The Ultimate Question: Driving Good Profits and True Growth

The Ultimate Question: Driving Good Profits and True Growth

by Fred Reichheld

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Overview

CEOs regularly announce ambitious growth targets, then fail to achieve them. The reason? Too many companies are addicted to bad profits. These corporate steroids boost short-term earnings but burn out the employees and alienate customers. They undermine growth by creating legions of detractors - customers who sully the firm's reputation and switch to competitors at the earliest opportunity. Now loyalty expert Fred Reichheld shows how to reverse the equation, turning customers into promoters who generate good profits and true, sustainable growth. The key: one simple question - Would you recommend us to a friend? - that allows companies to track promoters and detractors and produces a clear measure of an organization's performance in its customers' eyes. Analysis shows that on average, increasing the Net Promoter Score (NPS) by a dozen points versus competitors can double a company's growth rate. While easy to grasp, this metric represents a radical change in the way companies manage customer relationships and organize for growth. Rather than relying on notoriously ineffective customer satisfaction surveys, companies can use NPS to measure customer relationships as rigorously as they now measure profits. What's more, NPS finally enables CEOs to hold employees accountable for treating customers right. It clarifies the link between the quality of a company's customer relationships and its growth prospects. Based on extensive research and rich with vivid examples of organizations that have pioneered NPS in practice, The Ultimate Question offers hands-on guidance on how to: Distinguish good profits from bad; Measure NPS and benchmark performance against world-class standards; Quantify the economic value generated by customer word of mouth; Assign accountability for improving customer relationships; Identify core customers and set priorities for strategic investments; Move customers beyond mere "satisfaction" to true loyalty; Create communications of passionate advocates that stimulate innovation and growth. Practical and compelling, The Ultimate Question will help you solve your organization's growth dilemma.

Product Details

ISBN-13: 9781455893522
Publisher: Brilliance Audio
Publication date: 04/01/2012
Edition description: Unabridged
Product dimensions: 5.00(w) x 5.50(h) x 0.10(d)

About the Author

Fred Reichheld is Director Emeritus and Fellow at Bain & Co., and a bestselling HBSP author.

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The Ultimate Question: Driving Good Profits and True Growth 3.8 out of 5 based on 0 ratings. 18 reviews.
jpsnow on LibraryThing More than 1 year ago
This is the book through which Reichheld conveys the story behind his Net Promoter Score. Bain and Associates did research to determine which of several potential questions best relate to increased loyalty. The winner: On a scale of 0-10, how likely are you to recommend [company] to your family and friends? The "net promoter score" is the percentage of promoters minus the percentage of detractors. The approach proves itself empirically, as companies across industries show correlation between between NPS score and growth. The methodology includes recommendations for transparency, understanding the target audience, and a solid cycle of using surveys, backed by follow-up, action, and insight in a closed-loop process.
gauravrekhi on LibraryThing More than 1 year ago
As a methodology and philosophy - very strong. As a book however relatively very weak. I am a strong believer in the philosophy and methodology and hence the book is important for me - but I really think Reichheld needs a new version with lots more examples and lots more discussions.
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Guest More than 1 year ago
This surprising book offers a powerful message based on common sense: Companies that treat their customers ethically and honestly will build a dedicated client base, and thus grow steadily and earn 'good profits.' The opposite lesson is that companies that take advantage of their customers through predatory pricing or shoddy products earn 'bad profits' while building an army of disenchanted buyers who tell their friends to stay away. Fred Reichheld makes his point in black and white: Rip off your customers at your peril. He amply illustrates his message with powerful case studies, and includes details about using the 'ultimate' question - 'How likely is it that you would recommend this business to a friend or colleague?' - and the resulting 'Net Promotor Score' to identify your best customers. We commend this book to service or product providers who want to achieve solid growth by nurturing their core consumers.
Guest More than 1 year ago
Both the Wall Street Journal and USA Today have just named The Ultimate Question the #1 business book of the year. What more needs to be said?! Predictions are that the imact of net promoter score (NPS) will be at least as great as six sigma. This book should be required reading at every business school!
Guest More than 1 year ago
Reichheld's book provides a straightforward approach to better understanding your customer base. By asking a simple question - on a scale of 0 to 10 with 10 being most likely and 0 being least likely, how likely would you recommend company X to a friend or colleague? - you know precisely where your customers stand. And more to the point, by asking follow-on questions to those who are not 'promoters' (those who give a rating of 9 or 10), you can quickly find out what it takes to better satisfy these customers. I have learned that by doing this, customers not only feel their input counts, but also that companies can take steps to address customer concerns, thereby improving their business.
Guest More than 1 year ago
Every first-year marketing student learns about the ¿bait-and-switch¿ technique, even if only as a cautionary tale: a firm advertises a product at ¿too good to be true¿ prices, lures potential customers into the store, and then reveals to these customers that the advertised, bargain-priced model is out of stock. However, the disappointed customer is shown a higher priced alternative, one that generates a higher profit margin for the firm, of course. All of this is part of the firm¿s plan: the customer is lured into the store by the low-priced model, is disappointed by its absence, but is then encouraged to trade up to a higher priced alternative, lest having wasted a trip to the store (and the related sunk costs). The bait-and-switch came to mind as I read Fred Reichheld¿s recent offering, ¿The Ultimate Question.¿ While Reichheld¿s earlier work was at least marginally interesting, this latest work falls far short and will leave the attentive reader feeling scammed, like a consumer lured into a store only to have the advertised ¿too good to be true¿ sale revealed as a hoax. Let me explain. Throughout ¿The Ultimate Question,¿ Reichheld presents a strong rhetorical case for his Net Promoter Score (i.e. NPS, or ¿the ultimate question¿) against traditional and more complex measurement systems, typified by the customer satisfaction survey. (As a sidebar, Reichheld so transparently erects satisfaction surveys as a strawman throughout this book ¿ without offering a shred of real analysis or substantive critique, his simplistic ¿top ten list¿ of criticisms notwithstanding ¿ that the reader must laugh). These satisfaction measurement systems fail for a range of reasons, so Reichheld tells us, but mostly because they are too involved and too complex to be useful or easily applied by management. As Reichheld writes: ¿¿the only measurements of customers¿ happiness were vague statistics of ¿satisfaction¿ ¿ statistics derived from surveys that nobody trusted and nobody was accountable for.¿ ¿¿satisfaction surveys often delude executives into thinking that their performance merits an A, while their customers are thinking C ¿ or F. Business leaders need a hard, no-nonsense metric¿¿ ¿These black-box software packages [needed to analyze data] churn out analyses that are intelligible only to an elite breed of Ph.D.¿s.¿ It is as an alternative to these excessively complex measurement systems that Reichheld offers his ultimate question, the question that yields a company¿s NPS. With just one simple question ¿ ¿How likely is it that you would recommend Company X to a friend or colleague?¿ ¿ Reichheld claims a company has the information, the critical ¿one number¿ that it needs to generate ¿good profits,¿ build customer loyalty, and gain a strategic advantage over competitors. With the data generated by this question (after a little manipulation by Reichheld, although certainly nothing so complicated as to require an ¿elite breed of Ph.D.¿s¿) any company can have the one number that is strongly correlated with growth, a statistic that is simple to produce and easy to interpret. With this, traditional satisfaction surveys are dead, so says Reichheld ¿ the reader/market researcher/senior executive has found an attractive, superior alternative. But, of course, Reichheld¿s offer is a scam he himself admits as much throughout ¿The Ultimate Question.¿ After being promised repeatedly that we are done with complex measurement systems, that we now need only this one number to grow, Reichheld finally reveals the truth: NPS is not all we need to know. In fact, as early as the second chapter Reichheld informs us that: ¿We also realized that two conditions must be satisfied before customers make a personal referral [i.e. become promoters]. They must believe that the company offers superior value in terms that an economist would understand: price, features, quality, functionality, ease of use, and all the other practical factors¿¿ [my
Guest More than 1 year ago
Ok, we all know customer service today is a low priority for companies and their executives, even though they say they want to make their customers happy. But their customers are not...and many companies spend their time focusing on the bottom line (profits) to the detriment of their own best customers. What if there was a way to improve customer service, measure that improvement, and enhance the bottom line? Well, in Fred Reichheld's new book, this 'loyalty guru' has managed to do just that. I received this book through the BzzAgent program, and I was skeptical to say the least that this business book had anything new to say, but I was proven wrong. Since reading this book, everywhere I go, everything I read, all the times I end up a frustrated customer, I find myself reflecting back to what I read in Reichheld's book and the principles and examples he provides in 'The Ultimate Question.' It rings true, and better yet, it incorporates a way that all companies can adopt a measurement of customer satisfaction that relates directly to increased profits over the long term (organic profit vs. short-term gain at the customers' expense). This is an excellent book, and not only do Reichheld's arguments stand up, he provides actual examples of companies (Enterprise Rent-a-Car, Southwest Airlines, and Costco, to name a few) that have found these sets of actions to work for them, both in terms of customer satisfaction and profitability. Read this book and you will never look at your consumer experience the same way again!
Guest More than 1 year ago
This book really hit home for me. As a business owner, I have always realized the importance of customer satisfaction along with how much a happy customer can help both your current business and future business growth. This book assisted me in realizing the importance of measuring how many of my clients are true 'PROMOTERS' and how many are 'Detractors'. Instead of asking clients many questions using a long questionnaire, the book made me realize the importance of 'The Ultimate Question'. In my opinion, most small to even large business owners would benefit from spending a few hours reading this book. As a BuzzAgent I was able to listen to Fred Reichheld discuss his book on a conference call. As a result, my partner and I are in the process of asking all of our clients the Ultimate Question to determine our true promoters.
Guest More than 1 year ago
I am very excited about this book. I have read it cover to cover and it has changed the way I think about customer satisfaction surveys.
Guest More than 1 year ago
I recieved this book through a BzzAgent campaign recently. At first glance I thought it would be interesting. It ended up being a fairly quick read, and was easy to understand what Reichheld was trying to explain. I know that I am more likely to purchase something if a friend or collegue reccomends it. How many times have you gone to the restaurant down the street because a friend said they had great steaks or fair prices? Reichheld furthers that concept by explaining the NPS (net promoter score). In it's basic concept, NPS is turning your customers into promoters. Make your customer satisfied and they will in turn, promote your product to others by word of mouth. He discusses how to make your customers loyal to your product and your company by catering to their needs and by being fair. Too many companies are out to make the 'quick buck', but by doing so, they lose customers. Sure, they just made $200 on that stereo, but because of customer service issues, or unfair policies, that person will never again buy a product from their company - thus the company loses out on the POTENTIAL income from that customer, and the potential income from everyone that person knows. I found this book to be informative and eye-opening. As a consumer, I felt empowered by it to know that I deserve better consideration from companies.
Guest More than 1 year ago
I got an early copy of The Ultimate question through the Bzzagent program and I found it to be a refreshing business book. Unlike many others that are difficult or boring to read, or that require complicated and lengthy analysis this book boils down the growth possibilities of a company based on the satisfaction of its customers. This has been my own personal experience with companies of the past and it is very well articulated in an easy formula in this book. I highly recommend The Ultimate Question to those interested in analysis and improving their business by satisfying their customers and turning them in to promoters of the business.