Customer Satisfaction &Quality

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Customer Satisfaction & Quality

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Customer Relationship Management Module 7

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Goals • To help a participant to understand the dimensions customer satisfaction and to improve his/her business performance • To help a participant to understand connections between quality of services and development of customer relationhips

• Main themes: Customer Satisfaction Quality of Services

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Customer Satisfaction

C

0

=expectations

> = <

C

P

=performance

Customer Satisfaction CopyrightŠ PHMC GPE LLC 2001-2011 sqq All rights reserved

Customer Satisfaction

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C

E

> C = <

P

En Customer do f Satisfaction R e C ust o lat ion mer sh ip

Commitment

Customer loyalty Prof it

abil ity

lity i b a t rofi p n U

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Customer Loyalty Is a customer loyal to:

• Company?

• Contact Person?

• Other customers?

• Product/ Brand?

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Dimensions of Customer Loyalty Dimension of action •Contracts •Technics Dimension of knowledge Learning Up-dating knowledge

Dimension of emotion •Images •Tradition •Confidence

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Customer Satisfaction & Quality

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Customer satisfaction

-

+ Quality

“Window of quality”

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Quality: an estimation of a company (not necessary own

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experience)

Customer satisfaction: an estimation of a company, based on own expectations and experiences Value : Experienced quality - experienced costs (incl. a price and other costs)

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Effects of Customer Satisfaction

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Quality of Services

Satisfaction of personnel

Customer Satisfaction

Strength of CR

•To know customer needs - easier to satisfy them next time •Lower costs of marketing •Reducing Price •Opportunity for extra selling

Lower costs

Profitability

Marketing made by a customer •Lower costs of marketing •Raising reliability •Easier to create a positive image for new customers

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Dimensions of Quality

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Customer relationship

First transaction

Service marketing

Traditional marketing

Goods services

Business-to-business marketing

Project marketing

Resources and competence of a company

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Aspects of Quality 1. Production oriented quality 2. Product oriented quality 3. Value oriented quality 4. Competition oriented quality 5. Customer oriented quality 6. Society oriented quality 7. Environment oriented quality

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Problems of Quality Work

– It requires systematic investment – It requires contacts to customer and understanding their value creation process – It requires real interest in development work

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Quality of Services

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Quality of Service Relational – in-company quality is not enough – there are different kinds of customers – quality in relation to price – quality in relation to competitors – it requires on-going development Total – everything effects on total quality – in-company customers Dependent on details – uniform quality – small things can give advantage in competition

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Quality of Service and Customer Satisfaction A Strategic Approach

• • • •

Objective quality Experienced quality Quality of episodes - quality of CR Visionary quality

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Quality of Services - A Basic Model Oral communication

Personal needs

Experiences

Communication (outside)

Expected service Dimensions of quality of services Experienced service

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Experienced quality of expected service

Expectations are effected on PHMC GPE GPE LLC LLC PHMC

 Marketing

communication

 Image  Price

of service  Oral communication  Customer needs  Earlier experiences  Investments of a customer  Details in the situations Copyright© PHMC GPE LLC 2001-2011 sqq All rights reserved

Expectations of A Customer

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Standard for comparison

Episode

Ideal types

Ideal service Wanted service

Connected with branch

The best experienced service A typical service Accepted service

Connected with customer relationship

Typical for that special company

Experiences including All the acts and episodes during the customer relationship

Case by case

Expectations this time

Experiences this time

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Experiences are affected by... …all the variables present at service situation:  personnel  operations in service process  service environment and other physical resources  price  ... As well as a customer him/herself!

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Image Physical quality Quality of interaction

C expectations

> = <

C performance

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Experienced Quality Image Atmosphere inside a company Competence of personnel Behavior Appearance Handling customer contacts Reliability

HOW

WHAT

Entirety of service Physical resources Competence of a company

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Motivation

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Quality Criteria of A Customer 1. Reliability: things are done correctly, timetables are kept etc.

2. Physical resources: rooms, machines, equipments etc.

3. Willingness to serve: ready to serve, quickness 4. Expertise 5. Courtesy: friendly, respectful personnel 6. Reliability: image, consistency, accuracy 7. Security: physical, economical risk 8. Access: easiness to access at convenient times, waiting times 9. Communication: easiness to understand 10. Understanding the customer: special needs and wishes

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Price and Quality Price effecting before service situation: price is a hint of quality of service Price effecting after service situation: paid price is a cost which will be compared to experienced value

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Measuring Service Quality

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Measuring Service Quality “Objective”

Quality standards

“Subjective” Qualitative “story”

Estimation based on qualities

Interviews

“Normal”

Complaints Critical

episodes

“Customer “Mystery

juries”

inquiry (service is measured by scale) Picking

up problematic situations

SERVQUAL

shopper”

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- type scale

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The Model of Service Quality by Davis

High

Effectiveness = the lowest acceptable value

Area wanted by a customer

Area of service quality

Area wanted Not-wanted by a producer area Low Efficiency = the highest acceptable value

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Quality management of a service company A. Idea of Management

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of quality of service and decisions of quality

B. Idea of Contact Persons of quality of service and ability to act according to quality decisions Marketing

Expected quality

Service production

Measures of Quality Control

Estimation

Experienced quality

C. Customers’ view on quality of service

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Vicious Circle

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Economical problems or tightening competition Weakening of company image

Decisions concerning in-company effectiveness

Dissatisfied customers Weakening of quality of service Increasing traditional marketing

Weakening of quality of service

Dissatisfied customers Minor savings in costs Weakening of atmosphere inside a company

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Service Processes

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Phases of Service Process Service creating added value Support service

Core service

joining joining

consumption consumption

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leaving leaving

Service Systems of A Service Company

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Customer Customer resources resources

System for monitoring a customer

System of interaction

Physical Physical resources resources

Personnel Personnel resources resources

System for working

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Resources of Service Production

Customer Resources

– customer participates in service production – customer effects on service of other customers Personnel Resources

– customer contact personnel Physical Resources

– frameworks – goods – tools

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Customer Participation &

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Division of Labor Division of labor between customers

– guiding Division of labor between customers and personnel

– use of resources Division of labor between customers and physical resources

– “users guides”, manuals Copyright© PHMC GPE LLC 2001-2011 sqq All rights reserved

Participating Styles of Customers PHMC GPE GPE LLC LLC PHMC

   

 

Defining = a customer defines himself the service package he wants Marketing = a customer informs others about the service he has used Developing = a customer gives impulses for development work of services Controlling = a customer controls the quality of service he uses and aims at controlling the production process as well Productive = a customer is an essential resource in production process Consuming = a customer uses the service during the total production process Copyright© PHMC GPE LLC 2001-2011 sqq All rights reserved

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Production System of Service

A Part not seen by a customer: service

strategy in-company services systems

A Part seen by a customer: contact

persons machines, equipments, other physical resources other customers Copyright© PHMC GPE LLC 2001-2011 sqq All rights reserved

In-Company Marketing

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TRAINING ACTIONS OF FOREMEN IN-COMPANY COMMUNICATION

Recruiting good workers Keeping good employees Motivating employees to serve market

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Effects of Customers

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EMOTION

Emotion Satisfaction Confidence Disappointment

CUSTOMERS

KNOWLEDGE

ACTIONS

Knowledge Price Contents of service Experiences CopyrightŠ PHMC GPE LLC 2001-2011 sqq All rights reserved

Actions Decisions Demand Negotiations Complaints