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Gallup

Operations

More Data Don’t Always Mean Better Insights

Building relationships trumps crunching numbers

Published: Monday, November 30, 2015 - 16:34

As technology advances, it’s tempting for companies to believe that gathering more data and crunching more numbers will consistently lead to better customer insights. But Gallup finds that’s not always the case, particularly in the business-to-business (B2B) arena.

Here’s why: For B2B companies, success hinges narrowly on the quality of client relationships. Gallup finds that the typical B2B organization has an optimal relationship with fewer than one in seven of its customers. Companies can’t build lasting partnerships based on products, process, or price alone. That leaves the relationship vulnerable to competitors with similar offerings and lower prices.

The trick is to become irreplaceable to clients by helping them solve their biggest challenges and finding ways to succeed together. How to do this varies widely from client to client, but the answers usually aren’t evident from a spreadsheet or a customer experience management system alone.

Balancing big and small B2B data

Each year, Gallup conducts thousands of in-person, phone, and web interviews for B2B clients in various industries and markets, from Fortune 500 companies to mission-driven nonprofit organizations. Through comprehensive study and analysis, Gallup has uncovered unique features central to the most successful B2B relationships. These characteristics include how companies transition from vendor to valued partner status, how they create trust and transparency, and how they manage risk to gain the greatest return on investment.

Although it’s essential to measure these key elements to understand the dynamics of a B2B relationship, it’s difficult to find insights using quantitative metrics alone. For example, what does it mean to be transparent? For a customer of one of Gallup’s B2B clients, transparency means open conversations regarding billing rates and how costs are calculated. For another, it’s a window into how leadership and staffing decisions are made.

If Gallup only asked a quantitative question about transparency, the data would only show the percentage of customers who feel that transparency is important. The data wouldn’t reveal what transparency looks like to different customer groups. That’s why the best B2B strategy is to balance quantitative big data with a qualitative “small data” approach.

The best of both worlds

Quantitative questions discover facts about value, problem incidences, and emotional engagement with the brand, among other things. For example, Gallup has found that 82 percent of customers of B2B clients who strongly agree that a brand is easy to do business with are fully engaged, compared with 17 percent who are indifferent, and 1 percent who are actively disengaged. Among those who disagree or strongly disagree that the brand is easy to do business with, just 1 percent are fully engaged.

Further, large representative samples help gauge the prevalence of particular views among B2B customers. Thoughtful analysis can expose underperforming accounts or disengaged customers who are contemplating leaving for a competitor. Measuring engagement can even predict future revenue decline. These factors make quantitative data collection and analysis vital tools in Gallup’s customer engagement approach.

But B2B clients, in particular, require a more comprehensive, nuanced perspective that favors depth over breadth. Qualitative methods help build knowledge about and expertise on the client’s business, industry, and marketplace. B2B companies need small-data insights that get at the heart of their relationships with their customers. Qualitative methods can fill in the blanks and provide meaning and context to quantitative data. They also can help B2B clients understand the thoughts and feelings that drive customers’ answers to quantitative survey questions.

No shortcuts

Qualitative research requires tailoring specific, open-ended questions for a B2B company’s key stakeholders. Many questions complement quantitative items to help clients understand the findings more fully and guide them to meaningful action. In Gallup's work with a B2B client, for example, qualitative interviews conducted with the client's customers revealed long-standing disappointments that customers hadn’t shared with the company and that weren’t revealed in a quantitative survey. The results of the qualitative interviews brought to light fundamental problems that the client was able to resolve.

Some key lessons from Gallup’s qualitative approach in thousands of B2B interviews include:
• The most meaningful, compelling insights are not always the most frequently mentioned responses. Qualitative data uncover individual perspectives that differ from the norm. These insights—from particularly thoughtful or futuristic-minded customers—can help B2B clients see opportunities for growth that they wouldn’t have gathered from a purely quantitative survey. Though qualitative data are not always majority opinions, they can be incredibly valuable.
• Qualitative data help B2B clients recognize their unique organizational culture in survey results. Qualitative data give local context: Customers’ voices reflect how they perceive their B2B provider as it conducts business. Hearing customer perceptions in their words provides another level of depth and nuance to quantitative survey results, particularly when the findings are negative.
• B2B customers share insights during structured interviews, not informal conversations. It takes extensive skills and training to facilitate fruitful qualitative interviews. Interviewing senior B2B clients and gleaning actionable insights while maintaining neutrality and objectivity is a delicate balancing act that requires experience, considerable business judgment, and methodological training.

At the end of the day, qualitative methods don't trump quantitative research for uncovering what drives growth at B2B companies. Rather, it’s the interplay between both methods that offers superior power and nuance. Gallup’s B2B clients often find as much value in the small-data insights raised qualitatively by a subsample of their customers as through representative survey results.

First published Nov. 3, 2015, on the Gallup Business Journal.

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Gallup

Gallup has studied human nature and behavior for more than 70 years. Gallup’s reputation for delivering relevant, timely, and visionary research on what people around the world think and feel is the cornerstone of the organization. Gallup employs many of the world’s leading scientists in management, economics, psychology, and sociology; and their consultants assist leaders in identifying and monitoring behavioral economic indicators worldwide. Gallup consultants help organizations boost organic growth by increasing customer engagement and maximizing employee productivity through measurement tools, coursework, and strategic advisory services. Gallup’s 2,000 professionals deliver services at client organizations, through the web, and in 40 offices around the world.