Measuring Customer Satisfaction at ImageStream Essay

ImageStream Internet Solutions, Inc. is a privately held company in its 9th year of operation. ImageStream engineers, manufactures, and distributes Linux-based routing products for network and Internet applications. ImageStream products be used by Internet serve providers (ISPs), governments, schools, and businesses in more(prenominal) than 75 countries around the world. As ImageStream moves toward its nigh decade, market forces require it, like more or less high technology companies, to be fast and responsive. The company faces ceaseless change in demands and needs along with the pressures of mission creep in the face of limited resources. It is against this backdrop that ImageStream started its ISO 90002000 certification process. This process requires not unaccompanied the implementation of grapheme processes, but measurement of their efficacy as well.ImageStream conducts key manager meetings twice monthly, and a company-wide review on a semi-annual basis. During these ma nagerial and company reviews, the cured executives identify key metrics driving the success of the companys mission, including those metrics that would benefit to the highest degree from significant improvement. This proposal outlines the use of a guest cheer survey and seeks to answer the management incredulity What is the current client enjoyment with the level and type of customer utility provided by ImageStream? The issue leave explore the conceptual framework of profit timbre, the positive and forbid impacts of wait on part on ImageStream, and the mental picture of favorable and unfavorable customer intentions on perceived quality using survey research. Armed with the statistical analyses outlined below, the operations management team get out identify current trends in customer satisfaction in a proactive attempt to take apart to any issues.Background and books ReviewThe lead and development of customer run techniques and customerretention management program s has blossomed into its own industry. This increase focus on customer satisfaction is not surprising, given the positive correlation amongst happy customers and successful companies illust investd in countless marketing research studies. This study leave behind outline the relationship between customer satisfaction with wait on and customer retention at ImageStream. To halt the findings, we give conduct an empirical study charge on the relationship between perceived service quality and customer intentions.Weinstein and Johnson (1999) recommend that companies like ImageStream should perish 75% of its marketing budget on customer retention strategies and to strengthen these relationships. Once customers commit to a product platform, and the longer they use and deploy that platform, the more attain ImageStream can realize. Longstanding, satisfied customers lead largely continue, or often increase, buying, require less operational and customer service support, and be more un s get hold ofed to pay price premiums to remain with the companyall without incurring modern customer acquisition be (Pine, Peppers, and Rogers, 1995). This paper will analyze how ImageStreams service relationship with its customers produces customer miens indicating whether or not a customer will remain an ImageStream customer. The methodology used will follow Zeithaml, pluck and Parasuramans study on this topic (1996).Since replacing lost customers requires innovative customer acquisition costs, customer retention should be a fundamental performance measure for ImageStreams executive staff and a key fixings of the companys incentive programs (Zeithaml et al., 1996). According to the the Statesn forethought Association, acquiring a new customer can require quin judgment of convictions the investment needed to keep an existing customer (Weinstein et al., 1999).Literature ReviewCustomer service, not surprisingly, has been researched extensively from the conceptual framework of service quality, to the positive and negative impacts of service quality, to the effect of favorable and unfavorablecustomer intentions on perceived quality. We review these concepts in recent literature, and inquire an empirical study focusing on the relationship between service quality and customer behavioural intentions (Zeithaml et al., 1996).Zeithaml, Berry and Parasuraman (1996) spree a conceptual model of service quality. The researchers postulate that the quality of customer service will determine whether a company retains its customers or loses them to tergiversation. Zeithaml, Berry and Parasuraman (1996) highlight seven key points1.Customer errorion has a negative relationship with an organizations profitability.2.Retaining current customers costs less than acquiring new ones.3.Customer retention should be a fundamental component of incentive programs.4.Companies must advertise not only to attract new customers, but to replace lost customers.5.Advertising, promoti on, and sales costs are required expenses when attracting new customers.6.In general, at the beginning of a customer/vendor relationship, the customers do not generate a profit for the company. Zeithaml, Berry and Parasuraman estimate that acquisition cost recovery can pullulate as long as four years.7.Positive customer assessments of service quality lead to positive behavioral intentions, strengthening the relationship between the customer and the company. Negative assessments, on the different hand, create unfavorable customer behavioral intentions. The unfavorable conditions bring out the customer/vendor relationship.Based on their research and observations, Zeithaml, Berry and Parasuraman(1996) believe that expressed or discover behavioral intentions can indicate whether or not customers will remain with an organization.Reinartz and Kumar (2000) challenge Zeithaml, Berry and Parasuramans assertions that customer retention always leads well-managed companies to profitability. Reinartz and Kumar (2000) argue that long-run customers are not always the most utile customers, and dismiss research assuming that loyalty equates with profitability as a gross oversimplification. Reinartz and Kumar (2000) contend that managers should not automatically assume increased lifetime spending, decreased costs of service, and decreased price sensitivity for long-term retained customers. Reinartz and Kumar (2000) go further in alike disputing the idea that long-term retained customers require lesser marketing investment by companies.Their research concluded that long-term customers often have inactive purchasing periods unrelated to their retention by an organization (Reinartz and Kumar, 2000). During these dormant periods, these customers are at best a break-even bid for organizations, and often consume marketing and service resources resulting in net losses during periods of inactivity. Reinartz and Kumar (2000) open up that short-term customers whitethorn be as si gnificant to customers as longtime clients.Other research indicates that organizations struggling with a maven approach to satisfy all customers can end up with inefficient and inappropriate levels of service (Cohen, Cull, downwind and Willen, 2000). Cohen, Cull, Lee and Willen (2000) conclude that organizations must customize their service to meet each customers someone needs.Superior service generates favorable behavioral intentions in customers, including increased upcoming spending, acceptance of price premiums, invent of mouth referrals, and, ultimately, customer retention (Zeithaml et al., 1996). Research suggests that most employees have a true customer taste in that they understand their customers needs, and possess empathy and respect for their customers (Bitner, Booms and Mohr, 1994). gauge service builds customer faith in the organization, and is inhering for maintaining competitive advantage (Berry, Parasuraman and Zeithaml,1994). Since quality customer service c an generate positive behavioral intentions, quality service strategies are effectively profit strategies for organizations.Research illustrates this link between service and profitability, as Keaveney (1995) found that customer forgoings can cost an organization incoming revenue stream. As customers intentions toward a company improve, the results admit new customers, increased business with existing customers, fewer lost customers, and added pricing power (Berry et al., 1994). Berry and Parasuraman (1997) render the creation of customer feedback channels as a component of quality service. perceive and responding to the customers needs in a quality way has a direct effect on the quality of service provided (Berry and Parasuraman, 1997). This focus on customer feedback drove the purpose of this series of papers.Evidence, such as Keaveneys study, highlighting the role customer loyalty plays in making an organization more profitable ramp ups it imperative form that companies quic kly and proactively address concerns, complaints and other unfavorable behavioral intentions among their customers (Tax, Brown and Chandrashekar, 1998). Tax, Brown and Chandrashekars point also applies in a comparative sense as well. Organizations can latently provide satisfactory service that nonetheless lags other competitors service offerings. In these cases, customers may defect because of the attraction of comparatively victor service offerings from a competitor. Managers of service departments and service companies must recognize this comparative measure, and realize that some customers will defect even when they are satisfied with a former provider (Keaveney, 1995).Customers display favorable intentions such as praising the company, expressing a preference for the company to the company or to other consumers, continuing and/or increasing purchasing volumes, paying price premiums, and making recommendations to others based on their satisfaction with the company (Zeithaml et al., 1996). Satisfied customers preserve loyal to an organization longer, pay less attention to competitive products, exhibit less price sensitivity, offer service improvement or expansion ideas to the organization and cost less to service over time than new customers (Weinstein et al., 1999).When dissatisfied, customers display unfavorable intentions such as expressing an eagerness to leave the organization, decreasing purchase patterns, verbalize complaints to the vendor, complaining to others, or taking legal action against the organization (Zeithaml et al., 1996). When customers do leave an organization, many take up to do so quietly with the intention of getting even by making negative comments to others astir(predicate) the organization (Tax and Brown, 1998).Since defecting customers can impact current and future revenue streams, properly identifying dissatisfied customers and understanding wherefore customers defect can be valuable tools in improving customer retention m anagement programs. Companies must implement strategies to overcome potential customer defections. Retention efforts should begin as soon as organizations require new customers. The organization should proactively attempt to learn and address customer needs and resolve any complaints or concerns quickly (Weinstein et al., 1999).Weinstein et al. (1999) suggest several ways to build loyalty and increase favorable behavioral intentions in customers. They suggest that organizations could embed sales staff at the offices of their best customers, participate in their customers events or promotional efforts, interview their customers customers, conduct retreats with major customers to share best practices and to train customers on company products and services, develop a preferred customer pricing outline, reward customers for referring new business, tip feedback on product development roadmaps, and even partner with key accounts on industry research projects (Weinstein et al., 1999).SE RVQUALAmong the most popular assessments tools of service quality is SERVQUAL, an instrument designed by Berry, Parasuraman, and Zeithaml (1994). Through numerous qualitative studies, they evolved a set of five dimensions ranked consistently by customers as important to service quality, regardless of theservice industry. Berry, Parasuraman, and Zeithaml (1994) defined these dimensions as*Tangibles the appearance of physical facilities, equipment, personnel, and communication materials*Reliability an ability to perform the promised service dependably and accurately*Responsiveness a willingness to help customers and provide prompt service*Assurance the knowledge and ingenuity of employees and their ability to convey trust and confidence and*Empathy the caring, individualized attention the firm provides its customers.Based on the five SERVQUAL dimensions, the researchers also developed a survey instrument to measure the gap between customers runation for excellence and their percep tion of actual service delivered. The SERVQUAL instrument helps service providers understand both customer expectations and perceptions of specific services, as well as quality improvements over time (Berry, Parasuraman, and Zeithaml, 1988). Analysis of customer responses to a SERVQUAL questionnaire presents numerous potential practical implications for companies and their customer service teams.ScopeWe will conduct a study of all ImageStream customers (the tribe) by e-mailing or mailing a questionnaire to companies listed in ImageStreams internal records. The study will take less than one month to complete. We will contact all customers and direct them to the on-line survey, and follow up with customers who have not responded after two weeks. We will end the study after four weeks, and expect 25%-30% participation. We base this estimate on the response rate of similar studies mentioned above. A responserate of at least 10% will yield a significant sample, enabling us to make concl usive findings and recommendations.MethodologyWe identify three determinants of customer satisfaction with ImageStream service quality, solution quality, and price (through a measure of perceived value). Data on customer satisfaction, service quality, solution quality and price will be collected through the attached questionnaire survey. The questionnaire adapts the SERVQUAL instrument developed by Berry, Parasuraman and Zeithaml (1998) and uses a gang of Likert-scaled, dichotomous and unstructured questions.The use of both bipolar Likert/dichotomous and unstructured questions allows us to benefit from the strengths of both three-figure and qualitative research. The use of quantitative questions allows us to obtain a high degree of reliability and asperity using the scientific method, and enables others to more easily repeat or replicate our study. The qualitative questions provide background for customer responses, and help to identify any underlying issues highlighted by the qu antitative research. Triangulation, in this case the combination of qualitative and quantitative methods, allows us to overcome the weakness of using only one research technique.We do not assume that there is only one reality and believe that several(predicate) research methods will reveal different perspectives. Using quantitative and qualitative triangulation allows us to use different sets of selective information, different types of analyses, different researchers, and/or different theoretical perspectives to study customer service.The quantitative question results will provide data that we can subject to complex statistical analyses. We will combine the quantitative question responses to determine central tendencies and dispersion of the data, including measures of mean, standard error, median, mode, standard deviation, variance, kurtosis, skewness, and range. We will analyze theresults of each question and of the study as a whole.Based on the results of the analysis above, we will develop regressions to identify potential relationships between past service experiences, perceived quality, future purchasing behavior, and loyalty. A possible research design for the regression analysis follows.H1 in that location is a positive correlation between the level of superior customer service and positive future customer behavior.H2 There is a negative or no correlation between the level of superior customer service and positive future customer behavior.H3 There is a positive correlation between the level of inferior customer service and negative future customer behavior.H4 There is a negative or no correlation between the level of inferior customer service and negative future customer behavior.Using these results, we can make conclusions about the management problem defined above. Development of these findings will include the use of anecdotal evidence from the qualitative questions in the survey. We will use the responses to the qualitative questions to support the quantitative findings, and to highlight key issues not covered by the quantitative portions of the survey.Possible FindingsFollowing Zeithaml, Berry and Parasuraman (1996), we believe that a positive relationship exists between quality service and positive customer behavior as defined above. Additionally, we believe that our research will show that favorable customer behavioral intentions will be higher among customers experiencing no service problems. Customers who have experience problems, but received service to resolve them will show the next highest level. Customers with unresolved service problems will show the least favorablebehavioral intentions.ConclusionCustomer service and its effect on customer retention in an organization is a growing area of research, and one that is vital to maintaining quality at ImageStream. This paper examined customer retention and defection from an organization in the context of customer service quality, exploring four areas1.A conceptual fra mework of how service quality affects particular customer behaviors and the consequences for ImageStream, establishing the purpose for this study,2.Empirical studies that focused on the relationship between service quality and customer behavioral intentions,3.A triangulated quantitative and qualitative survey to study perceived service levels among ImageStream customers,4.Follow-on research based on the survey results and statistical analysis, including a summary of expected findingsCustomer retention branches off into many other significant areas such as value-added services, supply chain relationships, use of information systems to service customers better, and very significantly perceived and expected performance.Organizations have a chance to learn from their customers. The more customers teach the company the more effective it becomes at providing exactly what they want and the more difficult it is for competitors to lure them away from the organization (Pine II et al., 1995). Learning about customers is what this whole retention topic is about. The customers tell the organization what to do to keep them. The strategy is for the organization to learn how to listen and respond.ReferencesAnton, J. (1996). Customer Relationship Management Making Hard Decisions with Soft Numbers. stark naked York Prentice Hall.Berry, L., Parasuraman, A. and Zeithaml, V. (1988). A Conceptual Model of Service Quality and its Implications for Future Research. The Academy of Management Executive, 8, 32-52.Berry, L. and Parasuraman, A. (1997). Listening to the Customer The Concept of a Service-Quality cultivation System. Sloan Management Review, 38, 65-76.Berry, L., Parasuraman, A. and Zeithaml, V. (1994). Improving Service Quality in America Lessons Learned. The Academy of Management Executive, 8, 32-52.Bitner, M., Booms, B. and Mohr, L. (1994). Critical Service Encounters The Employees Viewpoint. diary of Marketing, 58, 95-106.Chase, R. and Stewart, D. (1994). Make Your Servi ce Failsafe. Sloan Management Review, 35, 35-44.Cohen, M., Cull, C., Lee, H. and Willen, D. (2000). Saturns Supply-ChainCooper, D. and Schindler, P. (2002). Business Research Methods (6th ed.). Burr Ridge, IL Irwin/McGraw-Hill.Cronin Jr., Joseph J. and Taylor, S. (1992). Measuring Service Quality A Reexamination and Extension. Journal of Marketing, 56, 55-68.Heskett, J., Jones, T., Loveman, G., Sasser, W., and Schlesinger, L. (1994, March-April). Putting the Service-Profit Chain to Work. Harvard Business Review, 164-174.Innovation High Value After-Sales. Sloan Management Review, 41, 93.Joppe, M. (n.d.). The Research Process. Retrieved January 12, 2004 from http//www.ryerson.ca/mjoppe/rp.htmKeaveney, S. (1995). Customer shifting Behavior in Service Industries An Exploratory Study. Journal of Marketing, 59, 71-82.Pine II, J., Peppers, D. and Rogers, M. (1995). Do You Want to Keep Your Customers always? Harvard Business Review, 73, 103-114.Pitt, L., Watson, R., Kavan, C. (1997). Meas uring Information Systems Service Quality Concerns for a complete canvas. MIS Quarterly, 21, 209-221.Reinartz, Werner J. and Kumar, V. (2000). On the Profitability of long-life Customers in a Noncontractual Setting An Empirical Investigation and Implications for Marketing. Journal of Marketing, 64, 17.Tax, S. and Brown, S. (1998). Recovering and learning from service failures. Sloan Management Review, 40, 75-88.Tax, S., Brown, S.and Chandrashekar, M. (1998). Customer evaluations of service complaint experiences implications for relationship marketing. Journal of Marketing, 62, 60-76.Van Dyke, T., Kappelman, L., and Prybutok, V. (1997, June). Measuring Information Systems Service Quality Concerns on the use of the SERVQUAL questionnaire. MIS Quarterly, 21, 195-208.Weinstein, Art and Johnson, W. (1999). Designing and Delivering Superior Customer Value Concepts, Cases, and Applications. Boca Raton CRC Press.Whyte, G., Bytheway, A., and Edwards, C. (1997). Understanding User Perceptions of Information Systems Success. Journal of Strategic Information Systems, 6, 35-68.Zeithaml, V., Berry, L. and Parasuraman, A. (1996). The Behavioral Consequences of Service Quality. Journal of Marketing, 60, 31-46.