1. CUSTOMER SATISFACTION and RETENTION
LECTURE (7)
CUSTOMER SATISFACTION and RETENTION

2. Major Topics Understanding Who Is Customer
Understanding Customer Defined Quality
Identifying External Customer Needs
Identifying Internal Customer Needs
Customer Satisfaction

3. Understanding Who Is Customer
In total quality setting, customer defined quality (external customers) and employees produce it (internal customers)
A Customer as anyone who is affected by the product or process. Three categories of customers the emerge : External customers; Internal customers; Supplier as customers.

4. Understanding Customer Defined Quality
In a total quality, quality is defined by the customer
The customer must be the organization’s top priority. The organization’s survival depends on the customer
Reliable customers are the most important customers
Customer satisfaction is ensured by producing high quality products

5. Identifying External Customer Needs
Take action
As indicated
Check the
Validity of your
conclusions
Analyze the
Results
Scholtes’s Six Step Strategy for Identifying Customer Needs
Observation; Capturing data;
Reflection and analysis; Brainstorming for solution;
Developing prototypes of possible solution
Gather the
information
Plan how to gather
The information
Speculate
About the results

6. Identifying Internal Customer Needs
Identifying the needs of internal customers is a matter of ensuring that employees who depend on one another as individuals, as well as departments that depend on each other as units, communicate their needs to one another continually

7. Customer Satisfaction
Why Measure Customer Satisfaction?
Customer Value
Design and Use of CSM Program
Are You Customers Completely Satisfied?

8. Why Measure CS? The average business losses between
10%-30% of its customers each year,
often without knowing :
Which customer they have lost?
Where they were lost?
Why there were lost?
How much sales and profit customer decay has cost them?

9. Customer Value Your customer’s perception of the value
of your company provides is based on
the following attributes foundation :
Organizational
Product
Service
Future Behavior

10. Design and Use a CSM Program
Defining the objectives
Develop the research design
Identify the attributes
Questionnaire design
Designing the sample plan
Pre-test the CSM Program
Analyzing the data
Using the data
Benchmarking
Benefits of using satisfaction surveys

11. Defining the Objectives
Any road will do if you don’t know where you want to go
Identify customer’s priorities
Learn customer’s tolerance band
Receive first-hand input on your company’s performance
Obtain performance rating relative to your customer’s priorities

12. Develop the Research Design
Research design is a fundamental part
of the CSM process
Research design flow directly from the stated objectives
Must be developed to ensure reliability
Ability to provide consistent results
Measure the original intent
Eliminates bias

13. Questionnaire Design Accurate identification of attributes that
are important to the customer is the
foundation upon which all sub-sequent
portion of the CSM program must be
built
Product attributes
Service attributes
Organizational attributes
Future behavior attributes

14. Designing the Sample Plan
Sampling is a highly visible element of research design
Pre-tests are essential. Do not minimize! They validate:
Questionnaire
Sampling
Data
Analysis

15. Benefit of Satisfaction Surveys
Improve customer, client or employee, loyalty
React quickly the changes in the market
Identify and capitalize on opportunities
Beat the competition
Retain or market share
Increase revenue
Reduce cost

16. Quality TIP
“ Profit in business comes from repeat customers, customers that boast about your product and service, and that bring friends with them. Fully allocated costs may well show that the profit in a transaction with a customer that comes back voluntarily may be 10 times the profit realized from a customer that respond to advertising and other persuasions”
Source : W. Edwards Deming (1991)