Preventing Success Bias in Client Priority Lists

2013-03-04 17.35.08An interesting question came in on our discussion of client priority lists asking “Isn’t there an inherent success bias built into any client priority list?”. This is a great question and great observation. There is definitely a built-in bias with these lists because by nature they tend to include accounts that have either the biggest production or the biggest upside relative to the rest of the client base. Also these lists tend to be modified continuously to add accounts that have recent increased focus and to remove accounts that are proving difficult to realize their opportunity. These factors lead to lists that are artificially positive/successful and are also difficult to track their overall success.

I have some guidelines to help address these problems.

1) Set a schedule on when lists can be modified. Ideally lists shouldn’t change very often, maybe once or twice a year. Any more and it would be difficult to allow for any traction of new prioritization and it will make the list difficult to track and evaluate.[more…]

2) Define clear rules around how and why a list is modified. In the most formal form, a committee can be created to evaluate the composition of the list and the details of the service offering. The committee should be comprised of representatives of all client-facing groups and all should have a voice. Make sure that any addition or upgrade in the list is matched with a deletion or downgrade in order to keep consistency in service across the platform, and prevent the list from continuously growing.

3) Measure and track the performance of a list like an investment portfolio in order to track the success of the program overall. The “performance” of the program can be viewed as performance year-to-date, over 1 year, over 2 years, etc. Performance of dropped/downgraded accounts should factor into the overall performance over time. It’s important to realize that what you want to understand is not only the impact of an account being on the list, but also whether all the components of the program are working to promote the programs goals.

4) Although this final point may be overkill, it has proven useful when testing new client prioritization programs. Each time a new priority list is created, it should be labeled and tracked separately. For example, you could have 1H 2012, 2H 2012, 1H 2013, and 2H 2013 as separate lists. Overall this is a good benchmarking exercise to help test assumptions about the list and component parts.

There’s usually a concern that by putting too many rules around client priority lists, the organization loses flexibility in targeting resources to potential opportunities. Managers need to find a balance between that flexibility and a structure that allows visibility into priority list’s effectiveness.

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