[{"@context":"https:\/\/schema.org\/","@type":"BlogPosting","@id":"https:\/\/www.the-future-of-commerce.com\/2019\/03\/05\/how-to-manage-business-risk\/#BlogPosting","mainEntityOfPage":"https:\/\/www.the-future-of-commerce.com\/2019\/03\/05\/how-to-manage-business-risk\/","headline":"How to manage business risk by turning customers into partners","name":"How to manage business risk by turning customers into partners","description":"Customer feedback can help you manage business risk, but you have to ask the right questions, then ACT on the answers.","datePublished":"2019-03-05","dateModified":"2020-11-17","author":{"@type":"Person","@id":"https:\/\/www.the-future-of-commerce.com\/contributor\/stephanie-thum\/#Person","name":"Stephanie Thum","url":"https:\/\/www.the-future-of-commerce.com\/contributor\/stephanie-thum\/","identifier":334,"image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/05bbc9017e3f89b9d6d4846c0cf0828093f534181adceca83e1773c2378f6385?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/05bbc9017e3f89b9d6d4846c0cf0828093f534181adceca83e1773c2378f6385?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Organization","name":"The Future of Commerce","logo":{"@type":"ImageObject","@id":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2023\/01\/logo-foc-schema-app-1.png","url":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2023\/01\/logo-foc-schema-app-1.png","width":172,"height":60}},"image":{"@type":"ImageObject","@id":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2019\/03\/thumbnail-69a086a9c9b63a215c923aa56a40177a.jpeg","url":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2019\/03\/thumbnail-69a086a9c9b63a215c923aa56a40177a.jpeg","height":375,"width":1200},"url":"https:\/\/www.the-future-of-commerce.com\/2019\/03\/05\/how-to-manage-business-risk\/","about":[{"@type":"Thing","@id":"https:\/\/www.the-future-of-commerce.com\/customer-experience\/","name":"Customer Experience","sameAs":["https:\/\/en.wikipedia.org\/wiki\/Customer_experience","http:\/\/www.wikidata.org\/entity\/Q984142"]},{"@type":"Thing","@id":"https:\/\/www.the-future-of-commerce.com\/customer-experience\/public-sector\/","name":"Public Sector","sameAs":["https:\/\/en.wikipedia.org\/wiki\/Public_sector","http:\/\/www.wikidata.org\/entity\/Q294217"]}],"wordCount":862,"keywords":["Customer Feedback"],"articleBody":"What if customers could be viewed as partners in managing business risk, rather than just a source of said risk?For many types of businesses, chief risk officers and other executives have adopted an \u201cus versus them\u201d mentality when it comes to viewing customers as a potential business risk, and sometimes with good reason: Non-paying clients, fraud, contract breaches, shoplifting, social media firestorms, and other realities have taken center stage.Of course, losing customers is a business risk in and of itself; without customers, your business won\u2019t last long. Everyone in the for-profit world seems to understand the downside to losing customers, or the painful sting of losing to a competitor. In government, the reality may be more about the risk of complaints to elected officials or the mainstream media.But what if you could flip the business risk lens? What if customers could be viewed as potential\u00a0partners\u00a0in managing and mitigating business risk? It\u2019s uncharted territory in many respects, but it is possible, and even necessary as business evolves.\u00a0Voice of the customer\u00a0practices, feedback collected from well-designed customer surveys, stakeholder roundtables, and client interviews can help you move in that direction.You can’t manage business risk if you don’t listen to customersIn a past life, I had just joined a firm where the relationship with a long-time client was in jeopardy. Billings had been on a steady decline. The firm had not been invited to bid on new business opportunities in two years.During a client feedback session, one of the first-ever conducted with any client of this firm, we learned that in addition to their own bills, the client had received multiple bills for an entirely different company\/client of the firm.\u00a0Of course, that\u2019s an annoying experience on the most basic level, but that mistake was also a potential operational risk. What if those bills contained confidential information specific to the other client?But that wasn\u2019t the only problem: A staff member who had been assigned to work on the account behaved inappropriately while speaking on behalf of the client, and in a way that was insulting to the client\u2019s customers. That behavior, to the client, was an even greater offense than messed up bills. Rather than say something, the client elected to stay quiet and move their business to a competitor firm.The client\u2019s feedback flagged an opportunity and two troubling issues:Opportunity:\u00a0Set up client feedback collection mechanisms earlier, and at a regular rhythm and cadence, to more proactively avoid the risk of losing clients. Had the firm known of these issues earlier, the relationship may have been saved. Unfortunately, in this case, because the client was never asked for feedback, the issues only grew worse in the client\u2019s mind over time. The relationship could not be saved.Issue:\u00a0An urgent need to examine error-prone business processes responsible for the billing errors and accompanying risk.Issue:\u00a0Risk of allowing a staff member to continue working with and possibly offending and losing other clients, without some coaching and mentoring.Can you hear them now? Setting up your voice of the customer approachesVoice of the customer practices\u00a0are one of the best first lines of defense in mitigating the risk of lost customers, and identifying other looming business and operational risks.Here some best practices for setting it up:1.) A skilled interviewer or survey administrator who is\u00a0NOT\u00a0part of the customer\u2019s immediate service team should lead. Sales and service team members can feel they personally have too much to lose if negative comments surface during the feedback process. On the same token, customers can fear retribution for speaking up to someone in control of when and how they are served.2.) Ask the right questions.\u00a0Don\u2019t waste the customer\u2019s time if you\u2019re going to ask old, outdated questions, or intend to do nothing with the feedback. Tip: ask about outcomes and the health of the business relationship.3.) Structure the work.\u00a0Use a platform with survey governance features to manage rhythm, questions, and people who have access to incoming feedback data. Beyond that, you should develop and socialize a customer feedback collection and data review policy.4.) Document the feedback in a standard way.\u00a0Formulate action plans based on the data, and store\u00a0customer feedback\u00a0where the right executives can review the data, like any other source of business intelligence.5.) Don\u2019t ignore feedback.\u00a0The only thing worse than not asking customers for feedback is asking and not following up.\u00a0Close the loop\u00a0with customers to make sure they know what you\u2019re working on in response to their feedback.If you\u2019re asking the right questions at a regular rhythm and cadence, listening carefully, sharing customer feedback across the organization, and taking the right action from the feedback, customers can actually help you to identify business risks before some of your own risk monitoring activities inform you of a problem. Don\u2019t miss the opportunity.Turn complaints into compliments by responding quickly to customer feedback. Learn more here.\u00a0This post was first featured on the Qualtrics blog, and is syndicated here with permission.\u00a0"},{"@context":"https:\/\/schema.org\/","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"2019","item":"https:\/\/www.the-future-of-commerce.com\/2019\/#breadcrumbitem"},{"@type":"ListItem","position":2,"name":"03","item":"https:\/\/www.the-future-of-commerce.com\/2019\/\/03\/#breadcrumbitem"},{"@type":"ListItem","position":3,"name":"05","item":"https:\/\/www.the-future-of-commerce.com\/2019\/\/03\/\/05\/#breadcrumbitem"},{"@type":"ListItem","position":4,"name":"How to manage business risk by turning customers into partners","item":"https:\/\/www.the-future-of-commerce.com\/2019\/03\/05\/how-to-manage-business-risk\/#breadcrumbitem"}]}]