IATF 16949:2016 Clause Customer satisfaction

Customers are primarily the end users of your product, but also include intermediaries such as assemblers (internal or external) who integrate your product into theirs, and dealers and distributors who market and sell your product or the integrated product. You need to consider feedback from all these customers to determine whether or not you have met their specified and perceived requirements. Customer requirements may relate to the design, manufacture, delivery, servicing, and customer and technical support of product, QMS,communication and financial requirements; etc. you must have controls to identify and meet these requirements. Customer satisfaction is the customer’s perception of the degree to which the customer’s requirements have been fulfilled. The phrase ‘the degree’ implies the use of a qualitative or quantitative measure that customers can use to rate to what extent or degree your performance met their expectations and requirements, e.g. supplier score cards; alpha or numeric rating scales on survey forms; etc.  There are many other ways to monitor customer satisfaction feedback (positive and negative). These may include – customer complaints; direct communications with customers; questionnaires and surveys; subcontracted collection and analysis of performance data ; reports from consumer organizations; reports in various media; sector and industry studies. You must continually gather information (about these requirements), capable of being analyzed and evaluated to determine how well you performed them. There are all kinds of performance indicators for design, manufacture, delivery, etc. Gather information on these indicators from both the customer as well from internal processes. You are expected to have a process that defines your customer satisfaction indicators; frequency and method of data collection; summarization, review and evaluation of data; actions to improve, timeline, responsibility and follow-up You must continuously review this customer feedback to ensure you maintain and improve your customer satisfaction rating. ‘Delivered part delivery performance’ relates to reduction in PPM defect rates. ‘Customer disruptions’ relate to temporary interruption or shutdown of your customers production or service operations that was caused by product quality or delivery problems from your organization. ‘Delivery schedule performance’ relates to product or service delivery that is not early or late, but just in time based on customer scheduling requirements. Premium freight whether paid by you or the customer to expedite on-time delivery is a non-value added cost that must be prevented. You are required to track premium freight costs and take corrective action if it is a significant cost or occurs frequently. Automotive OEM’s may impose a temporary halt on shipments from a supplier experiencing poor quality or delivery performance. You must take corrective action to eliminate the problems and their causes, following customer prescribed controls and measures, before you are allowed to resume production and delivery of the customer’s product. In many cases, third party audit and customer approvals are required to remove the ‘halt’. You must also consider performance indicators that improve the efficiency of your manufacturing processes. These may relate to lean manufacturing tools such as – ANDON process; direct run first time quality results; lead time reduction; level scheduling; number of error-proofing opportunities implemented; planned maintenance; standardized work; workplace organization and visual controls deployed. You must monitor trends in customer satisfaction indicators and use these as a baseline for continual improvement. You should consider both external as well as internal customer satisfaction. Note that every internal process is either a customer or supplier of another process. If any or all of your customer satisfaction process activities are done off-site, you must still identify this as a QMS process and show the interaction with the offsite organization (head office perhaps) in addressing these requirements and show how customer feedback information from Head office is used by you for continual improvement and enhancing customer satisfaction. Performance indicators (to measure the effectiveness of processes that control customer satisfaction may include – improvement in customer feedback ratings; reduction in customer complaints; increase in the number of customers providing feedback; increase in feedback that leads to QMS and product improvement opportunities.

Clause Customer satisfaction

In addition to the requirement given in ISO 9001:2015 Clause 9.1.2 Customer satisfaction, Clause requires that Customer satisfaction with the organization to be monitored through continual evaluation of internal and external performance indicators to ensure compliance to the product and process specifications and other customer requirements.. Performance indicators to be based on objective evidence and include delivered part quality performance; customer disruptions; field returns, recalls, and warranty (where applicable);delivery schedule performance (including incidents of premium freight); customer notifications related to quality or delivery issues, including special status.The organization must monitor the performance of manufacturing processes to demonstrate compliance with customer requirements for product quality and process efficiency. The monitoring shall include the review of customer performance data including online customer portals and customer scorecards, where provided.

Please click here for ISO 9001:2015 Clause 9.1.2

The integrity of your process for determining customer satisfaction is paramount, otherwise you could be misled by the data and believe customers are satisfied when they are not. The process therefore needs to be free from bias, prejudice, and political influence. A way of determining customer satisfaction is to:

  • Seek the opinions of customers about your organization’s products and services provided through questionnaires or interview checklists.
  • Seek opinions from the people within the customer’s organization, such as Marketing, Design, Purchasing, Quality Assurance, Manufacturing, etc.
  • Target key product features as well as delivery, price, and relationships.
  • Collect and analyze customer feedback, particularly complaints to target areas for improvement.
  • Conduct customer focus meetings to gather opinion and recommendations for action, using data gathered from questionnaires and periodic customer feedback.
  • Report back the findings to particular customers to secure understanding.
  • Summarize the data to identify trends and conditions that indicate improvement opportunities.
  • Compute customer satisfaction indices as an aid to measuring change.
  • Use the data to derive the business, product development, and quality plans for current and future products and services.

To document this process you should develop a customer satisfaction procedure that details:

  • The sources from which information is to be gathered and the forms, questionnaires, and interview checklists to be used
  • The actions and decisions to be taken and those responsible for the actions and decisions
  • The methods to be used for computing the customer satisfaction index
  • The records to be created and maintained The reports to be issued and to whom they should be issued

Frequency of measurement
Frequency also needs to be adjusted following changes in models and major changes in organization structure, such as mergers, downsizing, and plant closures. Changes in fashion and public opinion should also not be discounted. Repeating the survey after the launch of new technology, new legislation, or changes in world economics affecting the automotive industry may also affect customer perception and hence satisfaction.

To determine trends in customer satisfaction and dissatisfaction you will need to make regular surveys and plot the results, preferably by particular attributes or variables. The factors will need to include quality characteristics of the product or service as well as delivery performance and price. The surveys could be linked to your improvement programs so that following a change, and allowing sufficient time for the effect to be observed by the customer, customer feedback data could be secured to indicate the effect of the improvement. Customer dissatisfaction will be noticeable from the number and nature of customer complaints collected and analyzed as part of your corrective action process. This data provides objective documentation or evidence and again can be reduced to indices to indicate trends.

Performance indicators

Performance indicators play a crucial role in assessing the effectiveness of a company’s processes and their ability to meet customer requirements. In the context of the automotive industry, performance indicators should be based on objective evidence and cover various aspects related to product quality, delivery performance, and customer satisfaction. This KPI measures the percentage of delivered parts that meet customer specifications and quality requirements. It provides insights into the organization’s ability to consistently produce high-quality products. This indicator tracks the number and impact of disruptions experienced by customers due to issues with products or services. It helps identify areas for improvement to reduce customer disruptions and enhance customer satisfaction. This KPI monitors the number of products returned by customers, instances of recalls, and warranty claims. It reflects the reliability of products and highlights potential issues that need to be addressed to reduce warranty costs. This indicator assesses how well the organization adheres to delivery schedules and commitments. It measures the percentage of orders delivered on time and helps identify opportunities for improving supply chain efficiency. This KPI tracks the frequency and cost of premium freight, which is incurred when products need to be shipped urgently due to delivery delays or other issues. Reducing premium freight incidents can lead to cost savings and improved delivery performance. This indicator measures the number of notifications or complaints received from customers related to quality or delivery problems. It provides valuable feedback for identifying and resolving customer concerns promptly. This KPI tracks orders that have been assigned a special status due to quality or delivery issues. Monitoring special status orders helps prioritize corrective actions and ensures timely resolution of critical issues. This metric calculates the percentage of orders delivered to customers within the agreed-upon timeframe. It indicates the organization’s ability to meet customer delivery expectations. Regularly conducting customer satisfaction surveys provides valuable feedback on overall satisfaction with products, services, and support. It helps identify areas for improvement and gauges customer loyalty.This KPI measures the average time taken to resolve quality-related incidents or non-conformances. It reflects the organization’s responsiveness to quality issues. By tracking these performance indicators and analyzing the objective evidence, automotive companies can identify areas for improvement, implement corrective actions, and enhance their overall performance and customer satisfaction. These indicators are essential for measuring progress towards organizational goals and driving continuous improvement efforts.

Monitor the performance of manufacturing processes

Monitoring the performance of manufacturing processes is a critical aspect of quality management in the automotive industry, and it is essential to demonstrate compliance with customer requirements for product quality and process efficiency. By monitoring processes effectively, organizations can identify variations, detect potential issues, and implement timely corrective actions to ensure consistent product quality and customer satisfaction. Here’s how the organization can achieve this:

  1. Establish Key Performance Indicators (KPIs): Define specific KPIs that align with customer requirements and process efficiency. These KPIs could include metrics related to product quality, defect rates, process capability, on-time delivery, customer complaints, and more.
  2. Data Collection and Analysis: Implement a systematic data collection process to gather relevant information about process performance. Use statistical tools and techniques to analyze the data and identify trends or patterns.
  3. Control Charts and SPC: Use control charts and Statistical Process Control (SPC) methods to monitor process stability and identify any out-of-control situations. Control charts help distinguish between common cause variation (inherent to the process) and special cause variation (due to specific factors).
  4. Process Capability Analysis: Conduct process capability studies to assess the ability of the manufacturing processes to meet customer requirements. Use indices such as Cp, Cpk, Pp, and Ppk to quantify process performance.
  5. Root Cause Analysis: Implement root cause analysis techniques to identify the underlying causes of process deviations or quality issues. Addressing root causes helps prevent recurrence and improves overall process efficiency.
  6. Continuous Improvement: Emphasize a culture of continuous improvement by regularly reviewing process performance and seeking opportunities for enhancement. Encourage employee involvement in suggesting improvements.
  7. Customer Feedback and Complaints: Actively gather and analyze customer feedback and complaints to understand their expectations and concerns. Addressing customer feedback is essential for meeting customer requirements and maintaining strong relationships.
  8. Audit and Review Mechanisms: Conduct internal audits and management reviews to evaluate the effectiveness of the monitoring process and ensure alignment with customer requirements and quality objectives.
  9. Process Validation: Validate manufacturing processes, especially for critical or new products, to ensure they consistently meet customer requirements and specifications.
  10. Training and Skill Development: Provide training and skill development programs to employees involved in monitoring processes. Ensure they have the necessary knowledge and expertise to carry out their roles effectively.
  11. Documentation and Record Keeping: Maintain comprehensive documentation and records of process monitoring activities, data analysis, corrective actions, and improvements implemented.

By monitoring the performance of manufacturing processes and demonstrating compliance with customer requirements, automotive organizations can drive process excellence, achieve consistent product quality, and enhance customer satisfaction. Effective monitoring and continual improvement efforts are vital for staying competitive in the dynamic automotive industry and meeting the ever-changing expectations of customers.

Review of customer performance data

The review of customer performance data, including online customer portals and customer scorecards, is an essential practice in the automotive industry and other sectors. This process allows organizations to assess their performance from the customer’s perspective, identify areas for improvement, and strengthen the customer-supplier relationship. The organization should regularly collect customer performance data, which may include metrics related to product quality, delivery performance, on-time delivery, lead times, customer complaints, responsiveness, and other key performance indicators (KPIs) specified by the customer. Many customers provide access to online portals or scorecards where they share performance data with their suppliers. These portals often offer real-time visibility into KPIs and performance trends. The organization should actively utilize and analyze data from these sources. Use statistical tools and data analysis techniques to identify trends, patterns, and areas of concern in the customer performance data. Compare performance against agreed-upon targets and benchmarks to assess the organization’s adherence to customer requirements. In case of customer complaints or issues, conduct root cause analysis to understand the underlying reasons for the problems. Addressing root causes helps prevent recurrence and demonstrates a commitment to continuous improvement. Engage with customers to discuss performance data, gain insights into their expectations, and gather feedback on areas for improvement. Customer feedback is valuable for enhancing processes and overall performance. Utilize customer performance data as inputs for continuous improvement initiatives. Prioritize actions based on the most significant opportunities for enhancing customer satisfaction and meeting customer requirements. Compare the organization’s performance against industry benchmarks and best practices to identify areas where it can excel and gain a competitive edge. Include the review of customer performance data in management review meetings. This ensures that top management is aware of the organization’s performance from the customer’s perspective and can take strategic actions to address any issues. Identify potential risks or challenges related to customer performance data and develop mitigation strategies to minimize their impact. Maintain open communication with customers regarding performance data and improvement initiatives. Transparency fosters trust and strengthens the customer-supplier relationship. By regularly reviewing customer performance data, the organization can demonstrate its commitment to meeting customer requirements, enhancing product and service quality, and achieving customer satisfaction. Utilizing customer feedback and data-driven insights, the organization can continuously improve its processes, products, and services to meet and exceed customer expectations.

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