Customer Satisfaction Action Is...

...being aware of the management practices that support customer retention. And at this point, no one should have to remind you (but we will anyway) that it is five times more costly to replace a customer than retain one.

According to Questar Data Systems Inc., an Eagan, Minn.-based service quality research consultancy, following a few simple steps can account for up to 56% of your company's variation in customer retention.

· Twice your current customer satisfaction rates can be achieved when your employees know what roles their activities play in delivering good service. In fact, Questar research shows that customer satisfaction rates are double in organizations where employees are aware of- those roles.

· Proprietary research by Questar shows that where an organization's problems continually reoccur, 43% of the employees have trouble focusing on business details that customers report to be most important. By contrast, where problems do not reoccur, only 12% of the employees report such difficulties.

· Management must set the tone. In companies that have a definitive customer retention strategy, more than half-the employees report that management spends time interacting with customers. Where customer retention strategy is absent, fewer than one-third the employees report such activity.

· When employees believe they are delivering products and services as promised by the firm, customer satisfaction levels approach 80%. Where employees believe they can't or aren't delivering such, the level slips all the way down to 27%.

· Train your customers. Yes, your customers. All too often, line employees told Questar researchers that customers were not aware of the company's full product/service line.

· Similarly, train, educate, and communicate with employees. When a promotion is coming up, tell them about it, rather than have them find out about it from a vendor or customer. Furthermore, train employees thoroughly in new product and service offerings so they can leverage them completely. Beyond that, Questar researchers found that a surprisingly large number of employees feel their basic training was inadequate.

· Continuity comes from within. Employees told Questar that promotion should come from within, based heavily on service performance. Questar found that where managers are hired outside a firm, their perceptions of service quality and the line employees' perceptions of such are quite different.

· Similarly, again, it is crucial to share customer satisfaction measurement information with employees. In companies that do so, customer satisfaction ratings typically jump 81%. Where this isn't the norm, ratings usually improve just 50%.

· Pay attention to internal customer satisfaction factors. Where employees take care of each others' business service needs, they tend to do even better for external customers. Good internal service drives excellent external customer satisfaction performance.