BI researcher wins prestigious international prize

The Marketing Science Institute (MSI)/H. Paul Root Award is awarded annually to the research article which represents the greatest contribution to the development and practice of the study of marketing. Candidates for the prize are nominated by the permanent members of the editorial board of the Journal of Marketing.

This year the prize will be awarded at the American Marketing Association’s Winter Conference, to be held 15-17 February 2008 in Austin, Texas.

Professor Tor W. Andreassen from BI Norwegian School of Management has won the outstanding research prize for an article published by him and his research colleagues Timothy L. Keiningham, Lerzan Aksoy and Bruce Cooile in the Journal of Marketing in July 2007.

The Journal of Marketing is the oldest and foremost international professional publication for the study of marketing.

Management tool revealed as a sham

In their prize-winning article, Tor W. Andreassen and his fellow researchers conducted a study of a management tool which is much used by large international companies.

The tool, Net Promoter Score (NPS) was developed by the top American consultant Fred Reichheld in collaboration with the companies Bains and Satmetrix. Briefly, Net Promoter Score expresses how strongly your customers will recommend your products and services to their friends and acquaintances (a promotion indicator).

Reichheld’s discovery was marketed under the cover of research and promoted as “The One Number You Need to Measure” in the Harvard Business Review as the only key figure you need to know in order to ensure your company’s future growth. The arguments in the article were later drawn attention to in the book “The Ultimate Question” from Harvard Business School Press.

Many managers have paid an exorbitant amount in their enthusiasm for their new management tool.

Andreassen and his American research colleagues have now revealed this tool to be nothing more than a sham by testing it on various data, including that for BI’s research project the Norwegian Customer Satisfaction Barometer.

The researchers have demonstrated that the management tool promises more than it delivers and go a considerable way towards suggesting that the results are fabricated.