(This is a repost from Statistics & Analytics Consultants Blog, which was featured on SmartDataCollective's Blogarama)
Statistics & Analytics Consultants Blog
As a manager you have important business questions you need answered – and with the explosion of analytics, managers are expected to use the data to drive decisions. Buzzwords like “Voice of the Customer,” “Customer Segmentation,” “Competitive Intelligence,” and “Business Intelligence are bandied about – but how can you nail down a definitive methodology to answer your important question?
One tool for gaining access to the voice of your customers, employees, or population of interest, is a survey. How do you know when it is time to launch a survey? The short answer to this is when the available data that you have on hand (generally within your company’s databases) fall short in answering your most pressing business questions. Why hire an expert? Because if not properly constructed or sampled, the survey most likely will yield results that will either tell you very little of importance, cannot be joined back to your own data with confidence, or may not be representative of your population of interest. You want to have confidence in the tool itself and in the results that it yields.
Below are two business case examples where surveys have been used to answer important business questions. You may find these of interest within your own business context:
Customer Segmentation for an Online Company
Working with a company whose products were sold exclusively online, they had a database of customer records on hand. However, this information was incomplete regarding certain attitudinal information, as well as behavioral information as to how customers were shopping with competitors – both online and in-store. Launching a survey to a large sample of customers allowed us to gain insight into attitudes and behaviors of customers. Using a clustering technique, customers were segmented into several key segments that had very different characteristics, based on attitudes, shopping preferences, demographics, etc.
Using principal components analysis, the survey was then reduced to just a few main questions. When future customers registered on the site and answered these few questions, along with key demographics, they were placed into one of the segments where they would receive targeted marketing messages. This survey helped to answer business questions of: Who are our customers? What are their motivations for shopping with us? What are their buying behaviors by segment and demographics? Who are the major competitors by segments? From here, the marketing department was able to develop the creative messages targeted specifically to each segment.
What Does a Survey Have to Do With Your Salary?
In another key application, an association requested the administration of an annual Compensation Survey to collect data from their members about how much they earn, how much extra they receive in cash bonuses, and deferred compensation. Survey results may be disaggregated by level of education, position, region of the country, academic vs. non-academic, public vs. private, etc. Associations may also examine trend data of their members over 2, 3, or 5 years. In asking such sensitive information of workers, it is important to hire those who are skilled at constructing surveys in such a way that respondents are likely to follow through to the end of the survey. If you start with questions that are too sensitive early on – or too complex, it is unlikely that those taking the survey will finish. It is also important this be done by evaluators external to a person’s place of business – there needs to be a buffer, a sense of safety in answering questions that may be attitudinal with regards to their work, salary, work environment, and so forth.
Who uses this information? Human Resources departments use this information to figure out how much to offer prospective employees or to determine whether their employees are in line with industry practices. Similarly, prospective employees may use this information to know how much they can expect to earn. Current employees may also use this information to compare their compensation to their peers.
So, the next time you want to know whether you are being paid fairly, go to an association website to compare how much you could be earning. Where did they get this information? From a survey, of course!
If you have an important business question, and you current data cannot provide all the answers, ask Evans Analytics at [email protected]
to design and analyze a survey for you.