Published for Michigan’s Small and
Midsize Manufacturers
Volume 4, Issue 2, Spring 1998
Dear
Manufacturers
,
The most
valuable
customer is
one who
has
already
been served. A study
commissioned by the US
Department of Commerce
pointed out that for small
and midsize
manufacturing firms it
costs five times as much to
get a customer as it does to
keep one. The study also
showed that seven out of
ten customers never
complain when they have a
problem. Those two facts
alone are reason enough for
manufacturers to get out
and talk to customers,
listen to what they say, and
make some changes to keep
them coming back.

magazine, and best selling
business guru are telling
management to be customer
focused and really listen to
customers. So, when a
company decides to begin
monitoring customers
satisfaction through a survey,
the expectations are high.
The company announces the
process, develops a question-
naire, sends it out, and then
awaits the results. The
results trickle in, are tabu-
lated, and a presentation is
made to management. Many
times the survey finds no
surprises, offers few, if any
insights into customers
attitudes, and after a couple
of weeks the whole process is
forgotten. The experience is
disappointing. How can you
use customer satisfaction
monitoring as an opportunity
to increase your customers
loyalty, and have a positive
impact on your business?
Surveying customers seems
simple on the surface, espe-

There are many reasons to
survey customers. First, decide
what you are trying to accom-
plish. Some people want to
know how competitive their
company is. Others want
questions that relate to their
mission statement and strategic
plan. Still others will relate the
questions to their continuous
improvement program. All
these reasons are valid, how-
ever, pick just one. When they
are mixed together, the results
are less than satisfactory.
Continued on next page
manufactLINE
■
Spring 1998
2
what to do but usually the
questions are so vague no one
knows what to do, or has the
budget to solve the problem, so
the issues also soon disappear.
The solution is to ask most of
the questions about actionable
items. The quick way to find
out if an item is actionable is to
ask your managers, if this

times a customer is aggravated;
and 3) it gives a specific, finite
set of parts or services to focus
attention on. Management can
take action on these questions.
The narrow focus of the
actionable questions may steer
some companies away from
this type of question, however,
with proper planning manage-
ment should be able to provide
input on which areas are the
important ones for customers.
3
Understand What You Mean
by Satisfaction
For many companies, satisfac-
tion merely means you are
allowed to continue bidding for
jobs. Generally, customer
satisfaction is composed of
three areas:
n
ImportanceHow relatively
important is this issue to the
customer?
n
ExpectationWhat are the
customers expectations on
this issue? How do excel-

project is dragged out manage-
ment will forget about it, and
forget the importance and
original purpose. Keep the
process moving forward with
periodic updates for those with
interest in the results. Cus-
tomer satisfaction monitoring
often takes a backseat to more
urgent issues, and can have the
plug pulled on it if something
crucial occurs. Delivering the
results in a timely fashion is as
important as commitment to the
process.
2
Writing the Questions 
Focus On Things You Can
Change
I have read many surveys, and
some of them fall into the
category of popularity con-
test. The questions focus on
whether the customer enjoys
doing business with the
supplier or not. How We
Doin? was the title of one
questionnaire. This question is
asked in many ways: Hows
our quality? Hows our

3
5
Keep the Analysis on a Level
Managers Can Understand
Although you may understand
the results of the conjoint
analysis, if you spend most of
your time explaining the
technique to management
before giving them the survey
results, you may end up talking
to an audience of blank stares.
Results of customer satisfaction
surveys are often used for
employee performance reviews.
If you are going to judge an
employees performance by
your clients happiness, be very
certain you understand what
the results are saying and that
the person being judged will
understand them as well. Most
people without statistics
coursework have an intuitive
understanding of descriptive
statistics (minimum, maximum,
mean, mode, median, and
standard deviation). Correla-
tion and covariance are under-
standable but give people much

effort.
While its important to involve
employees and get them excited
about the process, you do not
have to involve them by
inviting them to develop
questions. If you do seek input
from others in the survey
development process, be certain
that they clearly understand
the purpose of the customer
satisfaction monitoring activity.
A couple of questions in a lot of
different directions may satisfy
your employees, but will not
give you a great survey tool.
Its also important to share
your companys commitment to
customer satisfaction with
customers so they realize the
importance of their participa-
tion. This is best done with an
introductory letter, signed by
the president of the company.
The letter shows the impor-
tance the process has for the
company, and serves to intro-
duce the interviewer to the
respondent in a positive light.
7

were positive.
If you are trying to learn what
customers think about a
product, consider open ended
survey questions in which you
prompt them to tell the story of
their experiences.
Continued on page 9
8
Prepare Your Customers and
Involve Them
The best way to ensure you are
touching on issues that matter
to your customers is to ask them
 What matters to you? It may
sound foolish but it works. By
asking them in the design
phase of the survey, you can
pinpoint their priorities and get
directly to the issues that mean
the most and produce the most
loyalty. The best method for
doing this is to work with a
customer who is friendly
enough to go out for a coffee or
a beer. In a relaxed atmosphere,
run a list of issues by the
customer and ask them to rank
ten issues by their importance
to them. Once you know the

should stay with customers.
This way, the person conduct-
ing the survey does not have to
deal with interview subjects
who may have never heard of
your company. Staying with
customers, one might compare
big buyers to so-so customers
and find out why they differ.
Some managers think that since
they are going through all the
trouble of developing a ques-
tionnaire and conducting the
survey, they might as well get
the most they can from the
About the
Author: Bill Loomis
is Director of the
Industrial
Technology
Institutes Small
Business Develop-
ment Center (SBDC).
Mr. Looms has
assisted hundreds
of small and
midsize manufac-
turers in the areas
of customer
satisfaction,

No, Cook isnt a New Age guru,
and she wont be running
retreats in the woods to wor-
ship Mother Earth. Shes a
business coach who spent 25
years in the corporate trenches,
including a stint as vice
president of Macys California
and partners with Tom
Peters.long enough to learn
that the current boardroom
mania for short term profits is
stifling long-term innovation
and customer satisfaction.
In its place, Cook challenges
companies to think and act
differently to create value for a
firms clients and employees
while hoisting the bottom line.
Cook posits this holistic
managerial mantra of custom-
ers, people and profits as the
key to long-term vitality.
Cook was given a golden
opportunity to test her long-
stewing hypothesis in 1990,
when, as founder of a consult-
ing firm called Think Customer,
she responded to a distress call
from Marriotts Roger Dow,

Cooks words, really care
about their customers, their
people and their shareholders.
To their amazement, they were
inspired by the five year results
of the publicly traded compa-
nies that they visitedsales
were up 300% and profits
600%!
Cook and Dow published these
startling results in Turned On
(HarperBusiness 1996), a
chronicle of their corporate
anthropology that serves in the
words of Tom Peters, as a full-
blown business plan for every
type of enterprise.
That design is based on Cook
and Dows Eight Insights,
the first of which is to build a
strong foundation. Cook
defines that by quoting Jim
Cleamons, ex-assistant coach of
the Chicago Bulls, who when
asked the secret of their five
championships, replied we
constantly work on the funda-
mentals.
One fundamental element to
business success is customer

satisfaction is clearly linked to
(1) Everything is clean and
works (2) Check-in is hassle-
free (3) Staff is friendly and
hospitable (4) Problems are
resolved quickly (5) Breakfast is
served on time. Bill Marriott
reinforces the message that the
basics mean serving hot food
hot, and cold food cold.
Addressing such basic con-
cerns will make each customer
feel special, another of Cooks
Customer Satisfaction
manufactLINE
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Spring 1998
5
main convictions. To illustrate
this, Cook summons the spirit
not of some Gatesian visionary
but of Bob the Bagel Man. For
three years, whenever I visit
New York, I stay at a hotel that
is trying to be the number-one
business persons hotel. Oh,
they spend millions of dollars
renovating the lobby and each
hotel roomeven have cherry
wood wall units built into each

manufacturing semiconduc-
tors. He convinced the govern-
ment and private industry to
put up $100 million each to
start SEMATECH (the
consortiums name) and
guaranteed a certain return on
investment. Ten years later, Intel
is No. 1 in the world in semi-
conductor sales and
SEMATECH is now privately
funded. She notes similar
successes in ventures ranging
from state welfare programs to
the Mars Sojourner.
Although most firms couldnt
build an interplanetary space-
craft (and would have a rough
time selling it to their boards),
what anybody canand
shoulddo is simplify things,
for both customers and employ-
ees. Cook is adamant about
removing the
crazymakersthose bureau-
cratic roadblocks that sap the
morale and innovative ideas of
an entire team. How are you
making it easier for your
customers and employees to do

subsidiary called Miller
SQAsimple, quick and
affordablethe very mandate
they received from customers.
Miller SQA reduced delivery
time for new furniture from 12
to 2 weeks, gave each dealer
computers and easy-to-learn
software that allowed custom-
ers to, in effect, become their
own interior designers. This is
a perfect demonstration of how
technology can be your servant
and enhance customer and
staff satisfaction and profitabil-
ity. (By the way, Miller SQA
continues to enjoy 35% com-
pounded growth in sales and
profit.)
We all know that if you dont
keep score, you dont know
how youre doing, asserts
Cook. Yet most organizations
she visits are inundated with
market research data, customer
satisfaction data and morale
studies. Of the 85% of the
organizations that talk about
customer satisfaction and
loyalty as their number-one

but by compassion. People
dont care how much you
know, until you show how
much you care. Customers and
employees are boss watchers
and they are individual people
with feelings. When treated as
human beings, they tend to act
that way.
Excerpted with permission from
Capturing Hearts, Minds and the
Bottom Line, By Jim Gerard,
freelance writer, New York, NY.
Customer Satisfaction