CUSTOMER ORIENTATION Chapter-5 Customer Focus Customer Satisfaction Model

CUSTOMER ORIENTATION Chapter-5 Customer Focus Customer Satisfaction Model Customer Retention Model Quality Function Deployment Customer Satisfaction Measurement

CUSTOMER FOCUS 1. 2. 3. Attracting more customers. Making them happy. Retaining them.

TYPES OF CUSTOMERS Type 1 ‘A customer who knows not what he wants and knows not that he knows not what he wants’ They are insignificant customers. Be gentle with him. It is relatively easy to satisfy them.

TYPES OF CUSTOMERS Type 2 ‘A customer who knows not what he wants and knows that he knows not what he wants’ They are humble customers. Teaching and training will make them knowledgeable. Then Satisfying will be easy.

TYPES OF CUSTOMERS Type 3 ‘A customer who knows what he wants and knows not that he knows what he wants’ They are sleeping customers. There may be only a few customers of this type. However, to awake them, attractive, stunning advertisements will make them understand the reality. Satisfying them will be tough.

TYPES OF CUSTOMERS Type 4 ‘A customer who knows what he wants and knows that he wants. ’ They are masters of themselves. They will be demanding types. Large percentage of customers fall in this category. The success of Quality mainly depends on making this category of people satisfied. They will even assume the position of the king!

CUSTOMER WINDOW Very good 3 1 4 2 Customer perception Poor Not at all Very much Importance to customer Priority Rating in Customer Window

CUSTOMER SATISFACTION MODEL Delighted customers Type B customers Customer without expectations Value addition not available Value addition available Type A customers Customer with expectations Dissatisfied customers

HOLISTIC APPROACH TO CUSTOMER SATISFACTION MODEL Human component Efficient Effective Needs of customers Unacceptable System component Interactive Model for Customer Satisfaction

CUSTOMER RETENTION MODEL Internal customers Implicit needs Sequencing Need identification Customer identification Strategies to fulfill the need Feedback from customer OK Production Explicit needs External customers Scheduling Not OK Improvised Customer Focus Model Delivery

CUSTOMER RETENTION MODEL Human Internal Service Quality Employee satisfaction Driver Employee retention Customer retention Profit Outcome External Service quality Customer satisfaction System

QUALITY FUNCTION DEPLOYMENT Characteristics of QFD ü Simply a technique that keeps the companies focused on what is important to the customer. ü A standardized approach to document and keep track of customers’ needs. ü A planning methodology that organizes relevant information helps companies make better decisions. ü A technique that helps companies do the things they know they should be doing. ü A systematic process that helps ensure that the voice of the customer doesn’t get lost in the product development process. ü A formalized way to keep track of all of the customers’, needs and to make sure that the most important needs get special attention.

QUALITY FUNCTION DEPLOYMENT Objectives of QFD ü A process that links customer and the company ü Getting customer requirements as input for processing and presenting it in a more specific form for improved customer satisfaction.

QUALITY FUNCTION DEPLOYMENT Main Features in QFD ü QFD is not tool, it is a process ü Inputs are customer requirements ü Matrix format is used to process the input ü Processing includes: deciding priority items, finding out relationships and comparing with competitors. ü Gives output as an action which will improve customer satisfaction.

QUALITY FUNCTION DEPLOYMENT Matrix of QFD ü Vertical part – customer requirement – competition details. ü Horizontal part – technical descriptors – competitive technical assessment.

Quality function deployment (house of quality) Interrelationship between technical requirement Horizontal part Vertical part Direction of improvement Customer Importance requirement rating Technical descriptors Comparison With Competitors’ product Relationship between requirements and descriptors Column weights Competitive technical assessment Operational goals and targets

THE CUSTOMER PART Customer requirement : v Customers of the organization are identified and their needs have to be listed out. v The survey is the commonly employed technique for getting the feedback from the customers on their needs. Information about competitors: v Questionnaires are usually used to conduct the competitor’s survey. v The responses reviewed and averaged.

TECHNICAL PART Translate the customers’ voice into technical language that a company uses to describe while designing a process or manufacturing. Ø Technical language should be: - measurable - something that should be worked on to satisfy the voice. 2) Find out the strength of relationship between customer voices and technical requirements. Ø The decisions are recorded in the centre of the matrix using symbols. Usually the following symbols are used: Triangle Strong relationship Single circle Moderate relationship 1) Square Weak relationship

TECHNICAL PART Direction of improvement is usually placed in the matrix above the technical requirement. v Symbols used to denote these directions are: Arrow pointing up ( ) – customer prefer the technical data to be higher Arrow pointing down ( ) – customer prefer the technical data to be lower 3)

COMPETITIVE TECHNICAL ASSESSMENT AND ESTABLISHING TARGETS The company’s product and competitor’s product is tested for each technical requirement and the quantitative data are recorded. q Time and money invested for this purpose depend on the number of technical requirements and the number of competitors included. q Target values are established using the competitive technical assessment graph (analyzing company’s position with competitor’s position) and direction of improvement. q

COMPETITIVE TECHNICAL ASSESSMENT AND ESTABLISHING TARGETS Technical requirements are related to each other. Ø Working to improve one may have effect on another in positive or negative way. Ø One of the main importance of co-relationship is that it indicates the negative relationships to the designers. Ø Symbols are mainly used to indicate the positive or negative relationships. Ø They are presented in the roof of the House of Quality. Ø Japanese uses four symbols for this purpose: Strong positive relationship Double circle Weak positive relationship Single circle Strong negative relationship XX Negative relationship X Ø

COMPETITIVE TECHNICAL ASSESSMENT AND ESTABLISHING TARGETS The bottom of the matrix is a row which has arbitrary value according to symbols in relationship portion. Ø This value is calculated by combining both importance level of customer’s voice and the numerical value assigned to each symbols. Ø Commonly used values are: strong - (triangle) 9 moderate - (single circle) - 6 weak - (square) 3 This may be calculated as percentage to highlight the column weight age. Ø

BENEFITS OF QFD Focus on customer ü Focus mainly on customer needs and wants. ü Compare their product with competitors. ü Prioritize according to customer’s level of importance. ü Identify the vital item to be acted upon.

BENEFITS OF QFD Time saving v Enables to change the design in the starting itself. v Limits the problems after introduction of the product. v Gives opportunities for future applications. v Reduces the time for redesigning since all changes are made in first step itself.

BENEFITS OF QFD Encourages teamwork ü Based on everyone’s ideas. ü Creates communication at interfaces. ü Team member are recognized.

SUCCESS OF QFD DEPENDS ON: Quality consciousness of each member v Prevailing team spirit v Correctness of customer requirements v Knowledge of members on management tools v Knowledge of members on process details. v

CUSTOMER SATISFACTION MEASUREMENT § § § Customer satisfaction measurement is done using customer survey methods. Survey may be oral or in written form. Questionnaires have to be prepared after carefully considering the type of questions, sequencing and scaling. There are three possible methods of administering the survey. It may be Interviewer-administered, Machineadministered or Self-administered. Each has its merits and demerits.

CUSTOMER SATISFACTION MEASUREMENT v Appropriate methods can be chosen based on the following characteristics: I. Extent of control maintained. II. Co-operation rate III. Cost IV. Possibilities of collection of observational data V. Minimum bias

CUSTOMER SATISFACTION MEASUREMENT Customer information Some of the tool/sources used for gathering information from customer are: § Surveys § Phone calls § Complaint reports § Trade trials § Customer audit § Sales force § consultants

CUSTOMER SATISFACTION MEASUREMENT Customer survey Market research can be done to get the voice of customer. The following forms of market research are available for use. § Exploratory research – to discover ideas and insights. § Conclusive research – to evaluate alternate courses of action. § Performance research – to monitor the performance of critical factors.