KPI Library – Customer Satisfaction

Customer Satisfaction Index

 

Description:

Customer Satisfaction Index is based on the premise that satisfied customers will be more likely carry out repeat purchase of goods / services, remain loyal to an organization and offer positive feedback. It follows therefore that this measure indicates how successful an organization is at delivering goods / services to the market. Customer Satisfaction is important to an organization’s financing, as the cost of attracting new customers is generally higher than that required to maintain a relationship with an existing customer. It also offers a tool to hi-light gaps which may arise between the product / service offered and the expectation of customers. A mix of qualitative and quantitate assessments is considered to provide the most accurate assessment, this may be obtained from a survey immediately following the delivery of goods / service or after a given period of time (e.g. Annually)

 

Calculation:

The customer scores satisfaction with criteria such as expectations, perceived value, etc. The scores may then be weighted to reflect relative significance to an organisation and combined to form a single numerical score  identifying the customer’s overall level of satisfaction or dissatisfaction. Sample size / survey method must also be selected to ensure it is representative of customers.

 

Example:

For a retail outlet: Post purchase questionnaire. Score 1 – 5 (1 = poor / dissatisfied) (5 = Good / very satisfied) Perceived quality Perceived value Satisfaction with sales assistance provided No returns – actual data obtained during the survey period. No customer complaints – actual data obtained during the survey period.