Written Report

In
Total Quality Management

Group II
Arumpac, Rekha M.
Billones, Dexter C.
Cabuslay, Rosana
INTRODUCTION----------Arumpac, Rekha M.
Total Quality Management is defined as a strategy for improving business performance through the
commitment and involvement of all employees to fully satisfying agreed customer requirements, at the
optimum overall costs, through the continuous improvement of the products and services, business
processes and people involved. The concept of Total Quality Management can be expressed as
“Achieving success through delighting the customers”.
DEFINITION OF CUSTOMER
There are two distinct types of customers external and internal.
Internal customers
Are within the company-the colleagues working together for delivering a service or product for the
external customer.
External customer
May be an individual or an enterprise that hires or purchases the product(s) or service(s) from another
person or business in exchange of money. One of the most important factors for the success of an
enterprise is its customers. Without them, a business cannot exist. But to capture customers, a business
must try to find out what people want, how much and how often they will buy and how their post-
purchase satisfaction will be ensured.
Service Quality
The process of managing the quality of services delivered to a customer according to his expectations is
called Service Quality Management. It basically assesses how well a service has been given, so as to
improve its quality in the future, identify problems and correct them to increase customer satisfaction.
Service quality management encompasses the monitoring and maintenance of the varied services that are
offered to customers by an organization. Whether you are in the software business offering services to
clients or operate in the food, hospitality or travel industry, service quality management is integral to
managing customer expectations and business growth. The service quality can either relate to the service
potential (qualifications of the persons offering service), service process (quickness, reliability etc.) or the
service result (meeting customer expectations).
Features of Services

 The most basic distinguishing characteristic of services is intangibility. Because services are
performances or actions rather than objects, they cannot be seen, felt, tasted or touched in the
same manner in which goods can be sensed(Zeithaml et al. 1985) The intangible nature of service
is argued to be one of the fundamental characteristics of service which differentiates services
from goods (Bateson 1979).
 Heterogeneity reflects the potential for high variability in service delivery (Zeithaml et al. 1985).
The quality and essence of service can vary from producer to producer, from customer to
customer and from day to day. Given the very nature of services, each service offering is unique
and cannot be exactly repeated even by the same service provider. While products can be mass
produced and be homogenous the same is not true of services.
  Inseparability of production and consumption involves simultaneous production and
consumption of services. Where goods are first produced, then sold and then consumed, services
are first sold then produced and consumed simultaneously (Regan 1963).
 The fourth characteristic of services highlighted in the literature is perishability. Perishability
refers to the fact that services cannot be saved, stored, resold or returned. Because services are
performances that cannot be stored service businesses frequently find it difficult to synchronize
supply and demand (Zeithaml et al. 1985)
Customer delight
Customer delight is surprising a customer by exceeding his or her expectations and thus creating a
positive emotional reaction.Customer delight directly affects sales and profitability of a company as it
helps to distinguish the company and its products and services from the competition.
Word of Mouth goodwill about a brand or business. It is passing of information from person to person

Kano Model----------Billones, Dexter C.

The Kano Model conceptualizes customer requirements. The model represents three major areas of
customer satisfaction.

 Explicit requirements – A depicted by the diagonal line. These include written or verbal
requirements and are easily identified, expected to be met, and typically performance related.
Satisfying the customer would be relatively simple if these were only requirements.
 Innovations - A curved line in the upper left corner. A Customer’s written instructions are often
purposefully vague, to avoid styling new ideas during conceptualization and product definition.
Because they are unexpected, these creative ideas often excite and delight the customer. These
ideas quickly become expected.
 Unspoken requirements – A lower right curve. The customer may indeed be unaware if them or
may assume that such requirements will be automatically supplied. Basic specification often fail
to take real-world manufacturing requirements into account, many are based merely on industry
standards or past practices.

AGREED CUSTOMER REQUIREMENTS

• Finding out requirements right first time –In service industry, the customers meet the service
provider and express the requirements orally.

• Use checklist-This is use to clarify or understand the requirements/preference of the customer.

• Review of requirements – Before the final acceptance of the contract, the both parties, the
customer and service provider should get a contract review done.

• Foresee and provide for amendments – Before even agreeing to provide the service, the
customer and service provider should agree upon how to amend the service agreement later on.
 • Documented Policy – Documenting customer’s requirements by policy for employees/
organizations and customers guide.

• Code of good customer handling practices – whatever mistakes and pitfalls are found should be
identified and documented.

CUSTOMER PERCEIVED QUALITY

This concept implies that there is no acceptable quality level; therefore, the customer’s needs, values or
expectation are constantly changing and becoming more and more demanding.
American society for Quality control (ASOC) -- conducted a survey on customers’ perception of
important factors that influenced purchases showed the following ranking:
• PERFORMANCE--- involves “fitness for use”; this phase tells that product quality and services
is ready for customer’s use at time of sale.

• FEATURES – are secondary characteristics of the product or service.

• SERVICES – is emerging as a method for organizations to give the customer added value.
Customer service is intangible; it is made up of many small things, all directed to change/
improve customer’s perception.

• Warranty – it represents a business organization’s public promise of a quality product supported

by a guarantee of customer satisfaction. Furthermore, it also represents public commitment to
guarantee a level of service sufficient to satisfy the customer.

• Price – present customer are willing to spend a higher price to obtain value, customer evaluating
product and services against those of its competitors who provides the greatest value.

• REPUTATION – Customer satisfaction is based on the entire experience with the organization
not just the product. Customers are very much willing to pay a premium for a known or trusted
brand name and often become customer for life.

CUSTOMER FEEDBACK AND COMPLAINTS RESOLUTION----------Cabuslay,Rosana

Customer feedback - refers to comments given to business by customer about the service they have
received and the products they purchased.
Feedback form or Response sheet - the common method of obtaining feedback
Confidentiality - the feedback should kept secret or private
Display Result - the data collected could be converted into charts like pie charts, bar charts and displayed
in the organization notice boards.
The Display of the Feedback is beneficial in two ways to the organization namely
1. The customer comes to know that their feedback is taken seriously by the organization.
2. The employees in the organization know about where they really stand.
Complaint Resolution - resolving the complaints or finding solutions to a problem
The following action should be taken:

 Analyze Independently
 Give Benefit of Doubt to Customer
 Satisfying annoying customer
COMPLAINT-RECOVERY PROCESS
What is the Complaint-Recovery Process? - The process where companies receive complaints, process
them, and communicate back to the customer.
What is the goal? 100% customer satisfaction? - Documentation of customer’s problems/concerns for
future reference
To fix the customers problem/concern wherever feasible, as soon as possible
These points are some of the goals of a company that a good complaint-recovery process will help reach.
Classifying Complaints
Develop a system within your organization to rank complaints on urgency.
What is the magnitude of the complaint?
EVERY COMPLAINT IS IMPORTANT!
Develop a system within your organization to rank complaints on urgency.
How urgent is the problem the customer is having? It is something that needs to be handled immediately?
If so, is there a system implemented of who to contact if a urgent complaint is filed?
What is the magnitude of the complaint?
Although every complaint is important, some require more attention then others. Your company should
set guidelines as far as who gets involved and at what point. It is much more cost efficient to take care of
the problem with the fewest number of people. But sometimes that is not the case. If a major grievance is
filed by a customer who buys multi-million dollars worth of goods from your company, it should require
more attention then when a customer who makes a five dollar purchase. In the case of a big account,
sometimes it is better to get upper-management involved. A call from the CEO to a big account is more
appropriate then a letter that would be sent out to a small customer.
EVERY COMPLAINT IS IMPORTANT!
If a customer took the time to complain it is obviously important to that customer, thus it should be
important to the company. Whether or not it is the 1000th complaint of the same type, each customer
should receive the same respect and explanation.
Complaint-Free Customer Service?
No one is perfect, everyone makes mistakes!
Sounds nice, but it will be counterproductive in the long run.
“A good service accepts that things are wrong and fixes it.”
According to,
-Ken Birkby, head of customer service for Marks & Spencer
No one is perfect, everyone makes mistakes!
You want to make it easy for customers to complain. If you notice your complaints dramatically went
down when a new system was implemented, it may mean your new system has flaws. You should make it
very easy and even invite the customer to voice his/her concerns.
Sounds nice, but it will be counterproductive in the long run.
Although it would seem nice to have customers that don’t complain, in the long-run this could end up
hurting your business. As stated before customers who complain and have their problems resolved are
more loyal then customers who never complain. Additionally, complaints identify problems, without
complaints your problems can remain hidden.
Complaint-Friendly Customer Service
It should be easy for customers to get in touch with your company.
Customers should always be treated with respect and courtesy.
The customer is ALWAYS right, even when they’re wrong.
It should be easy for customers to get in touch with your company.
The easier it is for a customer to complain the more comfortable a customer will feel. Your company
should have a phone number and address to get in touch with someone that is easily identifiable.
People like attention. If you give your customer the deserved attention, he/she will more likely stay loyal
to your business.
Cut the red tape, the simpler it is for the customer to speak to the right person in the right department the
easier it is to solve the customers problem.
Customers should always be treated with respect and courtesy.This is self explanatory.

The customer is ALWAYS right, even when they’re wrong.

If you argue with a customer you will be the one to lose in the long-run. If the customer feels he/she was
right and you tell them he/she was wrong he/she will be not likely to return to your business. This should
be taken within reason. If you feel a customer is scamming you the situation should be evaluated further.
Communicating to the Customer

 Organization
 Patience
 Understanding
 Assurance
 Honesty
 Organization
When you confront the customer about a complaint, especially over the phone or in person, be organized.
Know what the problem is, what went wrong, and what you can do to fix it.
Patience
Take a deep breath and relax. Remember, your company messed up somewhere along the line. You may
have to deal with very upset customers from time to time. If you get uptight it will frustrate the customer
even further.
Understanding
Be understanding and show some sympathy to your customer. People like to connect to on a personal
level. Apologize and let the customer know that your company is truly sorry for the inconveniences it
may have caused him/her.
Assurance
Assure your customer that the problem has been looked into and will be followed up. Then look into the
problem and follow it up. If you let it slide and forget about it, if it problem arises again you will lose
creditability.
Honesty
Be honest and upfront with your customer. If you get caught in a lie you and your company will lose all
creditability.
Getting Customer Feedback

 Passively Solicited Customer Feedback

 Waiting for the customer to come to you about grievances/gratitude's.
 Actively Solicited Customer Feedback
 Asking the customer if he/she has any grievances/gratitude’s regarding his/her experience with
your business.
Passively Solicited Customer Feedback
This is strictly customer initiated contact with your company. This can be done by a customer sending an ,
letter, or phone call to your company outlining any gratitude’s or complaints about your business. Most
feedback will be towards the negative aspects of your business.
Actively Solicited Customer Feedback
Taking an active approach to get in touch with the customer. This includes surveys, telephoning
customers, as well as focus groups. By understanding the customer companies are more likely to fix
problems before the complaint letters come flowing in. This approach is more expensive, but in many
industries it is worth the extra cost.
Implementation of a New System

 Issue a policy statement

 Establish an implementation team
 Establish a tracking system
 Develop recommendations for improvement
  Implement
Issue a policy statement.
-Make the statement that says the organization embraces complaints and view them as opportunities.
Establish an implementation team.
-Identify each step in the process and get a representative from each area in the complaint handling
process to work on a new system.
Establish a tracking system.
-Have employees record and classify complaints so they will be able to analyze the data and report to top
management.
Develop recommendations for improvement.
-Listen to employee’s recommendations to improve the core processes and develop a system where front-
line employees can resolve the problem on first contact.
Implement.
-The team should put an action plan together with a timetable for implementation.
Some Suggestions for Improvement

 Make it easy for your customers to complain and your customers will make it easy for you to
improve.
-Informed customers know how things should work and if things aren’t working properly, customers are
the first to know. Customers who are dissatisfied tell twice as many people as those who are happy with
the product/service. Use feedback from phone calls, letters, and surveys to identify causes of an unhappy
consumer. Use that information to look into a fix for the problem.

 Respond to complaints quickly and courteously with common sense and you will improve
customer loyalty.
-If a company quickly recognizes a customers complaint, customers usually reward the company by
remaining more loyal then a customer who has never had a complaint.
Key to Success Doing the job right the first time
Maximum customer satisfaction/loyalty
-The most customer loyalty can be gained by effective complaint management. Companies should try to
do it right the first time, but it is important to know that you can get more out of it if a problem arises and
it is handled right.
More Suggestions for Improvement

 Using technology is very important in a complaint handling system.

 Recruit and hire the best for customer service jobs.
 Resolve complaints on the first contact.
 Using technology is very important in a complaint handling system.
-A database is essential to keep a record of customer complaints. Present the findings in a report to all
employees, including upper management, outlining problems and possible fixes.
Recruit and hire the best for customer service jobs.
Put your best, well-mannered, well-spoken employees in touch with the customers. Give the customer the
image of a back office that is patient and well-organized. The customer-service position can be used for
employees to learn all about the different areas of a company.
Resolve complaints on the first contact.
You can save money by eliminating unnecessary additional contacts that escalate costs. When two or
more employees get involved it is more expensive than have one person handle it right the first time.
Getting lost amongst piles of papers. With this new system in place, less complaint was coming in and
customer satisfaction has gone up.
References