Believe it or not, we talk about metrics here all the time. I bet it is the same around your near real-time, software-driven enterprise too. For Agile teams, the pursuit of good metrics and forms of feedback to steer their work is an obsession. I swear we have as many “quants” in this company as engineers, service or sales professionals.
At Rally, we currently track four categories of metrics in a kind of balanced score card of SMART numbers:
- Employee satisfaction (see Colorado Best Company and Outside Magazine); We also use an on-demand 360-degree peer review system
- Value Throughput (% of value demand versus failure demand, work in process, cycle time, services backlog and lead time, along with any awards and/or positive reviews)
- Financial (Lifetime value of customer, cost of sales, breakeven point, bookings growth, renewals %, cash)
- Current Customer Satisfaction (Control charts of cases and escalated cases normalized by user base)
NPS as part of your Agile Metrics
We are about to start measuring a new number – NPS. Ever since Tom Poppendieck exposed me to the Fred Reichheld’s book on Net Promoter Score back in 2006, I have been interested to see how a powerful tool like this could be applied to Rally.
The theory behind Net Promoter Score is, as the book’s title says, “The Ultimate Question” – measuring customer satisfaction. On Wikipedia, you can see the criticism of this measure versus other questions, but I really like the rigor and material available behind this approach. You can find success stories, along with blogs, additional resources and information about what makes up a good NPS on the NetPromoter.com web site. Of course, Net Promoter is just one of a balanced set of metrics to help understand performance, improvement and stakeholder value. We see NPS as an increase in discipline around customer satisfaction measures. For an Agile enterprise, those end-of-pipe measures become a great predictor of future financial performance and growth.
Iteration One of NPS at Rally
We decided it was time to measure NPS at Rally due to four factors:
- our recent growth in staff, due to financing in late 2009
- success in moving other customer metrics this year
- the search for an over-arching metric around customer satisfaction
- increased sophistication and capabilities in our IT environment and belief that the feedback can help prioritize strategic work for 2011
Our team started this effort as a skunk works out of IT. Once we completed our first iteration and understood how we would need to scale NPS, our IT team prototyped a solution in and between our instance of Salesforce and Eloqua. We then expanded the team to include support, customer advocacy and marketing. This team’s first goal was to get smarter by reaching out to other friendly SaaS vendors we work with who had implemented NPS. We are extremely grateful for the time that Nadia De Villa of Eloqua and Susan Gingrich of Readytalk spent with us to share their experiences. (This Readytalk blog post led us to Susan.)
The first phase of our NPS survey will go out this week. If you are one of the randomly selected customers who receive it, please take the 30 seconds needed to respond.
We are eager to hear your feedback and ready to adjust things as necessary. If you can’t wait for our survey, please feel free to comment on this post or send me an email: firstname.lastname@example.org. We really want your feedback as we are trying to be a GREAT company.
Since NPS only measures customer satisfaction and we have to balance a portfolio of stakeholders, I am sure this will not become the one or “ultimate” number for the company. But, I am confident that this will become a part of the weekly corporate dashboard. If this is an interesting topic for folks, let me know and I will post follow-ups in the future. We would also love to hear about the experience of your team or company with NPS.