Introduction
This guide is about consumer participation in corporate decision making. It is based on the experiences and recommendations of corporate managers and consumer leaders who personally have helped to make consumer advisory panels a valuable part of business planning and a meaningful forum for the expression of consumer views.
A Guide to Establishing Face-to-face Consumer Participation Programs
Why should a company consider a consumer advisory panel? Formal or informal, a panel performs several important functions:
- establishing communications between a company and its customers
- giving customers a chance to voice their concerns to company management
- helping to find solutions to potential or existing problems and issues
- giving companies a human face
- enhancing the credibility and viability of companies, both large and small
What kind of consumer advisory panel would serve your company's purposes?
First, decide what your company wants to achieve. If you want to learn how your shoppers feel about store employees, services and merchandise, consider a panel representing a cross-section of your regular patrons.
If you want to solicit the views of consumer leaders about specific company programs or public policy issues, consider a one-or-two-session special issue forum.
If you want to create an ongoing dialogue with consumers and consumer advocates as part of company planning and management, establish a long-term consumer advisory panel whose members represent identifiable, organized constituencies.
If you want to learn how better to serve a particular segment of the population (such as elderly, low-income or non-English-speaking customers), consider a panel representing these consumers and experts in the field.
If your company likes the idea of a consumer advisory group, but is uncertain exactly how a panel would fit into company operations, go slowly. Don't promise more than you are sure you can deliver. Consider one or two consumer round tables or issue forums as an experiment. If company management and the consumer panellists are both comfortable with the arrangement, more permanent panels may evolve.
What makes a consumer advisory panel succeed?
Although there are many kinds of consumer advisory panels, and no single secret to success, some general rules apply to them all:
- 1 - The purposes and objectives must be clear in advance and the consumer members must be confident they are not being "used".
- Even though it is up to the company to first determine its objectives in establishing a panel, the consumer members must be comfortable with the panel's purpose and operations, and they must have management's assurance that they will be able to influence the direction of the panel and the substance of its agenda. The extent of the panel's potential influence over company decisions and the way that influence will be felt should be clear from the start, particularly when a company considers some topics to be off-limits.
- 2 - There must be well-understood and mutually acceptable ground rules.
- The extent and formality of ground rules depends on the nature and longevity of the panel. As a rule, they should state the purpose of the panel, define the membership and length of service, state the company's responsibilities and commitment, state the members' responsibilities and explain council operating procedures. Let the panel become involved in establishing ground rules, but be wary of becoming bogged down in red tape.
- Many panels find informal ground rules work well, so long as everyone understands and agrees to them. These generally include a description of the company's responsibilities (e.g: to listen seriously to panel recommendations and to respond, to provide backup support, and so on) and the panellists' responsibilities (e.g. to do their homework, attend regularly and bring constructive suggestions to meetings).
- Other panels have decided to develop written bylaws or rules governing such things as membership balance, nomination and selection procedures, conflict of interest, quorums, attendance requirements and rules about alternates.
- 3 - Top management must support the existence of the panel and be accessible to it.
- Management must be committed to listen to panel recommendations, to implement those that are feasible and to respond to all recommendations, whether they are adopted or not. It is a good idea for the chief executive officer to attend the first meeting to demonstrate the company's commitment.
- 4 - The effective decision-makers should attend meetings.
- The people in a position to implement the panel's recommendations, whether they are top management, department heads or store managers, should attend meetings to listen, make presentations and answer questions.
- 5 - The company must provide back-up support to the panel.
- Back-up support includes orientation, supplying background information, and serving as a secretariat if the panel so chooses.
- At least one company created a special staff position for liaison with the panel. This person steers panel recommendations through the company bureaucracy and arranges for studies, surveys and speakers at the panel's request.
- 6 - Background materials must be circulated prior to the meeting.
- Panelists need to know basic facts about the meeting: time and place, agenda, panelists' travel arrangements, who will be representing the company or making a presentation, who the other consumer representatives are. Background information about the company and about specific items on the agenda should also be circulated so everyone has the same basic facts to work with and so panelists can come fully prepared for a productive discussion.
- 7- The activities of the panel should not be publicized outside the company without the members' express consent.
- Publicity can hurt the panel's credibility if it leaves the impression that the panelists speak for the company. Employees of the company need to know about the panel and how it fits into the company framework so they will understand management's commitment should panel recommendations be referred to their department for consideration. But, outside publicity should be very circumspect, lest it jeopardize the effectiveness of the panel.
- Publicizing the existence of a panel may be necessary or desirable in order to recruit members.
What is the right size for a consumer advisory panel?
The optimum number of people at a meeting depends on the topics to be addressed and the best judgement of the panel about who should be included. Based on the experience of panel organizers and members, 10 to 15 people is a good number for a half-day meeting. If a meeting is to last all day, 24 people is not too many to allow everyone an opportunity to participate.
How can a company find panel members?
For Long-term Advisory Panels:
Let the consumers help designate panel members and add or replace members whose terms have expired. This can be done in several ways:
- Ask a neutral, trusted person (a consultant or academician who is sensitive to consumer issues or problems) or appoint a steering committee of consumer or public-interest representatives to organize a panel based on recommendations from the consumer and public-interest communities.
- Ask the interest groups that are to be represented to select a member to serve on the panel.
- Ask the public-interest community to submit names to create a pool of candidates from which the company can select a balanced membership.
For Shoppers' Panels:
- Post application blanks at stores or in advertising supplements.
- Select a representative cross-section of shoppers on a rotating basis.
- Ask people who have filed complaints to serve on the panel.
For Round Tables and Issue Forums:
- Using the same techniques recommended above, select a representative group of consumer and public-interest representatives from national organizations and local groups.
What about expenses and honoraria?
Companies handle compensation for panel members in a variety of ways. There is no one right approach. Many reimburse panelists for out-of-pocket expenses, particularly when they travel a long distance to attend meetings. Reimbursement may take the form of a modest honorarium calculated to cover gas and mileage, babysitting expenses and other incidental costs. Other companies provide a meal or gift certificate in addition to, or in lieu of, expenses.
Some companies provide a large honorarium to the organizations the panel members represent. Others pay an honorarium directly to panelists on the assumption that some of them do not receive a salary from the organization they represent. Many consumer organizations have preferences as to how their representatives should or should not be reimbursed. Companies should, therefore, check with the organizations directly as well.
The question of compensation for panelists is, however, controversial. Some consumer leaders have mixed feelings about accepting honoraria from a company because they are sensitive about the appearance of potential conflict. Other consumer advocates believe their time and services are just as valuable as those of any other consultant the company hires, and compensation allows them to devote their time to this activity.
How often should a panel meet?
This depends on the panel's purpose and workload. Many advisory panels meet monthly; others meet quarterly with subcommittee meetings in between.
Meetings need to be frequent enough to maintain continuity and communication and to allow the group process to work. It sometimes takes a while for the consumer and company representatives to learn to speak the same language.
How long should meetings last?
Meetings can last as long as necessary to accomplish the group's objectives but panels usually establish a routine.
Some groups agree that a meeting will last no longer than half a day, including breakfast or lunch.
Special issue forums or round tables that plan to meet only once or twice, or that bring people in from out-of-town, need to have longer sessions.
Who should prepare the meeting agenda?
The company and the consumer panelists should jointly determine the agenda in advance of each meeting. If the company prefers to draft the agenda to include the items it wants to cover, consumer panelists should have an opportunity to add items by suggesting them to a designated consumer spokesperson who works with the company liaison. Panels that convene regularly can set time aside at each meeting to plan the agenda for the next session.
Some things to remember:
- Avoid unproductive discussions of things the company cannot or will not do anything in response to panel recommendations.
- Leave enough flexibility and time to discuss new or tangential issues, should they come up.
- Limit the amount of time devoted to lectures or speeches to the minimum necessary to explain the issue. Save most of the time for discussion and decision making.
Who should run the meeting?
The chair of a consumer advisory group needs to have the confidence of its members. It should be an individual who is trusted by the group and who knows how to moderate a meeting. It is the quality of the individual, rather than his or her affiliation, that seems to make the difference. As mentioned earlier, a consultant or academician might act as chair.
Panels have worked well with an outside facilitator as chair. As a neutral party, the outsider can act as a buffer or mediator between the consumers and the company representatives. A good facilitator can serve other functions such as liaison between consumer panelists and the company, and disseminator of information between meetings.
What should happen with consumer panel recommendations?
All panel recommendations should be recorded and referred to the company personnel having the authority to make changes in policy. Each recommendation deserves to be treated respectfully and considered seriously by top management and by the affected departments.
It is suggested that management inform the panel within two months, or at its next meeting, what is being done with each recommendation.
There should be minutes or reports of each meeting prepared by a person chosen by the panel. An annual report of panel work and accomplishments is an important basis for evaluating the success of the panel.
How do the company and the panel know if consumer input is making a difference?
There are tangible measures of success. How many panel recommendations have been implemented? Have they improved company products, enhanced customer good will or improved profitability? Other benefits having to do with perceptions, attitudes and willingness to work together may be more difficult to quantify.
