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Understanding Customer Needs

By: Jagadis Purohit Radhika Wahal Swapnil Salvi

Identify the customers


A customer is anyone who is affected by the product or process delivered by an organization. Three categories of customers emerge: 1. External customer, both current and potential: A party who uses or is directly affected by a company's products/services. 2. Internal customer: Other divisions of the company that receive the processed product/service. 3. Suppliers: Extensions of internal customers An important tool for identifying customers is a flow diagram.

An organization should concentrate on the vital few customers and perform activities leading to customer loyalty.

Customer Behaviour

Customer needs are basic physiological and psychological requirements and desires for survival and well-being. Customer expectations are anticipated characteristics and performance of a good or service. Kano and Gitlow (1995) suggested three levels of customer expectations: 1. expected level or minimum or must be attributes :: no satisfaction 2. unitary (desired) level :: greater satisfaction but in small increments 3. attractive( surprising) level :: customer delight Customer satisfaction is the degree to which the customer believes that expectations are met or exceeded by the benefits received. Customer perception is the impression made by the product.

h Scope of Human needs: Types Example: Digital Camera Direct Needs customers have no trouble declaring those needs they are concerned about. Cost, good pictures, ease of operation Latent Needs not directly expressed by the customer without probing. Obtaining prints, easy viewing on PC Constant Needs these needs are intrinsic to the task of the product and always will be. When product is used, this need is always there. Nighttime picture taking, number of digital images. Special needs apply only to a smaller market segment within the entire population. Under water application These needs must be discovered and served.

Sources of Market Quality Information

Market quality information includes quality alarm signals arising from decline in sales , field failure reports, customer complaints, claims, lawsuits, etc. Alarm signals are poor measures of quality-rather measures of expressed product dissatisfaction Vast array of published data available relative to quality such as database on sales volume, price changes, success rate on bids, spare part usage, ratings from consumer journals, etc

Market Research in Quality ( Voice Of The Customer )


VOC is a continuous process of collecting customer views on quality and can include customer needs, expectations, satisfaction, and perception. Purpose of Market Research in Quality 1. Determine customer needs 2. Develop new features 3. Measure current customer satisfaction 4. Analyze customer retention and loyalty issues Customer satisfaction should be measured relative to the competition and should address both product features and freedom from deficiencies. Market research can help to discover opportunities for achieving a unique competitive advantage.

Needs related to product features

We need to identify the relative importance of the attributes of a product according to the customers. Next step is to identify how the product compares with the competition. Discovering Customer needs and marketing opportunities Approaches: Approach for improving fitness for use Gather information by observation of customers Observe Capture data Reflection and Analysis Brainstorming Prototyping

Approach for adding value 5 Possible ways to add value Be Flexible Tolerate customer errors Give personal attention Provide helpful information Increase convenience Focus Group Mass Customization

Needs related to product deficiencies

Pareto analysis as a tool to identify a vital few quality problems Company holding focus group meetings of customers to correctly customer complaints

Measuring customer satisfaction


Identify the attributes of the product that collectively define satisfaction A sample of customers should be asked which attributes constitute high quality and their relative importance Inputs from company managers, trade journals, and other sources are also included. List of attributes is then finalized for research with larger sample of customers. SERVQUAL model identifies five dimensions: Tangibles Reliability Responsiveness Assurance Empathy Information about customer satisfaction relative competition Customer satisfaction data to be linked with customer loyalty analysis Data on customer satisfaction collected by market surveys, mystery shoppers, employee reports, post-transaction interviews, focus groups, call centers for complaints, and other comments.

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