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What is social sigma?

23rd Mar 2009
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MyCustomer.com

Many people have never heard of social sigma, let alone how it can provide valuable insight to provide a better customer experience. MyCustomer.com editor Louise Druce gets to grips with the basics.

By Louise Druce, editor

If you want to improve your business processes you need to eliminate the defects. It sounds simple enough, yet initiatives such as the lean movement, Six Sigma and lean Six Sigma have proved that it is far from an easy process. And now comes social sigma, a process designed to improve the customer experience by looking at their online activities. Confused? You’re not the only one!

It could be argued that social sigma is merely a fancy term for a practice that has been deployed for years - that of collecting feedback from customer communities to refine and improve operations and products. The only difference is that the modern organisation can now plug itself into the online social community phenomenon. So to get more of a handle on it, we first need to look at Six Sigma.

"Companies who fail at social sigma will claim to be listening but will fail to incorporate ideas from the social network into its products. They will be faking it - and customers will figure that out quickly."

George Colony, CEO, Forrester Research

There are many definitions on exactly what this process entails but on a basic level, Six Sigma is a data-driven methodology that provides businesses with the tools to improve the capability of their business processes. The ultimate aim is to increase profits by eliminating variability, defects and waste that undermine customer loyalty.

It really came to the fore in the 1980s when Motorola looked at ways to improve its manufacturing processes but has since been developed and adopted by many other industries. A more comprehensive definition and examples of how it is being used can be found at iSixSigma.

Social Sigma is, according to George Colony, CEO of analyst firm Forrester Research, using continual online feedback from your customers to perfect your products. For example, data gathered from conversations on wikis, blogs, forums and social networking sites such as Facebook etc. are gathered and the results fed back into all parts of the company, including product development, sales and customer service, to improve the customer experience and marketing to other potential prospects. It is a method that is seen as being far more cost-effective than using traditional survey methods.

The whole truth

Forrester is one of the leading thinkers in social sigma, with vice president principle analyst Bill Band pointing out that it incorporates ideas from social networks, business process management and enterprise feedback management. Meanwhile, Colony believes over the next few years social sigma will be an integral part of research and planning in all the Fortune 500 companies.

In his blog, he says the reason why social sigma works is because the social network for a company is trusted and interested. "They have a stake in improved services and products and have built-in incentive to contribute time and ideas to the cause," Colony explains. "Companies who fail at social sigma will claim to be listening but will fail to incorporate ideas from the social network into its products. They will be faking it - and customers will figure that out quickly."

The organisation itself is using social sigma to survey its business users via the internet and to get feedback on its research reports. Colony says the four key benefits for social sigma are: more speed, more ideas, better products and cheaper development.

"It is only by embracing what customers really think about the organisation that they can tackle the key obstacles to achieving a better customer experience."

Both Colony and Mary Shacklett,, President of marketing and technology services firm Transworld Data, cite clothing firm Eddie Bauer and French financial services firm Credit Mutuel as companies who, with social sigma, are successfully using feedback from social networks to improve products.

Shacklett also notes Starbuck’s MyStarbucksIdea.com site as a good example of the social sigma approach. It was set up to find out from customers how it could improve its service, with the functionality of the site now integrated into Facebook. It has received over 65,000 ideas and allows the company to engage in regular dialogues with its customers. Meanwhile, Chris Bruzzon says Facebook gives it the "personalised local experience."

Bruzzo likens it to bringing customers into the boardroom. But here sits one of the biggest hurdles for Colony, who points out that when engaging in social sigma, those on the board may not like some of the brutal criticism they receive. However, it is only by embracing what customers really think about the organisation that they can really tackle the key obstacles to achieving a better customer experience. "That's how customers feel - and the company should use this knowledge to its advantage," says Colony.

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By greatemancipator
23rd Mar 2009 21:14

Call it social sigma or what you want. I called it the Citizen Engagement Exchange but it needs to be recorded/measured across ALL channels of contact, not just web. The problem may be in the channel!

Mick

http://greatemancipator.com

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