The outer loop's explicit purpose is to prioritize and support the kind of customer-friendly changes that employees and teams can’t make on their own. It does this by making sure information (from customer feedback or the broader organization) is captured and routed to the appropriate decision-makers and performers—often through elevation from the huddle.

The outer loop also offers the opportunity to prioritize and invest in changes that will improve products, processes, policies, and other elements of the business that are beyond front-line employee control. It serves an implicit purpose as well: An effective outer loop makes employees feel supported. It gives them a voice in the firm's priorities. It creates confidence that the company's priorities support customer centricity—and that leadership is putting its money where its mouth is.

An outer loop must employ a rigorous, well-defined, and transparent process for addressing issues or opportunities elevated from across the organization. This process is often led by a customer advocacy office, or CAO, and can be supported by technology, like Bain & Company’s NPS Outer Loop on Qualtrics XM. Typically, the CAO is not responsible for resolving the issues and opportunities directly, but for running an effective process that gathers ideas, deduplicates and triages those ideas, and routes the ideas to the team with the resources and know-how to resolve them. The assigned team then investigates root causes, develops solutions, and decides how to prioritize these solutions vs. all other initiatives before taking action.

Throughout the process, the CAO makes sure that both customers and employees are informed about progress whenever doing so is relevant or required.