Definition of Voice of the Customer (VOC):« Back to Glossary Index
While an organization may hear many voices (Customer, Business, Employee and Process), it is the voice of the customer (VOC) that is the driving voice as to what should be important to the organization and what the organization should focus on. The satisfaction of the VOC needs to be balanced against the Voice of the Business, Voice of the Employee, and Voice of the Process but is still the dominant voice.
In this article, we will define who the customer is, the different types of customers an organization may have, how the VOC can be collected and some benefits, best practices, and an example of how listening to the VOC was used to improve an organization.
Overview: What is Voice of the Customer (VOC)?
First, let’s define what a customer is. A customer can be defined as the person, organization, or entity that is the direct receiver of the output (product or services) your organization produces. Sometimes the term stakeholder is used as a type of customer but in reality, they are rarely the direct receiver (although they have a “stake or interest” in the well being of your organization).
The external customer directly receives your output and is the primary source for your revenue and income. The internal customer is the next department or next person within your organization that receives your work or that of your department. They generally do not pay you for your work product or services.
Now that you understand the definition of the customer, what is the voice of the customer? The voice of the customer, or VOC, is the structured process of directly soliciting and gathering the specifically stated needs, wants, expectations and performance experiences of the customer about the products and/or services you have provided to them.
Customer needs can usually be classified as being related to quality, cost, safety, service, and delivery — and, more and more frequently today, social responsibility. It is the satisfaction of those needs that should drive the organization. The challenge is how an organization gathers and synthesizes all the voices, many of which may be in conflict with each other.
There are a number of ways an organization can capture the VOC. Among them are:
- Direct observations
- Focus groups
- Complaint data
- Customer service reps
- Sales reps
- Existing company data
- Industry data
Unless both the organization and the customer define what is important in the same way, they may be delivering a product and service that does not provide the value the customer wants and needs.
3 benefits of knowing the voice of the customer
By knowing the VOC, the organization will be able to benefit in several ways.
- The customer pays the bills, so knowing what their needs, wants, and expectations are is an important factor in securing their business.
- By understanding the VOC, an organization may be able to do a better job for the customer than some competitors, thus picking up more business..
- If the organization and the customer are speaking the same language and define things in similar terms, you can reduce any misunderstandings.
Why is the VOC important to understand?
Unintended miscommunication between an organization and its customers is a common reason why organizations lose customers and their business. It’s important for an organization’s wellbeing and possible survival to understand the VOC and customer requirements.
- If an organization and a customer are saying different things, there is a high probability that the customer’s needs and expectations will not be satisfied.
- Needless arguments and disruption can be avoided if an organization understands its VOC.
- If an organization is focusing on things that the customer doesn’t really want and is not willing to pay for, a better understanding of the VOC could save the organization significant time, resources, and money.
The voice of the customer in action
A large consumer products company was concerned that customer dissatisfaction was increasing, which was negatively impacting sales. Internal leadership thought they were doing a great job and that the customers loved them, so it was a mystery why satisfaction was declining along with business.
They decided to do a simple survey to determine what things were important to the customer, how they defined those things, what the relative importance was, and how they and the competition were doing. They surveyed their customers, and internal leaders completed the same survey from the perspective of what they thought the customers would say.
After the results were analyzed, the insights were shocking. First of all, what the company leaders thought was important to the customer did not match what the customer thought was important. Furthermore, the things the company was doing well were not the ones the customers felt were important. And worse, the competition was doing better on the things that turned out to be important to the customer, which could explain why business was slipping.
The CEO made sure that there was a rapid change in what the business focused on to better align with the VOC.
3 best practices when thinking about the voice of the customer
Gathering and acting upon the VOC is not easy, but by following some basic best practices, an organization can achieve the understanding needed to better satisfy the customer’s needs and expectations.
- Don’t assume the organization knows what’s best for the customer — or what they want or need. Ask them directly.
- Be sure that any VOC is clearly defined, measurable, and actionable.
- Since there are a number of methods by which to gather VOC, be sure to use the most appropriate one. Cost and timing can be factors, so be efficient in how VOC is collected.
Frequently Asked Questions (FAQ) about the voice of the customer
- What is the voice of the customer?
It is the direct input and expression of the wants, needs, and expectations that the customer has for those organizations it does business with.
- What are the most common methods to gather VOC?
Focus groups consisting of a small number of people to better understand macro issues. Interviews to gather more information from a limited number of people. Surveys are used to gather information from large numbers of people and can be used to quantitatively understand how the organization is doing in satisfying specific expectations of the customer.
- Should an organization always try to satisfy the voice of the customer?
Not always. Satisfying certain customer expectations may be detrimental to the financial health of the organization. If two customers have conflicting needs, for example, it’s unlikely that you will be able to satisfy both.
Conclusion: Voice of the customer
Understanding and properly responding to the voice of the customer is the primary determinant of the long-term success and survivability of an organization. There are a number of methods by which an organization can collect and understand what the customer is telling them.
There will be conflicts, and there will be some tough decisions to make. But, there is no choice, because if the organization fails to fully understand the VOC, they will become a target for their competition — and the company that responds and listens the best will come out on top.« Back to Dictionary Index