'Measuring customer satisfaction in the context of a project-based organization'

Up-to-date information about customer satisfaction is important for successful management ofcomplex projects. The importance of customer satisfaction is emphasized in the case of projectbasedorganizations, where a customer often plays an integral role in the project delivery process.Turner and Keegan (2001, p. 256) elegantly define project-based organization as an organizationin which:
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“Measuring customer satisfaction in the context of a project-based organization”“Measuring customer satisfaction in the context of a project-based organization” Tuomas J. Ahola, Helsinki University of Technology tuomas.ahola@hut.fi Jaakko Kujala, Helsinki University of Technology jaakko.kujala@hut.fiABSTRACTThere is a lack of research that focuses on the suitability of the concept of customer satisfactionand the current methods used for measuring it in organizations operating in business-to-business(B2B) markets, such as project-based organizations (PBO), which typically provide customizedproduct and service offerings to a rather limited customer base. In this theoretical paper, wediscuss how certain characteristics of PBOs should be taken into consideration when measuringcustomer satisfaction. In addition, we discuss the suitability of different customer satisfactionmeasurement (CSM) methods for PBOs. We argue that PBOs can expect to benefit from survey-based CSM methods. However, survey-based methods do not often suffice alone and standardinstruments should not be directly transferred from a B2C context to a B2B context. In addition,we argue that the match between the selected CSM methods and the salient features of the PBOin question should always be considered.KEYWORDS: customer satisfaction, methods, project-based organization, project managementIntroductionUp-to-date information about customer satisfaction is important for successful management ofcomplex projects. The importance of customer satisfaction is emphasized in the case of project-based organizations, where a customer often plays an integral role in the project delivery process.Turner and Keegan (2001, p. 256) elegantly define project-based organization as an organizationin which: (1/37)“the majority of products made or services supplied are against bespoke designs for customers”According to Kerzner (1995) the client organization can have a great deal of influence on projectsuccess. Information about sources customer satisfaction or dissatisfaction can be used to ensurethat both project product and the delivery process meet customer expectations.The concept of customer satisfaction, how it should be measured, and its implications for anorganization have been studied extensively in the context of traditional product-orientedindustries such as consumer goods and in the context of mass-produced services such as hotelservices or air travel services. Numerous studies and publications have almost unanimouslyconcluded that measuring customer satisfaction can lead to several benefits for the organizationapplying it: • CSM results can be used to discover important strengths and weaknesses in product/service offerings and more effectively focus improvement efforts towards these issues (Lin & Jones, 1997; Emerson & Grimm, 1999; Sharma et al. 1999; Yang, 2003a; Lam et al., 2004). • Depending on the industry context, CSM results may be used to estimate the degree of customer loyalty which is vital for long-term revenues (Gronholdt et. al, 2000; Lam et al., 2004). • CSM enables the supplying organization to compare the performance of its different business units in different time periods and locations (Jones & Sasser, 1995). (2/37) • CSM is useful for assessing the effectiveness of efforts to redesign elements of the service delivery system (Chase & Bowen, 1991; Juran & Gryna, 1988). • Customer satisfaction can be used as a basis for customer segmentation (Athanassopoulos, 2000). • According to McColl-Kennedy and Schneider (2000), measuring customer satisfaction is not a neutral act, but an intervention. The opinions of the customer whose satisfaction is measured can be affected by the measurement process • CSM can be used by the supplier as a symbolic activity for demonstrating customer- oriented behaviour (Kujala & Ahola, 2004).Striving for high customer satisfaction can be considered important, since increased customersatisfaction has been linked to customer behaviour that positively affects business results (e.g.Kotler, 1994; Rust & Oliver, 1994; Vavra, 1997; Lam et al., 2004).We did not find any academic papers focusing on CSM in a project-based B2B context and onlya rather limited number of papers that focused on CSM in a general B2B context. We presumethat in practice, many project-based organizations among other organizations operating in B2Bmarkets are measuring customer satisfaction with methods developed for B2C market contextswithout clearly understanding t ...