Total Quality Management

Customer Satisfaction

M. Ali Hassan
alimba@live.com
Who is a customer?
 External Customer – People who buy and
use products or services of an organization
 Internal Customer – An employee within an
organization who receives the output of
another employee (who will be termed as an
internal supplier).
In TQM setting External customers define
Quality and internal customers produce it.
Internal customer supplier link
 For example employee A attaches some
components to a circuit board and then
hands over the board to employee B, who
adds different category of parts to the board
and passes it on to employee C installs more
components and this chain goes on until
product is finished.
Importance of Internal
customer-supplier Link
 In this relationship, employee A is a
supplier to employee B and employee B is a
customer of employee A. Similarly,
Employee B will then become supplier for
employee C and C will be customer of B.
 In this chain B cannot produce quality in his
work unless employee A has done his job
correctly. This concept is called dependency
of internal quality.
Understanding Customer
defined Quality
 Once you have understood who the customers are
and what your processes are, only then you will be
able to appreciate what quality means in the new
business world.
 If customers are people who receive your work,
only they can determine what quality is, only they
can tell what they want and how they want it.
 Quality begins with the customer. You must work
with internal and external customers to determine
their needs and collaborate with internal and
external suppliers.
O my customer! Where are thou?
 The customer must be the top priority. The
organization’s survival depends on it.
 Reliable customers are the most important
customers. Customers satisfied with their
purchases become reliable customers
 Production and delivery of high quality
products and services is the only way to
ensure customer satisfaction and retention
How to develop customer focus?
 The key to develop customer focus is
putting employees in touch with customers
and empowering those employees to act as
necessary to satisfy the customers. There
are number of ways to put employees in
contact with customers.
– Personal contact
– Contact through phones or customer website
– Through review of customer-provided data
Example of Zytec Corporation,
Minnesota
 At the heart of its corporate commitment to
customer satisfaction, the message to each of its
700 employees is: to solve problems for our
customers, you are empowered to spend up to
$1,000 on their behalf. No questions asked. There
is no paperwork or authorization needed to spend
money for a customer. Result: one employee
chartered a plane to fly some missing parts to a
customer in another state. Another bought new
tables for a visiting lounge where customers
frequently visited. Yet another one installed a
vending machine for convenience of customers
Identifying external
customer needs
 In a TQM setting, customer needs are identified
clearly as a normal part of product development.
 6-Step strategy for identifying customer needs-
– Research on industry needs
– Plan how to gather the information
– Gather the information
– Analyze the results
– Check the validity of your conclusions
– Take action towards product development
Key Indicators for customer
satisfaction
 Service standards derived from customer
requirements
 Understanding your customer
 Frontline empowerment
 Infrastructure support to frontline people
 Attention to HR functions for frontline
 Proactive customer service systems
 Using all information inputs
 Quality requirements of market segments
 Commitment to customer
Quality Tip from Deming
 Profit in business comes from repeat
customers, customers that boast about your
product and service and that brings friends
with them. Fully allocated costs may well
show that the profit in a transaction with a
customer that comes back voluntarily may
be 10 times the profit realized from a
customer that responds to advertising and
other persuasions.
Steps for identifying
internal customer needs
 Development of open and honest
communication system in the organization
 Implementation of Teams and allocation of
time and place for their meetings
 Practice of MBWA (Management By
Walking Around)
 Suggestion boxes
Internal customer retention
 Training of employees
 Equitable pay
 Benefits other than salary
 Rewards for quality improvement
 Involvement and empowerment
 Teamwork
 Sense of ownership