1. Industry Internship TM 391
Lecture 3

2. TQM’s Customer Approach
“the customer defines quality.”
“the customer is always right.”
“the customer always comes first.”
“the customer is king.”
“quality begins and ends with the customer”

3. Types of Customers
External - outside the organization (people who pay the bills.)
End-user customers
Manufacturer (OEM) for suppliers.
Internal - people within your organization who receive your work
In many situations, producers have multiple customers and therefore find it useful to identify “core customers”

4. Some Data on Customer Attitudes and Loyalty
(Source: Winning Back Angry Customers, Quality Progress, 1993)
An average customer with a complaint tells 9-10 people; if it is resolved he/she only tells 5 people.
For every complaint received, there are twenty others that are not reported.
It costs 5-10 times more in resources to replace a customer than it does to retain one.
Companies spend 95% of service time redressing problems and only 5% trying to figure out what made the customer angry.

5. Measuring Customer Satisfaction
Example: J.D. Power -- Initial Quality Survey measures customer satisfaction - problems per 100 vehicles.
Effect of J.D. Power IQS on automotive quality?
1998: 176 problems per 100 vehicles*
2005: 118 problems per 100 vehicles*
How does greater customer awareness impact quality?

7. Methods to Collect Customer Satisfaction Data
Negative Feedback Analysis
customer complaints, warranty claims, repair records…
focus on problems
concern: many dissatisfied customers do not complain (1/20 complain).
Proactive Feedback (ask customers for their opinions)
examples: customer surveys, focus groups, “employees” as customers.
advantage: identify key product features and assess levels of performance.
Analysis of Competitor Products
examples: Benchmarking, “War Rooms” or Tear Down Analysis
advantage: “Know thy competitor, know thyself”

8. Identifying Customer Needs
Possible solutions
focus-group discussions
individual and group interviews
surveys
comment cards
study repair and return data
customer complaints
warranty claims
analyze competitor products

9. Types of
Customer

10. Types of Customer’s.
.Based on unique behavioral attributes, customers are of following types
.Loyal customer
.Discount customer
.Impulse customer
.Need based customer
.Wandering customer

11. Loyal Customer
.They represent no more than 20 percent of our customer base, but make up more than 50 percent of our sales.
.Nothing will make a Loyal Customer feel better than soliciting their input and showing them how much you value it.
. These people are the ones who can and should influence our buying and merchandising decisions
.We need to be communicating with these customers on a regular basis by telephone, mail, , etc..

12. . 1 Satisfied customer will lead to 500 new customers.
. Customer satisfaction will lead to customer expectation.
. 1 Satisfied customer will lead to 500 new customers.
. the more you do for them, the more they will recommend you to others.

13. Discount Customer
They shop our stores frequently, but make their decisions based on the size of our markdowns

14. .This category helps ensure your inventory is turning over and, as a result, it is a key contributor to cash flow
.This same group, however, can often wind up costing you money because they are more inclined to return product.
.Merely satisfied customers, also show defection ready to switch.
.Chase low prices.
.Milk these customers as long as they are active or in discount seasons.

15. Impulse Customer
They do not have buying a particular item at the top of their “To Do” list, but come into the store on a whim. They will purchase what seems good at the time.

16. Clearly, this is the segment of our clientele that we all like to serve.
There is nothing more exciting than assisting an Impulse shopper and having them respond favorably to our recommendations.
They will purchase what seems good at the time
Buy on impulse.
Maximize the profit on each transaction.
Pursue fashion trends.

17. Need Based Customers
People in this category are driven by a specific need.
When they enter the store, they will look to see if they can have that need filled .if, not they will leave right away
It is difficult to satisfy these people.
Customers are habitual of particular brand.

18. Show inertia in brand switching.
Need based customer can easily be lost to internet sales or a different retailer.
So to overcome this threat, positive personal interaction is required.
They can also become loyal customers if they are well taken care of.

19. Wandering Customer
They have no specific need or desire in mind when they come into the store.
They want a sense of experience or community.
They make up the smallest percentage of sales.
keep in mind, however, that although they may not represent a large percentage of your immediate sales, they are a real voice for you in the community.
Although wandering customers cannot be ignored, the time spent on them needs to be minimized.

20. Provide Services to Colleagues and Customers
Guest Relations
Complaint Handling

21. TYPES OF CUSTOMERS INTERNAL CUSTOMERS People with whom we work
EXTERNAL CUSTOMERS
Including:
- International tourists
- Families
- Business Travellers
- People with disabilities
- Difficult customers
Provide Service to colleagues and customers

22. What are wants, needs and expectations?
A human need is a state of felt deprivation
Wants
A form taken by human needs as they are shaped by culture and individual personality
Expectations
To be treated with respect
To be made welcome
To receive timely and professional assistance and service
To be understood
To feel important
To be appreciated
To be recognised
To enjoy the experience
Provide Service to colleagues and customers

23. Factors influencing needs and expectations include
Social
Cultural
Economic
Health
Age
Personality
Personal interests
Likes and dislikes
Time Available
Perception
Provide Service to colleagues and customers

24. NEEDS AND EXPECTATIONS OF CUSTOMERS could include
Basic Human Needs
Food, Shelter, Security,Social and Esteem
Special services and facilities
Entertainment
Information
Provide Service to colleagues and customers

25. What would you consider when dealing with guests with special needs?
Physically challenged – mobility impaired, hearing impaired or blind
Intellectually challenged
Pregnant women
Families with children
Unaccompanied children
Business travelers
Travelers with special cultural or language needs
Elderly travelers
Provide Service to colleagues and customers

26. Customer Service Skills include
Meeting customer requirements
Demonstrating communication skills – listening and questioning techniques
Handling customer requests and complaints
Developing a rapport
Promoting suitable products and service to enhance experience
To deliver quality service we must also demonstrate appropriate work ethics and behaviour.
Provide Service to colleagues and customers

27. What is quality service?
You could describe customer service as the art of relating to your customers so they feel comfortable, looked after, satisfied, special and welcome.
Service excellence is achieved when the enterprises’ services and facilities not only meet but exceed the guests expectations.
Can you think of when this has happened to you?
Can you think of when you may have delivered quality service to a customer?
Provide Service to colleagues and customers

28. WHAT WE NEED TO PROVIDE QUALITY SERVICE!!!
KNOWLEDGE
- Of your customer
- Of how to do your job
- Of all services and facilities in your hotel
- Of local and state attractions
SKILLS
- Interpersonal skills
- Anticipation of your customer needs
ATTITUDE
- Genuine desire to help your guests - whether solving
problems or just making sure they have a great stay
- Positive attitude at all times
- Proactive – providing help and guidance without necessarily being
asked – guests feel they can depend on you
- Displaying tact and diplomacy
Provide Service to colleagues and customers

29. Steps to Ensure we give Quality Service!
Anticipate needs
Welcome customers warmly – with a warm genuine smile
Listen and probe - ask open questions
Reflective listen
Offer an action plan to deliver what they want
Agree on this plan
What? Where? When? How?
Avoid broken promises
Follow up to check everything is up to their expectations
Combine this with:
Communicating in a language they can understand
Tune into their individual needs – by observation
Use their name – wherever possible
Provide Service to colleagues and customers

30. Maintaining Quality Service
Organisation and staff responsibilities
Training of staff
Good communications between departments
Established work programs
Good awareness of activities within other departments
Importance of quality customer service to hospitality industry
Customers have come to expect quality service
Competition demands quality service
Quality service is the key to business success
Quality service requires you to be one step ahead of the customer – anticipating their needs
Provide Service to colleagues and customers

31. ANTICIPATE THE NEEDS OF YOUR CUSTOMERS
ASK YOURSELF:
Have I considered all the customer needs?
What could the customer need next?
How can I improve the service now for the customer?
Then offer to provide that service - without the customer having to ask!
Have you ever anticipated a customers needs?
Provide Service to colleagues and customers

32. How do you know when we’ve given Quality Service?
Increased job satisfaction
Positive performance appraisals
Gratuities – tips/gifts
Thank You - by letter or verbally
Enhanced reputation
Establishment winning quality awards
Returning guests
Guest Comment Cards - Questionnaires
Provide Service to colleagues and customers

33. WHY PEOPLE COMPLAIN? From frustration To impress other people
For compensation
Provide Service to colleagues and customers

34. When dealing with a guest complaint - NEVER
Talk down to the customer
Be defensive
Justify why it happened
Blame other people or departments
Blame the customer
Provide Service to colleagues and customers

35. COMPLAINT HANDLING PROCEDURE
Listen without interruption
Don’t get defensive
Use a ‘sad but glad’ expression
Express concern and empathy - apologise sincerely
Establish the problem - ask questions
Find out what they want
Explain what you can and cannot do
Fully discuss alternatives
Take Action
Follow up to ensure they are happy
Provide Service to colleagues and customers

36. Handling Complaints Information recorded accurately in Complaint Log
Recognised complaint handling procedure followed
Relevant department or personnel consulted
Follow up to ensure everything is resolved - record action in Log
Log reviewed to see if on going/multiple complaints being received and what steps can be taken to rectify.
Provide Service to colleagues and customers

37. Empowerment The person who takes the complaint owns the complaint.
You should try to resolve the complaint to the best of your ability.
Do you know what you can do to resolve a complaint without calling for a manager or supervisor?
Provide Service to colleagues and customers

38. Complaint Recording and Follow Up Procedures
All complaints must be handled diplomatically so all parties recognise:
The issue has been raised with relevant authority
All points of view have been aired
Discretion will be applied in resolving the matter
Due process will be followed
Action will be taken and the matter will be remedied
You must establish the details of the customer complaint through
Questioning and active listening techniques
Summarising and clarifying the issue
Recording details of complaint
Discussing with customer the process of resolution – giving them options and letting them know how the complaint will be resolved
You need to know the lines of reporting complaints and when to seek assistance
Provide Service to colleagues and customers

39. Benefits of positive handling of complaints
The value of amicably resolving complaints can not be underestimated and include:
Promoting goodwill
Improved customer relations
Positive work of mouth publicity
Promotion of enterprise service ethic
Provide Service to colleagues and customers

40. DIFFERENCE BETWEEN A COMPLAINING CUSTOMER AND A DIFFICULT CUSTOMER
A complaining customer is somebody whose needs and expectations have not been met
A difficult customer is somebody who is a challenge to serve because of their personality, for example, they may be rude, impatient or talkative
Provide Service to colleagues and customers

41. HOW CAN A CUSTOMER BE DIFFICULT?
Rude
Impatient
Noisy
Talkative
Confused - unable to make decisions
Silent
Fussy
Provide Service to colleagues and customers

42. TYPES OF DIFFICULT CUSTOMERS
Rude Customer
Can be rude to everyone - they just
don’t feel comfortable being nice.
DO Ignore their rudeness and don’t take it personally
DON’T Become Rude and Aggressive
Impatient Customer
Always in a hurry - and it won’t matter how quickly you serve them - they will still be impatient
DO Serve them quickly and politely
DON’T Waste their time with conversation and they may not want you trying to sell them products and services
Provide Service to colleagues and customers

43. TYPES OF DIFFICULT CUSTOMERS
Confused Customer
Find it difficult to make decisions and may take a long time
to decide
DO Be helpful by making suggestions and asking questions
DON’T Rush them - they could become flustered and embarrassed
Talkative Customer
Wants to talk and could spend all day doing it
DO Be friendly and attentive - Lead the conversation
DON’T Ignore them or give them all your attention
so other customers are ignored
Provide Service to colleagues and customers

44. Thank You