What is an acceptable Customer Complaint %?

[Greg B]

Hi All,

I am doing an exercise for marketing. They feel that our Customer Complaints (CCs) have increased over the past two years and they are correct....but.... our dispatches have also increased (at a greater rate). Our CC's are running at approx 2% (2000 dispatches campared to 40 CCs).

What are your thoughts on this ?

I know you are going to ask what is the increase in orders vs CCs has been over thees years versus previous years, but I really want to know what an acceptable level is? (I know 0% would be good)

Greg B

[encee98]

Hi. I don't know if this counts, but are the nature of the complaints similar? What I mean is, are your dispatches correcting the same nature of complaints because if you do, then maybe you need to make corrective and preventive actions. I know this does not answer your question really, but I just got curious. I have this idea that CCs may be used as gauge in determining if we satisfied the customers or not; and if we didn't then we may need to correct something...

Best regards,

Naomi

[Greg B]

encee98,

Yes we are correcting the issues and finding the root causes etc. The issues are not related and are across our entire customer range. The question really is, is 2% aceptable?

Greg B

[Claes Gefvenberg]

Originally Posted by Greg B

The question really is, is 2% aceptable?

I'd say that you need more than one measurable here. Using only that one may lead you down the wrong alley.

From what you're saying I take it that your cc/dispatch ratio is going down. A positive trend can't be bad, and it would seem that your actions are effective.

On the other hand the number of CC's are going up, and every one represents a dissatisfied customer who couldn't care less if the above ratio is good. The number of complaints should be considered.

What about the financial impact? How much does the CC's affect your profit?

/Claes

[Greg B]

Claes,

I agree with what you are saying and I do not usually crunch these type of numbers because they can be and usually are misleading (IMO).

Marketing think that there is a drastic increase in CCs. I say that there are also but other factors have to be taken into account such as the increased output. We have ramped up output by about 40% and the CCs have in actual fact gone down, as a percentage. Marketing just see the total number (morons) and I want them to see the whole picture which I wil give them on Friday but is 2% a good average? I have not seen a national or international study on the average complaints per company. I know this would be difficult as people see things differently but I thought I would plot it anyway.

I'll show the figures that show we are actually trending down but what I want from them in the future is a Risk analysis of how the CC affects the company both from an immediate dollar value and a risk to the customer and us (future purchases, next round cost increases etc).

I have been after these for years and I am still toget them.

Greg B

[Bulksupplier]

Just a word of caution here -
Are you 100% sure that you are capturing all customer complaints, or just those received formally in writing?
Our experience is that formal complaints represent only the tip of the iceberg. Customers usually make allowances for the odd supplier mistake, or don't even notice it. They only make a formal complaint when they suffer real inconvenience, or believe they can use it to lever down the price.
For example - we get our hauliers to report their actual delivery time at the customer. Using this data and counting how many complaints we get for late delivery, we find on average only 5% of lates result in a formal complaint. We therefore started logging all lates as nonconformances, and also capture concerns. The first result is a dramatic increase in 'complaints' - but from then on you can begin to make real improvements, with a real impact on customer satisfaction.
Incidently, our target for formal complaints is 1.5% of deliveries.

[Howard Atkins]

I heard that in FDA audits the first action is to check the number of complaints and compare this to a reference table, if you have to few then they start digging.
Maybe some one from this field can give some input.

This is similar to internal PPM levels, the numbers to compare just don't seem to be there.
I once asked about this in the field of hybrids and got no answer.

I think that people don't want to give numbers before they now an average and no one has an average cause no one gives numbers.

[RCBeyette]

I hate to say this, Greg, but maybe there is no accepted number for Customer Complaints. We track complaints/ton for each of our four complaint types. Unfortunately, we can do nothing about the two types that are attributed to Sales...so we focus our energies on the remaining two types that are our responsiblity to address. We've noticed that here in the mill, we're getting better...wish we could say the same for Sales. The work we do is offset by what they don't do.

Obviously, the number of Customer Complaints you want is zero...but I remember on a Cost of Quality course I took a few years back, we discussed External Failure Costs. External Failures included Allowances, Warranty Charges, Returned Goods and Customer Complaints and the "accepted ratio" for External Failures for your Cost of (un)Quality is 20%-40%. (my brain is still having a hard time accepting that)