Quality is usually defined as meeting requirments and satisfying the customer; no more, no less.
In this definition âtoo much qualityâ is judged to be as bad as too little. There are good reasons for this:
1) Any extra value to the customer should be compensated
2) An excess of unpaid functionality is unnecessary gold-plating
3) Funds would be spent on superfluous requirments
4) There is no way to manage the progress and delivery of excessive functionality
âMeeting requirmentsâ means that quality depends uniquely upon specifications and non-specified outcomes are equivalent to defects that reduce quality.
However, my experience is that in practice things are slightly different.
First of all, customers may be unable or unwilling to express their requirments. They cannot express their requirments when they have no experience of the product and donât yet understand the possibilities.
Unable: If I was asked to specify a whiteboard, Iâd be fairly ignorant of the possibilities, especially if asked to look several years ahead. Technology might make it possible to draw pictures like an artist, but should I put this in the requirments? Iâd certainly like the feature, but am I asking for something that is too expensive? Compared to peopleâs likely expectations of what should happen on a whiteboard and the integration of the physical with the virtual, is this likely to be desirable, or mandatory in a few years time?
Unwilling: I may not want to request something for a number of specific reasons. Many people feel that they should buy fair-price, or ecological, or social products, but in practice they buy something else. They may not wish to display disloyalty, or ignorance, or fussiness, or carelessness, or greed, or slothfulness, or for any other reason they may not wish to be thoroughly candid. Thus, many more people claim that they would buy fair-price products, for example, than actually do in practice. Many more people consume fast food than admit to it. People are more likely to vote for re-cycling of materials than actually spend their money on it in practice.
âSatisfying customersâ implies a price set at where value and price is equal or, as we learned at school, supply equals demand. Hence we converge with micro-economic theory.
Again my experience is different, when it comes to value for money, especially in a service environment.
In a service business itâs easy to think of small details that have a big impact. A smile costs nothing, but it has a big effect on a customer.
The appetizer given by a restaurant that wasnât on the menu may help the tip. A seat by the window doesnât cost more to the provider but means more to the customer. That extra glass of champagne in first class doesnât cost much more, but makes the customer feel special. In second class the same glass of champagne makes the customer feel treated beyond their expectations. Is this bad, if it secures future custom? Luckily thereâs a curtain between the two. Meanwhile the cost to the airline is more in the weight than in the cru or the brand.
People donât say âOh, yesterday I went to a restaurant that was really satisfying.â If itâs worth talking about, theyâre much more likely to say âThat was the best meal Iâve had in a long timeâ (or the worst). And people listening are much more likely to take note and resolve to visit a restaurant that is more than just satisfying. An excellent experience will be retold and may influence several other people, whilst an ordinary experience thatâs no more than satisfactory, is more likely to be forgotten.
The fact that someone remembers your name when you go back to the shop, that on the pillow in your hotel you find your favourite chocolate, the hairdresser who knows how you like your hair, the newspaper vendor who knows you prefer not to talk in the morning. A well-run service business is close to a craft. Craftspeople understand that every customer is different. Craftsmanship is not mass production. A true craftsperson puts heart and soul into the details. These small touches that make the object unique and precious, though not always expensive, add more value than they cost.
In my metier as an instructor and facilitator, if I pay 2 euros more for higher quality paper, then that works out at one cent for two and a half sheets, and for that I get the more lustrous feel of the paper, slightly more weight and a noticeable feeling of extra quality, especially for those who are tactile and aesthetic in their appreciation, which is hard to achieve through what I say or do. If I buy coloured post-its and flipchart pens with a nice feel, bold colours and even a pleasant aroma, then at a negligible extra cost, I have an easy win â an enhanced customer experience, and possibly superior to the alternatives.
A craftsman is like an artist. Some, like Van Gogh, paint fabulously, but never get the appreciation during their lifetime. Others, like Picasso, understand how to extract the value in what they do. The story goes that when he found himself short of cash in a restaurant he produced a quick sketch in lieu of payment. The host asked for a signature. Picassoâs reply was that he was paying for the meal, not buying the restaurant. Chutzpah yes, but he knew how to appeal to customers.
Many of us holiday in far corners of the world and have been charmed by beautiful painting, weaving, and carving and sculpture that we have been unable to carry home, due to customs duties or bulkiness. The value exists, but is too costly to extract. Musicians produce music that is as fine as ever and yet current business models donât enable them to extract so much value. So clearly the perceived value of a product depends upon many other factors, including competitive pressure and the value of alternatives, and these are constantly changing right up to the moment of delivery and payment.
If the price paid by the customer is greater than value perceived by the customer, then value for money is negative and repeat business tends to zero. But if perceived value is greater than price paid, then the sense of positive benefits develops a stock of goodwill that can lead to loyalty from the customer, repeat business, and even new business captured from the competition.
In any case, no organization should invest unless expected benefits exceed expected costs by a calculated amount, and enough to justify spending on this item instead of on something else.
Instead of just aiming at meeting requirments, we should aim to meet the requirments in a way that provides value for money and benefits over time. And the life time value of the experience should at least equal the perception of cost paid. Although value is correlated with cost, it is not the same thing, as we are well able to understand when we consume a beverage or a foodstuff, or use a garment, or indeed any other day to day product.
And when we perceive benefits and cost to be two different curves, then we are more likely to create an environment that accentuates value rather than just interpreting it as being as something that is outside our control, because simply related to cost. In other words, value is the output and cost is the input, two different things.