Case study

A major US water utility

Optimizing customer service targets, cost of service and customer satisfaction

PA's Market Analytics team conducted a state-of-the-art customer satisfaction study for a major US water utility. The study was designed to move beyond simply tracking changes in customer satisfaction to helping the utility manage customer service expenditures more cost-effectively while maintaining and increasing customer satisfaction.

PA designed and administered a mail survey to a representative sample of the client's customers. This asked detailed questions about customers' perceptions of the current level of service in a specific area such as call center hours of operation, their satisfaction with these levels and how much their satisfaction would change if the level of a service were to change.

At the same time, PA worked with the utility managers to develop estimates of the marginal costs (or cost savings) to provide the different levels of service. PA then combined the customer survey data and the utility marginal cost data to support a linear model for customer service resource allocation.

PA's model enabled the client to conduct 'what if' exercises, examining increases or decreases in the level of customer service in a specific area such as call center hours of operation, by weighing the cost of service against the resulting increase or decrease in customer satisfaction. This management tool helped the client present a successful case to the board of directors to revise their customer service targets and ensure a greater return on customer service investments.