Customer satisfaction evaluation on maintenance service quality at schindler vietnam ltd

ECONOMICS & MANAGEMENT MPQPM4 NGUYEN THI QUYNH ANH CUSTOMER SATISFACTION EVALUATION ON MAINTENANCE SERVICE QUALITY AT SCHINDLER... With the purpose to evaluate customer satisfaction a

ECONOMICS & MANAGEMENT

MPQPM4

NGUYEN THI QUYNH ANH

CUSTOMER SATISFACTION EVALUATION ON MAINTENANCE

SERVICE QUALITY AT SCHINDLER

ACKOWLEDGEMENT

Of the many people who have been extremely helpful in the preparation of this thesis, I am especially thankful to my supervisor Dr Jacques Martin for his help and support I am grateful for his comments and guidance throughout the development of this thesis

I would also like to express my gratitude to Mr Hung Le- Existing

Installation Director- for his supports and intellectual comments during

this research

I would like to thanks to Ms Ngoc Hien- Solvay Program Coordinator- for her support throughout the Master Program and a perfect coordinator in

proving useful information relate to final Project

Last but not least, I would like to express my gratitude to all my colleagues and my friends for their unconditional support in every way possible

throughout the process of this thesis

ABSTRACT

Customer satisfaction can be seen as one of the main instruments that ensure the existence and survival of a business organization It is very important for the business organizations to consider offering what the customers want rather than offering quality goods and services which may not meet up with the customers’

expectation Therefore, business organizations have to possess a framework in their organizational structure towards satisfying their customers so that they can maintain their existence, survival and success Satisfying a customer today leads to retention and attraction of new customers as a result of the current customers of the business organization being satisfied

For a maintenance service at Schindler Vietnam, every minute of break down

is cost and more serious is dissatisfaction of customer But normally, we don’t

know what customer think about our service So, evaluate customer satisfaction is therefore extremely important for Schindler’s survival With the purpose to evaluate

customer satisfaction at Schindler Vietnam, this thesis was performed as a case study at Maintenance Service of the company

To be able to evaluate the customer satisfaction The survey will be sent to customer, then data is gathered, analyzed Based on the outcome of these, company can identify the current issues and may use for future improvement

Key words: maintenance, Net promoter score, customer satisfaction,

CONTENTS

ACKNOWLEDGEMENT……… ……… 1

ABSTRACT……… ……….2

LIST OF FIGURES……… ……….5

LIST OF TABLES ……… ……… 6

LIST OF ABBREVIATION ……… ……… …7

INTRODUCTION…… ……… ………8

1- Background information about Schindler and MS Department … ……… 9

2- Research problem and Research question……… ………10

3- Objective of the research……… ……… 10

4- Plan of the research ……… ……… 10

5- Structure of the research……….11

PART 1 RESEARCH FRAMEWORK AND LITERATURE REVIEW …… 13

1- Customer satisfaction: Overview and importance……… …………14

2- Definition of Maintenance……… ………15

3- Customer satisfaction in maintenance service ……… ……… 17

4- Net promoter score (NPS)

5- Framework of customer satisfaction criterion in maintenance service… ….21 5.1 Customer oriented behavior ……… ……… 21

5.2 Promptness in problem fixing ……… ……….21

5.3 Operation reliability/ product quality……… ………22

5.4 Price……… ………23

5.5 Spare part availability ……… ……… 24

PART 2 METHODOLOGY AND RESEARCH DESIGN ……… …….27

1- Development of list of customer satisfaction factors……… ……….28

2- Design of questionnaire and sampling ……… ……… 29

2.1 Design of questionnaire……… ………29

2.2 Sampling……… ……… 31

3- Layout of questionnaire……… ……….31

4- Survey distribution and response……… ………32

5- Data analysis……… ………32

PART 3: DATA ANALYSI AND DISCUSSION ……… …….33

1- Response rate……… …….34

2- Description of result… ………34

2.1 Trigger Answer on Maintenance Service: ………34

2.1.1 Question 1: Did our engineer (technician) contact you upon arrival to site? 34

2.1.2 Question 2: Did our engineer (technician) act in a professional

manner? 36

2.1.3 Question 3: Did our engineer (technician) provide sufficient information about the completed works? 37

2.1.4 Question 4: Does our maintenance service meet your expectations?38 2.1.5 Question 5: Can you reach our Service Leader easily and does he respond to your needs? 39

2.1.6 Customer satisfaction summary on trigger question……….41

2.2 Net Promoter Score –NPS on Customer Satisfaction………42

2.3 Customer comment on Maintenance Service……….43

2.4 Recommendation………44

CONCLUSIONS AND RECOMMENDATION ………46

1 Conclusion ……….47

2 Possible future development… ……… 47

REFERRENCE …… ……… 49

APPENDIX A 51

LIST OF FIGURES Figure 1: Structure of Thesis Figure 2: Relationship between Maintenance and Quality Figure 3: Cost of conformance/non-conformance in relation maintenance

type

Figure 4: Net Promoter Score Figure 5: Frame of NPS Figure 6: Design of Questionnaire Figure 7: Layout of Questionnaire Figure 8: Q1 result Analysis Figure 9: Q1 Analysis per Area Figure 10: Q2 result Analysis Figure 11: Q2 analysis per Area Figure 12: Q3 result Analysis Figure 13: Q3 Analysis per Area Figure 14: Q4 result Analysis Figure 15: Q4 analysis per Area Figure 16: Q5 result Analysis Figure 17: Q5 analysis per Area Figure 18: Customer satisfaction in Summary Figure 19: Dissatisfaction per Area

Figure 20: Positive comment Figure 21: Negative comment

LIST OF TABLE

Table 1: Summary of Survey Result Table 2: Average percentage of Customer Satisfaction Table 3: Dissatisfaction per Area

Table 4: NPS result Table 5: Customer comment summary

LIST OF ABBREVIATION

NPS: Net Promoter Score MS: Maintenance Service SL: Service Leader

INTRODUCTION

Customer satisfaction is the result of the correlation between a customer’s assumption and a customer’s feelings By way of explanation, customer satisfaction

is identified as the distinction between assumed quality of service and the

customer’s involvement or feelings after having perceived the service Customer

satisfaction depends on such dimensions as assurance, responsiveness, reliability, empathy and tangibles, and further components such as personal, price and situational factors that may arise as the service quality (Bateson & Hoffman, 2000.) Customer satisfaction helps customers to communicate their needs straight to the sellers Customer satisfaction is very important because it helps to learn about the

business’s strengths and weaknesses Business holders can just know their strengths

and weaknesses and make the progression Not only this, also customer satisfaction also helps to appropriate resources for eventual strike or satisfaction Furthermore,

it supports to show calmness about making better quality of products and services to both the employees and the customers It does not help to learn about strengths and weaknesses but helps it also to persuade competitive strengths and weaknesses Similarly, it helps to benefit more vision into the sources of frustration and areas desiring progression At last, customer satisfaction helps to accommodate a system for informing management of problems or situations requiring actual promotion (ICR, 2011.)

While talking about business, it is not easy to establish this thinking but everything needs to be set up everything from top to bottom and management also exists there Nature of business depends upon the size that was established, either in the form of big-scale or small-scale No business has been established without thinking about the profit, and customers are the pillars of the business So every

business’s stake holders always think about the satisfaction of the customers by

trying to meet the needs of the customer, which is the main responsibilities of the business investor As the task of the research is concerned with the importance of customer satisfaction, some points have already explained this in the above section, and some points are going to be explained here Actually, customer satisfaction helps to increase the profit for business investors so every such investor thinks that

to earn profit is not as easy If the business is successful, and able to satisfy the customers then customers will be happy, they buy more goods and the company will be able to sell more goods and it helps to increase the profit Similarly, it helps

to increase the sales, to reduce the production costs, and to enhance marketing and advertising If the customers are fully satisfied with the goods and services provided

by the business company, they refer it to their friends and relatives

telling them that they are satisfied, and this helps to promote marketing and

advertising of the business Similarly, it helps to improve the goodwill

1- Background information about Schindler and Maintenance Service

Department

Founded in Switzerland in 1874, the Schindler Group is a leading global provider of elevators, escalators and related services Its innovative and environmentally-friendly access and transit-management systems make an important contribution to mobility in urban societies Behind the company's success are over 48,000 employees in more than 100 countries

Schindler manufactures, installs, services and modernizes elevators, escalators and moving walks for almost every type of building requirement worldwide The company specializes in the latest-technology engineering, as well

as mechanical and microprocessor technology products designed and rigorously tested for safety, comfort, efficiency and reliability

Inspired by the vision of being the best service provider in the industry for its customers, Schindler will continue in the future to develop highly innovative and user-friendly mobility solutions and to deliver these to the world market

In Vietnam, Schindler was one of the first foreign-owned elevator companies to start operating, back in 1995 It is involved in importing, installing and maintaining Schindler elevators and escalators In 1998, Schindler started its own factory in

Vietnam, which produces brackets, beams and builder’s elevators for both local and

At Maintenance service, Schindler’s committed to preventive maintenance

programs for elevators and escalators that will keep equipment running safely and reliably With trailblazing technology and highly trained technicians, this means fewer callbacks and fewer inconveniences for your tenants or guests

Schindler employee is over 100 specialist maintenance engineers and technicians across Viet Nam Where use latest-technology programs and systems to monitor equipment remotely and to enable predictive intervention, including Schindler Scorecard performance assessment and monitoring

technologies Maintenance service philosophy is very straightforward: to keep all equipment operating at optimum availability, maximum efficiency and absolute safety

2- Research problem and Research question

For Schindler, the Maintenance and Repair service represents a significant proposal of turnover and in many cases it collects the overall profits of the business

In recent years, the competition in maintenance and repair services of elevator has increased dramatically and many strong competitors have entered the maintenance and repair service of lift business in Vietnam In order to hold the competitive advantage in the changing market, it is important to deeply understand what is

customer’s need to ensure profits in the future as well

Base on research problem above, the following research question are: what are the most criterions that impact on customer satisfaction on maintenance service at Schindler Vietnam and also find out the net promoter score of this service

3- Objective of the research

The research attempts to analyze the satisfaction of customers in the Existing Installation Department at Schindler Vietnam Moreover, a research objective is to collect statistical information of the customers and their level of satisfaction in maintenance service in Schindler Vietnam., It will be interesting to do research on this topic in the form of structured Interview, quantitative survey and with the target

of the case study: Existing Installation Department at Schindler Vietnam

4- Plan of the research

In this chapter, customer satisfaction research in Maintenance department of Schindler Vietnam, research questions are discussed above and research process is defined in figure 1 And they are structured interview questions via phone And in the research process, 151 customers in HCM and Hanoi are taken for the interview and their point of view is analyzed in Part 2 Analysis and Discussion

The data was gathered through customer satisfaction survey, interview via phone Customer contact is available in maintenance contract portfolio The author asked the questions to the customers (questionnaire list is in survey sheet) to get the exact answers The interview is recorded, if customer said that they cannot freely give the answers, so, the author has written in the note book and ask when author can re-call

to them, if after 3 time effort, customer refuse survey, it’s considered in not

response part The questionnaires survey and structured interviews are used in order to collect information how the maintenance services is going and whether the

customers are satisfied or not The total amount of 151 survey was conducted in April and May 2014 The customer were randomly chosen in contract portfolio but

it must be include 50% customer in HCM area and 50% customer in Hanoi

5- Structure of the research

This thesis has been divided into three parts The introduction establishes the research context and objectives The second part introduces the theoretical context of customer satisfaction management and also the customer satisfaction

in maintenance service, the definition of Net Promoter Score and framework of customer satisfaction criterion which help to identify key elements of the

customer satisfaction on Schindler Vietnam’s existing installation quality

The third part of the thesis presents the methodology and research design

It’s include the list of customer satisfaction factor and how to design of

questionnaire, layout of questionnaire, sampling, how to distribute survey and how to analyze data The analysis and discussion begin with part 3 This part will analyze and discuss data; also research findings will be presented in this part SPSS is the tool evaluate if the data is valuable for analysis or not Lastly, Conclusion and recommendation will summary the key aspect of the research Furthermore, several recommendation and practical guidelines will be offered The limitation of this thesis, some comment and suggestion about future research will also be discussed and provided

The overall structure of thesis will illustrated in figure 1 which serve as a guideline to reader

Figure 1: Structure of Thesis:

PART 1 RESEARCH FRAMEWORK AND

LITERATURE REVIEW

1- Customer satisfaction: Overview and importance

Customer satisfaction is the result of the correlation between a customer’s

assumption and a customer’s feelings By way of explanation, customer

satisfaction is identified as the distinction between assumed quality of service and

Customer satisfaction depends on such dimensions as assurance, responsiveness, reliability, empathy and tangibles, and further components such as personal, price and situational factors that may arise as the service quality (Bateson & Hoffman 2000.)

Customer satisfaction helps customers to communicate their needs straight to the sellers Customer satisfaction is very important because it helps to learn about the

business’s strengths and weaknesses Business holders can just know their

strengths and weaknesses and make the progression Not only this, also customer satisfaction also helps to appropriate resources for eventual strike or satisfaction Furthermore, it supports to show calmness about making better quality of products and services to both the employees and the customers It does not help to learn about strengths and weaknesses but helps it also to persuade competitive strengths and weaknesses Similarly, it helps to benefit more vision into the sources of frustration and areas desiring progression At last, customer satisfaction helps to accommodate a system for informing management of problems or situations requiring actual promotion (ICR, 2011.)

While talking about business, it is not easy to establish this thinking but everything needs to be set up everything from top to bottom and management also exists there Nature of business depends upon the size that was established, either

in the form of big-scale or small-scale No business has been established without thinking about the profit, and customers are the pillars of the business So every

trying to meet the needs of the customer, which are the main responsibilities of the business investor As the task of the research is concerned with the importance of customer satisfaction, some points have already explained this in the above section, and some points are going to be explained here Actually, customer satisfaction helps to increase the profit for business investors so every such investor thinks that

to earn profit is not as easy If the business is successful, and able to satisfy the customers then customers will be happy, they buy more goods and the company will be able to sell more goods and it helps to increase the profit Similarly, it helps

to increase the sales, to reduce the production costs, and to enhance marketing and advertising If the customers are fully satisfied with the

goods and services provided by the business company, they refer it to their friends and relatives telling them that they are satisfied, and this helps to promote marketing and advertising of the business Similarly, it helps to improve the goodwill

2- Definition of Maintenance

Maintenance is an important organizational function that is needed to support

production related processes Breakdowns in production directly affect the output of the processes and thereby the profitability Companies have different views on how maintenance can be used Traditionally it has been seen as a necessary evil and that maintenance have complex relationships to other functions in the company (Ben Daya and Duffuaa, 1995) Further, Ben Daya and Duffuaa (1995) argues that:

“In general terms, equipment which is not well maintained and fails

periodically experiences speed losses and/or lack of precision and, hence,

tends to produce defects More often than not such equipment drives

manufacturing processes out of control A process that is out of control

produces defective products and therefore increases the production cost

which amounts to less profitability which endangers the survival of the

organization.” (Ben Daya and Duffuaa 1995)

Figure 2 Relationship between maintenance and quality (Ben Daya and Duffuaa 1995)

Figure 2 above show the relationship between production output and

maintenance Ben Daya and Duffaa (1995) clearly express the importance of

maintenance in relation to quality where other literature (Salonen and Deleryd, 2011;Dhillon and Liu, 2006) focus more on the direct costs and profitability Quality can

express different things, two of the most common definitions are: The features of a product that meet customer demand and Free from deficiencies (Juran, 1998) Regarding maintenance, the definition of quality:

Free from deficiencies is perhaps the most fitting but it can also be argued that the customer aspect is just as important in maintenance as in any other department However, the customer of maintenance might not be the consumer of the finished product, but another department or company

Dhillon and Liu (2006) separates maintenance and catogorize them as: preventive, corrective and predictive maintenance Preventive maintenance is often reffered to as planned maintenance and is carried out regularly or after inspection in order to keep the equipment in working condition (Dhillon and Liu, 2006) Corrective maintenance is done

to return the equipment to working condition after breakdown or after perceived deficiencies (Dhillon and Liu, 2006) Lastly Dhillon and Liu (2006) describe predictive maintenance as using technology to diagnose items’ or equipments condition during operation Predictive maintenance can also be the process of gathering information

about the state of the equipment (Niebel 1994) The information gathered is then used to plan and schedule maintenance

Preventive and predictive maintenance is closely related and are because of this often treated in a similar way, which is also the case in the literature that have been used in this report According to Salonen and Deleryd (2011), preventive maintenance can be regarded

as value adding while corrective maintenance is regarded as waste This relates to the fact that facilities and machinery need regular maintenance to function in an optimal way However, stops due to breakdowns can relate to lack of preventive maintenance, human error or other kinds of problems that can be avoided and hence are considered as waste More specifically the following model (Figure 3) can be used to categorize maintenance:

Figure 3 Cost of conformance/non conformance in relation to maintenance type (Ben Daya and

Duffuaa 1995)

Corrective maintenance is more costly than preventive since preventive can be planned and therefore be executed at a preferred time and date (Campbell and Jardine 2001) Corrective maintenance also implies that a company needs to quickly find material and personnel for reparation which, according to Campbell och Jardine (2001), increases the cost Campbell and Jardine (2001) present a rule of thumb where corrective maintenance in general cost

50 % more than planned stops and breakdowns cost 200 % more than planned stops The cost aspect is a driving factor for producing companies to shift from corrective to preventive maintenance The ideal state is to only have preventive maintenance when considering the numbers from Campbell and Jardine (2001), but as Salonen and Deleryd (2011) shows in Figure 3 it is not always justified to do so To create a well working maintenance organization, both preventive and corrective is important (Dhillon and Liu 2006) Preventive

maintenance should be carried out to ensure a satisfying working condition while corrective maintenance should handle random distributed errors and failures that are not financially justified to prevent (Salonen and Deleryd 2011) Hence, both types of maintenance are equally important parts to have in a sound maintenance organization

3- Customer satisfaction in maintenance service

Maintenance services is an important department in lift company as two thirds

from elevator and lift profits comes from maintenance services Maintenance services include all the services that take place after the lift has been installed Maintenance services are repair activities that include maintenance service and other repairing; damage repair including spare part functions as well as all other possible maintenance services Nowadays by service it is meant creation of intangible value and significance Since the industrial product production has been transferred to countries where salaries are significantly lower, service business has become more significant for a large part of employees in the old industrial countries The society where we live today is a service society and most of the employees and the work that is done are related to services In today’s business life

the service innovations and developing new services is a process where customer

needs are linked to service providers’ resources So, Customer satisfaction is an

important factor in the development of the maintenance process and customer relationship As Lift Company’s face-increasing competition, greater attention

continues to be placed on customer relationships and satisfied customers Customer satisfaction enables lift companies to differentiate themselves from their competitors and create sustainable advantage In order to measure customer satisfaction in maintenance service, the main subjects must be identified A customer may be defined as the owner of the building, in simple terms, the customer is the buyer of the product or service In this paper, customer is considered

as a building owner, private house ( owner) or a building management team who control all activities of building include lift operation

4- Net promoter score (NPS)

Faced with competitive markets, companies are eager to focus their efforts on the

wishes and needs of the customers to retain old customers and to attract new ones While corporate communication directed at the customer is conducted by advertisement, in store promotion, public relation efforts and a range of other means, the flow of information and feedback from the customer to the company is much more limited: for example, companies track customers’ behavior while

shopping or implement voluntary feedback system Business consultant Fred Reichheld (2003) proposed a single question as best and sufficient measure of customer satisfaction Customers are asked, ‘How likely is it that you would recommend [brand or company X] to a friend or colleague?’, and they can respond

by choosing a number between 0 to 10, with 0 labeled ‘not at all likely’, 5 labeled

‘neutral’, and 10 labeled ‘extremely likely’ The responses to are then aggregated

and transformed into a single summary statistic, the Net-Promoter Score Figure 4

to show the formula of NPS

Figure 4: Net Promoter Score formula

A company’s Net-Promoter Score is the difference between the proportion of

customers placing themselves at points 9 or 10 (called ‘promoters’) and the

proportion of customers placing themselves between 0 and 6 (called ‘detractors’)

Respondents on scale point 7 and 8 are called ‘passive’

Figure 5: Frame of NPS

According to Reichheld and his collaborators the Net-Promoter question is all a Company needs to ask in their customer satisfaction surveys At most a follow-up question should be used to elicit reasons for the selected response option (Reichheld, 2003) Their conviction that likelihood to recommend is the best measurement for businesses to understand the state of their customer relations is

quite strong: “an individual’s propensity for recommending a company to friends or

colleagues may be the most direct gauge of customer loyalty and ultimately,

question” (Reichheld, 2003) and “the single most reliable indicator of acompany’s ability to grow” (netpromoter.com, 2008)

Likelihood of recommending does fit well with concepts of custom satisfaction and purchase behavior Put simply, likelihood of recommendations leads to actual recommendations, which leads to positive impressions in other potential customers and ultimately to new purchases and growth in sales

The likelihood to recommend itself should be based on a positive attitude towards the company This attitude could be measured, for example, with a question on how much the customer likes or dislikes the company and its products The customer’s

past experiences with the company, exposure to communication in mass media such

as reviews and advertisement, and communication with other customers about the company will primarily contribute to the construction of that attitude Past experience is reflected

in the satisfaction a customer feels in his or her interactions with the company The word of-mouth communication is reflected by how many recommendations are given about a company and therefore is influenced by how many people report the intention or likelihood of recommending the company and its products To increase sales, companies want to increase customer satisfaction, how much respondents like their company, and

how many people are giving positive recommendations about their company when talking to potential customers

The customer-company interactions influence satisfaction, liking and the propensity

to give future recommendations These three concepts are connected: if a customer

is satisfied he or she is more likely to give recommendations and probably increases his or her liking of the company Higher liking leads to more recommendations as well Higher liking and higher satisfaction turns directly into higher retention rates for the company, but higher likelihood of recommendations would also measure the amount of word-of-mouth promotion that might occur

Reichheld (2006) describes the Net-Promoter score as a measure that both

reflects “the emotional and the rational dimensions” of the relationship between the

customer and the company If liking and both satisfaction are precursors of the likelihood of recommending, the question is whether they make any additional contributions to increased sales beyond the measured likelihood of recommending

or whether likelihood of recommending is contributing something that is not covered by asking simply about satisfaction and liking

Likelihood of recommending might be a better measurement than simple

like/dislike questions or a measurement of satisfaction, because it asks the respondent to make a commitment to future behavior When a respondent gives recommendations he or she is putting his or her own reputation as a trustworthy source on the line This commitment might even apply to the hypothetical measure

of likelihood of recommending (Reichheld, 2003) Therefore, respondents might have higher incentives to give better, that is more valid and considerate, answers than for inconsequential direct questions on attitude and satisfaction Discussing attitudes towards the business and the past experience with the business in terms of recommendations also might be more natural than the abstract concept of satisfaction, because of respondents regularly engage

in giving recommendations to other people as their everyday behavior

Reichheld (2003) based his claims on initial research with data collected on

customers of 14 different companies across six industries In 11 of those 14 companies he found that the Net-Promoter score performed better than other measures of customers satisfaction in predicting actual purchase behavior on the level of individual customers Next, he and his collaborators conducted a large data collection and investigated the relationship between growth indicators (growth in revenue, growth in shipment, etc.) and aggregated Net-Promoter scores for different companies They found, across a variety of

industries, that the Net-Promoter score was a strong correlate with indicators of growth(Satmetrix, 2004)

5- Framework of customer satisfaction criterion in maintenance service

5.1 Customer oriented behavior

The conceptualization of customer orientation behavior is consistent orientation is the degree to which an organization or its employees focus their efforts on understanding and satisfying customers Brown, Mowen,

Customer-Donavan, and Licata (2007) defined that customer orientation behavior as a tendency of employees to meet their customers¡ needs Therefore, researchers have defined customer orientation behavior as the extent to which frontline employees try to satisfy their customer needs The intangible and interactive characteristics of services means that employees behavior plays a key role on customer decision making Customer orientation behavior of frontline employees is important to create long-term profit for service firms In recent years, more and more companies have invested remarkable resources to enhance customer orientation behavior of employees The emotional or affective responses of employees are often caused by the nature of boundary spanning and it is important to study the factors that influence customer orientation behavior of frontline employees Previous researches have indicated that emotional or affective responses of frontline employees, such as job satisfaction and job stress, influenced their customer orientation behavior The customer orientation behavior of employees relies on the efforts that frontline employees engage in while at work Since frontline employees are emotional labors, the researchers also discuss the roles of emotional intelligence

5.2 Promptness in problem fixing

In order to achieve customer satisfaction, organizations must be able to satisfy

their customers needs and wants through prompt service delivery and hence, good

quality service (La Barbera and Mazursky, 1983) Customers become endeared to a service provider or company due to many factors including the promptness with which employees receive and serve clients - mindful of the fact that customers increasingly generate more profits for a company by doing business with that same company for a long time (Kumar and Menakshi, 2007) Similarly, no business or organization can succeed without building customer satisfaction and loyalty Likewise, no person can make a good living without meeting the needs of his or her

customers That is what people do in organisations: they serve others and succeed

through this (Timm, 2008)

According to Kumar and Menakshi (2007), prompt service delivery and resulting customer satisfaction do not exist in a vacuum Since the provision of a

service involves a face-to-face human contact, it is important that the frontline employees have the time, the tools, the training, the support, and the backing and encouragement not only to satisfy the customer then but to do it in a way that makes the customer come back again and again - customer loyalty Poor frontline performance has huge adverse impact on customer satisfaction and probably nothing can assuage a customer who has been treated shabbily by a frontline staff The work systems, policies, and procedures of the organization

should empower the frontline staff to do whatever is possible to please the

customer; hence, top- management vision is important

5.3 Operation reliability/ product quality

Product quality is product features matched with 8 dimensions namely: performance, features, conformance, reliability, durability, serviceability, aesthetics, and customer-perceived quality Briefly, performance is the products primary operating characteristic, features is mean to the additional features for the

product, conformance is representing the extent in which the product‘s design and

also its operating features met the established standards, reliability specifies the probability that the product will be operating properly over a specific period of time under the stated condition of used, durability is the means of the overall amount of the consumers get to use the product before the product physically deteriorates or until it need to be replaced, serviceability is referring to the speed, competency, and courtesy if repairs, aesthetics is how the product appeal to the five sense and lastly customerperceived quality indicates the customer s perception

of a product s quality, which it basically on reputation of the firm (Garvin, 1988)

Traditionally, quality has been defined in four categories namely excellence, value for money, conformity to requirements and also meeting or exceed customers

requirements (Reeves and Bednar, 1994) A product based approach is used in focusing on the performance, features and durability, user-based approach used in focusing on aesthetics and perceived quality, and lastly manufacturing approach is

used in focusing on conformance and reliability (Garvin, 1984)

Product-based approach is based on its economical roots which the differences of the elements or attributes infatuated by the product are being considered as reflecting to the differences in quality (Garvin, 1984) The user-based approach is where quality of products and services meets or surpasses customers expectation Quality was of two parts namely, the quality of design and also the quality of conformance (Juran, 1951) Providing satisfaction to customers by the

design the products to the needs of customer is referred to the “quality of design”

(Juran, 1974) In manufacturing- based approach has its origins from operation and production management; hence it is called as conformance to specification The degree of the product meets certain standard designation it is called as quality of conformance which it has internal focus on the contrary of external focus of the user-based approached and quality is being reflected in outcome of engineering and also manufacturing processes (Crosby, 1979) Lastly, value-based approached compared quality towards the performance at the satisfactory price or conformance

at the affordable price which consumer uses price as the measurement to quality (Feigenbaum, 1951) Besides that, quality set at a high level off product or services,

it expand reputation, increase customer retention, attracting new customer from the word of mouth, and also increasing the financial performance as well ask profitability (Julian and Ramaseshan, 1994; Zeithaml,1996) In value based approach, quality is being defined as the product or services meet the consumers need and wants or expectation Quality of design and quality of conformance is the origin of quality (Juran, 1951) The quality of design is used in addressing product

quality to the design which designated and met consumers needs (Juran 1974)

Meanwhile, in manufacturing approach conformance in the product

Meanwhile, in manufacturing approach conformance in the product meets the formulated standards or specifications (Crosby, 1979) Based on value approached, product quality is been define as the have fair relations between quality with performance at an acceptable or affordable price Always product quality is being thought to contribute to the expansion of competitive advantage whereas the product is to be designed and also manufactured to achieve customer requirements in enhancing the product performance (Benson et al., 1991; Flynn et

al., 1994) Product attributes has become products quality s view where in

operations management, multiple dimension of quality has been determine which it resulted in the fitness usage of the product which means does the product do as it

supposed to do and does the features meets customer s needs, reliability of the

product which means to what level the product is off from insufficiency (Parasuranaman et al., 1988)

5.4 Price

Price is a factor that is playing neither an important role in affecting the distribution of newly product nor services in the market Hence, setting a price for

a new product in the market is difficult (Foxall, 1984)

Price is one of the element in marketing mix, which it is very plays a very heavy role because marketers uses price as communication medium with customers

where the message is being clearly perceived by customer as what it meant to the marketers (Dickson and Sawyer, 1990; Monroe and Lee, 1999) A product price is one of the main decision methods for both customer and also retailers as now the market is very competitive, price has made its position and role in differentiate in designing marketing and business strategies Price resulted to be the main point for customer to judge what is offered in the market (Monroe, 2003; Oliver, 1997) Price

is also a main factor in transaction relationship where it is one of the medium used

by marketers to counter the market, either in attracting or in retaining customer or

as a element in competing with competitors (Summerour, 2000; Patton, 2002; Beck, 2000) In making a reasonable and affordable price for a product in depth information from what does a customer perceive is needed (Munnukka, 2005)

Consumers center of concentration in developing the distinctive of price and the

cognitive is the element on which the price information to be elaborated and kept (Xia, 200s5) Price does not only as an element of financial sacrifice but as well as a determination of product quality (Monroe, 2003)

Customer satisfaction resulted as an evaluation which is being reflected after product or services usage Therefore, customer satisfaction is evaluated by positive perception perceived which have similarity to the meaning of customer value package that are from price, product quality, service quality, innovation and corporate image (Fredericks and Salters, 1995) Price is one of the elements in measuring customer satisfaction where price or value is a similar in considering it

is a important factor in influencing and assisting in building up customer satisfaction (Getty and Thompson, 1994)

5.5 Spare part availability

Spare parts availability plays an important role in achieving the desired plant availability at an optimum cost Presently, the industries are going for capital intensive, mass production oriented and sophisticated technology The downtime for such plant and machinery is prohibitively expensive It has been observed in many industries that the non-availability of spare parts, as and when required for repairs, contributes to as much as 50% of the total down time Also, the cost of spare parts is more than 50% of the total maintenance cost in the industry It is a paradox to note that the maintenance department is complaining of the non-availability of the spare parts to meet their requirement and finance department is facing the problem of increasing locked up capital in spare parts inventory This amply signifies the vital importance of spare parts management in any organization

The unique problems faced by the organization in controlling/managing the spare parts are as follows Firstly, there is an element of uncertainty as to when a part is required and also the quantity of its requirement This is due to the fact that the failure of a component, either due to wearing out or due to other reasons, cannot

be predicted accurately Secondly, spare parts are not that easily available in the market as they are not fast moving items The original equipment manufacturer has

to supply the spares in most of the cases New

models are introduced to incorporate the design improvements and old models are phased out Hence the spares for old models are not readily available Particularly, this is more so in case of imported equipment as the design changes are taking place faster in the developed countries Thirdly, the number and variety of spare parts are too large making the close control more and more tedious For instance, the number

of items of spares in a medium scale engineering industry may be around 15,000 and that in a large scale chemical industry may be around 100,000 Fourthly, there

is a tendency from the stage of purchase of the equipment to the stage of the use of the spare parts, to requisition spare parts more number than that are actually required and accumulation of spares takes place Finally, the rate of consumption of spare parts for some are very high and for some are very low These problems are to

be faced by systematic spare parts management

Every organization should proceed systematically and establish an effective spare parts management system Codification helps the organization minimizing duplication of spare parts stocking thereby reducing inventory, aids the accounting process and facilitates the computerization of spare parts control systems The inventory analyses carried out on the basis of different characteristics of the spare parts, such as annual consumption value, criticality, lead time, unit cost and the frequency of use, help the company in establishing suitable policies for selective control This also helps in focusing our efforts on real problem areas

A good inventory control system will help systemizing the ordering procedure and also achieving an optimum level of inventory In addition, selectively efforts should be made to evolve optimum replacement policies for selected spare parts, for which cost of down time and cost of replacement are very high So, we have to identify such spare parts and carry out the exercise for evolving optimum replacement policies

For the spare parts which are very expensive and those which are to be imported, it is essential that the useful life for such spares is extended by appropriate applications of reconditioning and repair techniques Also, efforts should be made to indigenize the spare parts in view of the hard-to-get foreign