1Leading Edge Management Consultancy Limited The latest thinking on Customer Satisfaction Measurement Leading Edge Management Consultancy Limited 27th April 2004 2Leading Edge Management Consultancy Limited Why we feel we understand the issues around customer satisfaction O We have been carrying out customer service audits, by telephone and face to face interviews, since 1995. O 6000 interviews have been completed O We always use ‘moments of truth’ O Audits are comprehensive but expensive O A web based system is be cheaper O KPI-online was developed and launched (now known as ACE) 3Leading Edge Management Consultancy Limited And what we do ourselves: O We became quality assured in 1997 and now have ISO 9000: 2000 O We aim to capture our clients expectations in our briefing sheet when we meet the client O We use KPI-online system for getting feedback from our clients O We have been using a system for capturing improvements since 1996, called Worry Notes (now known as PIN Notes) 4Leading Edge Management Consultancy Limited The need for change . Source: Benchmarking the Government Client Stage 2 Study: Agile Construction Initiative, December 1999 O 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% 5Leading Edge Management Consultancy Limited The issues for a modern efficient and effective construction industry O The construction industry is not known for focusing on customers’/end users’ needs O 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) O They may have an unrealistic idea of what they are going to get for their limited budget and may be insufficient O The public sector (with the NAO) is driving the way of engaging stakeholders in defining construction outputs not inputs 6Leading Edge Management Consultancy Limited But we can help by changing the way we approach customer satisfaction To improve, we need to: O understand what is important to each customer as an individual O measure to give a datum point to show where improvement is needed O look for where improvement is needed O have specific actions to work against O choose a specific person to be responsible for making sure agreed actions are carried out O measure continuously to show that improvement has taken place 7Leading Edge Management Consultancy Limited And so we must begin with a measurement system that asks the right questions O Many companies have been working with Key Performance Indicators (KPI’s) - but if they get a low score they don’t know what to do to improve it O We need to measure things that give us an action list to work against O If people are being scored and they don’t understand the basis on which they are being scored, it can be very threatening. O They need to understand what they need to do to ‘score an 8’ 8Leading Edge Management Consultancy Limited Principle 1. Measure in a useful way by focusing on ‘Moments of Truth’* O A ‘Moment of Truth’ is anytime a customer comes into contact with any aspect of a business, however remote O It is an opportunity to form an impression O Many ‘Moments of Truth’ are controlled by people O People are probably your least controllable asset O Murphy’s law says, according to Tom Peters, · ‘each bad moment of truth scores 10x against you, · but each good moment of truth only scores 1x for you’ *Jan Carlzon, SAS Airline, 1981 9Leading Edge Management Consultancy Limited Make the questions into statements which the scorer can agree with on a scale of 1-10 O Understand what the customer expects · so that the team can strive to meet it · not every element is equally important O Measure what the customer perceives is the level that the team is reaching · so that the team can identify where its performance is falling short O Focus on the performance gap between the two · removes the arbitrariness of different scoring scales, i.e. what is an 8 out of 10 for one person may be a 6 for another O Perception may not be reality - but that means the issue still exists, but is one of communication 10Leading Edge Management Consultancy Limited You need to be able to aggregate the data against business models that managers are familiar with O While project team members need to work to improve their ‘Moments of Truth’… O 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 [...]... practice Help the client understand their role & how they can help improve the way that the project works Help all members of the project team to understand their mutual responsibilities 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. .. as best practice Designate one person to be responsible for finding a solution on a clear timeframe Agree the final solution Share it! 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 together Ideas don’t get lost or forgotten Dates & actions are met It provides a... Ltd, Mott MacDonald Group, Mouchel Group, Shepherd Group Ltd, • Government departments and agencies like Constructing Excellence, the Department of Transport & Regions, the Building Research Establishment (BRE), AEA Technology, JEMU, the Environment Agency, • Professional bodies like The Chartered Institute of Building Services Engineers, the Concrete Society and trade associations like the British Cement... Management Consultancy Limited Continual Improvement 11 How customer satisfaction can be expressed against 5 dimensions of customer service* Customer service Reliability Responsiveness Assurance or Competence Empathy or Understanding Tangibles or Equipment and Image Moments of truth * based on research conducted by Parasuraman, Zeithaml & Berry (Journal of Marketing Vol 49 1985) Leading Edge Management Consultancy... internally The whole organisation is progressively brought up to the standard of the best Improvements actually happen Leading Edge Management Consultancy Limited 20 To summarise… 1 Measurement must be carried out in a useful way Customer routinely scores supplier Leading Edge Management Consultancy Limited 21 …to summarise 2 Start off in the right direction by identifying what is important to customers... Limited 12 How the ISO 9000:2000 process model needs customer requirements & satisfaction to be acted on ACE workshop C U S T O M E R R e q u I r e m e n t s MANAGEMENT RESPONSIBILITY PIN notes CONTINUAL RESOURCE MANAGEMENT Management System MEASUREMENT ANALYSIS IMPROVEMENT IMPROVEMENT INPUTS PRODUCT & SERVICE REALISATION KPIonline scores S a t i s f a c t i o n OUTPUTS Leading Edge Management Consultancy... market analysis, research and strategy the construction & engineering sectors Leading Edge Management Consultancy Limited 25 The Leading Edge client base: • large publicly quoted companies (and their subsidiaries) like Alumasc plc, Baggeridge plc, BT plc, Caradon plc, Charter plc, Costain plc, EMAP plc, Hanson plc, Headlam plc, Interserve plc, Lavendon plc, Pilkington plc, RMC plc, Severn Trent plc, Shanks... surprises Greater client satisfaction! The project team works cooperatively & cohesively Leading Edge Management Consultancy Limited 17 Principle 3 Capture issues & develop best practice with the PIN Note system to: Identify issues that prevent a higher level of client satisfaction being achieved Monitor progress Jointly problem-solve & agree the likely area to find a solution Recommend it be adopted... measurement should be just a formality Discuss with the client what is important it brings their hidden agendas onto the table When you understand what a customer wants it is easier to meet their needs measurement becomes a formality Measurement can be at any appropriate frequencies but should be far enough apart so that improvements can be made and seen before the next scoring Reviews look at any issues,... supply chain members The team works to achieve target performance Customer routinely scores supplier Leading Edge Management Consultancy Limited 22 …to summarise 3 Complete the continuous performance improvement loop Workshop with supply chain members The team works to achieve target performance e r tte manc Be for per PINs completed, actions implemented Continuous improvement Customer routinely scores . 1Leading Edge Management Consultancy Limited The latest thinking on Customer Satisfaction Measurement Leading Edge Management Consultancy Limited 27th April. completion date by 63% 5Leading Edge Management Consultancy Limited The issues for a modern efficient and effective construction industry O The construction