You can't escape it. Everywhere you look - on televi­sion, in newspapers and magazines - people are talk­ing about quality - service quality, product quality, customer satisfaction.

That's great, but what surprises me is that some of them are talking about it as if it were a new concept. It seems to me that quality should be a given for any business that wants to do more than just keep its creditors at bay. It should be Job One.

With quality as their mantra, many firms are busy construct­ing new or refining existing quality programs. Some compa­nies - such as Federal Express and Caterpillar, whose customer satisfaction work is profiled in this issue - have been concerned with quality for years, long before it became a national buzzword. They know that as a supplier of a product or service, you can't define service quality yourself, you have to ask your customers to do it for you. That's where marketing research comes in.

Research plays two critical roles in the service quality pro­cess, first by providing a foundation for construction of cus­tomer satisfaction program, and second by providing a way tomeasure how well the program's goals are being met.

The research industry is spreading the research/service quality gospel (we've joined the chorus this month by adding customer satisfaction/service quality to our list of annual special emphasis issues), and so are folks like Harvey Shycon.

Shycon has been studying service quality and customer satisfaction for 15 years as a part of his work as a director of operations management with Arthur D. Little, a Cambridge, Mass.-based international management and technology consulting firm. In his work with his clients he stresses the importance of finding out what the customer wants.

"Too often, companies define service as they see it. For you or I to sit back, if we were service providers, and decide what services the customer might like really isn't the way to do it. You have to find out from the customer what he needs. I also stress to our clients that the customer is not only the consumer, but, for example, in the case of a distributor, it could be the retailer."

Shycon says that a common error companies make is to define their target service level based on the level that already exists in their industry. "Too many companies assume that if they can identify what the competitive service levels are and either match or provide somewhat better service, that that's adequate. It's not, because that isn't necessarily what the customer needs. Each level of customer has certain needs and desires and he acts on them based on how well they are satisfied by his suppliers. People do more business with the firms that cause them the fewest problems."

The first step in developing a customer satisfaction program is to find out how the people inside the company view service quality. Shycon says it's important to get the perspective of everyone involved, people in marketing, sales, customer ser­vice, etc. Then, focus groups should be used to define the issues that are important to customers. "You must determine the needs of your different market segments, geographic areas, and product categories, for example, because each of these will require some differences in the service provided."

Armed with this information, the survey can be constructed and tested. "When the survey is field tested, make sure it is in the mode that you intend to use in the final survey. For example, if you plan to use a mail survey, field test with a mail survey to make sure that it successfully elicits the kind of responses that you need."

Is all of this effort worth it? Yes, Shycon says, and he has the proof. Over the last decade and a half, he has amassed data showing how an incremental increase in service "buys" an increase in market share and sales.

"Rendering the proper level of customer service does impact market share. You can measure the value of the components of service and their impact on market share. And thus you can develop the proper package of products and services to provide your customers that will maximize your available market share."

Probably the most convincing indication of the importance of service quality comes from a comparison of findings from Arthur D. Little studies that ask customers across a wide variety of industries to rank the importance of various business perfor­mance elements. Five years ago, respondents ranked product quality first, followed by price. Service finished several notches down.

Today, product quality is still tops, but service is now the second most important element; price is fifth.