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Customer Satisfaction Index

A customer satisfaction index is an easy way to track the level of overall customer satisfaction among a pool of customers or clients regarding a company's products, quality, levels of customer service and to lesser extent company culture. The customer satisfaction index can be easily constructed and tailored in many different ways, and can be an integral part of the company’s TQM system. The calculation of the index level is usually done in different ways even though the objective is always the same to give an accurate representation of the level of customer satisfaction with the businesses product(s) or services. The index can be used to track the satisfaction of customers among different product types, overall, and the reaction to changes in products or services.

Collecting data for the satisfaction index:

Every customer in the portfolio of customers will score the product or company's group of products in terms of quality, product and service satisfaction from 1 to 5, 1 to 10, or a certain percentage. Once the satisfaction scores have been collected for the different products or services, they can be manipulated to accurately represent the true customer satisfaction among product lines, overall and or geographic areas. A common use for the quality and service data collection is to compare it with production data over the same period surveyed to identify similarities and potential production, process, quality defects issues that may be related to variations in the index.

Calculation of the index

Calculating the index can be done in many ways, below is a list of some of the most popular ways of calculating a customer quality and/or service index: -Simple average
-Moving Average
-Product specific
-Product range weighted average
-Geographical area weighted average
-Customer revenue size weighted average
-A mixture of the above

Calculating the index should be a straight forward statistical calculation as suggested by any of the methods above. This then can be graphed and monitored to evaluate changes in the index. The index should be communicated to all employees within the business so that they are aware of their product's quality and service perception at all times and the importance of quality at every step.

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