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How we set our priorities at Zephyr

May 26, 2011 Will Clemens

How we set our priorities at Zephyr
Every business is constantly forced to prioritize. New ideas from research, requests from customers, or pressure from competitors all vie for attention. Zephyr is no different. How do we decide where to focus?

We talk to our customers. We try to make all key resource decisions based on whether a priority has been validated by direct customer feedback. This might seem obvious, but it takes persistence and discipline to get it right. We call this methodology our “Voice of the Customer” program. As a vendor, our role is not to tell customers what to buy. Rather, it’s to listen and learn from them, and try to deliver what they need. We don’t always get this right, we usually need to focus on a smaller number of items than customers would like, we can’t always do what customers need, and we can’t always do something based on a single request. But, the goal is to allocate resources to the areas where customers point us.

Isn’t Zephyr supposed to be the expert? Shouldn’t we “know” what customers need? Aren’t we paid to “figure this stuff out?” Yes and no. Yes, we are the ones being paid to develop and deliver a solution. But we all will get a better result if our customers tell us where to look; Zephyr’s business will be healthier and customers will be happier with what we deliver. Customers don’t have to give us technical specifications, but they can help us identify a problem and the requirements to fix it.

An example is Zephyr OnDEMAND, a new Zephyr product designed for client management and sales teams. Many customers told us that they wanted to distribute Zephyr analytics to a wider audience. But, these other teams need a simpler, template-driven system that incorporates disclosures and other compliance requirements. Customers didn’t tell us they needed “Zephyr OnDEMAND;” rather, they told us if we addressed some shortcomings of our original product, they would give Zephyr to more people. We solved the problem by designing something new.

Another example is the Zephyr K-Ratio, a new risk/return measurement that incorporates the ordering of returns. We heard customers cite the limitations of established risk/return measurements, such as the Sharpe Ratio, because portfolios with very different return characteristics could have identical Sharpe Ratios. Our Director of Applied Research, who heard customer complaints about established risk/return measurements countless times, then learned about the underlying mathematical concept for the Zephyr K-Ratio in his studies. With further research and programming, we were able to take a somewhat obscure metric and apply it to investment research. Matching customer feedback with academic research, we introduced a new way to measure portfolios to supplement the established ways.

Since I joined Zephyr last year, we’ve put an emphasis on listening to customers. We’ve doubled the size of our Support and Consulting teams. We’ve started a regular process of surveying customers. We hosted a conference and recently completed a 11-city tour, in which Zephyr’s management team met hundreds of customers in one-on-one and group meetings. In my first year, I’ve personally met with over 200 customers. All of these meetings provide an opportunity for us to share what we’re doing, but more importantly, we get feedback on what’s working, what’s not, and what our customers would like us to prioritize. What we learned has directly impacted our development priorities in 2011 and led us to change staffing plans and business policies.

The Voice of the Customer methodology is not unique to Zephyr. Links to some third party sources are below. If you are interested in discussing this concept more or providing us feedback, please contact me here.

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