Advantage Rent A Car and USAA Lead in 2013 Temkin Forgiveness Ratings

All companies, even customer experience leaders, make mistakes. But how much goodwill have companies built up for consumers to forgive them after those miscues? To answer this question, Temkin Group surveyed 10,000 U.S. consumers about companies with whom they’ve recently interacted. We used this data for the third annual Temkin Forgiveness Ratings of 246 companies across 19 industries.

Download entire dataset for $295

Company Results

Here are the highlights of the 246 companies in the 2013 Temkin Forgiveness Ratings:

• Advantage earns top spot. With an excellent score of 61%, Advantage earned the highest rating.
• USAA dominates forgiveness. USAA grabbed the next three spots for its banking, insurance, and credit card businesses.
• The rest of the top 10. H.E.B., Blackboard, Aldi, Alaska Airlines, credit unions and Publix round out the top 10
• No industry owns the top. The top 25 companies in the ratings comes form a variety of industries: Four grocery chains, three airlines, three retailers, two banks, two hotel chains, two investment firms, two software firms, one appliance maker, one auto dealer, one credit card issuer, one fast food chain, one health plan, one insurance carrier, and one rental car agency.
• HSBC dominates the bottom. HSBC earned the bottom two spots in the ratings for its credit card and banking businesses.
• Many TV service providers are at the bottom. Six of the bottom 12 companies are TV service providers: Cox Communications, Time Warner Cable, Comcast, Verizon, Charter Communications, and Optimum (iO)/Cablevision.
• USAA most outperforms its peers. We compared company ratings with their industry averages and USAA came in the top three spots, 36 points above in banking, 31 points ahead in credit cards, and 28 points ahead in insurance. Three other companies are more than 20 points above their industry averages: Advantage (car rentals), credit unions (banking), and TriCare (health plans).
• HSBC most underperforms. HSBC fell the farthest below its industry average in two areas, 23 points behind its peers in banking and credit cards. Five other companies had scores that were 15 points and more below their industry: US Airways (airlines), Motel 6 (hotels), McAfee (software), Kia (auto dealers), and Hertz (rental cars).

We also examined year-over-year results for 204 companies that were in both the 2012 and 2013 Temkin Forgiveness Ratings. Here are some highlights of that analysis:

• Chrysler improves the most. With a jump of 29 percentage points, Chrysler is the most improved company.  Six other companies gained 20 points or more: Continental Airlines, Citigroup, Avis, EarthLink, Ameriprise Financial, and Alaska Airlines.
• US Cellular declines the most. With a drop of nearly 20 percentage points, US Cellular dropped the most in 2013.  Nine other companies fell by more than 10 points: Bright House Networks, HSBC, Cox Communications, Hertz, PNC, SunTrust Bank, Dollar Rental Car, Hyatt, and TD Ameritrade.

Industry Results

Here are the highlights of the 19 industries in the 2013 Temkin Forgiveness Ratings:

• TV service providers are unforgivable. TV service providers, as an industry, earned the lowest Temkin Forgiveness Rating of 12%. It was five points below Internet service providers and seven points below wireless carriers.
• Grocery chains are the most forgivable.  With an average rating of 39%, grocery chains are the highest scoring industry. Three industries are just four points behind: hotel chains, auto dealers, and rental car agencies.
• Credit cards make the most improvements. Credit cards made the largest improvement, nine percentage points, over the previous year.  Auto dealers, rental car agencies, and airlines also improved by more than five points.
• TV service providers head in the wrong direction. Led by TV service providers that dropped three points between 2012 and 2013, three industries earned lower scores in 2012. The other industries are retailers and appliance makers.

Calculating the Temkin Forgiveness Ratings

During January 2013, Temkin Group asked consumers to identify companies that they have interacted with during the previous 60 days.  For a random subset of those companies, consumers are asked to rate companies as follows:

How likely are you to forgive these companies if they deliver a bad experience?
Responses from 1= “extremely unlikely” to 7= “extremely likely”

For all companies with 100 or more consumer responses, we calculated the “net forgiveness” score. The Temkin Forgiveness Ratings are calculated by taking the percentage of consumers that selected either “6” or “7” and subtracting the percentage of consumers that selected either “1,” “2,” or “3.”

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To see all of the companies in the Temkin Forgiveness Ratings as ell as all of our other Temkin Ratings and sort through the results, visit the Temkin Ratings website

The bottom line: Forgiveness is an asset that you accumulate by consistently meeting customer needs.

Alaska Airlines and Southwest Airlines Lead Airline Industry in 2013 Temkin Experience Ratings

We recently released the 2013 Temkin Experience Ratings that ranks the customer experience of 246 companies across 19 industries based on a survey of 10,000 U.S. consumers. Alaska Airlines and Southwest Airlines tied for the top spot in the industry. US Airways and American Airlines, the recently merged companies, ended up as the two lowest rated airlines. As a matter of fact, US Airways is the lowest rated company across any industry. Together, they threaten to become a customer experience mega-monster.

Here are other highlights from the airline industry:

• The average rating for airlines places it at number 15 out of 19 industries.
• The average industry rating remains steady at 60% (in 2012, it was 61%, and in 2011, it was 60%).
• The highest-ranked airlines Alaska Airlines and Southwest Airlines, both with a rating of 68%, eight points above the industry average. Alaska Airlines increased five points from 2012 while Southwest Airlines dropped five points.
• The next airlines in the ratings, in order, are: AirTran Airways (65%), JetBlue (64%), and Delta Airlines (63%).
• Delta Airlines improved five points from the 2012 ratings, tying it for the largest gain in the industry.
• JetBlue has an unusually emotional profile. The airline’s emotional rating is almost eight percentage points above the industry average, but its functional and accessible ratings are less than three points above average.
• Southwest Airlines leads in functional and accessible components and Alaska Airlines leads in the emotional rating.
• US Airways (#246 overall, the lowest rated company) earned a rating of 45%, nine points behind the next lowest scoring American Airlines.
• US Airways had the largest drop since 2012, seven percentage points, and earned the lowest score for all three subcomponents: functional, accessible, and emotional.
• Here’s a link to industry results from the 2012 ratings.

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American Airlines + US Airways = Worst Customer Experience

As an update to my previous post, American Airlines and US Airways formally announced their merger. According to our 2012 Temkin Ratings, they are the two worst U.S. airlines in customer experience. US Airways actually holds the bottom spot in our experience, loyalty, forgiveness, and trust ratings. By contrast, the recent merger between Southwest Airlines and AirTran represents a combination of the two top airlines in customer experience.

Does this mean that the merger will create a mega-monster in terms of customer experience? Hopefully not. But I recommend that every member of the newly combined management team focus on all four customer experience core competencies:

• Purposeful Leadership
• Compelling Brand Values
• Employee Engagement
• Customer Connectedness

The bottom line: There’s a lot of work ahead for American Airlines and US Airways

American Airlines Needs More Than a New Paint Job

American Airlines recently announced a brand makeover, releasing its new logo and designs for its planes. According to CEO Tom Horton:

“Our new logo and the refreshed exterior of our planes represent more than a change of symbol, but a symbol of change in our path to modernize and innovate“

My take: The company spent millions of dollars on this veneer, but has yet to address its bigger brand issue: Customer experience. The airline can make whatever promises that it wants in its visual identity, but the lasting impressions of its brand are formed by the millions of interactions that customers have with American Airlines every day, whether it’s online, on the phone, at the airport, or in the air. Brands are formed not by the promises we make, but by the promises we keep.

To put American’s customer experience into perspective, it was the next to worst airline in the 2012 Temkin Experience Ratings (only slightly ahead of US Airways, the airline that it is planning to merge with) and rated 187th out of 206 organizations in the ratings. Making matters even worse, it was one of the few companies to show a decline from 2011 to 2012. While we won’t be releasing the 2013 Temkin Experience Ratings for a couple of weeks, I can tell you that American Airlines and US Airways have successfully defended their bottom spots in the airline industry.

Where should American Airlines focus its energy, if not a new logo and some fancy paint on the tail of its planes? Employees. One of the Six Laws of Customer Experience is that unengaged employees don’t create engaged customers. Until American finds a way to get employees on-board, then it will continue to deliver terrible experiences to customers. And there’s no amount of marketing and advertising spending that can make up for a bad experience.

As a vision of what might be possible in the long-term future, take a look at what Southwest Airlines does with employees. With that in mind, Horton and the rest of the American Airlines management team should immediately start focusing on what we call the Five Is of Employee Engagement: Inform, Inspire, Instruct, Involve, and Incent.

As a frequent flyer, I hope that American Airlines figures this out. An upcoming merger with US Airways will hopefully become a catalyst for making signifiant improvements in employee engagement (and ultimately customer experience). If not, this might just be a case of the bad getting bigger.

The bottom line: You can’t paint over poor customer experience

2012 Temkin Trust Ratings

Temkin Group has just released the 2012

We introduced the Temkin Trust Ratings last year to gauge which companies are earning this important element of loyalty. The 2012 Temkin Trust Ratings include 206 companies from 18 industries and is based on a survey of 10,000 U.S. consumers.

Congratulations to the top firms in this year’s ratings: USAA, credit unions, H.E.B., Publix, Chick-fil-A, Sam’s Club, Hy-Vee and BMW. Of course, not every company has earned such a high degree of trust with their customers, especially the companies at the bottom of the 2012 ratings: Charter Communications, Citigroup, Bank of America, HSBC, Time Warner Cable, Comcast, and Qwest.

We also examined industry averages and found that grocery chains have earned the most trust from consumers followed by investment firms, retailers, and parcel delivery services. But consumers do not trust TV service providers, Internet service providers, or credit card issuers.

We examined how individual companies are rated relative to their industry peers. Twenty-one companies are 10 or more percentage points above their industry averages. The ones that are farthest out in front: USAA (34 above credit cards), credit unions (30 above banks), USAA (28 above banks), USAA (22 above insurers), and PNC (21 above banks).

Twenty-nine companies are at least 10 percentage points behind their industry averages. Here are the ones that fall the farthest behind: Bank of America (23 behind banks), Citibank (22 behind banks), Super 8 (19 behind hotels), Charter Communications (18 behind TV service providers),  Days Inn (18 behind hotels), and Citigroup (18 behind credit card issuers).

We also analyzed changes from the 2011 Temkin Trust Ratings. The research shows that consumers are more trusting this year than they were last year. Led by computer makers and insurance carriers, all 12 industries that were in both the 2011 and 2012 Temkin Trust Ratings showed improvement.

Fifty-two of the 139 companies that were in the 2011 and 2012 Temkin Trust Ratings earned double-digit improvements and six companies improved by more than 20 percentage points: USAA, PNC, Lenovo, credit unions, U.S. Bank, and HSBC. Seventeen companies lost ground over the last year with the biggest drops coming for Cox Communications, Bank of America, Citigroup, Edward Jones, TriCare, and Costco.

Do you want to see the data? Go to the Temkin Ratings website where you can sort through all of the results for free. You can even purchase the underlying data if you want to get more access.

The bottom line: It’s hard to succeed without your customers’ trust

2012 Temkin Forgiveness Ratings

Temkin Group has just released the 2012
Every company makes mistakes now and then, but how willing are customers to forgive the company when it happens? Forgiveness is a valuable asset that companies earn by consistently meeting customers’ needs.

We introduced the Temkin Forgiveness Ratings last year to gauge which companies are earning this important element of loyalty. The 2012 Temkin Forgiveness Ratings include 206 companies from 18 industries and is based on a survey of 10,000 U.S. consumers.

Congratulations to the top firms in this year’s ratings: USAA, Hyatt, credit unions, H.E.B., Hy-Vee, Dollar Rent A Car, Chick-fil-A, Publix, Costco, and Amazon.com. Of course, not every company enjoys such a high degree of forgiveness from their customers, especially the companies at the bottom of the 2012 ratings: Citigroup, Charter Communications, HSBC, Chrysler dealers, EarthLink, Bank of America, Comcast, Quest, and US Airways.

We also examined industry averages and found that grocery chains have earned the most forgiveness from consumers followed by retailers, appliance makers, and parcel delivery services. But consumers are not very likely to forgive mistakes by credit card issuers, Internet service providers, and TV service providers.

We examined how individual companies are rated relative to their industry peers. USAA holds the top two spots, outpacing its credit card and banking peers by more than 30 percentage points. USAA also outpaces the insurance industry by more than 20 percentage points. Credit unions, Hyatt, US Cellular, Dollar Rent A Car, Chick-fil-A, and Bright House Networks are also more than 15 percentage points above their industry averages. Five companies fall 15 or more percentage points below their industry’s average Temkin Forgiveness Ratings: Chrysler dealers, Citigroup, Travelers, Charter Communications, and RadioShack.

We also analyzed changes from the 2011 Temkin Forgiveness Ratings. The research shows that consumers are more forgiving this year than they were last year. Led by banks and insurance carriers, all 12 industries that were in both the 2011 and 2012 Temkin Forgiveness Ratings showed improvement.
Sixty-eight of the 139 companies that were in the 2011 and 2012 Temkin Forgiveness Ratings earned double-digit improvements and four companies improved by more than 25 percentage points: TD Ameritrade, Lenovo, USAA, and credit unions. Ten companies lost ground over the last year with the biggest drops coming for Citigroup, Continental Airlines, Travelers, Sears, Holiday Inn Express, and The Hartford.

Do you want to see the data? Go to the Temkin Ratings website where you can sort through all of the results for free. You can even purchase the underlying data if you want to get more access.

The bottom line: To err is possible, to earn forgiveness is divine

Report: 2012 Temkin Loyalty Ratings

Access the data from all Temkin Ratings research at the Temkin Ratings website.

We just published a new Temkin Group report, 2012 Temkin Loyalty Ratings. The report analyzes feedback from 10,000 U.S. consumers to rate their loyalty to 206 organizations across 18 industries. Congratulations to the top firms in this year’s ratings: Sam’s Club, Aldi, USAA, Publix, credit unions, and Amazon.com.

We added six industries (fast food chains, grocery chains, major appliances, car rental agencies, auto dealers, and parcel delivery services) and 63 companies compared with the 2011 Temkin Loyalty Ratings.

Here is the executive summary from the report:

Sam’s Club, Aldi, and USAA earned the top spots in the 2012 Temkin Loyalty Ratings while Citigroup (banking and credit cards) and Charter Communications (TV service and Internet service) each show up twice in the bottom four. We asked 10,000 U.S. consumers to rate their loyalty to companies across three dimensions: likely to recommend, reluctant to switch, and willing to repurchase. Their responses allowed us to rate the loyalty of customers to 206 companies across 18 industries. One-quarter of companies have “strong” or “very strong” ratings while 50% have “weak” or “very weak” ratings. At an industry level, grocery chains and retailers have the most loyal customers while internet service providers and TV service providers have the least loyal customers. USAA has the most loyal customers across three industries, banking, insurance, and credit cards. When comparing the results from the 2011 and 2012 Temkin Loyalty Ratings, we find that PNC and USAA improved the most and Kohl’s and Hyatt declined the most.

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The Temkin Loyalty Ratings are based on evaluating three components of loyalty:

1. Recommending: How likely are consumers to recommend the company to friends and colleagues?
2. Switching: How reluctant are consumers to switch business away from the company?
3. Repurchasing: How willing are customers to purchase additional products and services from the company?

Here are the ratings for all 206 companies:

Here’s how the industries compare with each other:

Here are some other highlights from the research:

• USAA (in their banking and credit card divisions) as well as credit unions (banking) outpaced their industry peers by more than 25 percentage points.
• DHL and RadioShack are the furthest behind their peers, falling more than 20 percentage points below their industry averages.
• Across the 12 industries we examined in both years, nine earned higher loyalty scores in 2012 and three showed a decline. Computer makers are at the top of the list of gainers while retailers had the largest decline.
• Of the 139 companies that are included in both the 2011 and 2012 Temkin Loyalty Ratings, 84 firms made at least a small improvement in their scores. Led by PNC and USAA, 19 companies earned double-digit improvements over the last year.
• Kohl’s and Hyatt are the only companies that declined by more than 10 percentage points over the previous year.

Download report for $195

Do you want to see the data? Go to the Temkin Ratings website where you can sort through all of the results for free. You can even purchase the underlying data if you want to get more access.

The bottom line: Consumer loyalty remains up for grabs across most industries.

Southwest Provides Best Airline Customer Experience

This post examines the nine airlines included in the 2012 Temkin Experience Ratings.

Southwest Airlines earned the top spot in the industry and received the only “good” rating.  AirTran Airways was ranked second in the industry and earned a rating of “okay” along with JetBlue Airlines and Alaska Airlines. The remaining five airlines earned poor ratings, with US Airways and American Airlines at the bottom.

The overall airline industry, on average, earned the 12^th spot out of 18 industries. The industry made a modest improvement in its overall customer experience ratings between 2011 and 2012. Led by AirTran Airways, Southwest Airlines, and United Airways, five of the eight airlines that were included in both studies showed some improvement. Continental Airlines and American Airlines had the largest declines since last year.

Do you want to see the data? Go to the Temkin Ratings website where you can sort through all of the results for free. You can even purchase the underlying data if you want to get more access.

The bottom line: There’s a long way to go across the airline industry

Report: 2012 Temkin Experience Ratings

Access the data from all Temkin Ratings research at the Temkin Ratings website.

We just published a new report, 2012 Temkin Experience Ratings. The report analyzes feedback from 10,000 U.S. consumers to rate 206 organizations across 18 industries. Congratulations to the top firms in this year’s ratings: Sam’s Club, Publix, Starbucks, Subway, Chick-fil-A, Aldi, Winn-Dixie, H.E.B, and credit unions.

We added six industries (fast food chains, grocery chains, major appliances, car rental agencies, auto dealers, and parcel delivery services) and 63 companies compared with the 2011 Temkin Experience Ratings.

Here is the executive summary from the report:

Sam’s Club and Publix earned the top two spots in the 2012 Temkin Experience Rankings, with three fast food chains rounding out the top five. We asked 10,000 U.S. consumers to rate their recent interactions with companies across three dimensions of their experience: functional, accessible, and emotional. Their responses allowed us to rate 206 companies across 18 industries. Only 28% of those companies received at least a “good” rating. Grocery chains earned the highest average scores and health plans dominated the bottom of the ratings. Kaiser Permanente and credit unions most outperformed their industries while DHL and RadioShack fell the farthest behind their peers. None of the companies earned an “excellent” rating for the emotional component, while Charter Communications and Earthlink lead 10 companies falling below the “very poor” threshold in that area. Compared with last year’s ratings, most industries improved, led by a 5.3 point average increase by insurance carriers. When it comes to changes over the past year by individual firms, PNC and Lenovo improved the most while Regions Bank had the sharpest decline.

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The Temkin Experience Ratings are based on evaluating three elements of experience:

1. Functional: How well do experiences meet customers’ needs?
2. Accessible: How easy is it for customers to do what they want to do?
3. Emotional: How do customers feel about the experiences?

Here are the ratings for all 206 companies:

Here’s how the industries compare with each other:

Here are the companies that are leaders across the 18 industries:

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Do you want to see the data? Go to the Temkin Ratings website where you can sort through all of the results for free. You can even purchase the underlying data if you want to get more access.

The bottom line: Customer experience is improving, but there’s a long way to go

Amazon.com, Costco, and USAA Are The Most Recommended Companies

In the 2011 Temkin Loyalty Ratings, we examined three elements of loyalty that includes the likelihood of consumers to recommend U.S. companies to their friends and relatives. I decided to take a closer look at the companies with the most, and the least, percentage of consumers that are likely to recommend them.

Here are some observations of the results across the 143 companies we examined:

• Amazon.com, Costco, and USAA are on top. No surprise; these companies do well in just about every measure of loyalty.
• Southwest Airlines and Vanguard stand out. Besides USAA, Southwest Airlines and Vanguard are the only companies that aren’t retailers or hotel chains on the top 20 list.
• Anthem, Blue Shield Of CA, and Charter Communications are on the bottom. Led by Anthem, Blue Shield Of California, and Charter Communications, 15 companies had less than 50% of consumers willing to recommend them.

We also looked at the level of consumer recommendations compared with industry averages. This analysis showed that:

• USAA and Regions outperform the most. Led by USAA (credit cards and insurers) and Regions (banks), seven firms have 10 percentage points more consumers willing to recommend them compared with their industry average. The others: Southwest (airlines), Amazon.com (retailers), TriCare (health plans), and USAA (banks).
• Gap and Radio Shack underperform the most. Led by Gap (retail) and Radio Shack (retailers), five companies fall at least 10 percentage points their industry average level of recommendations. The others: US Airways (airlines), Super 8 (hotels), and Anthem (health plans).

The bottom line: Recommendations are an asset that companies must cultivate.

20 Companies Most Susceptible To Negative Comments Via 3rd Party Ratings Sites

In my previous two posts, I listed companies that were susceptible to negative feedback via Facebook and Twitter. Now it’s time to look at 3rd party ratings sites like TripAdviosr and Yelp.. In the report How Consumers Give Feedback, we analyzed what US consumers did after they had a very bad or a very good experience.

As a part of the analysis, we examined the difference in social media use across 141 companies. Our analysis looked at how often people that had interacted with those companies had also used social media to talk about a very bad experience in the previous 60 days. We then compared that data to the overall US average.

This chart shows the 20 companies that interact with consumers who are most likely to post a comment or rating about a very bad experience on a 3rd party site.

As you can see, Days Inn, Super 8, TD Ameritrade, United Airlines, Hyatt, Hilton, and AirTram Airways are more than the most susceptible to having a bad comment or rating show up on these sites.

The bottom line: These firms need to track third party rating sites more than their peers

Retailers Lead, TV Service Providers Lag In Loyalty

I just published research called How Loyal Are Consumers? Not Very that examines the loyalty that consumers have with 113 large firms across 12 industries: airlines, banks, cell phone service providers, credit card providers, hotels, insurance firms, Internet service providers, investment firms, medical insurance companies, PC manufacturers, retailers, and TV service providers.

We asked 4,500+ US consumers about three areas of loyalty:

1. Willingness to consider the provider for another purchase
2. Reluctance to switch business away from the provider
3. Likelihood to recommend the provider to a friend or colleague

Here are some of the industry-level findings (in terms of the percentage of loyal customers):

• Willingness-to-repurchase
  • Leaders: Retailers (89%) and Insurers (82%)
  • Laggards: TV Service Providers (69%) and ISPs (73%)
• Reluctance-to-switch 
  • Leaders: Retailers (80%) and Investment Firms (73%)
  • Laggards: Airlines (62%) and TV Service Providers (63%) 
• Likelihood-to-recommend 
  • Leaders: Retailers (81%) and Insurers (75%)
  • Laggards: TV Service Providers (59%) and Health Plans (60%)

Here are some of the company findings (ranked relative to their industry averages): 

• Willingness-to-repurchase
  • Leaders: USAA credit cards (+24%), Southwest Airlines (+13%), and credit unions banking (+13%) 
  • Laggards: US Airways (-18%), Sprint (-16%), and RadioShack (-13%)
• Reluctance-to-switch 
  • Leaders: USAA credit cards (+20%), Apple (+19%), and Hampton Inn (+18%)
  • Laggards: US Airways (-18%), Sprint (-16%), RadioShack (-15%), and Washington Mutual banking (-15%)
• Likelihood-to-recommend 
  • Leaders: USAA credit cards (+26%), Kaiser (+17%), and Southwest Airlines (+17%)
  • Laggards: US Airways (-18%), Compaq (-17%), and RadioShack (-16%)

The bottom line: What are you doing to make your customers more loyal?

Southwest Airlines Soars Above Its Peers

I’m writing this post as I’m flying to Puerto Rico on America Airlines. Seems like an appropriate time to discuss my new report: Customer Experience Index (CxPi) 2008 Snapshot: Airlines. The research examined the results of the seven airlines in the 2008 CxPi: American Airlines, Continental Airlines, Delta Airlines, Northwest Airlines, Southwest Airlines, United Airlines, and US Airways.

The results are probably not surprising:

• Airline experiences are mostly poor. The average CxPi score for the airlines was 65; on the cusp between an ”okay” and “poor” rating. But six of the seven airlines received “poor” or “very poor” ratings.
• Southwest stands out from the pack. The top scoring airline, Southwest received a CxPi score of 81%; a “good” rating. The next airline on the list, Continental, was a whopping 14 points behind.
• US Airways dissapoints the most. Coming in at the bottom of the list is US Airways, with a “very poor” rating of 50%. That score earned the airline the 103rd spot out of the 113 firms in the CxPi. Northwest was the next to last airline with a 56% score.

It might have been a closer race if we had data for some other airlines like JetBlue and Virgin America. But there’s no doubt that Southwest does things differently than most airlines. The differences start at the top. I often refer to this quote from Herb Kelleher, founder of Southwest Airlines:

If you create an environment where the people truly participate, you don’t need control. They know what needs to be done and they do it. And the more that people will devote themselves to your cause on a voluntary basis, a willing basis, the fewer hierarchies and control mechanisms you need.

The bottom line: The airline industry could use more leaders like Kelleher

The Satisfaction Quarterly Report, Q1 2008

I recently mentioned the American Customer Satisfaction Index (ACSI) to someone and was surprised that she had not heard of it. It’s a great research effort led by Claes Fornell at the University Of Michigan which tracks customer satisfaction on a quarterly basis. Here’s a chart of the national average since the index was created in 1994:

As you can tell, satisfaction scores have been generally on the rise over the last few years.

The ACSI provides both company-specific and industry-specific data for a different set of industries every quarter. The Q1 2008 ACSI looked at the following industries: hotels, restaurants, hospitals, cable & satellite TV, cellular telephones, computer software, fixed line telephone service, motion pictures, network/cable TV news, newspapers, wireless telephone service, airlines, express delivery, U.S. Postal Service, and energy utilities.

Here are some of the highlights from that Q1 2008 data:

• Best & Worst Organizations:
  • Top rated: FedEx Corporation (express delivery), UPS (express delivery), Olive Garden (restaurant), and Southern Company (Utility)
  • Largest improvement (since last year): Ameren Corporation (energy utilities), Reliant Energy (energy utilities), Energy Future Holdings (energy utilities), and McDonalds (limited service restaurants).
  • Lowest rated: US Airways (airlines), Charter Communications (cable & satellite TV), Comcast Corporation (cable & satellite TV), and Sprint Nextel (wireless telephone services).
  • Largest decline (since last year): US Airways (airlines), Continental Airlines (airlines), Sprint Nextel (wireless telephone services), and Northwest Airlines (airlines).
• Best & Worst Industries:
  • Top rated: Express Delivery and Ambulatory Care.
  • Largest improvement (since last year): Hotels and Fixed Line Telephone Services.
  • Lowest rated: Airlines, Cable & Satelitte TV, and Newspapers. 
  • Largest decline (since last year): Newspapers and Broadcast TV News.

The bottom line: This should be a wake-up call to many firms (are you listening airlines and cable & satellite companies?).