week 4 customer satisfaction retention loyalty

L4. TQM (SHAD 2073)L4. TQM (SHAD 2073)Customer Satisfaction, Retention &

Loyalty

Who is the customer?Identify customer needsCustomer valueCustomer retentionCustomer loyalty

TQM-Chapter 1: Introduction

C2 Customer Satisfaction

Principal 2: Customer SatisfactionPrincipal 2: Customer Satisfaction

Critical factor for success organization Customer service is very important because:

– Customer will tell twice as many people about bad experiences as good experiences.

– A dissatisfied customer will tell 8 to 10 people about the bad experiences.

– 70% of upset customers will remain your customer if you resolve the complaint satisfactorily.

– It is easier to get customer to repeat than to find the new business.– Service firms rely on repeat customers for 85% to 95% of their

business– 80% of new product ideas come from customer– The cost of keeping an existing customer is one-sixth of the cost of

attracting a new customer.

Who is the customer?

Figure 7.1 Figure 7.1 Traditional View of Suppliers and Customers Showing That Customers and Suppliers Are StrictlyTraditional View of Suppliers and Customers Showing That Customers and Suppliers Are Strictly

External EntitiesExternal Entities

C2 Customer Satisfaction

Supplier-Customer Model in Supplier-Customer Model in Total Quality SettingTotal Quality Setting

Supplier Supplier Supplier Supplier

Customer & supplier

Customer & supplier

Customer & supplier

Customer & supplier

Customer & supplier

CustomerCustomerCustomer Customer

internal

External

Strategy for identifying customer Strategy for identifying customer needs: PDCA approachneeds: PDCA approach

Plan:– Speculate about the results– Develop information-gathering plan- How

Do– Collect data

Check– Analyze– Valid?

Action– Priority? Short / long term?

Identifying External Customer NeedsIdentifying External Customer Needs

Information gathering plan

Figure 7.3 Six-Step Strategy for Identifying Customer Needs

Quality Function DeploymentQuality Function Deployment

QFD :

Is a technique that seeks to bring the voice of customer into the process of designing and developing a product or service

C2 Customer Satisfaction

Identifying Internal Customer NeedsIdentifying Internal Customer Needs

Employees depends on one another as

Communication

C2 Customer Satisfaction

Customer satisfaction

Customer Satisfaction ModelCustomer Satisfaction Model

The Teboul Model (1991)

Company Offer

Customer Need

Unnecessary

How do customers define quality?How do customers define quality?

What does quality represent to a customer?ASQ: Quality =

– “a subjective term for which each person has his or her own definition. In technical usage, quality can be two meanings :

–The characteristics of a product or service that bear on its ability to satisfy stated or implied needs

–A product or service free of deficiencies

Customer Perception of Customer Perception of qualityquality

An ASQ survey on factors that influence purchases:– Performance– Features– Service– Warranty– Price– Reputation

QUALITY

How do customers define How do customers define VALUE?VALUE?

Value= the attributed or relative worth or usefulness of a product/service, is judged by consumer each time he or she trades something or worth in order to acquire the product/service.

What is the difference between What is the difference between satisfaction (S) and perceived satisfaction (S) and perceived

value (PV)?value (PV)? S & PV are related but different concept.S = expectation vs experiencePV, goes beyond customer satisfaction

Future Transactions (repurchase)

Loyalty????

http://www.youtube.com/watch?v=6y-bWZnfIYIhttp://www.youtube.com/watch?v=6y-bWZnfIYI

TQM-Chapter 1: Introduction

Listen, Acknowledge, Solution, Thank you {L.A.S.T}

C2 Customer Satisfaction

Customer FeedbackCustomer Feedback

Why important?– Discover customer dissatisfaction– Discover relative priorities of quality– Compare performance – Identify customers’ needs– Determine opportunities for improvement

Customer FeedbackCustomer Feedback

The TOOLS:– Comment Card– Customer Questionnaire (Survey)– Focus Group– Toll-Free Tel. no.– Customer visit– Web Site Inquiries– Clinic

Reactive Customer-Driven Reactive Customer-Driven Quality ModelQuality Model

Customer Expectation

Supplier Performance

Region of Complacency

Region of dissatisfaction

Time

Q

Continual communication is required because customer needs change and it is dynamic

Customer Relationship Customer Relationship ManagementManagement

Complaint Resolution

Feedback GuaranteesCorrective

Action

Thank you