VISION STATEMENT: It is a short declaration of what an organization aspires to be tomorrow.

Successful visions provide a guideline for decision making Example : Disney Theme Park - Happiest place on earth Polaroid - Instant photography MISSION STATEMENT: It answers the following questions Who are the customers? What we do? How we do it? It describes the function of the organization. It provides a clear statement of purpose for employees, customers & suppliers A simpler mission statement is To meet customers transportation and distribution needs by being the best at moving their goods on time, safely and damage free - NATIONAL RAILWAYS QUALITY POLICY STATEMENT: It is guide for everyone in the organization as to how they should provide products and services to the customers. Common characteristics are Quality is first among equals Meet the needs of the internal & external customers Equal or exceed competition Continuously improve the quality Utilize the entire workforce Customer perception of quality Before 1988 Performance, Prize and service After 1989 Performance, service and prize 1. Performance availability (ready for use), reliability (free from failure), maintainability 2. Features psychological and technical. Added feature along with main usage 3. Service intangible, made up of many small things 4. Warranty Vs guarantee. Customer feels comfortable with this 5. Price value for money, ready to pay at the same time comparative study to be done 6. Reputation Branding merges with quality. Good exp reaches 6 bad reaches 15 Service Quality Shift in focus from manufacturing industry to service industry and the services involved in manufacturing organization. Customer service is the set of activities an

organization uses to win, attract and retain customers. It can be provided before, during and after the sale of the product. Elements of customer service Organization 1. Identify each segment where the organization needs to concentrate on quality 2. Write down requirement Proper documentation of quality policy in the form of a handbook 3. Communicate requirements Inform its importance to all levels in the organisation 4. Organize process create a systematic process as it is ongoing and never ending process 5. Organize physical spaces aesthetics, atmosphere, room space, recreation, wifi etc Customer Care Henry Ford The boss just handles the cash it is the customer who pays your salary 1. Meet the customers expectation treat all customers alike, respond quickly 2. Get the customers point of view think in the point of view of a customer 3. Deliver what is promised keep up promise at any cost 4. Make the customer feel valued customer must feel that due respect and importance is given to him 5. Respond to all complaints minimize complaints and eradicate similar and repeated complaints 6. Over-respond to customer make him feel he is cloud nine 7. Provide clean and comfortable reception area cleanliness, spacious, dress code, weather etc Communication All forms of communication written, verbal, advt, web site must prove quality 1. Optimize trade off between time and personal attention 2. Minimize the number of contact points channels and levels 3. Provide pleasant and knowledgeable enthusiastic employees 4. Write document in customer friendly language simple and point blank Front-line people The people who have first and direct contact or interaction with the customer 1. Hire people who like people train groom them 2. Challenge them to develop better methods small changes in packing, billing etc 3. Give them authority to solve problems give discounts, free gifts etc 4. Serve them as internal customers 5. Make sure they are adequately trained written and oral communication, body language etc 6. Recognize and reward performance - Nordstorm example obsess with the customer Leadership 1. Lead by example spend time with all level, dealers and suppliers. Like having food , using co product 2. Listen to front line people 3. Strive for continuous process improvement CUSTOMER SATISFACTION Customer satisfaction, a business term, is a measure of how products and services supplied by a company meet or surpass customer expectation. It is seen as a key performance indicator within business and is part of the four of a Balanced Scorecard.

In a competitive marketplace where businesses compete for customers, customer satisfaction is seen as a key differentiator and increasingly has become a key element of business strategy. Performance Features Service Warranty Price Reputation THE CUSTOMERS ARE The most important people in the business Not dependent on the organization, but the organization depends on them. Not an interruption to work but are the purpose of it. Doing a favor when they seek business and not vice-versa. A part of business, not outsiders and they are life blood of the business People who come with their needs and jobs Deserve the most courteous and attentive treatment. TYPES OF CUSTOMERS Internal Customer: The customer inside the company are called internal customers External Customers: An external customer is the one who used the product or service or who purchase the products or service or who influences the sale of the product or service. CUSTOMER SUPPLY CHAIN

CUSTOMER COMPLAINTS (FEEDBACK) Customer feedback must be continuously solicited and monitored to reduce the dissatisfied customers as much as possible. CUSTOMER FEEDBACK OR CUSTOMER COMPLAINT IS REQUIRED To discover customer dissatisfaction To identify customers needs To discover relative priorities of quality To compare performance with the competition To determine opportunities, for improvement TOOLS USED FOR COLLECTING CUSTOMER COMPLAINTS Comment card - Low cost method, usually attached to warranty card Questionnaire - Popular tool, costly and time consuming - by mail or telephone preferably multiple choice questions or a point rating system (1 to 5) or (1 to 10) Customer Focus groups - Meeting by a representative of the company with the group of customers. Imprint analysis is an emerging technique to obtain intrinsic feelings using customer meetings, word associations, discussion, relaxation techniques etc. Phone - Toll free Telephone numbers Customer visits - Visit customer's place of business. Report cards - Usually, send to customer on a quarterly basis. The internet and computer - It includes newsgroups, electronic bulletin board mailing lists, Employee feedback. Mass Customization - Capturing the voice of customers using data of what customer want instead of what customer is thinking about buying and manufacturing exact what they want. STEPS TO SOLVE CUSTOMER COMPLAINTS Complaints can be collected from all sources (letters, phone -calls, meetings and verb inputs) Develop procedures for complaint resolution, that include empowering front-line personnel. Analyze complaints, but understand that complaints do not always fit into new categories Work to identify process and material variations and then eliminate the root cause. When a survey response is received, a senior manager should contact the customer and strive to resolve the concern. Establish customer satisfaction measures and constantly monitor them. Communicate complaint information, as well as the result of all investigation

solution, to all people in the organization. . Provide a monthly complaint report to the quality council for their evaluation and needed, the assignment of process improvement teams. Identify customer's expectations beforehand rather than afterward through complaint analysis. CUSTOMER RETENTION More powerful and effective than customer satisfaction It is the process of retaining the existing customer Customer care can be defined as every activity which occurs within the organization that ensures that the customer is not only satisfied but also retained. SIGNIFICANCE OF CUSTOMER RETENTION 60% of organizations future revenue will come from exiting customers 2% increase in customer retention has 10% decrease in operating cost. 96% of unhappy customers do not complain but 3 times likely to convey to other customers about their bad experience. 91% of unhappy customers never purchase goods and services from you. It costs 5 times more to attract the customer than retaining the existing customer. Customer retention creates customer loyalty and moves customer satisfaction to a next level called customer delight. Dimensions of product and service quality

Dimension Performance Features Conformance Reliability Durability

Meaning and Example Primary product characteristics, such as the brightness of the picture Secondary characteristics, added features, such as remote control Meeting specifications or industry standards, workmanship Consistency of performance over time, average time of the unit to fail Useful life, includes repair Service Resolution of problems and complaints, ease of repair

Response Aesthetics Reputation

Human to human interface, such as the courtesy of the dealer Sensory characteristics, such as exterior finish Past performance and other intangibles, such as being ranked first

QUALITY COSTS QUALITY COSTS:Q uality costs are defined as those costs associated with the non- achievement of prodect/service quality as defined by the requirements established by the organization and its contracts with customers and society. Quality cost is a cost for poor product of service. ELEMENTS OF QUALITYCOST:Many companies summarize quality costs into four broad categories. They are, a) Internal failure costs - The cost associated with defects that are found prior to transfer of the product to the customer. b) External failure costs - The cost associated with defects that are found after product is shipped to the customer. c) Appraisal costs - The cost incurred in determining the degree of conformance to quality requirement. d) Prevention costs - The cost incurred in keeping failure and appraisal costs to a minimum.

1. PREVENTION COST Marketing / Customer / User. Product / Service / Design Development. Purchasing Operations (Manufacturing or Service) Quality Administration. 2. APPRAISAL COST Purchasing Appraisal Costs. Operations Appraisal Costs External Appraisal Costs Review of Test and Inspection Data Miscellaneous Quality Evaluations 3. INTERNAL FAILURE COST Product or Service Design Failure Costs (Internal) Purchasing Failure Costs Operations (Product or Service) Failure Costs 4. EXTERNAL FAILURE COST Complaint Investigations of Customer or User Service Returned Goods Retrofit and Recall Costs Warranty Claims Liability Costs Penalties Customer or User Goodwill Lost Sales ANALYSIS TECHNIQUES OF QUALITY COST

The purpose of quality cost analysis is to determine the cost of maintaining a certain level of quality. Such activity is necessary to provide feedback to management on the performance of quality assurance and to assist management in identifying opportunities. INDEX NUMBERS : Index Numbers are often used in a variety of applications to measure prices, costs (or) other numerical quantities and to aid managers in understanding how conditions in one period compare with those in other periods.

TREND ANALYSIS : Good visual aids are important communication tools. Graphs are particularly useful in presenting comparative results to management. Trend Analysis is one where Time-to-Time comparisons can be made which illustrates

Pareto Analysis This fact gave rise to the Pareto effect or Paretos law: the vital few and the trivial many. The Pareto effect is named after Vilfredo Pareto, an economist and sociologist who lived from 1848 to 1923. Originally trained as an engineer he was a one time managing director of a group of coalmines. Pareto analysis is a statistical technique in decision making that is used for selection of a limited number of tasks that produce significant overall effect. It uses the Pareto principle the idea that by doing 20% of work you can generate 80% of the advantage of doing the entire job. Or in terms of quality improvement, a large majority of problems (80%) are produced by a few key causes (20%). Pareto analysis is a formal technique useful where many possible courses of action are competing for your attention. In essence, the problem-solver estimates the benefit delivered by each action, then selects a number of the most effective actions that deliver a total benefit reasonably close to the maximal possible one. Use of Pareto principle in prioritizing or ranking a range of items which have different levels of significance. Its objective is to separate the 'vital few' from the 'useful many.' Steps to identify the important causes using Pareto analysis the causes and their frequency as a percentage. the most important cause first) x- and cumulative percentage on y-axis x- and percent frequency on y-axis y-axis parallel to x-axis. Then drop the line at the point of intersection with the curve on x-axis. This point on the x-axis separates the important causes (on the left) and trivial causes (on the right)