1. 1 Table 2-1: Old Economy vs. New Economy Old EconomyNew Economy Organize by product units Focus on profitable transactions Look primarily at financial scorecard Focus on shareholders Marketing does the marketing Build brands through advertising Focus on customer acquisition No customer satisfaction measurement Overpromise, underdeliver Organize by customer segments Focus on customer lifetime value Look also at marketing scorecard Focus on stakeholders Everyone does the marketing Build brands through behavior Focus on customer retention and growth Measure customer satisfaction and retention rate Underpromise, overdeliver

2. 2 Measuring (and Acting upon) Customer Satisfaction

3. 3 Description of Cisco processes for Data Gathering Driving Action from the Data Tell the Customer ! Goals Initiatives Data Drivers Analysis Progress Metrics

4. 4 Satisfaction Motivation Revenue Time Strong emphasis on customer satisfaction Cisco Customer Satisfaction and Loyalty Increasing Company Value Reward for Performance Stock ownership Cisco Bonus Program Truly Loyal Accessible TrappedHigh Risk Loyalty

5. 5 The Complete Measurement Process Relationship Survey “Annual Sat Survey” Broad representation of all End-Users Partner served customers All theaters, all people 15 to 20 minutes Length Indications / Directions Overall Satisfaction Loyalty factors Experience satisfaction : Pre-Sales Team, Post-Sales Software, Products Digging / More Info Follow-on surveys EMBU Product Surveys Focus groups / TAGs Product Beta tests Ongoing Tracking TAC Bingo Cust. Service survey CCO Satisfaction Internal Measures : On time shipment Bugs per week indicate understand measure Transaction Every User Every time Small & Quick Understanding Selected Customers Particular subjects Could be deep & long We need all three layers to Measure and Improve Customer Satisfaction

6. 6 Continuous Flow – Annual Satisfaction Measurement Invitations / Replies Thru-Out the Year = It’s a Continuous Process A Particular Person gets ONE survey during the year = It’s an Annual “event” Invite Analysis / Actions Start 1 August Replies = Data Stop 15 July Bonus Calculations 30 Apr Sources “One-byOne” Field Sales Anyone at Cisco Channel Partners : www.cisco.com/go/pal/ “Mass Upload” TAC case customers Web users Networkers attendees Etc.

7. 7 Real Time Invitations: Cisco and Partners SEND Options SEARCH company Name database Cisco: Web Based Names Tool Cisco Partners: External Portal And Web Based Names Tool

8. 8 Customer Information Gathered Sample Information Includes – Name, e-mail, Country – Account Manager and System Engineer – Sales Hierarchy ( Theater, Area, Operation, Region ) – Partner Name sending invitation Cisco Standard Company (CSC) name Global Ultimate ID - GUID Company Target ID - CoTgtID – Company site ID ( future ) Customer Input – Co. Size, Market Type, Role in Company – Cisco Products in Use – Follow-up Contact Y/N ? & Release Info to Partners Y/N ? – Name, phone, address for further contact

9. 9 Names Machine- Real Time Status Names Blanked Out

10. 10 Names Machine – Low Score / Loyalty Alerts

11. 11 Annual Survey Questionnaire : http://survey.walkerinfo.com/MZTEST0

12. 12 TAC “Bingo” Customer Survey BINGO survey for every Closed TAC case

13. 13 Reporting Tools Allow Wide Access to Results Scoreboards Fixed Format Reports GUID and CoTgtID codes allow Company Specific Reporting too

14. 14 2002 National IT Customer Benchmark Study - Cisco IT Benchmark Network Sector (Excl. Cisco) Truly LoyalAccessible TrappedHigh Risk 36%2% 32%29% IT Benchmark Total (Incl. Cisco) Truly LoyalAccessible TrappedHigh Risk 47%3% 29%21% We Compare Cisco to Others via Benchmarks Source : “Analysis of Cisco Customer Loyalty – Walker Information Oct, 2002 GUID and CoTgtID codes allow Company Specific Loyalty

15. 15 OK - We Have a Bunch of Data... So What ? What are the Key Drivers of Satisfaction and Loyalty ? “This finding supports previous analyses that have shown that for customers worldwide (regardless of loyalty level), satisfaction towards Cisco is largely driven by how they perceive interactions with the Account Team, Hardware Products and Post-Sales Technical support” - (Walker National Benchmark study) “Three separate analysis techniques were employed to rigorously test which key areas influence whether a customer is Trapped or Truly Loyal. All three analyses confirmed the same key areas:” – Hardware Products – Account Team – Post-Sales Technical Support - (Analysis of FY-02 Cisco data) Source : “Analysis of Cisco Customer Loyalty – Walker Information Oct, 2002

16. 16 Taking Action to Improve Support Satisfaction WalkerInfo Computes relative Impact, or Importance - Timely Case Closure is seen to be the Biggest Driver of Post Sales support – Lower Sat level too, so there is plenty of “Runway” around this issue. CA Initiatives for FY-03: TRIP – Timely Resolution Improvement – Re-Launch of TAC-WEB site – PSI – Product Serviceability Improvement – Low Score Follow-Up Process

17. 17 TRIP Launched - June 2002

18. 18 Post Sales Support ( cisco ) Real Time, Web based Reporting Customer Advocacy takes Goal on overall Support Q# 34 The TAC team watches this Number While BINGO Q #3 is the Business metric

19. 19 Communicating in Cisco “My Customer” Pages Consolidating Customer Sat information as well as Service and Sales Initiatives For Top 3,000 accounts Company Specific Scores and Alerts Note: Demo Data Low Score Alerts Satisfaction, Loyalty by Customer

20. 20 Communication to Customers Survey Participants See this Link in the Thank-you note http://www.cisco.com/warp/public/750/cust_sat/strength_areas.html

21. 21 The Action Process Annual Survey : Indications Goals Transactional : Timely Data Running Metrics Trends Comments : Extra Information Customer Follow-up Phone Interviews... Low scores - Contact “Overall” surveys gives Directions and Goals- ANNUAL Initiatives Delivered by Business Owners Transactional measures for tracking – eg: TAC BINGO

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