Customers are segmented logically according to common needs.

1. 3.1a(1) HOW do you identify CUSTOMERS, CUSTOMER groups, and market SEGMENTS? HOW do you determine which CUSTOMERS, CUSTOMER groups, and market SEGMENTS to pursue for current and future products and services? HOW do you include CUSTOMERS of competitors and other potential CUSTOMERS and markets in this determination? Indicators for Question 3.1a(1) • Customers are segmented logically according to common needs. • Your organization has been deliberate in deciding what types of • customers and market segments it wants to work with. • Amount of evidence suggests that the organizations has been proactive • in selecting particular markets or customer types. • Customers are segmented into logical groups based upon common characteristics. • New and potential market segments are evaluated periodically for • growth opportunities. • Customer segments are selected to reduce the organization’s vulnerability • to economic trends in a particular customer or industry.

2. 3.1a(2) HOW do you use the voice of the CUSTOMER to determine KEY CUSTOMER requirements, needs, and changing expectations (including product and service features) and their relative importance to CUSTOMERS’ purchasing or relationship decisions? How do your listening methods vary for different CUSTOMERS,CUSTOMER groups, or market SEGMENTS? HOW do you use relevant information and feedback from current and former CUSTOMERS, including marketing and sales information, CUSTOMER loyalty and retention data, CUSTOMER referrals, win/loss ANALYSIS, and complaint data for PURPOSES of planning products and services, marketing, making WORK SYSTEM and work PROCESS improvements, and developing new business opportunities? • Indicators for Question 3.1a(2) • Data on requirements collected from your own and competitors’ customers. • Degree to which customer requirements have been identified for each market • segment your company serves. • Identification of the common and unique requirements and expectations • for each market segment. • Objectivity of data collection methods used to identify customer requirements • and expectations. • Frequency of data collection on each market segment.

3. Indicators for Question 3.1a(2) • Sample sizes are large enough to be adequate representation of customer • populations. • How the company provides information to customers to help ensure that • their expectations are realistic. • Evidence of a proactive approach to identifying targeted customer markets. • Use of multiple methodologies (e.g., telephone interviews, mail surveys, • focus groups, etc.) to gather data on customer requirements. • Use of comparative data for such areas as product/service performance, • complaints, and gains/losses of customers to help determine customer • requirements. • Use of outside sources of data to supplement the applicant’s own data on customer requirements. • How the role of and logistical support for customer contact personnel are determined. • Use of a systematic process for gathering customer requirement data. • Evidence that customer complaint data are summarized and used as input for design or enhancement of products/services. • Tracking of lost customers and follow-up to determine their reasons for buying products/services elsewhere and why they were dissatisfied with your products/services.

4. Indicators for Question 3.1a(2) • Thoroughness of a system for following up with lost customers. • Data gathered from new customers to determine why they selected the product/services offered by your company. • Use of performance data on products/services to identify customer requirements. • Evidence that data from new or lost customer are used to design, enhance, or change products and/or services. • Extent to which requirements have been identified for all dealers or distributors if appropriate. • Explanation of a time horizon for determination of how future customer requirements match applicant’s business, products/service, and technology. • Time frame for determination of future requirements is far enough in the future to allow the organization to capitalize on trends by designing and introducing products and services to meet future customer expectations. • Extent to which projections are made about requirements of existing customers in the future and requirements of potential customers who currently do not buy the organization’s products or services. • Identification of important trends in technology, competition, society, economy, demographics, and other factors that may impact the business. • Extent to which the company has identified how each of these trends will impact its business.

5. Indicators for Question 3.1a(2) • Identifications of specific strategies the company will use to capitalize on future trends in all areas listed above. • Evidence of a systematic approach being used to link high-priority customer • requirements to the product/service design process. • Use of a variety of different sources of data to identify customer priorities. • Use of a systematic process to evaluate the importance of various future customer requirements. • Demonstration that only the most important future customer requirements are translated into new product/service features. • Clarity and completeness of explanation of how future trends are translated into customer requirements leading to design of new or enhanced products/services. • Thoroughness of data collection process used to determine customer priorities. • Deployment of customer requirements research to all customer market segments and products/services. • Use of complaint data as input to the products/services design process. • Use of gains and losses of customer referrals, and other similar data as input to the products/service design process. • Use of data on future customer requirements to design new or enhanced products/services.

6. 3.1a(3) HOW do you use voice-of-the-CUSTOMER information and feedback to become more CUSTOMER-focused, to better satisfy CUSTOMER needs and desires, and to identify opportunities for INNOVATION? Indicators for Question 3.1a(3) • There is evidence of a systematic process for analyzing customer feedback for trends and opportunities for improvement. • Results of customer feedback is provided to individual and departments who are able to make changes and improvements. • Links between customer feedback is one of inputs to process improvement initiatives and new product/service development. • Credibility and number of examples provided to illustrate improvements or innovations implemented based on customer feedback. • Result in Item 7.2 clearly support the claims that the changes or innovations actually resulted in improved customer satisfaction and/or loyalty.

7. 3.1a(4)HOW do you keep your CUSTOMER and market listening and LEARNING methods current with business needs and directions, including changes in your marketplace? Indicators for Question 3.1a(4) • Evidence that a systematic process is used to evaluated the approach used to determine future customer requirements. • Extent to which evaluations are done on all methodologies employed to conduct research on future customer requirements. • Degree to which evaluation methods are appropriate for the research methods used. • Validity of measurement indices used for evaluation. • Validity of evaluation approaches used. • Clear description of a system to compile evaluation results and follow up on them. • Evidence that evaluation results are acted upon and result in improvements in research approaches. • Evidence to indicate that improvements have been made in the last few years in the accuracy and/or time frames of predictions about future customer requirements. • Evidence of a number of improvements being made in approaches for determining customer needs and priorities.

8. 3.2a(1) HOW do you build relationships to acquire CUSTOMERS, to meet and exceed their expectations, to increase loyalty and repeat business, and to gain positive referrals? Indicators for Question 3.2a(1) • Important customer requirements are communicated to customer contact personnel. • Great care is taken in selecting customer contact personnel, and effort is put into minimizing turnover of the good ones. • A systematic approach is used to get to know customers as individuals where possible, and to build trust and rapport with them. • Exit barriers are used where possible to make it more difficult for customers to switch suppliers. • Efforts to delight customers and build loyalty through extra features/services are evaluated for their effectiveness. • Efforts to reward customers for their loyalty through entertainment events ( e.g. golf outings, trips) or by providing them with special privileges are benefits customers want and enjoy. • Efforts are made to form partnerships or alliances with key accounts where possible.

9. 3.2a(2) HOW do your KEY access mechanisms enable CUSTOMERS to seek information, conduct business, and make complaints? What are your KEY access mechanisms? HOW do you determine KEY CUSTOMER contact for each mode of CUSTOMER access? HOW do you ensure that these contact requirements are DEPLOYED to all people and PROCESSES involved in the CUSTOMER response chain? Indicators for Question 3.2a(2) • Amount of effort and trouble customers must go through to comment or complain, or seek assistance. • Use of frequent personal contact with customers where appropriate. • Staffing levels and expertise of personnel operating toll-free lines designed to help customers are adequate to ensure minimal waiting and accurate answer to questions. • How many times customers receive a busy signal when trying to call your toll-free lines (blocked calls) and how long they must wait on old. • Evidence of a proactive approach to get customers to comment and complain.

10. Indicators for Question 3.2a(2) • Definition of key customer contact points with customers, and most important requirements for each transaction. • Identification of specific performance measures for each major interaction with customers. • Extent to which measures have been identified for each customer interaction point. • Evidence that measures are clearly related to customer requirements. • Definition of standards for each measure associated with customer service levels. • Standards exist for all measures. • Standards are set based upon requirements and desires of customers and upon what competitors and benchmark organizations do. • Evidence that data are collected on each major service measure. • Data on extent to which standards are met is fed back to appropriate employees and used to improve performance. • Processes for meeting or exceeding customer requirements are continually improved.

11. 3.2a(3) HOW do you manage CUSTOMER complaints? HOW do you ensure that complaints are resolved EFFECTIVELY and promptly? HOW do you minimize CUSTOMER dissatisfaction and, as appropriate, loss of repeat business and referrals? HOW are complaints aggregated and analyzed for use in improvement throughout your organization and by your PARTNERS? Indicators for Question 3.2a(3) • Comprehensiveness of system for tracking customer comments and complaints. • Objectivity of the approach for gathering and documenting data on customer comments and/or complaints. • All employees who have telephone or personal contact with customers have a simple but through way of documenting any incidental comments or complaints heard about the company’s products or services. • Data on customer comments/complaints from a variety of sources are aggregated for overall evaluation and comparison.

12. Indicators for Question 3.2a(3) • Data on customer comments/complaints are fed back to appropriate personnel in a timely fashion. • Customers believe that the comments/complaints they make to any of the organization’s employees will get documented and reported. • A formal and logical process exists for resolving customer complaints. • Clearly defined escalation procedures are in place for situations in which customers do not feel their complaint has been resolved by lower-level personnel. • Improvements have been made showing reductions in the amount of time needed to resolve customer complaints over the past few years. • Objectivity and reliability of data on levels of customer satisfaction with the handling of complaints are established. • Evidence is presented on the thoroughness with which complaints are handled. • Organized and systematic process is used for analyzing the causes of customer complaints. • Those analyzing the causes of customer complaints have the knowledge and skills to do so.

13. Indicators for Question 3.2a(3) • Information on the causes of customer complaints is fed back to employees who can correct the problems. • Evidence that complaint data are used to initiate improvement projects that prevent future complaints and potential loss of customers. • Evidence that analyses of causes of customer complaints are used to make changes in processes, products, and/or services. • Complaint data is communicated to suppliers/partners as necessary.

14. 3.2a(4) HOW do you keep your APPROACHES to building relationships and providing CUSTOMER access current with business needs and directions? Indicators for Question 3.2a(4) • Evidence of a planned systematic approach to evaluating approaches outlined in this section. • Identification of specific measurement indices for evaluating customer satisfaction and relationship building approaches. • Formal evaluation and improvement is done at least once a year. • Mechanisms exist for ongoing continual refinement or improvement to approaches, along with more formal periodic evaluation and improvement. • Major overhauls have been done to systems, along with minor tune-ps. • Changes and improvements to approaches are consistent with business plans and strategies. • Number and scope of changes and improvements that have been listed or described in the application. • Evidence that approaches to customer satisfaction and relationship building are based upon the best practices of leading companies where appropriate.

15. 3.2b(1) HOW do you determine CUSTOMER satisfaction, dissatisfaction, and loyalty? How do these determination methods differ among CUSTOMER groups? HOW do you ensure that your measurements capture actionable information for use in exceeding your CUSTOMERS’ expectations? HOW do you ensure that your measurements capture actionable information for use in securing your CUSTOMERS’ future business and gaining positive referrals, as appropriate? HOW do you use CUSTOMER satisfaction and dissatisfaction information for improvement?

16. Indicators for Question 3.2b(1) • Measure of loyalty of important customers are used as part of overall approach to customer satisfaction measurement. • Company measures customer-perceived value as well as satisfaction. • Number of different sources of data on customer satisfaction. • Use of objective measures such as repeat business along with opinion data. • Frequency with which customer satisfaction is measured. • Adequate sample sizes used when measuring customer satisfaction. • Extent to which customers in all segments/markets are included in customer satisfaction data. • Validation done with customer satisfaction instruments prior to their use. • Reliability of instruments used to measure customer satisfaction. • Use of multiple approaches to gather customer opinion data, such as surveys, focus groups, etc. • Logical approach for segmenting customers and customer satisfaction data. • Use of measurement indices and instruments that are unique to each customer group’s expectations and needs regarding your products/services.

17. Indicators for Question 3.2b(1) • Separate sets of data collected on levels of customer satisfaction for each major market group or segment. • Use of data collection instruments and methods that minimize the time customers must spend providing you with feedback. • Evidence that approach to measuring customer satisfaction has been refined and improved. • Evidence that soft measures of customer satisfaction ( surveys, complaints, feedback ) correlate with hard measures of customer buying behavior.

18. 3.2b(2)HOW do you follow up with CUSTOMERS on the quality of products, services, and transactions to receive prompt and actionable feedback? Indicators for Question 3.2b(2) • Percentage of customers surveyed during follow-up to determine their levels of satisfaction with your products and/or services. • Frequent informal contact is done to build strong relationships with customers. • Use of a variety of different data collection methods as follow-up on customer transactions. • Follow-up approach demonstrates concern for minimizing customer time and hassle. • Proactive follow-up is done for all types of customers and all of the organization’s products and services.

19. 3.2b(3) HOW do you obtain and use information on your CUSTOMERS’ satisfaction relative to their satisfaction with your competitors? HOW do you obtain and use information on your CUSTOMERS’ satisfaction relative to the CUSTOMER satisfaction LEVELS of other organizations providing similar products or services, and/or industry BENCHMARKS? Indicators for Question 3.2b(3) • Use of a variety of sources of data on competitors’ levels of customer satisfaction. • Objectivity of data gathered on how your customer satisfaction levels • compare with competitors. • Amount of data collected on comparison of customer satisfaction levels to those of competitors. • Reliability of data-gathering methods used to assess competitors’ levels of customer satisfaction.

20. 3.2a(4) HOW do you keep your APPROACHES to building relationships and providing CUSTOMER access current with business needs and directions? Indicators for Question 3.2a(4) • Evidence of a planned systematic approach to evaluating approaches outlined in this section. • Identification of specific measurement indices for evaluating customer satisfaction and relationship building approaches. • Formal evaluation and improvement is done at least once a year. • Mechanisms exist for ongoing continual refinement or improvement to approaches, along with more formal periodic evaluation and improvement. • Major overhauls have been done to systems, along with minor tune-ps. • Changes and improvements to approaches are consistent with business plans and strategies. • Number and scope of changes and improvements that have been listed or described in the application. • Evidence that approaches to customer satisfaction and relationship building are based upon the best practices of leading companies where appropriate.