Business Linkage Analysis: An Overview

Business Linkage Analysis: An Overview by Bob Hayes.

From the post:

Customer feedback professionals are asked to demonstrate the value of their customer feedback programs. They are asked: Does the customer feedback program measure attitudes that are related to real customer behavior? How do we set operational goals to ensure we maximize customer satisfaction? Are the customer feedback metrics predictive of our future financial performance and business growth? Do customers who report higher loyalty spend more than customers who report lower levels of loyalty? To answer these questions, companies look to a process called business linkage analysis.

Business Linkage Analysis is the process of combining different sources of data (e.g., customer, employee, partner, financial, and operational) to uncover important relationships among important variables (e.g., call handle time and customer satisfaction). For our context, linkage analysis will refer to the linking of other data sources to customer feedback metrics (e.g., customer satisfaction, customer loyalty).

Business Case for Linkage Analyses

Based on a recent study on customer feedback programs best practices (Hayes, 2009), I found that companies who regularly conduct operational linkages analyses with their customer feedback data had higher customer loyalty (72nd percentile) compared to companies who do conduct linkage analyses (50th percentile). Furthermore, customer feedback executives were substantially more satisfied with their customer feedback program in helping them manage customer relationships when linkage analyses (e.g., operational, financial, constituency) were a part of the program (~90% satisfied) compared to their peers in companies who did not use linkage analyses (~55% satisfied). Figure 1 presents the effect size for VOC operational linkage analyses.

Linkage analyses appears to have a positive impact on customer loyalty by providing executives the insights they need to manage customer relationships. These insights give loyalty leaders an advantage over loyalty laggards. Loyalty leaders apply linkage analyses results in a variety of ways to build a more customer-centric company: Determine the ROI of different improvement effort, create customer-centric operational metrics (important to customers) and set employee training standards to ensure customer loyalty, to name a few. In upcoming posts, I will present specific examples of linkage analyses using customer feedback data.

Discovering linkages between factors hidden in different sources of data?

Or as Bob summarizes:

Business linkage analysis is the process of combining different sources of data to uncover important insights about the causes and consequence of customer satisfaction and loyalty. For VOC programs, linkage analyses fall into three general types: financial, operational, and constituency. Each of these types of linkage analyses provide useful insight that can help senior executives better manage customer relationships and improve business growth. I will provide examples of each type of linkage analyses in following posts.

More posts in this series:

Linking Financial and VoC Metrics

Linking Operational and VoC Metrics

Linking Constituency and VoC Metrics

BTW, VoC = voice of customer.

A large and important investment, in data collection, linking and analysis.

Of course, you do have documentation for all the subjects that occur in your business linkage analysis? So that when that twenty-something who crunches all the numbers leaves, you won’t have to start from scratch? Yes?

Given the state of cybersecurity, I thought it better to ask than to guess.

Topic maps can save you from awkward questions about why the business linkage analysis reports are late. Or perhaps not coming until you can replace personnel and have them reconstruct the workflow.

Topic map based documentation is like insurance. You may not need it every day but after a mission critical facility burns to the ground, do you want to be the one to report that your insurance had lapsed?

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