Published by:
Harvard Business Publishing
Length: 14 pages
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Abstract
U.S. corporations lose half their customers every five years. But most managers fail to address that fact head-on by striving to learn why those defectors left. They are making a mistake, because a climbing defection rate is a sign that a business is in trouble. By analyzing the causes of defection, managers can learn how to stem the decline and build a successful enterprise. The longer customers stay with a company, the more they are worth. The key to customer loyalty is value creation. The key to value creation is organizational learning. And the key to organizational learning, says the author, is grasping the value of failure.
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Abstract
U.S. corporations lose half their customers every five years. But most managers fail to address that fact head-on by striving to learn why those defectors left. They are making a mistake, because a climbing defection rate is a sign that a business is in trouble. By analyzing the causes of defection, managers can learn how to stem the decline and build a successful enterprise. The longer customers stay with a company, the more they are worth. The key to customer loyalty is value creation. The key to value creation is organizational learning. And the key to organizational learning, says the author, is grasping the value of failure.