Chapter 5 - The Voice of the Customer Flashcards
Customer
The receiver of the goods or services that are produce.
Internal customers
Individuals within the organization who receive the work that other individuals within the same organization do.
External customers or end users
The ultimate consumers of the goods that an organization produces.
Customer-driven quality
Term that refers to a proactive approach to satisfying customers needs
Reactive customer-driven quality (RCDQ)
A state that is characterized by supplier “reacting” to the quality expectations of a customer rather than proactively anticipating customer needs and expectations.
The complaint-resolution process involves…
the transformation of a negative situation into one in which the complainant is restored to the state existing prior to the occurrence of a problem.
Customer-relationship management (CRM)
A view of the customer that asserts the customer is a valued asset that should be managed
Describe the difference between the internal and the external customers of a business organization. Why is it important to distinguish between internal and external customers?
On page 112, the text defines internal customers as: … employees receiving goods or services from within the same firm. External customers are described as: … the ultimate people we are trying to satisfy with our work. If we have satisfied external customers, chances are we will continue to prosper, grow, and fulfill the objectives of the firm.
The external customer, or end user, makes the ultimate decision as to whether the company will survive. The internal customer is integral to the quality of the end product. From a business perspective, the internal customer is carried overhead, while the end user is a source of income.
Describe some of the potential pitfalls of customer-driven quality. Can you think of any ways to avoid or lessen the impact of these potential pitfalls?
The text contrasts customer-driven quality with reactive customer-driven quality. The ongoing theme of the text, Long Term Planning, is the key. Figure 5-1 presents a model of reactive customer-driven quality. This model shows that when quality is reactive, rather than planned, customer expectations increase at a faster rate than supplier performance. At the point where these trends cross, customer dissatisfaction increases.
How can a supplier avoid settling into a reactive customer-driven quality (RCDQ) mode?
The company that takes the precaution of long-range planning will have a better chance of prospering; the company that simply reacts, will not. In a sense, manufacturers and service organizations attempting to meet customer expectations are pursuing a moving target. The difference between world-class and ordinary suppliers lies in whether suppliers stay ahead of the target or fall behind the target.
Describe the basic concept behind strategic alliances. In what ways can strategic alliances facilitate a firm’s quest for quality?
The purpose of a strategic alliance is to provide a suppler and a buyer the opportunity to work closely together to enhance the value of the relationship. On page 120, the text states:
Increasingly, single-sourcing arrangements are developing into strategic alliances where the suppliers become de facto subsidiaries to their major customers.
With the importance of Supply Chain Management, the relationship between the supplier and customer becomes even more vital. This situation enables the supply side of Just In Time (JIT) processing to function. Again on page 120, the text states:
Today many companies use single sourcing as a way to reduce the number of suppliers. Single sourcing is a process for developing relationships with a few suppliers for long contract terms. Historically, this was the Japanese method of purchasing.
Single-source suppliers to Ford are increasingly trained by Ford representatives concerning the preferred and required organizations, processes, and delivery systems. Suppliers also enter into agreements to reduce costs and improve productivity and are graded on an annual basis concerning the attainment of these targets.
Describe the basic idea behind a focus group. Are focus groups an effective way of gathering data about customer preferences and tastes?
The text defines a focus group as actively solicited customer feedback.
Focus groups gather customers and solicit their ideas and reactions to products or concepts. Focus groups address a selection of individuals with similar characteristics.
First, focus groups narrowly address a single topic or group of topics. Second, focus groups draw individuals with similar characteristics in a highly focused environment. Figure 5-6 shows the steps involved in a focus group.
Focus groups can be used to identify topics that draw out a strong set of opinions which can be used to define the status of the product or service.
Complaint-recovery process
Process associated with resolving complaints
Describe the difference between actively solicited customer feedback and passively solicited customer feedback. Which type of feedback results in a lower rating of quality? Explain why.
Active Data Collection is initiated by the supplier of the good or service. The three most common forms are: telephoning customers, conducting focus groups, and sending out surveys. The supplier is able to direct the communication. This has both benefits and disadvantages.
Passive Data Collection is customer-generated. The customer takes the lead in providing the feedback. The fact that the customer has taken this initiative does add an incentive to closely review the comments.
It was found that passive collections resulted in lower ratings of quality than active collections. It is not clear which approach is more biased.
Describe the difference between hard data and soft data. What are the unique advantages of each type of data in terms of obtaining information about customer perceptions?
Soft data tends to be qualitative or non-measurable. Soft data includes information as: phone contacts, focus groups, and survey results.
Hard data is quantitative or measurable. Hard data includes measurement data such as height, weight, volume, or speed.
Soft data is useful in measuring the perceptions of customers. One might use soft data to compare customer satisfaction information. Hard data, on the other hand allows exact comparisons: Which is heavier? Or which car has a higher average mileage?
Explain the concepts of reliability and validity. Why is it important that survey instruments be both reliable and valid?
Figure 5-10 illustrates the distinction between reliability and validity:
Reliability comes into play when the process produces a consistent product. As the first target illustrates, the results are consistent but not on target. Reliability, as target two shows, implies that the process may, on the average be on target, but the cohesion of output is not there. Target four shows the result of a reliable and valid process.
What are the 2 main types of feedback
- Feedback to the customer
2. Feedback to the firm
To be effective, a guarantee should be…
Unconditional - No “small print.”
Meaningful - Customer grievances must be fully addressed.
Understandable - The customer must be able to understand easily the parameters of the guarantee and how to achieve resolution quickly.
Communicable - The phrasing of a guarantee should resonate with the customer.
Painless to invoke - The customer must not be inconvenienced too much.
Gap
The Differences between desired levels of performance and actual levels of performance.
Gap analysis
The formal means for identifying and correcting these gaps.
Data about customers can be gathered from a number of sources, such as…
Industry groups
External sources
The Internet
Questionnaires
