In business, if you’re doing something wrong, your customers will usually tell you about it, right? Sometimes, but not always. As GTE found out, no news is not always good news.

“We found that many of our customers do not complain to us,” says Michael English, director of quality positioning, GTE Corp. “When we’ve gone to interview them, we’ve found problems, like their service is not working properly, but when we’ve asked them ‘Have you reported it to us?’ they say ‘No’ often. You cannot rely on the number of complaints you get as a barometer of how you’re doing.”

In other words, don’t wait for your customers to tell you what’s on their mind. You must ask them yourself. “We could no longer assume we understood what customers needed and wanted and, as time went on, what were new, emerging needs and expectations. In order to do that, you have to go out and talk to customers, and a customer satisfaction tracking program clearly is the most effective way of doing so,” English says.

In GTE’s case, though they had long been involved in residential customer satisfaction research with their Tel-Cel program, the de-regulation of the telephone industry increased competition, making it imperative to find out how they rated with their business customers.

“What we’re trying to do now,” English adds, “is operate the business as though it’s competitive-because it is becoming   increasingly competitive-and to try to treat customers as though they do have a choice. In some cases they don’t have a choice today, but they soon will, and in the case of business customers they have a wide range of choices for almost anything they need.”

Two programs instituted

With the help of Total Research Corporation’s Service Quality Management program, GTE instituted two programs to gauge their performance in the eyes of their business customers: the Business Customer Expectations Survey (BCES), and the Business Customer Opinion Survey (BCOS), an on-going survey aimed at tracking satisfaction levels.

“I think what created the need for this kind of work,” says Hugh Devine, executive vice president of Total Research Corp., “was the increase in Japanese competition in particular, where American consumers were starting to move to higher quality products and services and move away from the American products and services.”

In the early 1980s, Devine says, businesses began to realize that there were differences between marketing a service and marketing a product. “Some of the techniques and approaches that had been developed, in particular by consumer packaged goods companies, were not really appropriate for service companies. Therefore they were looking to develop new approaches and new techniques which would be specifically applicable to services marketing.”

One of those approaches was an increase in emphasis on customer satisfaction. “Total Research Corp., understanding the needs of the marketplace, based on research we did, began to develop the Service Quality Management program about five years ago. Management in major corporations started to find out that managing quality was essential to the growth of their companies, not only in terms of market share, but also in terms of profitability,” Devine says.

Concept of quality

To start out, GTE outlined the concept of quality, breaking it up into five qualifications that needed to be met. To assure quality, the company must:

  • Fully meet customers’ needs.
  • Fully meet customers’ expectations.
  • Eliminate sources of problems for customers.
  • Communicate effectively with customers.
  • Anticipate what’s important to customers.

“We learned that quality is really something defined by customers and delivered by employees,” English says. “To be able to deliver on these five points, you need to know from the customer, not from your own internal measurement system, how well you’re doing, and therefore you have to have some way to talk to the customer after service delivery.”

BCOS

To participate in BCOS—which surveys more than 20,000 customers each year—the business customer is contacted by telephone at a convenient time by a Total Research representative to respond to the 15 minute survey. After a screening process to make sure the respondent is responsible for making decisions regarding telecommunications within the company, they are asked to grade GTE (on a scale of A to F) on a number of attributes and areas, including repair and installation services, account management, the sales force, the quality of voice and data transmission, and reliability. They also provide information on company size and give an overall rating to GTE.

Concerns and attributes

One of the purposes of the Business Customer Expectation Study was to find out what kinds of concerns and attributes should be contained in an on-going tracking study like BCOS. Focus groups were conducted in several GTE markets, such as Tampa , Fla. , where telecommunications managers from medium ($5,000 to $25,000 per month in billing) and large ($25,000 or more per month) companies were interviewed. Focus groups were also conducted in communities where GTE was not the predominant provider of local service, such as Los Angeles - where GTE borders the Bell operating territory - including customers of both GTE and the local Bell company in their research.

“The purpose of the focus groups was to determine how customers view service quality,” Devine says. “What is it that they consider service quality to be? We were looking to find this out in two ways. One was to understand customer terminology; what language do they use when they talk about service quality? The other was to determine which aspects of service quality were more important to these customers.

“Based on the results of the focus groups,” Devine continues, “we determined there were a variety of different needs that customers had. So we then structured a quantitative questionnaire for the Expectations Study and we identified from the focus groups. A long list of service quality attributes that needed to be measured quantitatively.” Some of those attributes were; repair responsiveness in certain situations, hours of maintenance coverage, quality of incoming/outgoing calls, network quality, and reliability.

Conjoint exercise

As part of the Expectations Study, approximately 300 quantitative interviews were done in-person with telecommunications managers around the country, in which they were asked to do a full profile conjoint exercise in hypothetical scenarios involving various aspects of telephone service, from the installation of a new office-wide phone system to adding a data transmission line from a branch office to a main office.

“We tried to put people into realistic situations,” says Devine, “and we felt, based on the focus groups, that seven different scenarios would provide people with enough choices. We first asked them to pick a scenario that made sense to them, and there would be a variety of things related to that particular choice. The attributes that were important to people in our focus groups were then given to them on full profile conjoint cards, so they were given the attributes relative to that particular choice and what they were doing is trading off how much service they required for each of those attributes.

“For example, if it were timeliness, we would give them different choices in terms of how quickly they needed service if they were having something new installed, ranging from immediate service to within the next week, to within the next 30 days.”

“We wanted to know what they would trade off, given the situation,” English says. “In several cases what they needed was very price inelastic. Price was as important as what they needed had to be reliably provided, done right, and on time as expected.”

Data transmission quality

The qualitative and quantitative Business Customer Expectation Study identified data transmission quality as an attribute of major importance to the customers, especially medium and large customers.

“We knew it was important,” English says, “but we didn’t understand it to be as important as it was shown to be in the research.”

It was especially important for businesses such as banks that rely heavily on telephone data transmission to transfer information, for example, from branch offices to the main office. In fact, in areas susceptible to circuit-breaking lightning strikes and power surges, some customers would use two or three lines as backups because they didn’t trust their primary circuits to be reliable.

GTE took this information regarding reliability needs to its network operations planners and engineers, who translated the insight into revised engineering and construction specifications. Many of the service people found that the customers had requested a voice grade circuit, when what they needed was a data grade circuit, which was better designed to deliver reliable transmission quality and protection against power surges.

“We discovered that we were going to have to do a better job of communicating with our customers to understand what their needs are so we could better design a solution and, specifically, to give them the data transmission quality that they need,” English says.

“One thing we’ve learned is that customers speak one language and we speak sometimes within our industry another language. Part of what we’re doing is trying to translate customer language into language within GTE we understand and can act on.”

The strengthened communication with customers, along with technical improvements—through overnight line testing and other efforts—led to an increase in the number of customers satisfied with data transmission quality.

Sales force

The focus groups and overall research also gave GTE valuable information on how their customers perceived the GTE sales force. Too often, the research showed, the customers felt that the GTE sales people didn’t understand enough about their industry, whether it was banking, insurance, education, or government, and that made it difficult, English says “to translate the unique characteristics and needs of their industry into telecommunications solutions.”

“So, with the key involvement of our marketing people, we put in place through BCOS a series of questions that had to do with how often the customers were being contacted by the sales force, how knowledgeable the sales force was about products and services related to their needs, how timely the sales force was in responding to their problems, and how satisfied they were with things that the sales force had proposed, subsequently were agreed to and contracted for.”

Once again, the research led to an increase in customer satisfaction. Approval has jumped 20% over the two years since tracking began.

Action Comment

In addition to uncovering more pervasive problems through the BCOS questionnaire, there is a facet of BCOS used by about 1,000 respondents per year called the Action Comment Procedure which lets GTE be responsive to individual complaints. During the BCOS interview, if the customer indicates a need or a problem that’s not being met, the interviewer can step into the ACP.

“The ACP is a separately prepared document, written up by the interviewer, that in effect says the customer wants to be contacted by GTE about this matter,” English says. “It could be something as simple as they have not received their telephone directory, or it could be something more complex, like they have a service problem and could someone from GTE come out and talk about it.”

The Action Comment Procedure, through customer requests for upgrades and service changes, has also generated sales leads, says English. “As you categorize these action comments, some fall into the category sales leads. So here is a case where a program has actually generated sales leads for growth of new revenue.

“There has always been out of this program the identification of specific types of problems plaguing customers, say it was the delivery of directories in one location, for example. Those have been identified in a better way and acted upon. This year we may find something new that’s important to them that they want handled differently, and that will enable us to better respond to what they need.”

Other programs

Information gleaned from BCOS has lead to other ongoing programs. For example, in Tampa , Florida , GTE now holds regular business customer forums, where they get together with customers over lunch to discuss an agenda of topics set by the customers. In addition to keeping them in touch with their clients’ needs, the meetings let GTE keep their clients in touch with what GTE is doing to improve service and directly address their needs.

In California , a consumer advisory panel, made up of people from fields such as business, government and education, gives input on changes to billing statements and other matters.

Long term

These and other facets of the research help GTE address immediate customer problems and concerns, resulting in immediate benefits. But the research may be most beneficial in the long term, where GTE is able to bring the following four objectives to bear, using the data as:

  1. a basis for strategic planning, something to give them an indication of what areas they should focus on in the development of new programs, new products and new services.
  2. a basis for performance measurement, to compare how well each of the GTE operating units around the country was doing in comparison to the others, and how they compared to the overall GTE average.
  3. a primary source of customer information. “If we had specific things we wanted to   know,” English says, “we could add on questions for certain types of customers as a primary source of information to meet other needs without having to separately have that customer reinterviewed.”
  4. a springboard for additional intelligence gathering, to find out, for example, how well their customers rated GTE in comparison to their competitors.

Another important long term use for the research data has been the tracking of GTE’s advertising, especially in those markets which the company has been engaged in correcting years of negative feelings towards the local telephone service, which, prior to purchase by GTE, had failed to adequately respond to customer needs.

“We’ve learned that some of our companies have what we call a positive and negative halo,” English says. “We’ve taken the findings and conclusions and integrated them into the planning for advertising to better approach the image we’re leaving with our customers, about how much we care about them.

“It may be that we’ve not seen all the benefits or dividends from the things that are going on in this area, because with strategic planning you’re talking long-term. But there are things in the works now and I’m optimistic we will over the next few years have delivered much better on those things of greatest importance to customers.” MRR

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Spreading the word within GTE

Introducing a company-wide program devoted to service quality doesn’t mean anything if the program doesn’t get company-wide acceptance and understanding. To make sure BCOS gained that crucial acceptance, representatives from GTE and Total Research gave multiple presentations at each of GTE’s operating companies in 1986, at the program’s inception.

“We took Hugh Devine and members of his staff,” Michael English says, “and we did a slide presentation and had the key management in from those locations and we talked about the objectives of the program, what it was to do, and how to utilize it as a tool to drive improvements in quality.

“We did a lot to introduce it so they’d understand what the program consisted of, and we told them what our design and methodology was, how many interviews we were going to do, how it would be tabulated, and how it all would be weighted.”

Meetings were also held to determine in what form the information would be delivered to the GTE employees. “We’re treating these people as internal customers of ours within GTE, and as we went around we had discussions about what information would be most meaningful at what time intervals. We got comments like ‘If you put this question in or take this one out, that will make the report more valuable for us,’ or ‘If we could get this information on a quarterly basis   rather than monthly, it would be more useful.’ That’s led us to where we are today, where we have these three key reports that come out during the month, two of which contain quarter ending results as well as 12 month-to-date results.”

The monthly reports are issued as:

  • an advanced management report that comes out within five working days of each month containing the previous month1s results;
  • a summary report in a more graphical design, showing the results for the key units on key questions.
  • detailed respondent data on disk or magnetic tape made available by operating unit.

Total Research, says Devine, played a key role in designing the reports, working carefully with GTE to make sure the information was getting to the right people in the right form. The company also maintains contact with the service and marketing coordinators at each GTE operating company, as well as personnel at GRE headquarters.

“We like to be responsive to the users within GTE,” Devine says, “to make sure they’re getting the information in a timely fashion and in a content and style that they can use it most readily, ranging from hard copy reports to magnetic tapes and floppy disks.”

The data can be tailored to meet each group’s specific needs. English says, “Our medium and large client results are linked to an account management system, so that the people working on those accounts in a sales capacity get results on them as they occur, for use in conferring with the customers about what they need.”

The care and attention paid to making BCOS work for the GTE employees is critical to the process of what English calls “institutionalizing” the program. For a service quality program to succeed, he says, “You have to integrate it into your fabric and culture of how you do business.”