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1Leading Edge Management Consultancy Limited
The latestthinking 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 onthe 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. completion date
by 63%
5Leading Edge Management Consultancy Limited
The issues for a modern efficient and effective
construction industry
O The construction