Mumbai, Aug 16: If you were beginning to wonder whether your stakeholder satisfaction model is really satisfactory, take a litmus test: does your customer satisfaction score tell you exactly how satisfied your most loyal customer is? For while the aggregate satisfaction feedback might do you proud, you just might be focussing on the wrong end of the stick: a customer with a high level of satisfaction, but poor brand loyalty.To ferret the finer details on stakeholder satisfaction, the Mumbai-based Business Consulting Group (BCG), has come up with a unique tool called POSAT. Pointing out that the tool is designed to help bridge the gap between current levels of satisfaction and expectations, BCG chairman, Raj Nair says: ``Process-Oriented Satisfaction Assessment Technique (POSAT) is our own diagnostic-cum-prognostic tool to assess customer satisfaction-or the lack of it.''
POSAT took around three years to develop and has been used on 20 BCG clients so far. It's implementation involves understanding, indetail, the various product and process-related factors in the client's organisation, that go into building satisfaction levels among customers.
Parameters are then identified in such a manner that accountability for improving satisfaction levels can be fixed to one group of people or one department. POSAT is therefore, a dynamic tool and can be repeated periodically either to understand the changes in satisfaction levels due to changing competitive conditions, or to assess the impact of strategic actions on satisfaction levels.
The chemistry of satisfaction
To illustrate the effectiveness of POSAT, Business Consulting Group, vice-president, Naimish Dave took The Financial Express, through a case study where a leading chemicals company wanted to make a fair assessment of the satisfaction levels of its customers and dealers. The consultancy zeroed in on the client's heavy chemicals business first-it accounts for a major part of the company's sales-to get an insight into customer satisfactionlevels.
The Customer Satisfaction Index (CSI) was then analysed separately for the endusers and the distributors. Within the endusers category, a further segmentation was done in-terms of end-use (glass, detergents, etc.), zones (north, west, etc.) and size (large, medium and small). ``The satisfaction index was then measured for all the parameters-product, packaging, price, sales service, order fulfillment, etc-for each of the segments,'' says Dave.
Significantly, an initial analysis revealed that while the overall satisfaction index for endusers at 70 per cent appeared satisfactory, price and sales-service were the laggards weighing down the overall CSI. Besides, it became apparent that two zones were less satisfied and disturbingly, large customers were less satisfied compared with small and medium ones.
Digging deeper, analysis showed that under sales-service, it was the handling of complaints and the pricing policy which were the major causes for dissatisfaction among the endusers. Similarly, itwas found, dealers were unhappy with the inadequate number of sales visits by the company personnel.
The next step under POSAT was to map individual enduser customers on a grid of `Satisfaction versus Loyalty'-an attempt aimed at recognizing clusters which require differential marketing approaches. The grid identified four classes of endusers:
Mercenaries (high satisfaction but low loyalty);
Drifters (low loyalty and low satisfaction);
Hostages (low satisfaction and high loyalty);
Loyalists (high satisfaction and high loyalty).The grid then revealed that small pharmaceutical companies were the only `Hostages' (due to limited alternatives) and a higher proportion of large endusers fell in the `Mercenary' category. The consultancy then suggested different approaches for each category of enduser, in order to improve or maintain satisfaction levels.
BCG also mapped the satisfaction ratings vis-a-vis their importance, for individual endusers and distributors. This mapidentified three zones: Normal, Over- and Under-performance.
Based on the findings, the consultancy urged the client that top priority should be given to ensure: response to complaints; priority treatment to the `A' category customers; adequacy of cash and quantity discounts; and pricing options flexibility.
Was BCG's client satisfied with the model? The consultancy claims in its favour, that the client managed to maintain market share despite the turbulence in the sector in the last two years and was able to stave off the pressure from cheaper imports in the commodity chemicals market. More importantly, the model at least identified who the most important stakeholders were-and therefore, worth satisfying first.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
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