Customer Satisfaction  ((adapted from “Measuring and Managing Customer Satisfaction” by Sheila Kessler)

Customer satisfaction = Results - Expectations 

You have to compete everyday, for every customer. 

Written customer surveys and satisfaction measures were supposed to be the answer in the late 1970s and 1980s.  But it’s easy for your customer satisfaction system to evolve into a technical, statistical –and ineffective system.   

Understanding your customers does not depend on the size of your unit or company.  You can learn to both measure and manage customer satisfaction and value.  Why is measuring customer satisfaction important?  Because “If you are not measuring it, you are not managing it.”   

Your customer assessment system has to please customers while it assesses them. 

Problems with Typical Customer Satisfaction Measurement Systems 

• A once-a-year written survey is too little, too late
• Doesn’t include information about competitors (ask your competitors’ customers questions about your company)
• Doesn’t focus on important customers (focus on segments that are linked to your future financial success)
• Doesn’t match the depth of the tool to the sophistication of the customers (target key customers for a more personal interview—not just a survey—on customer satisfaction)
• Designed at too low a level in the organization (integrate the system from the top)
• Doesn’t send the right message that you care about your customers and what they want (it’s better to not survey at all if you’re going to survey poorly).
• Doesn’t take pricing into account (it is critical for you to know how much the customer will pay for which features)
• Doesn’t test the customer satisfaction measurement tools before deploying them
• Doesn’t train and use frontline employees to constantly gather customer satisfaction information

The winning way to keep in touch with customers is a real-time, dynamic model of simultaneously measuring and serving customers’ needs.  Train your employees to instantly observe a customer’s needs and know how to adjust the service or product accordingly.  A real-time, every time customer satisfaction model goes way beyond just using a written survey and taking action on it once a year.   

From a strategic point of view: You do not have to sample all of your customers 

1. Focus on customers who are important to your bottom line.
2. Focus on the exact issues that are important to that group.

Technology allows us to ask, “Who are the customers most important to us, and what do they contribute to profit?”  Technology allows us to use the information that links the financial investment a company makes in a particular customer and the return that customer generates to the company.  For example, consider each segment within your market and measure that segment based on things like: highest revenues, highest profits, highest growth potential, etc.  Now you have a segment or two to focus upon.   

Reaching out and touching your high-end customers not only measures their reactions, but also cements your relationship further.  Eventually your customer satisfaction measurement and management system can be tailored to each important customer instead of segments.  By that time you should have in place a system that empowers front-line employees to gather much of the information.   

When designing the tools to use in your customer satisfaction measurement system, keep in mind the following:

·         High-relationship services or products require personal measurement tools

·         Low-relationship services or products can use impersonal tools 

Some of the tools mentioned in “Measuring and Managing Customer Satisfaction” include:

·         Advisory board (made up of customers)

·         Blind survey

·         Complaint system

·         Customer information file

·         Customer satisfaction survey (telephone, written)

·         Focus group

·         Perceptual survey (relative to your competition) 

Noriaki Kano described three levels of customer satisfaction: 

·         Expected quality (if you meet the standard, doing a better job at that feature will not buy you any more business)

·         Desired quality (the better you are at providing desired features, the greater the satisfaction)

·         Excited quality (customers aren’t expecting these features of your product or service; they are “wowed” or pleasantly surprised) 

Note that the “wow’s” soon turn into normal expectations (e.g., having air conditioning in your car).   

Next time we’ll discuss which tools to use based upon which level of customer satisfaction you are dealing with.   

Have a great week! 

Keith