Hozpitality Plus- Dedicated Hospitality Networking group

Measuring and Managing Customer Satisfaction

Measuring and Managing Customer Satisfaction

It takes continuous effort to maintain high customer satisfaction levels.

"The gulf between satisfied customers and completely satisfied customers can swallow a business."

As markets shrink, companies are scrambling to boost customer satisfaction and keep their current customers rather than devoting additional resources to chase potential new customers. The claim that it costs five to eight times as much to get new customers than to hold on to old ones is key to understanding the drive toward benchmarking and tracking customer satisfaction.

 

Measuring customer satisfaction is a relatively new concept to many companies that have been focused exclusively on income statements and balance sheets. Companies now recognize that the new global economy has changed things forever. Increased competition, crowded markets with little product differentiation and years of continual sales growth followed by two decades of flattened sales curves have indicated to today's sharp competitors that their focus must change.

 Competitors that are prospering in the new global economy recognize that meas-uring customer satisfaction is key. Only by doing so can they hold on to the customers they have and understand how to better attract new customers. The competitors who will be successful recognize that customer satisfaction is a critical strategic weapon that can bring increased market share and increased profits.

 The problem companies face, however, is exactly how to do all of this and do it well. They 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 strategic weapon to drive the business, no firm can be effective in this new business climate. Plans constructed using customer satisfaction research results can be designed to target customers and processes that are most able to extend profits.

 Too many companies rely on outdated and unreliable measures of customer satisfaction. They watch sales volume. They listen to sales reps describing their customers' states of mind. They track and count the frequency of complaints. And they watch aging accounts receivable reports, recognizing that unhappy customers pay as late as possible--if at all. While these approaches are not completely without value, they are no substitute for a valid, well-designed customer satisfaction surveying program.

 It's no surprise to find that market leaders differ from the rest of the industry in that they're designed to hear the voice of the customer and achieve customer satisfaction. In these companies:

  • Marketing and sales employees are primarily responsible for designing (with customer input) customer satisfaction surveying programs, questionnaires and focus groups.
  • Top management and marketing divisions champion the programs.
  • Corporate evaluations include not only their own customer satisfaction ratings but also those of their competitors.
  • Satisfaction results are made available to all employees.
  • Customers are informed about changes brought about as the direct result of listening to their needs.
  • Internal and external quality measures are often tied together.
  • Customer satisfaction is incorporated into the strategic focus of the company via the mission statement.
  • Stakeholder compensation is tied directly to the customer satisfaction surveying program.
  • A concentrated effort is made to relate the customer satisfaction measurement results to internal process metrics.

    To be successful, companies need a customer satisfaction surveying system that meets the following criteria:

  • The system must be relatively easy to design and understand.
  • It must be credible enough that employee performance and compensation can be attached to the final results.

It must generate actionable reports for management.

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Comment by santram on December 23, 2013 at 9:07

Customer satisfaction is a pivotal point around which the Hospitality Industry moves  and companies that are not taking care of it are bound to fall or face retardation. Mr. Adnan Anwar Khan has rightly pointed out in his blog and suggested measure to combat this problem for which he deserve commendation.

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