CUSTOMER SATISFACTION

Service – The results generated, by activities at the

interface between the organization and the
customer and by organization’s internal activities,
to meet customer needs”
Importance of Service
It gives job to the people and at the same time,
delivers good quality services. It is important for
all organizations.
Features of Service
- Speed
- Delivery schedule Basic Quality – called the threshold quality
- Each service offering is different  Fulfilling the basic quality is measured by the
- Customer requirements are difficult to following:
comprehend o Customer complaints
- Difficulty in estimating cost o Warranty data
- Difficulty in measuring performance of o Product recalls
services
o Number of lawsuits
- Difficulty in marketing services
o Things gone wrong
- Difficulty in measuring customer satisfaction
- Psychology of customers o Other failure reports
Contractual and Non-Contractual Requirements of Performance Quality – measures the satisfaction
Customers proportionate to the performance of the product
 Contractual requirements could include Excitement Quality – generated because the
the following parameters: customer received some feature or attribute that
o Quality they did not expect or think of.
o Time schedule for delivery
Some Measures For Customer Satisfaction
o Price
 Customer perceived quality
o Services
 Response time
o Documentation
 Errors in documentation
o Training support
 Errors in delivery
 Non-contractual expectations include the
 Delay in execution
following parameters
 Delay in delivery
o Quality
Customer Feedback And Complaints Resolution
o Implied requirements
 Customer feedback
o Value for the money spent
 Feedback forms
o Environment of conducting business
 Confidentiality
and the friendliness of the customer
 Display results
service personnel of the organization
 Complaint resolution
According to D.H. STAMATIS, (customer service
 Analyze independently
attributes)
C – Caring  Give benefit pf doubt to customers
O – Observant  Satisfying annoying customers
M – Mindful Complaint Recovery Process – aims to satisfy the
F – Friendly customers, resolve the problems and take preventive
O – Obliging actions
R – Responsible
T – Tactful EMPLOYEE INVOLVEMENT
Strategies and Principles:
The Kano Model  Motivation
- Dr. Nariaki Kano of Tokyo Rika University  Teamwork
- Developed from Herzberg’s Motivator-Hygiene  Training and mentoring
Theory  Recognition and rewards
X-Axis – represents the performance of the product  Feedback and performance appraisal
or service or degree of implementing the product  Empowerment
function Employee Motivation
Y-Axis – represents the level of customer satisfaction  Top-Notch-Self Actualized (10%)
  Fence Sitters (80%)  Upward Communication – communicating
 Difficult to Improve (10%) with seniors
Motivation Theory of Individual Employees  Communication with juniors –
 Theory X (Sigmund Freud) communicating of the seniors with the junior
o Avoid work patiently and in detail
o No ambition  Communication with peers – work for a win-
o No initiative win situation with peers, customers and
o Do not take responsibility supplier
o Needs security Ways for Effective Communication
- and to make employees work  Monthly board meetings
o Reward  Quality council meetings
o Coerce  Departmental and interdepartmental meetings
o Intimidate  Problem solving sessions
o Punish Training and Mentoring
- Employees have to be supervised all the time  Necessity for orientation training
 Theory Y (Douglas McGregor) o To help employees understand the
o Want to learn following:
o Work is a natural activity  Objectives of the organization
 Requirements and expectations of his
o Have self-discipline
team
o ]develop themselves  Role
- Employees do not need supervision  Responsibility
 Authority
 Theory Z (William Ouchi)  The know-how and know-why of the
 Abraham Maslow Theory of Needs job
o Self-Actualization needs  Familiarity and skill in operating
o Esteem needs equipment
o Love needs o Reluctance of the management to send
o Safety needs employees to training:
o Physiological needs  Excessive workload
 Herzberg’s Theory  Non-availability of appropriate training
o Hygiene Factors course
 The company  Fear of migration of employees after
 Policies and administration training
 Supervision  Personal Coaching/ Mentoring – it can
 Working Conditions sustain the momentum of the employees from
 Interpersonal relations the training in working towards the
 Salary organization’s goal
 Status PDCA for Training
 Security  Plan for training
o Motivation factors  Provide training
 Achievement  Measure training Effectiveness
 Recognition for achievement  Improve training effectiveness
 Interest in the task Recognition and Awards
 Responsibility for large task  Recognition – has to aim a transforming
 Growth and advancement to each employee as a performer and an
higher level tasks achiever.
Teamwork  Attributes fro selection of best employee:
 Management’s Role: To foster teamwork o Commitment
amongst employees with clear definition of o Creativity
their: o Flexibility
o Responsibility o Adaptability
o Authority o Determination
o Wherewithal for accomplishing the o Responsibility
task  Types of Awards:
o Criteria of measurement of the work o Appreciation in annual meetings
output o Certificates
Effective Communication
 o Mementos
o Cash awards
Feedback and Performance Appraisal
 Features of Feedback to success of TQM
o Appropriate feedback – the task of the
management is to find out the right
performance level of the employees and
then give the feedback
o Timely feedback – the feedback should be
given at the appropriate time
o Watch effect of feedback – effect of
feedback has to be monitored, studied, and
analyzed
o Continuous feedback – it should be given
continuously
Empowerment – it means involvement of all
employees for improvement processes on continual
basis
 Steps in Empowering:
o Agree on what they will produce or carry out
o Decide on how to organize them
o Decide on the responsibility within the team
o Decide in work flor
o Decide on improvement and restart
PROCESS APPROACH
 Three Elements of Process Model
o Input/s to the process
o Output/s to the process
o The process or task
 Input of the Process
o Bill of materials
o Specification for each material
o Requirements for inspection for the
incoming materials
o Procedure for receipt of materials
 Output of the Process
o The products or service to be
delivered
o Documents to be delivered
o The specifications for all the above
o Method of measurements for verifying
conformance to the specifications
o Criteria for acceptance/rejection
ETX Model
 Task – the value adding process
 Entry – conditions to be satisfied before the
task is undertaken
 Exit – conditions to be fulfilled before the task
is considered as completed
SUBBURAJ’s 6S Model for Process Improvement
 Study
 Streamline – the process should offer the
least resistance to motion in the organization
 Simplify
 Standardize – permits performing the process
in the same way by every employee at all
times
 Synergize – a process may interact with at
least two other processes – customer –
supplier processes.
 Strengthen
Customer Supplier Chains – dividing the entire
process of manufacturing or providing services
Supply Chain Management
 Supply Chain – the series of links and shared
processes that exist between the suppliers
and customers
 Number of Distributors
o Wholesalers
o Warehouses
o Retailers
 Down-Stream – flow of product from supplier
to customer
 Up-Stream – the demand of information from
customer to supplier
 Supply Chain Management – a task of
optimizing all activities throughout the supply
chain
Supply Chain Management involves the Following
Activities:
 Demand Planning – a planning process to
predict the demand of products and services
based on forecasts
 Manufacturing Planning and Scheduling –
a planning process that optimally schedules
manufacturing orders with production capacity
 Supply Planning – process that meets
customer demand based on available
inventory and transportation resources
o Distribution Requirements Planning
(DRP) – determines the need to
replenish inventory at branch
warehouses
 Transportation Planning – a planning
process to optimally schedule, load, and
deliver shipments to customers while
considering constraints, such as delivery date,
mode of transportation, carrier, etc.
Benefits of SCM
 Improved customer service
 Reduction of costs
 More efficient management of raw materials,
WIP and finished good inventory
 Increased efficiency in the transactions
between supply chain partners
 Better manufacturing resource management
 Optimized manufacturing schedules
  Optimal distribution of existing inventory
across the supply chain
 Enhanced customer value, often in the form of
lower prices
JUST-IN-TIME – a philosophy that focused attention
on eliminating waste by purchasing or manufacturing
just enough of the right items just-in-time
- Zero Inventories are a synonym of JIT
- JIT Philosophy is based on two principles
o Production and supply of required
number of parts when needed
o JIDOKA (self-actualization), which
means utilizing the full capacity of the
workforce
Objectives of JIT
 Development of optimal process and be
competitive
 Streamlining of operations and eliminating
unwanted processes
 Continuous improvement
 Reducing the levels of wasted materials
 Increasing of efficiency of reduction
JIT can be practiced by defining and
implementing several concepts such as:
 Kaizen
 Team work
 Multi-function work-force
 Optimizing plant layout
 Eliminating wastages
 Reduced set up time
 Kanban
 Material Resources Planning (MRP)
 Manufacturing Resources Planning (MRP II),
etc.
 Involvement of people
 Plant optimization
Benefits of JIT
 Benefits of Just-In-Time
 Reduction of Wastes
 Reduction of Work-In-Process (WIP)
 Establishing proper customer- supplier
relationship
 Reduction in Lead Time
 Less-Inventory of raw materials
 Improvement in flexibility
 Lower cost and high productivity
 Enhanced customer satisfaction due to lower
price owing to elimination of wastes
 Improved employee morale owing to a perfect
system without waiting
 Improved satisfaction of shareholders due to
high profit
 Reduced space requirements on account of
Total Elimination of WIP and buffer stock of
materials, sub-assemblies and products
 Improved productivity and improved quality
Lean Manufacturing – a whole system approach that
creates a culture in which everyone in the
organization continuously improves processes and
production
 Major Tenets of Lean Manufacturing
o Quick Changeover/Setup Reduction
o Value Stream Analysis
o Pull/Kanban Systems
o Total Productive Maintenance (TPM)
o Workplace Organization 5S System
o Cellular Manufacturing
 Kanban Systems – Mr. Taiichi Ohno, vice
president of Toyota
o Kanban stands for Kan-card, Ban-
signal.
o Most Common Types of Kanban
 Withdrawal Kanban – to pass the
authorization for the movement of
parts from one stage to another
 Production Kanban – to release an
order to the preceding stage to build
the lot size indicated on the card
o Two different Kinds of Cards:
 Transport Kanban – contains
information from where the part/
component originated and its
destination. Simple Kanban
Process (only this card is used)
 Production Kanban – outlines to
what extent and when work has to
be accomplished by a specific
station on the production line.
Integrated Kanban Process
(together with the transport Kanban)
o Advantages of Kanban Process
 A simple and understandable
process
 Provides quick and precise
information
 Low costs associated with the
transfer of information
 Provides quick response to changes
 Avoids overproduction
 Minimizes waste
 Control can be maintained
 Delegates responsibility to line
workers
 Cellular Manufacturing – heart of lean
manufacturing
 Single Piece Flow – also called one-piece
flow or continuous flow manufacturing. A
technique used to manufacture components in
a cellular environment
o Cell – an area where everything that
is needed to process the part are
within easy reach and no part is
allowed to go to the next operation
 until the previous operation has been  Seiri (Sort) – to sort and throw away
completed unnecessary thing
 Seiton (Set in Order) – to arrange necessary
items in a neat, proper manner so that they
can be easily retrieved for use and to return
them to their proper location after use
Zero Defects  Seiso (Scrub) – to clean and inspect the
 Accepted Quality Level (AQL) – Philip respective work places thoroughly, so that
Crosby’s third absolute of quality there is nor dust on the floor
management. “The performance standard  Seiketsu (Systematize) – to maintain high
must be zero defects, not that’s close enough standards of work place organization by
keeping everything clean and orderly at times
CONTINUOUS IMPROVEMENT  Shitsuke (Standardize) – to make the
 Concepts, techniques and tools that are previous four steps part of the daily routine
used for C.I. and to observe self-discipline through
o Juran’s Trilogy continuous practice
o Kaizen - 5S Certification
o Kaizen Blitz o National Productivity and
o 5S Practice Competitiveness(NPCC)
o Three Mus o Aimed at developing and assisting the
o The Seven Deadly Wastes productivity culture across Mauritius
o Business Process Reengineering The 7 Deadly Wastes
Juran’s Trilogy  Overproduction
 Three managerial processes of planning,  Waiting time
control and improvement  Transportation
o Quality Planning  Processing wastes
o Quality Control  Inventory
o Quality Improvement  Unnecessary motion
Kaizen – a Japanese word meaning gradual, orderly,  Product defects
and continuous improvement. Business Process Reengineering (BPR) –
 Two Activities of Kaizen fundamental rethinking and radical redesign of
o Maintenance business processes to achieve dramatic improvement
o Improvement in critical, contemporary measures of performance
 Three Basic Principles of Kaizen  How to carry out Reengineering?
o Work place effectiveness o Planning
o Elimination of Waste, strain and o Process study
discrepancy o Study of the best practices
 MUs: o Redesign
 Muda (Waste) o Implementation
 Muri (Strain)
 Mura (Discrepancy) SUPPLIER PARTNERSHIP
 MUs in respect of the ffg are to  Outsourcing – enables the manufacturers to
be eliminated: focus their attention in managing their brands
 Human Resource rather than capital equipment required for
 Production volumes manufacturing every part
 Inventory  Selection of the right suppliers – the most
 Time important activity with regard to supplier
 Working Space partnership
 Machinery  Supplier Standard
o The selected suppliers should be
 Techniques
clearly intimidated about the
 Facilities
requirements:
 Tools and jigs
 Quantity required
 Thinking
 Quality requirements
o Standardization  Specifications for the materials
5S Practice – a management tool focused on  Style
fostering and sustaining high quality  Workmanship
  Acceptable quality level o Delivery Rating (DR)
 Delivery instructions
 Payment terms
 COTS or Commercial Off-the-Shelf
Products – packaged solutions which are  Q = quantity promised to be
then adapted to satisfy the needs of the supplied within the stipulated
purchasing organization, rather than delivery time
commissioning of custom-made, or bespoke,  Q1= actual quantity supplied
solutions within the stipulated delivery
 T = promised delivery time for
 Short-term commitments – not an
full consignment
advantage to the vendor and also to the
 T1 = actual delivery time for
company
full consignment
 Long-term commitments – if the vendor
 P = Q1/Q
does not maintain the committed quality,
 q=1–p
schedule, price or services, the company
 Composite Vendor Rating:
should be free to charge the vendor
 Product Audit – a thorough evaluation of
vendor’s products at periodic intervals
 Supplier Rating:
o Quality
o Price
o Delivery
o Services  Vendor Rating
 Vendor Rating – an objective oriented
method or continuous assessment of the
supplier’s ability to supply on time, with quality
o Vendor Rating System:  VR1 = vendor rating of ith lot
 Quality  n1 = lot size for ith lot
 Price
 Delivery
o Quality Rating (QR)

 Q1 = quantity accepted
 Q2 = quantity accepted with
deviation
 Q3 = quantity accepted with
rectification
 Q4 = quantity rejected
 Q = Total Quantity supplied
Q1 + Q2 + Q3 + Q4
 X1 = demerit factor (less than
one) when material is
accepted with deviation
 X2 = demerit factor (less than
one) when material is
accepted with rectification
o Price Rating (PR)

 PL = Lower of the prices

quoted by vendors for the item
 P = Price quoted by the
vendor being rated