INTERNAL CUSTOMER

SATISFACTION
 

INTRODUCTION

Customer is the king, this is all the more apt for today's business

environment where, all other factors remaining more or less constant, it is the value

addition to the customer that is making all the difference.

      Customer satisfaction depends on the performance relative to a expectations.

A key premise in customer satisfaction is understanding the needs and

meeting or exceeding the expectations of customers. Further more, this is done

while optimally using resources. While most companies have developed strategies

to improve quality and external customer service, internal customer satisfaction is a

much neglected component of quality improvement. To this end, it is important to

emphasize that total customer satisfaction can be attained only if all employees

devoted to external customer satisfaction  can work together and assist each other

to achieve the common objective, when the internal customer isn't satisfied,

Relationships with the external customer suffer. So, it is suggested to adopt

customer oriented approach to keep the internal customer satisfied and motivated,

who in turn will focus their attention and energy upon meeting the requirements of

their customers, thereby maximizing the customer, thereby maximizing the

customer satisfaction.
 Customer satisfaction survey is the process to monitor the satisfaction

quotient of their people. In internal satisfaction surveys therefore tracks the return

on your investments in keeping your people happy, high salaries, a quality culture,

a healthy work environment.

Last, but not the least  internal customer satisfaction survey helps in finding

the critical areas, which need further improvement.

NEED OF INTERNAL CUSTOMER  SATISFACTION SURVEY ARISES

DUE TO FOLLOWING REASONS.

Ø      Rapidly growing organization.

Ø      High or growing turnover rate.

Ø      Excessive rumor's

Ø      Highly competitive industry.

Ø      Planned and recent organizational changes.

BENEFITS OF A INTERNAL CUSTOMER SATISFACTION SURVEY

Ø      It creates better teamwork and much improved work process.

Ø      It leads to higher output and superior quality product.

Ø      It decreases the turnover.

Ø      Reduced overheads, and increase customer satisfaction level's inter

departmental.

Ø      It enhance communication and hence helped in team building, hence there is

less wasted effort caused by lack of common purpose and poor communication.

Ø      A good employee feedback survey improves employee attitude and boosts

morals.

   INTERNAL CUSTOMER-SUPPLIER RELATIONSHIP

In an organization, from procuring an order to delivering the final product, a

series of activities takes place. There are different deptts. To which these activities

are assigned eg. Raw material for production is purchased by one deptt. And

supplied to other deptt. Where the production initiates. Thus every deptt. play an

important role of  a customer and supplier as well.

          The importance of a customer is well known from the maxim, “ Customer is

the king”. Earlier, organizational administrators concentrated only on the

satisfaction of external customers i.e. the target market. But now it is being realized

that if the internal customer is satisfied the quality as well as the quantity is also

appreciable. Higher the customer satisfaction index, higher will be the quality of

the production. This results in the satisfaction of external customers and ultimately
brings profits & prosperity to the organization. It can benefit the organization in

following ways:-

1)     There will be less employee turnover.

2)     Optimum utilization of available resources will take place.

3)     High job satisfaction and feeling of belongingness in employees.

4)     Qualitative product.

5)     Least conflicts in the departments.

6)     Good reputation in the market and many more benefits can be accrued.

Thus, every deptt. should ensure that the customer deptt. is satisfied with the

product and services provided by it as it will result into an overall improvement of

the organization.

To serve a final customer first of all a company has to satisfy his employees.

If employees are satisfied then they will ultimately satisfy the final customer.

Three types of marketing arises. These are a follows:-

 1)     Internal marketing:

It is defined as when company communicates its policies to the

employees. In this    understands their employees & provides good working

condition, compensation and incentives so as to satisfy their employees.

Company satisfy their employees because they are the person in touch with

the final users.

2)     External marketing:

When company communicates with its final end user regarding the

product complaints & suggestions so as to satisfy them.

3)     Interactive marketing:

In this employees communicate company product to its final end users.

INTRODUCTION TO CUSTOMER SATISFACTION

Today’s companies are facing their toughest competition ever. These

companies can outdo their competition if they can move from product and sales

philosophy to a marketing philosophy. We spell out in detail how companies can

go about winning customers and outperforming competitors. The answer lies in

doing a better job of meeting and satisfying customers needs. Only customer-

centered companies are adept at building customers, not just building product.

They are skilled in market engineering, not just product engineering.

          Too many companies think that it is the marketing/sales department’s job to

procure customers. If that department cannot, the company draws the conclusion

that its marketing people aren’t very good . but in fact, marketing is only one factor

in attracting and keeping customers. The best marketing department in the world

cannot spell products that are poorly made or fail to meet anyone’s need. The

marketing department can be effective only in companies whose various

departments and employees have designed and implemented a competitively

superior customer value-delivery system.

          Although the customer oriented firms seek to create high customer

satisfaction, its main goal is to maximize customer satisfaction ,first the company

can increase customer satisfaction by lowering its prices, but results may be lower

profits second the company might be able to increase prices. Third the company

has many stake-holders including employees, dealers, suppliers and stock holders

spending more to increase customer satisfaction might divert funds from increasing

the satisfaction of other partner. Estimate the company must operate on the

philosophy that it is trying to deliver a high level of satisfaction to the other stake-

holder within the constrains of its resources. From the past studies of last three

decades we observed that the company’s first task is to create and satisfy

customers. But today’s customers face a vast array of product and brand choice

prices and suppliers.

          It is generally believed that customers estimate which offer will deliver the

most value customers are like value maximizes, within the bounds of search costs
and limited knowledge, mobility income, they form an expectation of value and act

on it, whether or not the offer lives up to the value expectations affects customer’s

satisfaction and their repurchase probability.

CUSTOMER VALUE

Customer delivered value is the difference between the total customer value

and total consumer cost. Consumer value is the bundle of benefits customers

expect from a given product or service. Total consumer cost it the bundle of costs

consumer expect to incur in evaluating, obtaining and using the product.

          That two customers can report being “highly satisfied” for different reasons.

one may be easily satisfied most of the time and other might be hard to please but

was pleased on this occasion. Companies should also note that managers and

salespeople can manipulate their ratings on customer satisfaction. They can be

especially nice just before the survey. They can also try to exclude unhappy

customers from the survey. Another danger is that if customers will know that the

company will go out of its way to please customers, some customers may express

high dissatisfaction (even if satisfied) in order to receive more concession.

DELIVERING CUSTOMER VALUE AND SATISFACTION:

          The value chain is a tool for identifying ways to create more customer value.

every firm is a collection of activities that are performed to design, produce,

market, deliver and support its product. The value chain identifies nine

strategically relevant activities that create value and cost in a specific business.
These nine value-creating activities consist of five primary activities and four

support activities.

INTERNAL RECORD SYSTEM

Marketing managers rely on internal reports on orders, sales, prices, cost,

inventory levels, receivables, payables, and so on. By analyzing this information,

they can spot important opportunities and problems.

THE MARKETING INTELLIGENCE SYSTEM

           A marketing intelligence system is a set of procedures and sources used by

managers to obtain everyday information about developments in the marketing

environment. Marketing managers collect marketing intelligence by reading books,

newspapers and trade publications; talking to customers, suppliers and distributors;

meeting with other company mangers.

First, it can train and motivate the sales force to spot and report new

developments. Sales representatives are positioned to pick up information missed

by other means.

          Second, the company can motivate the distributors, retailers, and other

intermediaries to pass along important intelligence.

Third, companies can collect competitive intelligence by purchasing

competitors’ products; attending open houses and trade shows; reading

competitors’ publishing reports; attending stockholders’ meeting; talking to

employees, dealers, distributors, suppliers, and freight agents; collecting

competitors’ ads; and looking up news stories about competitors on the

internet.        

SOURCES OF INTERNAL DATA

Sources of internal data are of two types:

1.     Internal or primary data

2.     External or secondary data.

Internal Sources

Company profit-loss statements, balance sheets, sales figures, sales call

reports, invoices, inventory reports and prior research reports.

External Sources

A)   Government publications

B)   Periodicals and books

C)    Commercial data

Find the Next Chapter -Objectives, research, limitations, suggestions,

bibliography, questionnaire ...........

 OBJECTIVES OF STUDY

Ø      The main objective of the study is to find out the level of satisfaction among

the internal customers.

Ø      To know the present status of the suppliers in terms of their supplied

material & services.

Ø      To collect and evaluate ideas/views and expectations of the internal

customers for the improvement in suppliers performance.

Ø       To make company's internal suppliers aware about the dissatisfaction part

of their customers.

Ø      To find out the most prominent area of dissatisfaction.

Ø      To enhanced the communication & co-operation between the internal

suppliers and their customers.

RESEARCH METHODOLOGY 
The quality and reliability of research study is dependent on the

information collected in a scientific and methodological manner. Scientific

planning of designing of research method is a blue print for any research study.

Therefore, proper time and attention should be given in designing the plan of
research. While proper definition of problem tells the researcher where he has

to go, proper design tells him how he should go. Selection of methodology for

a particular project is made easy by sorting out a number of alternative

approaches, each of them having its own advantage and disadvantages.

Efficient design is that which ensure that the relevant data are collected

accurately.

The researcher has to think about what procedure and techniques

should be adopted in the study. He should arrive at the final choice by seeing

that the methodology chosen for project is indeed the best one, when

compared with others.

RESEARCH DESIGN :

          Research design is the first and foremost step in methodology adopted

and undertaking research study. It is overall plan for the collection and analysis

of data in the research project. Thus it is an organized, systematic approach to

be the formulation, implementation and control of research project.

          Infact a well planned and well balanced research design guards against

collection of irrelevant data and achieves the result in the best possible way.

SAMPLE DESIGN :-
          The universe of study being large, researcher has to resort to sampling

method of data collection. On the basis of a section of the universe selected in

a prescribed manner one is able to deduce for the universe. For the sample

results to be applicable on the universe, sample should be adequately chosen

so to make it representative and reliable.

Population : General Managers in the operation.

Sample : Sample covers the respondents of 20 departments.

Ø     DATA COLLECTION METHOD :

          Data are the bricks with which the researcher has to make  a house.

While the quality of research findings depend on data, the adequacy of

appropriate data in turn depends upon proper method of data collection. A

number of methods are at the disposal of the researcher of which one has to

select the most appropriate one for visualizing the research objective. Thus he

has to see that the method adopted is compatible with the resources and

research study.

a)                Primary Data : Data which are collected fresh and for the first time and

thus happens to be original in character. Primary data are gathered for

specific purpose.
b)                Secondary data : Data that collected from primary data i.e., they are

already exit some where. For the purpose of our study we collected both

the data.

Ø     For the purpose of this study we collected :

          Secondary data through induction manual, magazines, corporate

journals and web site &

Primary data through.

a)                 Questionnaire method.

b)                Interview method.

In our study the main emphasis was on the questionnaire method. We

used questionnaire method which consisted of 4 attributes and again they

were further divided into 12 parameter. Question,  which were asked, were of

multiple choice in nature and were of closed ended.

          Personal interview were also conducted. There was face to face

conversation between researcher and the respondents. All the answers were

recorded while interview was in progress. Through interviewing, additional

information was received regarding our study.

 Ø     Data Analysis :

          Data collected, if not subjected to analysis is meaningless. For the

purpose, data after collection has to be presented in the form of tables,

diagrams and graphs. It is only after presentation that data can be analyzed,

interpreted and inferences can be drawn.

The likert scale has been used for getting the responses through

questionnaire.

          We used 5 point scale, which are assigned to degree of satisfaction level

of the respondent with regard to the effectiveness of training which was

imparted to them during the last year.  

1 2 3 4 5
Poor Average Good V. Good Excellent

The responses were collected and analyzed on the above mentioned 5 point

scale. We used weighted score and weighted average for the purpose of

presenting our findings in the Radar Chart and Pyramid Chart.

Weighted Score : This score was observed for every individual attribute for

each department. The score was obtained as :

 Ø     No. of response X Weights

          These score were used to make Radar chart type (spider chart) for the

presentation of the performance of a particular department on 12 Parameters.

The purpose of making Spider Chart is to locate the position of department on

each parameter.

Ø     Weighted Average :

          We get the Weighted Average for each attribute by :

Weighted Score / Total department (respondent) score

          Through this method the weighted average for each individual parameter

of a particular department was obtained. And through these W.A. we

calculated the mean of the weighted average of a dept. Sum of the weighted

averages of all the department

Ø     Total No. of attributes.

This is the required weighted average, which we get for a department as a

representative of the performance with respect to others.

This weighted average was then used to make a pyramid chart to show the

performance of the departments on 5 point scale.

 
 Ø     Department-wise analysis :

          We derive a rating scale in continuous series with a common class

interval by using the following methodology.

          We take difference between highest and lowest rating obtained by the 2

departments (HRD-3.33 & Civil-2.15) & further divided by 4 so that to make a

continuous series of 4 classes with a common difference of 0.295 and assign it

the measurement criteria.

 Rating Scale Measurement Criteria

2.15 – 2.45 Below average performance
2.45- 2.74 Average Performance
2.74-3.04 Good Performance
3.04-3.33 High Performance

We used the above measurement criteria in our department-wise. Analysis

chart also show the performance of each internal supplier as compared to

other.

   Methods of evaluation

1.     The opinion and judgment of head of the department .

2.     Asking the head of the department to fill up evaluation forms.

3.     Use of questionnaire .

4.     Giving oral and written test .

 5.     Comparing departments performance.

6.     Analysis of efficiency & effectiveness of time.

7. Measuring level of Quality, Delivery, Innovation and Productivity.

LIMITATIONS OF THE STUDY

As no person is perfect in this world , in the same way no study can be

considered as fully reliable at one glance . there are a number of uncontrollable

factors acting as limitations in conducting the study . some of such limitations

encountered by me in our study are -

1.     Non - availability of secondary data compelled me to start from the very

minute information .

2.     Respondents in some department gave biased responses for fear of their

position in the company. This may have influenced the results .

3.     Some people at top level were afraid and showed complete reluctance

to give responses to some questions.

 
 CONCLUSIONS

After conducting the survey and analysis the data collected, it can be

concluded that:-

1.     The employees are not much aware of internal customer supplier

concept.

2.     Employees of different departments believe in concentrating only upon

their departmental functions.

3.     Things are seen from department point of view and not from

organization’s point of view.

4.     Certain problems which are faced by almost every department are:-

a)     Inconsistency in quality of product/service supplied by the

respective suppliers.

b)    No group discussions, workshops or customer care programmes

take place between the customer - supplier deptts.

c)     Requirement of a lot of follow up to the work done.

5.     Quality of the product service provided needs improvement.

6.     Lacking of customer training & knowledge sharing.

7.     Need of improvement in feedback communication.

8.     There is a need for the adoption of innovative tools and techniques.

9.     Communication, coordination and feedback to internal customer to be

strengthened.

10. There was no flexibility in adopting cost control techniques.

11. Lot of wastage of resources and under utilization machine/men-hours.

12. There was no promptness of service/response to the customer

department.

13. Irregular availability of data, records and diagnostics approach to the

customer deptt.

14. There was no consistency in services and lengthy strength.

15. Internet was limited.

16. No routine check-up of pc and printers.

17. Lacking in the best technology like “ON LINE TRACKING” of each batch of

fabric etc.
 SUGGESTIONS

General suggestions for improving internal customer satisfaction to be

followed by the organization to be really successful in exploiting the fullest

potential of their employees are as follows:

1.     Cost control measures

2.     Promptness

3.     Pre-detection & proper maintenance of old dg sets

4.     Consistency in quality of  steam

5.     Adherence to delivery commitments

6.     Participative planning with customers

7.     Communication and coordination should be more effective

8.     Optimizing of machine and men-hours

9.     Needs improvement in quality of product and services provided

10. Submission of summarized quality reports daily

11. To highlight problem and record the solution

12. Resistance in accepting the feedback regarding damages

13. Advanced information regarding any new quality is needed

 14. To be more effective in inventory control and ordering through
diagnostic approach

15. Training and knowledge sharing of financial reports

16. Provide advanced information about the failure

17. Needs better planning of procurement of packing material

18. Improve customer service in all respects

19. Resolve day to day problem quickly

20. Improvement in timely payment

INTERNAL CUSTOMER SATISFACTION SURVEY

Internal customer dept._____________________________________________

Internal supplier dept._____________________________________________

Supply/Service received___________________________________________

Rate the answer on a scale 5.

1 2 3 4 5
Poor Average Good Very Excellent
Good

Sr. Parameters 1 2 3 4 5
 No.
1  Quality          
a)  Quality of Product/Service          
b)  Quality of feedback/communication          
c)  Consistency of services          

2 Delivery 1 2 3 4 5
a) Promptness of response/service          
b) Accessibility & availability of          
documents
c) Adherence of delivery          
commitments

3 Innovation 1 2 3 4 5
a) Receptivity for innovation / new          
ideas
b) Adoption of innovation tools &          
techniques
c) Analysis of data/diagnostic          
approach

4 Productivity 1 2 3 4 5
a) Adopting cost control measures          
b) Minimizing wastage of          
resources/time
c) Optimization of machine/men-          
hours
 

·        Kindly give your expectation from the service department which has not
met

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Find the First Chapter ................ Internal Customer Satisfaction

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