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February 1997 Volume 1.6
"These are
not Customer Satisfaction Surveys"
It was early 1990 and we were part way through launching
Telecom New Zealands new Customer Satisfaction monitors under the
internal brand name of Telsat (Telecom Customer Satisfaction). Ray
Kordupleski and West Vogel from AT&T had worked with us in 1989
to share their new approach to measuring and improving customer
service. They had developed these techniques for AT&T in the
competitive long distance telephone and business equipment markets
in the United States. Everybody else in Telecom New Zealand thought
we were implementing a new Customer Satisfaction measurement system.
Why then was my market research expert telling me that these were
not Customer Satisfaction surveys?
A quick look at the structure of these surveys revealed
why she had made this statement:
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There were none of the usual questions found in
customer satisfaction surveys like, "How satisfied are
you with the repair service?"
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The surveys covered non-customers as well as customers.
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Questions were asked about what people thought
about the value of the service, and their loyalty.
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The surveys were designed for statistical analysis
so they could be used to focus customer service improvement
and cost reduction projects.
I had to agree. These were clearly not Customer Satisfaction
surveys. At that time it wouldn't have been appropriate to tell
this to Telecom New Zealand people, as they were just getting used
to the Telsat name, so we continued saying that these were customer
satisfaction surveys. In the intervening years a name has emerged
for this new type of customer opinion research. We now call this
type of survey, Customer Value research. The publication of the
book, Managing Customer Value" by Bradley Gale in 1994 released
these techniques into the public domain for the first time. Brad
Gale describes the new approach as, "Moving Customer Satisfaction
from a slogan to a science". As with any science, application
of the techniques requires considerable knowledge and skill.
Sharing the Internet
Well how do our mythical Internet Service Provider
companies W, X, Y, and Z perform in terms of Customer Value?
In the September 1996 newsletter we looked at how
each company performed in terms of Relative Total Quality and Competitive
Price. The conclusion was that after Company X's price drop, Company
Z would be in the Low Value corner of the Value Map, Companies X
and Y would lie in the Fair Value Zone, and Company W would be in
the High Value corner.
If we related these positions to absolute Customer
Value performance, the results out of 10 would look something like:
Company Customer Value
W 7.5
X
7.0
Y
7.3
Z
6.7
One of the major findings from Ray Kordupleski's work
at AT&T was the critical importance of the Value question. Before
his analysis and research, this question had been included only
as a minor subattribute. We now know how this Customer Value factor
can be used to predict changes in market share. While we now always
include a Customer Value question in our research, the choice of
the type of question to be asked depends on the products and services
being assessed, and the nature of the market.
Next month we explore Customer Value further and look
at it relation to the competition.
Ferry to Williamstown
I boarded the Williamstown ferry at Southgate, heading
down the Yarra River through the heart of Melbourne's dock land
before reaching Port Philip Bay. Looking back towards Melbourne
provides a marvelous view with the city's spires rising from the
Bay. On arrival at Williamstown I had a single objective - to find
an air-conditioned restaurant. The high temperature meant that this
was not a day for seeking out culinary delights. Inside the Customs
House Hotel the temperature was ideal. The lunch menu provided a
good choice and excellent value, assisted by a glass of the house
shiraz. On then to the next ferry and the purpose of this tale.
At weekends a ferry runs from Williamstown to St Kilda. The timetable
shows a ferry leaving on the hour, every hour. In practice the first
ferry leaves on the hour. Every trip after that the ferry loses
5 minutes, or 10 minutes an hour. By the end of the day, the ferry
is one hour late. On enquiry I learned the reason for this strange
timetable is that the ferry can indeed meet the schedule if it carries
no passengers. It is the passengers getting on and off at each end
that causes it to get progressively later and later as the day goes
on. Well I enjoyed the trip across the Bay, and the cool sea breeze,
even though this company has their service specification wrong.
The day became hotter and hotter until it reached 38.6 C, then I
melted.
Regards,
Rodger Gallagher
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