Customer Relationships

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Customer Relationships

• (The Voice of the Customer)

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Supplier - Process - Customer Model
Supplier
Process
Customer
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Two Approaches

• Customer Value Management (CVM) - (ref B.T.
  Gale, Managing Customer Value)
• Quality Function Deployment (QFD) - (ref R.
  King, Better Designs in Half the Time)

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Customer Value Management

• Conformance Quality
• Customer Satisfaction
• Market-perceived quality and value relative to
  competitors
• Quality a key to customer value management

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CVM - Conformance Quality

• Conform to requirements
• Do it right the first time
• Reduce scrap and rework

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CVM - Customer Satisfaction

• Get close to the customer
• Understand needs and expectations
• Be customer-driven

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CVM - Market-Perceived Quality

• Get closer to the market then your competitors do
• Use customer value analysis
• Understand why orders are won or lost
• Be market-driven

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CVM - Quality a Key to CVM

• Use metrics and tools to
• Track competitiveness
• Decide on what business to be in
• Make capital investments
• Assess acquisitions
• Align entire organization with the evolving needs
  of your targeted market

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Creating Value Customers Can See
Effective Design Quality Control
Understanding Customer Needs
Superior quality in areas that matter to
customer
Advertising other Communications
Low Cost of Quality overall cost leadership
Market-perceived Quality
Exceptional Customer Value
Business Result Profitability,
Growth Shareholder Value
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CVM - Seven Tools

• The Market-perceived quality profile
• The relative price profile
• The customer value map
• The won/lost analysis
• The head-to-head area chart of customer value
• A key event time line
• A what/who matrix

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Steps to Create Quality Profile

• Ask customer to list factors other than price
  that are important to them
• Establish how various quality attributes are
  weighted
• For each attribute divide your score by
  competitors and multiply by the weight of that
  attribute
• The total of all weight-ratio products is the
  overall market-perceived quality score

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Example
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Customer Value Map
Worse Value
Fair-value Line
Better Value
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Won/Lost Analysis

• Ratio of number won to number lost
• Why won?
• Why Lost?
• Who Won?

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Head-To-Head Chart
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Who/What Matrix
(XX Primary, X Support)
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Quality Function Deployment (QFD)

• Quality Works right first time fitness for
  use meet requirements of value to customer
• Function Research, design, manufacturing,
  quality, sales, etc.
• Deployment Put into effect, systematic
  prioritization - Pareto principle
• QFD A system for designing a product or service

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QFD Elements

• Inputs Customer demands, companys current
  performance, competitors performance company
  ratings, and sales features
• Outputs 3 or 4 quality characteristics
• Compares customer demands w/ quality
  characteristics
• Weights companys current performance, plans,
  sales features and competitor performance
• Develops initial plan for meeting customer
  demands
• Prioritizes customer demands
• Develops which quality characteristics are
  controllable

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How QFD Works

• Organizing the QFD Project
• Extent of study
• Who is the study for
• Project selection
• Team selection
• Statement of theme

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How QFD Works

• The descriptive phase
• Customer demands
• Quality characteristics
• Functions
• Mechanisms
• Parts
• New technology
• New concepts
• Product failure modes
• Part Failure modes

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How QFD Works

• The breakthrough phase
• Creativity - combining two items in a new way
• Form matrices by combining various categories
  from the descriptive phase

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How QFD Works

• Implementation phase
• Product planning
• Product design
• Production preparation
• Regular production
• Sales and service
• Comprehensive monitoring

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Levels of Detail
Car
Product
System
Car Chassis
Door
Sub-system
Components
Door Handle
Opening Lever
Parts
Raw Materials
Steel Alloy
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Benefits and Results

• Strategic choices for increased market share
• Better communications between departments
• Focused effort
• Reduced engineering changes on critical design
  elements
• Better control of critical elements of critical
  designs
• Better reliability of critical design elements
• Openness to new concepts
• Cost reduction (VE integrated with QFD)
• Competitive benchmarking
• Cross training of design engineers

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Benefits and Results

• Better understanding of
• customer demands
• different customers
• conflicting customer demands
• engineering requirements
• conflicting engineering requirements
• quality in general
• market research
• planning - individual efforts fir into product
• Improved structure of the design process

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Benefits and Results

• Establishes a critical path
• Build in quality upstream
• Improved documentation
• Common language for all departments
• Identifying customers
• Break down walls
• Make quality real - touch, taste, feel
• Improve internal budgeting (potentially)
• How individual efforts fit into product
• Why designs are set the way they are
• Potentially early identification of conflicting
  Substitute Quality Characteristics - down stream
  fixing user problems without causing other
  problems

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Most Frequent QFD Errors

• Charts too big. Chart A-1 is a Pareto chart -
  not improved by more items
• Using only Chart A-1
• Not knowing in written detail what the customer
  wants
• Not doing something about it is probably worse
• Putting everything (e.g. cost, reliability,
  wants, functions) in the chart is often confusing
  and misleading
• QFD if mandated. QFD if propely done, is
  complex. As a ritual it will not be understood
• Parts should not be mixed with substitute quality
  characteristics
• Parts belong in A-4
• Parts are different from quality characteristics
• Engineering and customer demands should not be
  mixed
• Customer demands should be in Chart A-1
• Engineering demands should be in Chart A-2
• Customers should not be asked about things they
  know nothing about
• Do QFD when it is too late to make changes or
  there is no buy-in for changes

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How to Select and Facilitate QFD Projects

• Select
• Identify project that support company priorities
• Select projects that will improve key interfaces
• Involve personnel who believe QFD will work
• Select projects that are likely to succeed
• Select projects that are likely to generate
  significant success
• Facilitate
• Clearly define the project
• Obtain management commitment to take action on
  findings
• Focus on process rather than contents of project