ACSI Pres 03 Pom 246.ppt
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  • 1. American Customer Satisfaction Index ( ACSI ) You won’t have loyal customers until you have “ completely satisfied customers !” ~William R. Loomis (baldridgeplus.com)
  • 2. ACSI Presentation ’03
    • Starring-- in alphabetical order :
      • Sonja Arnet
      • Allen Bischofberger
      • Nathan Calabrese
      • Jon Carpenter
      • Tony Filiberti
  • 3. ACSI Topics
    • What is ACSI?
    • ACSI Metrics
    • FAQs about ACSI
    • ACSI Model
    • Company Examples
  • 4. What is ACSI?
  • 5. What it is…
    • ACSI:
      • Created in the nineties to be an economic indicator
      • A uniform, independent measure of consumption
      • tracks customer satisfaction trends and provides helpful benchmarking insights
  • 6. What it is…
    • An economic tool:
      • For creating Industry standards
      • For companies to use as a benchmark
      • For consumers to use to make better informed purchasing decisions
  • 7. What it is…
    • The ACSI is based upon information compiled from customer evaluations of goods and services.
    • Later we will learn from the ACSI Model how customer satisfaction can lead to either customer loyalty or complaints.
  • 8. ACSI Metrics
  • 9. ACSI Measures :
    • Customer satisfaction with the quality of goods and services purchased in the United States over time
    • 8 economic sectors, 35 industries, 190 companies, and Federal or local agencies*
      • Includes domestic and foreign companies that have major market shares in several industries (i.e. Toyota, Honda, etc.)
  • 10. ACSI Process
    • 1. Data is collected
      • Collection is done at the individual customer level
      • Random telephone interviews of adults (age of 18-84) are conducted to obtain data
      • Data collected is regarding the customer’s satisfaction with specific products
      • 700,000+ consumers are interviewed each year
      • ACSI results created for each company are based on 250 customer interviews
    • 2. Data entered into a multi-equation, econometric model
  • 11. ACSI Process (cont.)
    • 3. Scores are produced
      • Reported on a 0-100 scale (0=Lowest;100=Highest)
      • Four levels of scores:
        • Company -aggregated customer scores
        • Industry -average of company scores weighted by the revenues of each company
        • Sector -industry scores weighted by industry revenues
        • National -sector scores weighted by each sector’s contribution to GDP
      • Company Example
  • 12. The Result
    • ACSI produces company-level satisfaction scores
    • Produces scores for the causes and consequences of customer satisfaction, and their relationships
    • Answers the questions:
      • Are customer satisfaction and evaluations of quality improving or declining for the nation’s output of goods and services?
      • Are they improving or declining for particular sectors of industry, for specific industries, or for specific companies?
  • 13. FAQs about ACSI
  • 14. Query #1
    • Who is behind the ACSI & how is it funded?
      • Developed by the National Quality Research Center at the University of Michigan
      • Co-sponsored by ASQ, CFI Group and the University of Michigan Business School
      • Corporate subscribers 
      • Sales of ACSI reports
  • 15. Query #2
    • Who benefits from ACSI?
      • American consumers  
      • Companies   
      • Comparing quality  
      • Software available
  • 16. Query #3
    • When were ACSI results first released?
      • October, 1994   
      • 3rd Monday of February, May, August, November, & December
  • 17. Query #4
    • What kind of information is available to what companies?
      • Any ACSI subscriber  
      • Corporate subscribers   
      • Also in Fortune, BusinessWeek
  • 18. Query #5
    • Can a company not included not included in ACSI get its own customer satisfaction index?
      • Pay a fee to receive:     
        • index     
        • custom research
  • 19. Query #6
    • How many companies are reviewed through ACSI?
      • Approx. 200 companies  
      • 70 segments of federal agencies   
      • two local government services:
        • Police
        • solid waste
      • Specific companies are included and excluded
  • 20. ACSI Model
  • 21. ACSI Model
    • Elements of the ACSI Model
      • Customer expectations
      • Perceived Quality
      • Perceived value
      • Satisfaction
      • Customer complaints
      • Customer Loyalty
  • 22. ACSI Model
    • Customer expectation
      • customers experiences with product or service and information about it
        • media
        • advertising
        • salesperson
        • word of mouth from other customers
      • customers expectation influence the evaluation of quality and forecast how well the product or service will perform
  • 23. ACSI Model
    • Perceived quality
      • Three questions measure the perceived quality
        • overall quality
        • reliability
        • the extent to which a product or service meets the customers needs
      • Perceived quality proves to have the greatest impact on customer satisfaction.
  • 24. ACSI Model
    • Perceived Value
      • Two questions measure the perceived value
        • overall price given quality
        • overall quality given price
      • Perceived price is usually only important in the first purchase decision.
  • 25. ACSI Model
    • Customer complaints
      • Customer complaint activity is measured as the percentage of respondents who reported a problem with a company’s product or service within a specified time frame. Satisfaction has an inverse relationship to customer complaints.
  • 26. ACSI Model
    • Customer loyalty
      • Customer loyalty is measured through questions on the likelihood to purchase a company’s products or services at various price points. Customer satisfaction has a positive effect on loyalty, but the magnitude of that effect varies greatly across companies and industries
  • 27. Company Examples
  • 28. National, Economy, Sectors and Industries
    • ACSI divides Economy by type of good produced
      • 8 major divisions
        • Each division has quarterly report
        • Reports available from US Government, University of Michigan, and ACSI
      • Newest Division, E-Commerce highly monitored
        • Fast paced, highly dynamic
        • many new companies
        • can be used somewhat successfully to determine stock profitability
  • 29. National, Economy, Sectors and Industries
    • Sections covered by ACSI (with %GDP)
      • Transportation/Communications/Utilities (8.4%)
        • Airlines
        • Cable/Satellite TV providers/Newspapers
        • Express Mail
      • Manufacturing Durables (9.1%)
        • Automobiles
        • Household Appliances
        • Computers/TV/VCR
      • Manufacturing Non-Durables (6.7%)
        • Beverages/beer
        • Food Processing
        • Personal Care/Cleaning Products
  • 30. National, Economy, Sectors and Industries
    • Sections covered by ACSI (cont.)
      • E-Commerce (calculated GDP found in other sections)
        • Auctions
        • Portals
        • Retail
      • Finance and Insurance (8.4%)
        • Banks
        • Insurance
      • Retail (9.1%)
        • Restaurants
        • Service Stations
        • Specialty and high volume Retail
  • 31. National, Economy, Sectors and Industries
    • Sections covered by ACSI (with %GDP)
      • Public Administration/Government (9.4%)
        • Police (metro)
        • Federal Agencies
        • Solid waste (metro)
      • Services (21.9%)
        • Hospitals
        • Hotels
        • Motion Pictures
  • 32. Corporate Subscribers
    • Corporate Subscribers Belong to ACSI or other organizations such as the CSMA (Consumer Satisfaction Measurement Association)
    • CSMA is a group of companies that conducts benchmarking studies in order to improve customer satisfaction.
    • CSMA has many more international members than ACSI
  • 33. Corporate Subscribers
    • Notable ACSI Members
      • AAFES
      • Bank of America
      • Bell South
      • Direct TV
      • Domino’s
      • Home Depot
      • US Department of Labor
      • K-mart
      • US Postal Service
      • Verizon
  • 34. Corporate Subscribers
    • Notable CSMA Members
      • MCI Worldcom
      • Department of the Army
      • Honeywell
      • Rockwell Electronic
      • Payless Shoe Source
      • Pitney Bowes
      • Steel Authority of India
      • Boeing
      • Unisys
      • Fiat
  • 35. ACSI Case Study-Dow Corning
    • Dow Corning
      • Founded in 1943
      • $2.7 Billion
      • 25,000 companies supplied with Dow products
        • Over 7,000 products
          • Ceramics
          • Lubricants
          • Aerospace
  • 36. ACSI Case Study-Dow Corning
    • Mid 1990’s saw the emergence of a strong silicon based industry
      • Needed to gain competitive advantage
      • Produce performance-enhancing material
      • Fix global Supply Chain
      • Improve Customer satisfaction index
  • 37. ACSI Case Study-Dow Corning
    • ACSI style surveys used as an indicator for Customer satisfaction improvement
    • Based on Customer complaints
    • Globalization stretched Supply chain
    • SAP created Supply Chain Management software
  • 38. ACSI Case Study-Dow Corning
    • SAP Software improvements
      • Reduced lead time
        • 9-20% depending on product
      • Quicker shipping to worldwide customers
        • Reduced significantly
      • Overall improvement in responsiveness
        • Orders processed more quickly
  • 39. ACSI Case Study-Dow Corning
    • Results
      • Quicker ship times lead to higher customer satisfaction
      • Reduced inventory keeps administrative and warehousing costs low
      • Increase in customer satisfaction helps retain investors (stockholders)
      • Improved forecasting accuracy, especially for custom orders
  • 40. Conclusion
    • What ACSI is as an financial tool
    • How it measures Customer Satisfaction
    • The ACSI model ( a g reat exam question! )
    • The Dow Corning case study
  • 41. References
    • http://www.theacsi.com/overview.htm
    • http://www.baldrigeplus.com
    • http://www.flash.net/~benchmar/csma.html
    • http://www.sap.com
    • Text: The Management & Control of Quality,
    • 5 th ed., by Evans & Lindsay, 2002.
  • 42. The End
    • Any questions?