If your Senior Leadership Team or Board is bonused on achieving NPS results, stop this practice immediately! You would be amazed at the number of companies that engage in such bonus schemes.

Rule No. 3: Resist the temptation to publish your Net Promoter Score in your annual report. All you are doing is setting yourself up for inflated NPS results as nobody in the organisation will want to be associated with a ‘down year’. It’s human nature. By accident or design, employees and leaders will game the system to achieve higher scores next year.

Rule No. 4: Put a robust CX governance structure in place. Make sure ALL clients are surveyed. Sign off the contact lists. Resist the urge to exclude people whose views might be unfavourable – you want to know what they are thinking.

Rule No. 5: Finally, don’t approach CX with the mindset of a colonial administrator! Senior leadership teams have to view customer feedback as a gift. They have to encourage their colleagues to be open about getting feedback, whether good, bad or indifferent. Without honest feedback, change will never happen. Poor practices will continue and eventually clients will leave.

Finally, if you want to find out more about how to set up and run a customer experience (CX) programme effectively, contact us for a chat. We’d love to hear from you.