Quality Management and Customer Satisfaction

Background to the study

In their consumption patterns, consumers are increasingly becoming concerned with quality. It is the consumers’ objective to purchase high-quality products and services and those that last for a long period. The resultant effect is that they are able to receive the desired level of utility. For example, with regard to automobiles, consumers are increasingly being concerned with safety as an element of quality. Additionally, their automobile purchasing patterns are also being influenced by whether the automobile is fuel-efficient. This trend has been motivated by the high cost of fuel being experienced globally.

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The change in consumption behaviour coupled with the changes in the business environment has presented a challenge to firms in different economic sectors since they have to adjust the quality of their products and services in order to remain competitive. This arises from the fact that quality leads to a high level of customer satisfaction. This is due to the fact that quality leads to a high level of customer satisfaction. Ensuring the provision of high-quality products and services is an essential element amongst firms in different professions and industry. Firms that provide high-quality products and services are able to attain their profitability and productivity objectives.

For a firm to provide high-quality products and services, it must invest a substantial amount of resources. These resources do not only entail financial resources, but they also include human capital. The firm must have the appropriate human capital to ensure the provision of high-quality products and services. Additionally, human capital aid in effective identification of the customers’ needs.

For example, in its operation, ASDA, which operates within the UK retail industry, invested £100 million in an effort to improve the quality of the products it provides in all its stores. The firm managed to achieve this by talking to customers in order to understand their customers’ product preferences. In their quest to improve the quality of products and services offered, firms’ management teams should be conscious not to increase the price charged to products and services. This is due to the fact that consumers are price-conscious in their consumption patterns.

Definition of quality in terms of businesses and services provision

Definition of quality varies depending on the context in which it is being applied (Armstrong, 2006, p.143). For example, the definition of quality with regard to business’ perspective varies from that of the customers’ perspective. Additionally, the definition of quality also varies depending on whether its definition is in the context of a product or service. In the profession such as the provision of social care services, health services and law, quality may be measured with regard to the degree of professionalism.

For example, with regard to the provision of health services, a customer may define quality on the basis of whether the doctor is able to make an accurate diagnosis, communicate to the patient regarding his or her illness and provide timely and effective treatment. Organisations can evaluate whether they are able to offer high-quality products and services by evaluating whether they successfully meet the customer’s product and services requirements. This paper entails an analysis of quality in terms of businesses and services provision and customer satisfaction. Additionally, the paper also evaluates the various mechanisms used in measuring quality management.

Quality as a management concept is applicable to firms in different economic sectors. This arises from the fact that the provision of high-quality products and services enables a firm to attain competitive advantage. In its operation, Microsoft has been able to attain a large market share due to the provision of high-quality applications software and operating systems. On a global scale, Microsoft Incorporation has successfully developed a high level of market dominance due to its commitment to the provision of high-quality products and services.

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For example, the firm incorporated the concept of new product development in order to satisfy the changes in consumer demand with regard to computer software and applications. Since 2009, the firm has launched the most prolific products which include Kinetic for Xbox, Microsoft Office 2010, Microsoft Server R2, Windows 7 operating system, Windows 7 mobile, Azure cloud-based technology. Due to the quality of Microsoft’s Windows operating systems, it is estimated that 97% of all computers in the world use Microsoft’s operating system. Through the provision of high-quality products, businesses are able to increase the utility that customers receive upon consumption of these products.

Quality is increasingly being considered as being user-segment-specific. This means that a product may be considered to be of good quality in one user-segment but bad in another. Therefore, it is critical for organisations both in the product and the services sectors to understand their market segments in order to succeed. However, organisations face a challenge in defining quality with regard to services due to their intangible characteristic. Additionally, it is not possible to measure the level of quality offered with regard to services. Therefore, in order for organisations in the services sector such as those in the hospitality industry, for example, hotels, restaurants and tourists firms to satisfy their customers, they must understand their customers’ quality preferences.

One of the ways through which these organisations can attain this is by undertaking a comprehensive consumer market research. The research will give an individual a one-on-one interaction with the customers. This means that there is a high probability of the firm appealing the emotions of the customers. Additionally, they can also be able to determine the customer’s perception of quality. The organisation will also be able to identify avenues through which they can improve the quality of their services.

The resultant effect is that the firm will be able to develop a strong bond with the customer. The ultimate effect is that the customer is able to develop loyalty. Brown (1991, p.1) asserts that this arises from the fact that services are generated and offered at the same time. The diagram below illustrates how a firm in the service industry can develop service loyalty. Due to the one on one interaction, the firm is able to appeal to the customers’ emotions. The firm is also able to exceed the customers’ anticipations and expectations. As a result, the customers are delighted, which leads to the creation of service loyalty.

Model for service loyalty.
Figure1: Model for service loyalty.

Quality is mainly concerned with ensuring that the customer’s expectations either stated or implied, are met. In its operation, The Kodak which is in the photography industry defines quality to include the degree to which a firm’s products or services are regarded as being effective in meeting or exceeding the customer’s expectations. To achieve this, the firm has invested a substantial amount in photography technology. The firm understands the fact that quality with entails conforming to particular customer specifications or requirements.

The International Standard on Quality Management System (ISO 9000:2000) defines quality to include the degree to which a particular product meets the set requirements. For a firm to be effective in its quality management, it must undertake effective market research. The research should be focused on understanding the customers’ product requirements. This is the only way that a firm can provide quality products.

One can also define quality with regard to the various product characteristics that lead towards attainment of his or her satisfaction. In this case, the customers need may either be stated or implied needs (Pfeifer, 2002, p.4). For example, a firm within the retailing industry such as Tesco Limited may decide to implement new technology in its operation such the Electronic Data Interchange (EDI) in order to improve the quality of services it offers to its customers. EDI will enable customers to undertake online purchasing.

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In addition to the quality of the EDI system, Tesco will also expect the EDI system to be interoperable. This means that the system should be easily integrated with the firm’s systems. This illustrates the fact that most organizations both in the services and the production sector are concerned with ensuring that their products and services accomplish more than the role or purpose for which they were designed. Additionally, the benefits of the product or service should not be short-lived. However, they should continue in the future. For example, the EDI integrated by Tesco should be adjustable to changes in the technological environment.

One of the situations that can be used to illustrate the element of quality with regard to conformance in the business perspective relates return purchase behaviour amongst the customers while its products are not returned. In its operation, Virgin Atlantic is committed to ensuring that it establishes itself in the market as the leading firm with regard to the provision of effective air travel services. In order to achieve this, Virgin Atlantic’s management team appreciates the importance of ensuring that its customers are satisfied through the provision of high-quality services during the flight. Additionally, the firm also ensures that its price is customer friendly. The firm also takes into consideration the element of safety in its product and services provided.

Quality in terms of customer satisfaction

With regard to customer satisfaction, Mukherjee (2006, p.79) asserts that customer satisfaction entails ensuring that the customers’ needs are met effectively. If a firm does not serve its customers effectively, there is a high probability of the firm not achieving its profit maximisation objective. Therefore, ensuring customer satisfaction is of paramount importance in the provision of products and services. In their consumption behaviour, most customers are satisfied only when their needs, whether stated or implied, are fully accomplished. For example, if a consumer purchases a laptop, he or she expects that the laptop will serve the intended purpose in addition to other functionalities. As a result, the customer will associate the laptop with value for money.

Some customers also define quality on the basis of integrity with which the product or service is delivered. Firms which deal with the production of beauty products such as Proctor and Gamble have to ensure that their products are effective in improving their customer’s appearance. In the provision of products and services, there are various aspects that determine the extent to which the customers are satisfied. For a firm to effectively integrate quality in its operation, it must be customer-oriented.

In its operation, Toyota Incorporation is concerned with being customer-oriented rather than being product-oriented. In order to achieve this, the firm has incorporated a customer satisfaction policy. The policy stipulates that Toyota Company must produce cars of high quality, attractive cars, outstanding driving performance, and whose safety is high. The firm’s commitment towards ensuring customer satisfaction is depicted by its operational philosophy which is ‘striving to make better cars’. The firm’s commitment to quality is also evidenced by the recent recall of its SAI and Prius models from the US market due to safety issues.

Measurement of quality management

There are a number of ways through which organisations can measure the effectiveness of their quality management. One of the ways through which they can attain this is by incorporating their own procedures. For example, organisations within the hospitality and catering industry, such as hotels and restaurants, may decide to conduct market surveys on a number of market issues. Some of the measures that organisations can integrate into customer satisfaction. In its operation, McDonald’s Incorporation which operates within the United States Fast Food industry conducts market surveys in order to determine the quality of its services. The firm achieves this by issuing questionnaires to customers. The customers are requested to fill the questionnaires freely. The following is a sample of some of the issues that McDonald’s enquires.

Questionnaire Respondents comment
Which is your preferred product from McDonald’s?
What is your opinion of the quality of the product?
Which area of the firm’s operation would you advise the management to improve?
Please list a problem that you might have experienced at McDonald.
Does McDonald’s have any unique selling proposition?

Figure 2.

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The information provided by the customers through this questionnaire enables McDonald’s management team to undertake effective quality improvement. This arises from the fact that it is the customers who should make a judgement regarding the quality of a firm’s products and services since they are the consumers of a firm’s products and services and hence developing a personal experience.

If a firm’s products are of high quality, the probability of customers being satisfied is high.

Another strategy that organisations can integrate into their quality management is the evaluation of brand loyalty. Additionally, firms can also analyse customer repeat purchase behaviour.

Organisations can also measure quality by conducting a comparison between current and past performance. This would play a critical role in the firms’ effort to improve its future operation. Another strategy that an organisation can incorporate to measure quality entails evaluating whether the firm’s products or services adhere to the set industry standards. Organisations can also integrate priorities setting in their quality management efforts. Charantimath (2003, p.137) asserts that firms’ management teams should set priorities with regard to quality. The firm should identify areas of quality which result in a high level of customer satisfaction.

Alternatively, business organisations can also use the concept of benchmarking to measure quality. This entails comparing the performance of the firm’s products and services with regard to quality with those of its competitors (Dahlgaard, Kristensen & Kanji, 2005, p.218). During the 1970s and 1980s, Rank Xerox Corporation, which operates within the UK, incorporated the concept of benchmarking in its quality management. This arose from an increment in the intensity of competition from the Japanese firms. The firm intended to improve its processes. Through benchmarking, the firm was able to reverse the trend by increasing its market share. Additionally, the firm became a leader with regard to quality innovation.

Conclusion

Quality is a critical consideration for firms regardless of whether they are in the service or the manufacturing sector. This arises from the fact that quality contributes towards the customers attaining a high level of satisfaction. Meeting the customer’s requirements with regard to their products and services, whether stated or implied, is one of the organisation’s key consideration in an effort to survive in the long term. Customers define products or services quality on the basis of the satisfaction received. To determine their progress with regard to quality, it is critical for organisations to measure quality. There are different quality measurement elements that organisations can take into consideration.

Recommendations

To improve the quality of their products and services, organisations should consider the following.

Developing a comprehensive understanding of the customers’ product or services requirement. This will enable the firms to undertake effective quality improvement.

Firms should also measure the quality of their products and services in order to determine its effectiveness in adhering to the quality requirements.

Reference List

Armstrong, M., 2006. A handbook of management techniques. London; Kogan Page.

Bolton, A. 1999. Quality management systems in the food industry; a guide to ISO 9001/2. Gaithersburg, MD: Aspen Publishers.

Brown, S., 1991. Service quality: multidisciplinary and multinational perspective. Lexington: Lexington Books.

Charantimath, E., 2003. Total quality management. New Delhi: Pearson Education India.

Dahlgaard, J., Kristensen, K. & Kanji, G., 2005. Fundamentals of total quality management: a process analysis and improvement. London: Routledge.

Kanji, G., 2002. Measuring business excellence. New York: Routledge.

Mukherjee, P., 2006. Total quality management. New Delhi: Prentice-Hall.

Pfeifer, T., 2002. Quality management. London: Hanser Verlag.

Ridley, J., 2008. Cutting edge internal auditing. Chichester, England: Wiley.

Schutta, J., 2006. Business performance through lean six sigma; linking the knowledge worker, the twelve pillars and Baldrige. Milwaukee, Wisc: ASQ Quality Press.

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