The document discusses customer satisfaction and delivering customer value. It states that satisfied customers will be repeat customers and loyal customers. Customer value is the difference between total customer value and total customer cost, which includes factors like product value, service value, personnel value, and image value, versus monetary price, time cost, and psychic cost. Customer satisfaction is the level of a person's state from comparing a product's perceived performance to their expectations. Companies can deliver customer value through their value chain and core business processes like product development, inventory management, and customer service. Maintaining customers reduces attrition costs and maintaining partnership-level customer relations is most profitable. Total quality management requires that quality be perceived by and reflected in all company activities to continuously improve

1. Customer
Satisfaction
Quality, Service, and Value

2. Customer Value and
Satisfaction
• A happy customer was a satisfied customer, a happy
customer will be a repeat customer, and a repeat customer
is a loyal customer.

3. What does it take to
satisfy a customer?

4. Customer Value and
Satisfaction
Customers are…
• Estimate which offer will deliver the most value
• Value Maximizers
• Form an expectation of value

5. Customer Value and
Satisfaction
Customer Value
- the difference between the total customer value and
total customer cost.
Sources of Value
• product
• services
• personnel
• image

6. Customer Value and
Satisfaction
Customer
Delivered
Value
Product
Value
Service
Value
Personnel
Value
Image
Value
Monetary
Price
Time
Cost
Energy
Cost
Psychic
Cost
Total
Customer
Cost
Total
Customer
Value

7. Customer Value and
Satisfaction
Satisfaction
- level of a person’s felt state from comparing a
product’s perceived performance in relation to the person’s
expectations

8. Delivering Customer
Value and Satisfaction
Value Chain
– a company tool for identifying ways to create
more customer value
- a firm’s collection of activities that are performed
to design, produce, market, deliver, and support its product

9. Delivering Customer
Value and Satisfaction
…to deliver Value you need…
Core Business Processes
• Product Realization Process – identifying, researching,
developing, and successfully launching new products with
speed, high quality, and target cost attainment.
• Inventory Management Process – developing and managing
the right inventory locations or raw materials and finished
products.
• Order-to-remittance process – receiving orders, approving,
shipping, and payment collection.
• Customer Service Process – after-sales services

10. Delivering Customer
Value and Satisfaction
Cost of Lost Customers
• Define Retention Rate – how much customers you keep
• Causes of Attrition
• How much profit you loose per customer lost – (customer
lifetime value)
How much cost would it take to reduce defection rate.

11. Delivering Customer
Value and Satisfaction
Levels of Customer Relations
• Basic – no contact after sale is made
• Reactive – seller encourages customer for contact after
sale is made
• Accountable – seller contacts customer after sale is made
if satisfied
• Proactive – seller contacts customer from time to time
• Partnership – company continuously work with
customers to improve products and after-sales services

12. Delivering Customer
Value and Satisfaction
A Profitable Customer…
- a customer that yields a revenue stream over time,
exceeding by an acceptable amount the company cost
stream of attracting, selling, and serving that customer.

13. Delivering Customer
Value and Satisfaction
• Rule #1. The Customer is always right
• Rule #2. If Customer is wrong, see rule#1.

14. Delivering Customer
Value and Satisfaction
Total Quality Management
Quality – totality of features and characteristics of a product
or service that bear on its ability to satisfy stated or implied
needs

15. Delivering Customer
Value and Satisfaction
• Premises about TQM
1. Quality must be perceived by Customers
2. Quality must be reflected in every company activity
3. Quality requires total employee commitment
4. Quality requires high quality partners
5. Quality can always be improved
6. Quality improvement requires quantum leaps
7. Quality do not cost more
8. Quality is necessary but may nit be sufficient
9. Quality drive cannot save a poor product.

16. Reading Assignment
• Developing Corporate Mission, Vision, and Objectives
• The Boston Consulting’s Group Growth-Share Mix
• Business Strategic Planning