Customer is King: Does it really work in Sri Lankan markets?

Wednesday, 19 April 2017 00:00 -     - {{hitsCtrl.values.hits}}

01The expansion of world trade and the development of mass production has distanced customers from producers, and the realities of the life patterns on the customer in the country will decide the production patterns but with the current trend of the customer becoming global, the market becomes either export oriented or for domestic consumption.

In Sri Lanka nearly 40% of the population earns Rs. 300 per day, only the rest are in the ‘development cycle’ for quality and can afford to look for higher performance, better design, process control and branded product.

The 40% will be looking at basic needs such as food, shelter, clothing and the free education and health subsidised travel and they tend to look to the State for support. In this situation, State policies will be the lifeline for the category and issues such as food safety, cheap clothing and State sponsorship on housing, education health and transport will not change for at least the next 10 years. All governments in power should have one objective – to reduce this 40% to perhaps about 10% in 10 years. This will be really the unemployable group of society. 

Industries should take this situation into consideration and develop production focusing on cheap products which bring tighter controls on raw material control, production planning, reduced errors and rework which invariably will result in better quality assurance, which brings the cost down, with a cheap and good quality product.

Quality and cost

Many still believe having quality assurance will increase the cost of production. But in reality investments in quality brings down the cost of production due to reduced errors, rework, saving of raw material and productivity increases through improved processes where cycle time is reduced and the workforce is motivated. 

The cost of inspection will be reduced as the product process is standardised and under control, and the production costs with ‘error free’ system or ‘always right approach’ are significantly reduced, permitting mass production, bringing down the cost of unit production.

Origin of quality

Many people are of the view that quality of ‘industrial products’ is merely the result of certain operations in the manufacturing 02process. Until recently services were excluded and no attention is paid to the quality of services.

In recent years, however, people have become increasingly aware of the fact that the quality of the product does not come into existence exclusively during the production processes. From the relative of definition of quality given previously, it follows that there is no stage in design, production and consumption during which quality is not influenced.

Customer focus

Customer focus is the first of the eight management principles on which the ISO 9001 Quality Management System (QMS) is developed. 

The key benefits identified are “Organisations depend on their customers and therefore should understand current and future customer needs, should meet customer requirements and strive to exceed customer expectations”.

Key benefits include:

  • Increased revenue and market share obtained through flexible and fast responses to market opportunities;
  • Efficient uses of resources in the organisation to enhance customer satisfaction
  • Improved customer loyalty leading to repeat business.The application of customer focus leads to:
  • Researching and understanding customer needs and expectations
  • Ensuring that the objectives of the organisation are linked to customer needs and expectations
  • Communicating customer needs and expectations throughout the organisation
  • Measuring customer satisfaction and acting on the results
  • Systematically manage customer relationships
  • Ensuring a balanced approach between satisfying customers, and other interested parties (such as owners, employees, suppliers, financiers, local communities and society as a whole)

Possible actions to ensure customer satisfaction:

1.Understanding the organisation and its content

2.Understanding the needs and expectations of the interested parties

3.Determining the scope of the quality management system

4.Customer focus

5.Customer satisfaction

Finding the customer

This is the basic before a decision to manufacture is required in terms of the scale of production, performance characteristics, price, etc. As mentioned, with the increase in mass production, the distances between the customer and the manufacturer had increased – exempting a few fortunate people where personal contact between the customer and the supplier has increased – and focus is on an ‘invisible customer,’ except in special products such as in shipbuilding, or a special purpose aircraft; in all other instances identifying the customer is really a task before the manufacturer.

In the motorcar industry, the difference between Volkswagen and Rolls-Royce, is that they are making completely different products and their scale of production, price, fuel consumption, comfort, etc. all differ as these are manufactured for two different types of customers. Once the customer is identified, the manufacturer or representative identifies customer needs very carefully and goes into all details. The techniques in market research become very useful.

Once the requirements are made, the manufacturer identifies his capabilities and resources and finalises a design for the product. This may not happen in large-scale consumer products, where regulations play a key role. 

Before large-scale production, a prototype is made and trials are carried out to assess the performance with regard to different requirements. Production involves process control to ensure that the production rally meets customer requirements. Delivery and after sales service are added requirements for the quality of the product. 

Internal customers and external customers

The strength of an organisation depends on the satisfaction of the internal and external customers, their roles and the links have to be identified. This is facilitated by the process approach (ISO 9001:2015), where each activity or operation is considered and analysed as a process. 

The organisation is full of processes that can be defined, measured and improved. These processes interact to deliver results consistent with organisational objectives and cross-functional boundaries. Some processes can be critical while others are not. Processes have interrelated activities with inputs to deliver outputs (ISO 9000:2015).

The effectiveness of the process input/output will determine the productivity of the process and ultimately the entire organisation. 

Customer is defined as person or organisation that could or does receive a product or service that is intended for or required by this person or organisation (ISO 9000:2015).

As per this definition any person sitting next to you who receives a product or service needs to be treated as an internal customer and this chain of customers are involved in performing the overall activity. All these internal customers should work in unison to provide what the external customer wants and the weakest point in the internal customer chain decides the performance of the organisation.

State and the people

This simple quality equation brings us to an important relationship in a country i.e. state and the people, where state becomes the service provider and the people are customers.

Election pledges are prepared by the politicians without any consultation with the people, thereby violating the basic concept of quality and there may not be what the people really need. However, the people’s requirements are fed mostly by the media and also through protests and/or strikes and push the state to provide what people really need. Still in many cases the state sticks to what they want.

Failure to understand the basic concept of quality, service and performance and confrontation results in the state resorting to violence, sometimes ending up in deaths. 

It does not require rocket science to understand the fundamental rights of the people i.e. food to eat, water for washing, drinking and many basic functions, clothing to cover themselves and shelter to keep the sun and rain away. 

Going back to the start of the article where 40% live below the poverty line, with only the State health facility to attend to their illness, people do not need super-luxury vehicles or huge mansions to live in; meeting these very basic needs will make many people in the country happy. That is the message of quality.

Measuring 

customer satisfaction

The supplier, manufacturer or service provider must measure the degree of satisfaction of the customer. This is a requirement in international standards on quality management systems. This provide a feedback on the degree to which the product or service meets customer requirements.

The supplier is expected to device own methods of customer satisfaction measurements. These include customer surveys, customer feedback on delivered products or services, meetings with customers, market-share analysis, compliments, warranty claims and dealer reports. 

Some companies use the services of a Dispute Resolution Provider (DRP), this is generally outside the organisation.

Customer education

It is customary that most customers do not complain but on most occasions they change the supplier. This is basically due to lack of information on the product or service and also consumer rights.

This is usually done through consumer associations/societies and the success of the consumer associations are determined by the number of active associations or societies.



[The writer is an internationally recognised food safety consultant/auditor and tutor who won the prestigious Harrington and Ishikawa medal of the Asia and the Pacific Quality Organization (APQO) in 2013 for outstanding contribution to promote quality in the Asia Pacific Region. Currently he heads the Federation for Quality and Productivity addressing SARRC and ASEAN countries. He can be contacted on email [email protected] or 077 281 7181.]

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