Customer based executive compensation

Before you say anything, I recognize I’ve been somewhat absent.  My fault completely, no excuses, just an attempt to do better and be more present.  To kick things off – I was fortunate to be at the Engage Summit http://engagesummit.com/ last week (as a speaker no less).  It was quite interesting, some fascinating speakers and topics, lots of good grist for blogging as well, so you should see me back here more often as a result.

One subject came up as a question after a session and I couldn’t help chiming in – executive compensation on your customer KPI, most notably NPS http://www.netpromoter.com was mentioned, although others arose as well.   to be clear up front, I’m all for incenting the right behavior and having incentives that are rooted in improving the customer experience are great. 

What I’ve experienced and heard about from many in this field is that once you incent based on improving the customer KPI, you will often find an intense focus on how the number is captured, calculated and surrounded by debate on the score.  This results in a frustrating amount time spent justifying the number itself, rather than improving the customer experience.

So how do you get out of that hole?

The easiest way I’ve found is to change the focus of attention away from the number (whichever one you use) and instead focus on incenting for improvement initiatives that are based in customer feedback.  By doing this, you comfortably fit full control of the efforts and results into the hands of the executive being incented (which also encourages engagement) and you circumvent all of the arguments around the number. 

Do you have a customer based KPI?  Is there incentives for it?  I want to hear how you handle this challenge.