The Pros And Cons Of Three Types Of Feedback

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Successful organizations concentrate on adding value to all stakeholders of the organization. There are generally three primary categories of stakeholders-customers, employees, and owners. In the case of credit unions there are only two primary groups since our members are also the owners of the institution.

Regardless of the types of stakeholders, each one has an interest in the success of the institution in regards to how it helps them fulfill their own needs. To truly be successful, it is imperative that management makes a commitment to not only fulfill those needs but also continually uncover them and adapt to changes in people's desires.

There are three primary proactive techniques used by institutions to discover the needs of their stakeholders and collect information. They are focus groups, phone surveys, and mailed/e-mailed surveys. The following are pros and cons of each:

Focus Groups

Pros-Focus groups can allow you to meet in person with members and employees. The individual conducting the meeting can gain additional information by observing facial expressions, voice tone, and other body language. If the sponsor of the sessions is known and a representative of the institution is present or is the facilitator, this could produce positive PR. Most stakeholders appreciate when they are asked for their opinion in a sincere manner.

Cons-They can be costly in terms of time, money, or both depending upon how they are conducted. Traditionally, an independent party conducts a focus group, with the participants not knowing whom the sponsor is until possibly the end. Hiring a firm to conduct the program can be expensive. The level of expense generally depends on how many sessions need to be conducted and the amount of work the firm is asked to complete in conjunction with the program. If run by the institution, attendees could tell you only what you want to hear.

Phone Surveys/Interviews

Pros-They are generally more cost effective than focus groups. The individuals making the calls can still detect tone of voice. This is especially true if those making the calls are experienced in interview techniques and are attuned to certain oral cues. In general, an institution can talk to more people by phone over time than by conducting individual meetings.

Cons-There can still be a large time factor. Phone surveys can be obtrusive to members if the calls are made at an inconvenient time, such as dinnertime. Body language and other visual cues cannot be detected over the phone.

Mailed/E-mail Surveys

Pros-They can be very cost effective, especially if created and managed internally. Surveys are generally not obtrusive to people-if someone doesn't want to fill it out, the survey is thrown away or deleted. They can be sent out to most, if not all, of the member base. Surveys allow for anonymity. This can be especially helpful when requesting feedback from employees.

Cons-Surveys can yield a low response rate. There is no opportunity to have a respondent elaborate on a comment.

Given that the weakness of one technique is generally another's strength, many institutions choose to employ a combination. This will increase the overall quality of the information and gauge the validity of the responses. For example, if both focus groups and surveys are conducted and the responses to similar questions have a common theme, one can be pretty confident in the data. If the results of two different techniques contradict each other, you need to ask yourself why that is. There may be a valid reason why the results are different, such as if the focus group and the survey were not done for the same market segment. However, in order to use the data for product enhancement, forecasting, brand development, or any other project, you need to determine that the information is accurate.

The best technique, or combination thereof, to use depends on two primary factors. The first is the purpose for gathering the data. If the goal is simply to gather feedback concerning a minor product enhancement, a mailed survey will probably suffice. If there is a desire to measure service levels, a phone survey may be warranted since you can allow respondents to expound on their opinions when necessary. Feedback on a change in advertising would require a focus group so participants' full range of reactions can be gauged. A major objective that involves a change in strategic direction or an alteration to the brand essence would require information gathered from a variety of techniques.

The second factor is the budget available for the project. A company may find it's necessary to undergo a major facelift that necessitates a high degree of market research. However, neither the improvements nor the research is going to take place if there are no funds to collect the information. In these situations it's usually a wise idea to conduct the research that can be afforded and make changes slowly based on the results.

Kenneth C. Bator is president of Bator Training & Consulting, Inc. Mr. Bator can be reached at P.O. Box 4844, Naperville, IL 60567, at 630-854-6380, or at kbator

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