2019

EXPERT ANSWERS

Big data and quality

Q: What is the relationship between big data and quality?

A: When you think about big data, what often comes to mind are ideas about sales and marketing opportunities.

You might contact a customer service rep at your bank, for example. The rep, armed with mounds of data that documents your activities and tendencies, is able to take customer information and turn inquiries into sales opportunities.

Suddenly, the rep asks the customer a question from seemingly nowhere: "I see you have this type of product. Have you ever thought about changing to a different product?"

When you think about big data and quality, you should think about going granular. Take a moment and think about all those unanswered X’s that could have been investigated. For years, the thought has been that there are other factors influencing performance. But what are those factors—and why haven’t they been identified?

Years ago, for example, I supported a product line that’s used in aerospace and defense applications. The product in question was one of the few qualified products that would meet a particular weapon spec. We got ourselves in a situation in which we could not manufacture the product so that it would meet the spec. As a result, a major program was shut down. Not good.

It wasn’t until the team started putting all of the data into a matrix and running regressions that the team understood what the relationships actually were.

In other words, we needed to understand the three-legged stool consisting of:

  • Raw material process parameters.
  • Raw material performance.
  • Finished product performance.

There were about five ingredients in the product, and many were manufactured internally. The solution didn’t come until there was an understanding of what happened to the finished product when a certain raw material’s process was manipulated. After that was confirmed, the team knew the degree to which that particular processing parameter had to be controlled, and the team could manufacture a product that met spec 100% of the time.

That’s the relationship between big data and quality: using the capability to lump many X’s together and understanding the resulting Y’s.

After you know the relationships, you know what you need to control. What big data does for us is make the entire process much more user friendly, flexible and productive.

Keith Wagoner
Certified quality engineer
Wilmington, NC

Get back defected customers

Q: What are the reasons for customer defections and how do you reverse the process?

A: When we discuss customer defections, we should assume that there was previously a long-term relationship between your organization and your customer (similar to when a citizen defects from his or her country).

We also should assume the customer was beyond satisfied (stating that he or she was happy with the product or service offering) and he or she was loyal (as evidenced by repeat purchases over time).

Understanding the reasons why customers defect requires knowledge of their behavior and your competitive environment. Both are complex subjects.

But there are three concepts that should help you get started toward understanding.

First, the Kano model describes five requirements that contribute to customer satisfaction and loyalty:

  1. Performance requirements are those that provide greater satisfaction the better they are performed (and provide dissatisfaction if they are not performed well).
  2. Basic requirements are those that provide a neutral customer response when performed well, but result in dissatisfaction when performed poorly.
  3. Excitement requirements delight the customer when performed and don’t provide dissatisfaction if not performed.
  4. Indifferent requirements are those that the customer does not care about.
  5. Reverse requirements cause dissatisfaction when present and satisfaction when absent.

Understanding how your offering relates to your customers’ requirements, relative to this model, will help you design offerings that meet their needs and expectations.

Second, moments of truth. Customers form positive and negative impressions about your product or service offering each time there is some type of contact with your offering or organization. This contact is sometimes referred to as the moment of truth.

This contact could include the product or service itself, your organization’s website, marketing materials, customer service, billing and other forms of contact. Understand your customers’ impressions with each moment of truth to determine opportunities for improvement.

Third, the five competitive forces model, developed by Michael E. Porter, was developed to explain the factors that affect industry profitability, but it also may provide some insights into customer defection. The five forces are:

  1. Rivalry among competitors.
  2. Bargaining power of buyers.
  3. Threat of substitutes.
  4. Threat of new entrants.
  5. Bargaining power of suppliers.

To better understand your competitive environment, ask these questions:

  • How does your offering compare to your competitors?
  • How easily can a customer switch to your competitor?
  • What substitute products or services are available to customers?
  • What are the barriers to entry that prevent new competitors from entering the market?

The answers to these questions will help you develop a competitive strategy for addressing your weaknesses and leveraging your strengths.

So why have some of your customers defected? At one time, your offering met their requirements. Something has changed. The customer’s requirements may have changed, or your offering may have changed.

Customers’ requirements can change because of comparisons they make between your offering and your competitors’ offering. Your offering may have changed because of design changes, procedure changes or degradation in the quality of the product or service.

One way to reverse the process is to determine what has changed by applying the concepts described earlier and make the necessary modifications or improvements to your offering. Ask yourself:

  • Are you no longer performing a customer’s basic requirement well?
  • Did your customer form a negative impression based on a moment of truth?
  • Is a new competitor providing an offering that excites the customer?
  • Is your customer using a substitute product or service that’s available at a lower price?

Each customer’s requirements will be different, so making these determinations will be challenging.

Another way to reverse the process is to solicit feedback from your customers. Conversation is better than surveys because it allows for a more in-depth understanding of your customers’ requirements and provides the opportunity to ask follow-up questions. Understand the future requirements of your current customers and make plans to meet those needs. Understand why former customers defected and determine how you can win them back.

With this information, you can apply quality tools to understand root causes and develop an action plan.

Affinity diagrams, quality function deployment, cause and effect diagrams, prioritization matrixes and other tools will help you manage this challenging work.

Bibliography

Carlzon, Jan, Moments of Truth, HarperBusiness, 1987.

Juran, Joseph M., and A. Blanton Godfrey, Juran’s Quality Control Handbook, fifth edition, McGraw-Hill Professional, 1998, chapter 18.

Porter, Michael E., Competitive Advantage, Free Press, 1985.

Verduyn, Dave, "The Kano Model," kanomodel.com, www.kanomodel.com/about-the-kano-model, 2014.

Ken Cogan
Senior manager,
performance management
Intelsat


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