Measuring Customer Satisfaction by Paul Cardis, President/CEO of NRS Corp. (from Builder Magazine, December 1997)
Q: I need to start measuring customer satisfaction. How do I survey my buyers and
properly track the results? - M.P., Kirkland, Wash.
A: Paul Cardis responds: It is crucial to ask your customers how you're doing: While
you may think your company is doing a good job, your customers' ideas might be different.
You could have a salesperson who's occasionally rude, poor quality paint, or an
unresponsive office staff - and never know it.
You can create your own survey and conduct the research. You just need to make sure
the survey questions tell you exactly what you need to know and don't mislead you.
Here's how:
Use clear questions and avoid repetitive ones. Builders commonly ask the same general
questions about every position in the company. For example, many ask if the sales
person, color selection coordinator, superintendent, and others were "helpful
and courteous." you'll get better information if you ask about specific job
functions: "Was the salesperson informative and available?" and "Was
the color coordinator knowledgeable about options?"
Respect buyer confidentiality. Always give respondents the option to remain anonymous.
You'll get much more accurate information if they feel free to be candid.
Give respondents enough choices. For example, when you ask the all-important question,
"Would you recommend us to family and friends?" don't simply ask for a
yes or no response - it won't adequately gauge a customer's likelihood of recommending.
Ask this question using a four-point scale. Some customers might recommend your
company strongly, while others might feel only a slight inclination to recommend.
Be aware of validity measures. Your survey results will not perfectly reflect reality.
Just like in political polls, your surveys must take into account the "margin
of error," or the degree to which the data could be off. I've seen builders
nearly fire employees or make drastic product changes based on low scores, when
the numbers were actually fluctuating due to measurement error. Calculating accuracy
is tricky, especially if you don't know much about statistics. So if you're doing
the surveys yourself and see big fluctuations in satisfaction ratings, get expert
advice before making any major changes. If you use a professional firm, be sure
their reports include the "confidence interval" or "margin of error."
Compare yourself with competitors. Satisfaction scores vary by region and change
depending on the time of year, so be sure to compare your scores with your competitors'.
Ask them to share their reports, or work with a research firm that shows you competitive
numbers.
Track it. Your surveys should allow you to watch the progress of specific communities
and departments over time. Create monthly reports that chart your data so you can
easily see trends. Finally, share your findings with your staff. When your employees
understand just how important customer satisfaction is, your score will almost automatically
increase.
Satisfaction Brings Referrals
Percent Satisfaction Referrals Per Homeowner
91% 6 or more
87% 3 to 5
81% 1 to 2
67% 0
Source: NRS Corp.
We surveyed more than 10,000 buyers of our clients' homes. Those who had a higher
percent satisfaction gave more referrals than those who were less satisfied.
