The latest thinking on Customer Satisfaction Measurement

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The latest thinking on Customer Satisfaction Measurement Leading Edge Management Consultancy Limited 27th April 2004 Leading Edge Management Consultancy Limited 1
Why we feel we understand the issues around customer satisfaction We have been carrying out customer service audits, by telephone and face to face interviews, since 1995. 6000 interviews have been completed We always use ‘moments of truth’ Audits are comprehensive but expensive A web based system is be cheaper KPI-online was developed and launched (now known as ACE) Leading Edge Management Consultancy Limited 2
And what we do ourselves: We became quality assured in 1997 and now have ISO 9000: 2000 We aim to capture our clients expectations in our briefing sheet when we meet the client We use KPI-online system for getting feedback from our clients We have been using a system for capturing improvements since 1996, called Worry Notes (now known as PIN Notes) Leading Edge Management Consultancy Limited 3
The need for change... A benchmarking study of 66 central government departments’ construction projects (with a total value of £500m) showed that in 1999: 3/4 of the projects exceeded their budgets by up to 50% 2/3 exceeded their original completion date by 63% Source: Benchmarking the Government Client Stage 2 Study: Agile Construction Initiative, December 1999 Leading Edge Management Consultancy Limited 4
The issues for a modern efficient and effective construction industry The construction industry is not known for focusing on customers’/end users’ needs Many of the people who are actually managing construction projects have no experience in doing so. head teachers hospital trust managers groups that have been allocated lottery money (e.g. Bootle Cricket Club’s pavilion) They may have an unrealistic idea of what they are going to get for their limited budget and may be insufficient The public sector (with the NAO) is driving the way of engaging stakeholders in defining construction outputs not inputs Leading Edge Management Consultancy Limited 5
But we can help by changing the way we approach customer satisfaction To improve, we need to: understand what is have specific actions to important to each customer work against as an individual choose a specific person to measure to give a datum be responsible for making point to show where sure agreed actions are improvement is needed carried out look for where measure continuously to improvement is needed show that improvement has taken place Leading Edge Management Consultancy Limited 6
And so we must begin with a measurement system that asks the right questions Many companies have If people are being scored been working with Key and they don’t understand Performance Indicators the basis on which they (KPI’s) - but if they get a are being scored, it can low score they don’t know be very threatening. what to do to improve it They need to understand We need to measure what they need to do to things that give us an ‘score an 8’ action list to work against Leading Edge Management Consultancy Limited 7
Principle 1. Measure in a useful way by focusing on ‘Moments of Truth’* A ‘Moment of Truth’ is Murphy’s law says, according anytime a customer comes to Tom Peters, into contact with any aspect ‘each bad moment of truth of a business, however scores 10x against you, remote but each good moment of truth only scores 1x for you’ It is an opportunity to form an impression Many ‘Moments of Truth’ are controlled by people People are probably your least controllable asset *Jan Carlzon, SAS Airline, 1981 Leading Edge Management Consultancy Limited 8
Make the questions into statements which the scorer can agree with on a scale of 1-10 Understand what the Focus on the performance customer expects gap between the two so that the team can strive removes the arbitrariness to meet it of different scoring scales, not every element is i.e. what is an 8 out of 10 equally important for one person may be a 6 for another Measure what the customer perceives is the level that Perception may not be the team is reaching reality - but that means the so that the team can issue still exists, but is one identify where its of communication performance is falling short Leading Edge Management Consultancy Limited 9
You need to be able to aggregate the data against business models that managers are familiar with While project team members need to work to improve their ‘Moments of Truth’… Managers need to get a higher level strategic overview against standard business models that they use: Business excellence model Customer satisfaction Quality standard ISO 9000:2000 Leading Edge Management Consultancy Limited 10
The Business Excellence Model (shown in relation to ISO 9000:2000 headings) System Involvement Process Approach of People Approach ENABLERS RESULTS PEOPLE PEOPLE RESULTS Leadership Factual LEADERSHIP POLICY & PROCESSES CUSTOMER KEY PERFORMANCE Decisions STRATEGY RESULTS RESULTS PARTNERSHIPS SOCIETY & RESOURCES RESULTS INNOVATION & LEARNING ® EFQM Excellence Model Continual Supplier Customer Improvement Relationships Focus Leading Edge Management Consultancy Limited 11
How customer satisfaction can be expressed against 5 dimensions of customer service* Customer service Reliability Responsive- Assurance Empathy Tangibles ness or or or Competence Understanding Equipment and Image Moments of truth * based on research conducted by Parasuraman, Zeithaml & Berry (Journal of Marketing Vol 49 1985). Leading Edge Management Consultancy Limited 12
How the ISO 9000:2000 process model needs customer requirements & satisfaction to be acted on ACE workshop MANAGEMENT RESPONSIBILITY PIN notes R S C e a C U q CONTINUAL t U u KPI- i S I s S T r RESOURCE Management MEASUREMENT online f T ANALYSIS O e MANAGEMENT System a O m IMPROVEMENT scores c M e t M E n IMPROVEMENT i E R t o R s n PRODUCT & SERVICE INPUTS OUTPUTS REALISATION Leading Edge Management Consultancy Limited 13
You also want to be able to present the data in a graphical and simple way that will show trends Leading Edge Management Consultancy Limited 14
Principle 2. Start off by understanding exactly what is important to your customer BEFORE YOU BEGIN THE PROJECT so that you can: Identify what the client Help the client understand expects from the project their role & how they can team on each moment of help improve the way that truth the project works This identifies what a 6 or 8 Help all members of the is. And more specifically project team to understand what a 10 is - as this will be their mutual responsibilities best practice to one another Explain to members of the project team what they need to do to achieve specific scores Leading Edge Management Consultancy Limited 15
If you know what is important to your customer then the measurement should be just a formality Discuss with the client what Measurement can be at any is important appropriate frequencies it brings their hidden but should be far enough agendas onto the table apart so that improvements can be made and seen before the next scoring When you understand what a customer wants it is easier to meet their needs Reviews look at any issues, measurement becomes suggested improvements or a formality changes - to agree the best course of action make one person responsible for making sure it happens Leading Edge Management Consultancy Limited 16
This means that: You know which issues You know exactly what you need improvement need to do to ‘score an 8’ You identify them early You can even probably enough to make predict what your score will improvements be Hidden agendas are Greater client satisfaction! exposed - no late surprises The project team works co- operatively & cohesively Leading Edge Management Consultancy Limited 17
Principle 3. Capture issues & develop best practice with the PIN Note system to: Identify issues that prevent Monitor progress a higher level of client satisfaction being achieved Agree the final solution Jointly problem-solve & Recommend it be adopted agree the likely area to find as best practice a solution Share it! Designate one person to be responsible for finding a solution on a clear timeframe Leading Edge Management Consultancy Limited 18
The PIN Note (Worry Note) system looks like this.. Leading Edge Management Consultancy Limited 19
Which means that.. The whole team is working It provides a meeting together agenda for communicating internally Ideas don’t get lost or forgotten The whole organisation is progressively brought up to Dates & actions are met the standard of the best Improvements actually happen Leading Edge Management Consultancy Limited 20