Best practices for measuring customer satisfaction? Is it upper level management, hired consultants, surveys, or reactions to industry swing? So many choices but what really is a best practice. Customer satisfaction programs, research, employee satisfaction, and personal experience all play a role in measuring customer satisfaction. Even when using those practices it takes effort and continuous improvement to stand a chance on improving customer engagement and satisfaction. Hopefully these next few paragraphs can add some insight on measuring results.
The problem companies face, is exactly how to and do it well. Companies need to understand how to quantify, measure and track customer satisfaction. Without a clear and accurate sense of what needs to be measured and how to collect, analyze and use the data as a major strategic focus to achieve business success, no firm can be effective in satisfying customer to drive business. [i] Plans must be constructed using customer satisfaction research results and design a strategy that target customers and/or processes that add to the bottom line.
The last thing a company should do is not take action, there is collateral damage in asking (resources and time) customers about a service or product if it won’t or can’t be changed. What are some of the ways to measure customer satisfaction. One used quite frequently because of the associated low cost is using outdated and unreliable measures of customer satisfaction. [ii] The data is already available but the trap of seeing volume decline then base lost volume on the rationalization of sales reps or upper management ultimately leads to a dead end.
Another way is to track and count the frequency of complaints and try to find the trends of the complaints and act on those leaving the other to continue. Eventually, realize those unhappy customers pay as late as possible or if at all. Another process is questionnaires or surveys. One downfall on questions is you tend to lump average outcomes (product quality, pricing, etc. ) with non-average issues (perception, attitudes, and expectations). There are few others best practices we will not elaborate such as employee satisfaction models, relationship models, and marketing models.
A major flaw with any MCS model is too many companies rely on a few measurements that never tell the whole story or too much information that will never be used. Until recently, this was the case at Waste Management. Waste Management uses a three-tier method to measure customer satisfaction. First we use J. D. Power to measure customer satisfaction. We strive for 55% of survey responses say they will definitely recommend use to someone else. We use this because a very satisfied customer is six times more likely to recommend than a customer who at the very least is just satisfied. iii] The next measurement is with our retention department. This department makes phone calls twice a year to our core customers to see how we are doing and if there is anything else we can do for them. A customer feeling that we care about them is nine times more likely to remain loyal. [iv] Almost guaranteed to renew their contract with us. The third measurement is an in house program we call code red, code green. Code Reds happen when a customer complaint or concerns are not addressed and the process requires an elevated response with an analysis if the occurrence was a trend or an isolated incident that can be corrected.
The second part strictly deals with recognition and incentives for the employees providing quality service. Each time a compliment is received the employee that was the responsible party for the customer to acknowledge they received quality service receives peer recognition and is awarded points that can be used as cash to purchase items from a merchandise catalog. The code green fosters pride and competition among employees and drives them to provide outstanding customer service. Using this methods in capsules many best practices used across many successful service organizations.
The keys are feedback, follow up, and continuously improving the customer experience. These methods measure customer satisfaction but there are some ways to improve. Being operationally focus to achieve greater bottom line results some of my recommendations would have to provide some linkage from the customer measurements and corporate strategy. Then tie those two together as an incentive to compensation for senior leadership. All to often we as a company we start down a path and everything is fine until a decision has to be for short term indices to be accomplished.
Many programs like customer satisfaction measurement are put on the back burner sort of speak. We can talk it but until you actually continue to see it the validity of these programs lose their luster. Although retaining customers is at the heart of success, stakeholders and investors want growth. So I think another piece would be to formulate a process to gather data from potential new business. Cannot grow unless you get new customers, what has prevented them from being a customers should be the focus.