Foundations of Business Analysis Report Essay Example

Customer Satisfaction at Computer RUS

Customer satisfaction at Computer RUS

Executive Summary

Computer R Us recently diversified its line of offerings by creating a new division known meant to offer repair services. After this initiative failed to meet set benchmarks and led to diminished customer satisfaction levels, the management called for the urgent discovery of the issues affecting the division’s performance and the solutions that must be implemented to foster improved performance. A suite of pragmatic solutions was generated and applied. Presently, there is a need to weigh the efficacy of the solutions in terms of improving the level of customer satisfaction to meet or surpass a bare minimum of 6 on a scale of 1 to 10. In order to do so, it is necessary to determine whether each of the strategies deployed by the business has boosted the customers’ satisfaction with Company R Us’ products and services. In this study, a statistical analysis of a survey conducted among 420 respondents is presented in order to prove or disprove the hypothesis that there is a nexus between the novel approaches and consumer satisfaction.

Introduction

Ever since its conception, Computer R Us has been one of the leading firms with regards to the production, distribution, and sale of computers. Recently, however, the business sought to explore novel ways of generating revenue and the proposal that carried the day was the introduction of a division that would offer repair services for the brand’s laptop/netbook/portable computers. The division was created and dubbed CompleteCare. The ambition was that this novel division would offer prompt responses to all technical inquiries as well as warranty repairs. Even so, we have encountered a continuum of issues that have impeded the division’s ability to achieve expected benchmarks. A preliminary observation revealed that the problems were primarily attributable to the shortage of trained technical operators in the telephone center, distribution problems, and parts availability problems. It is no wonder that the most recent polls revealed that customer satisfaction levels have dropped as evidenced by the numerous complaints registered at the firm’s call centre.

It became paramount to address these issues in order to ensure that CompleteCare yields optimal benefits for the business. As a result, the company’s management spearheaded the generation of a research proposal in order to help generate pragmatic solutions. A whole suite of solutions were raised including reducing response times in the CompleteCare division and increasing methods of communication between Computers R Us and its customers. The other steps include upending the level of advice that staff members offer concerning the firm’s products and services, and the implementation of a new loyalty rewards program. What remains now is to establish which strategy will yield optimal outcomes and foster incremental customer satisfaction promptly before the present trend hurts Computer R Us’ image and prospects. This is after data was collected from a survey that involved 429 respondents. The expectation is that the responses elicited from the survey will be helpful in picking out the precise strategy that the business must prioritize.

Objectives

This report seeks to conduct a statistical analysis using the data generated during the survey in order to:

1. Establish whether the current satisfaction level is in congruence with the management’s aspiration to achieve a minimum of 6 out 10

2. Examine whether there is any disparity between the satisfaction of female and gender consumers with the company’s new royalty rewards program

3. Discover whether any differences in the overall customer satisfaction exist across the following age groups: 1, 2, 3, 4, and 5

4. Find out whether there is any change in customer satisfaction between responses to the initiatives of ‘increasing the level of advice CompleteCare staff provide on Computers R Us products and services’ and ‘the loyalty rewards program at Computers R Us’

5. Determine whether any of the initiatives of ‘decreasing response times in the CompleteCare division’, ‘the level of advice CompleteCare staff provide on Computers R Us products and services’, ‘the level of communication with staff and management’ and ‘new loyalty rewards program’ influence the overall satisfaction of Computers R Us customers

The analysis conducted concerning these hypotheses is expected to demonstrate whether there is a nexus between the present level of customer satisfaction and the strategies implemented to improve customer satisfaction.

Research Design

This section details the techniques used in gathering and analyzing the research data. The objective of the study is to establish whether there is a correlation between the present level of customer satisfaction and the strategies implemented to improve customer satisfaction. The interpretation of the outcomes will be useful in pinpointing the best approach in terms of eliciting greater customer satisfaction relative to the others. The subsections include the research approach, research design, data collection method, and data analysis.

1. Research Approach

When choosing the preferred approach, it is important to take into account the outcome of the whole study. For this study, it will be instrumental to use the quantitative approach. The objective of the study is to discover deeper meaning as well as foster nuanced understanding via interaction with the company’s customers. The quantitative method is especially beneficial because it helps in eliciting results that are generalizable and can, therefore, be extrapolated and projected onto the larger population. In essence, quantitative research elicits numerical data, which is fundamental in fulfilling the purpose of this study. As Aliaga and Gunderson (2000) articulate, the quantitative research methodology concerns “explaining phenomena by collecting numerical data that are analysed using mathematically based methods.” It is intrinsically more objective and reliable than qualitative research that seeks to examine non-numerical data. Quantitative research typically entails reducing complex issues to a few variables. Afterward, a researcher can proceed to establish the causal relationship between the variables in question to prove or disprove a hypothesis, which goes to the heart of the purpose of this study.

2. Sampling Technique and Sample Size

There are two types of sampling techniques that one can choose between when conducting a quantitative study, namely probability and non-probability sampling. As regards probability sampling, each person in the target population has an equal chance of being chosen to be a part of the study sample (Jackson, 2011). On the other hand, non-probability sampling is premised on subjective judgment (Schmidt and Hollensen, 2006). What this means is that each participant is not accorded an equal chance of being selected to form part of the sample. This study adopts the random sampling method in order to escape the pitfalls regarding subjectivity that inherent in non-probability sampling methods. Other than the avoidance of bias, probability sampling is also advantageous because it enables a researcher to calculate and document the sampling error since the research is based on random selection (Black, 2009). The selected sample size in this study was 500 participants, which is adequate to offer comprehensive insight into the nexus between the implemented strategies and changes in customer satisfaction levels.

3. Data Collection Method

The preferred data collection method in the survey was questionnaires. Fundamentally, questionnaires are a common research instrument. This instrument is helpful in determining the following: successful use of a strategy; user satisfaction; user expectations, needs, perspectives, preferences, and priorities; changes in opinion and attitudes; and trends. These are examinable factors in this study, which makes it paramount to conduct the survey by administering questionnaires. Data on the participants’ perception of different strategies applied by the business was gathered using questionnaire surveys administered to randomly chosen customers. Questionnaires made up of both open-ended as well as closed questions were utilized to collect primary information from the participants. This type of questionnaire was preferred over a structured format because it is helpful when a researcher needs to collect information from many subjects easily and promptly.

4. Ethical Considerations

Every research must be conducted within specific ethical codes. The main ethical concerns that will underpin the conduct of this study include seeking the participants’ voluntary and informed written consent to participate in the study, strict compliance with privacy provisions found in the consent form, and ensuring that the respondents understand what the study entails (Resnik et al., 2010). The essence of adhering to these ethical principles lies in the fundamental necessity to respect the dignity of the participants as well as avoid any misconducts that would color the validity and reliability of the study (Broom, 2006).

Hypothesis Development

Question 1: Does the current level of customer satisfaction differ from management’s goal of 6 out of10?

Null Hypothesis (H_o): The current level of customer satisfaction does not differ from the management’s goal of 6 out of 10

Alternate Hypothesis (H_A): The current level of customer satisfaction differs from the management’s goal of 6 out of 10

Question 2: Is there any difference between the satisfaction of male and female customers with the new loyalty rewards program at Computers R Us?

Null Hypothesis (H_o): There is no difference between the satisfaction of male and female customers with the new loyalty rewards program at Computers R Us

Alternate Hypothesis (H_A): There is a difference between the satisfaction of male and female customers with the new loyalty rewards program at Computers R Us.

Question 3: Are there any differences in the overall customer satisfaction across the following age groups: 1, 2, 3, 4 and 5?

Null Hypothesis (H_o): There are no differences in the overall customer satisfaction across the following age groups: 1, 2, 3, 4 and 5

Alternate Hypothesis (H_A): There are differences in the overall customer satisfaction across the following age groups: 1, 2, 3, 4 and 5

Question 4: Is there any difference in customer satisfaction between responses to the initiatives of increasing the level of advice CompleteCare staff provide on Computers R Us products and
services’ and ‘the loyalty rewards program at Computers R Us’?

Null Hypothesis (H_o): There is no difference in customer satisfaction between responses to the initiatives of increasing the level of advice CompleteCare staff provide on Computers R Us products and services’ and ‘the loyalty rewards program at Computers R Us’

Alternate Hypothesis (H_A): There is a difference in customer satisfaction between responses to the initiatives of increasing the level of advice CompleteCare staff provide on Computers R Us products and
services’ and ‘the loyalty rewards program at Computers R Us’

Question 5: Do any of the initiatives of ‘decreasing response times in the CompleteCare division’, ‘the level of advice CompleteCare staff provide on Computers R Us products and services’, ‘the level of communication with staff and management’ and ‘new loyalty rewards program’ influence the overall satisfaction of Computers R Us customers?

Null Hypothesis (H_o): None of the initiatives of ‘decreasing response times in the CompleteCare division’, ‘the level of advice CompleteCare staff provide on Computers R Us products and services’, ‘the level of communication with staff and management’ and ‘new loyalty rewards program’ influences the overall satisfaction of Computers R Us customers.

Alternate Hypothesis (H_A): The initiatives of ‘decreasing response times in the CompleteCare division’, ‘the level of advice CompleteCare staff provide on Computers R Us products and services’, ‘the level of communication with staff and management’ and ‘new loyalty rewards program’ influence the overall satisfaction of Computers R Us customers

Statistical Technique and Justification

To test the first hypothesis, the technique that was used was one sample t-test. This is because it is the most appropriate technique when it comes to comparing the differences in the average to a mean that is already predetermined. It is used to test hypotheses in which the researcher is interested in knowing whether the average of the sample suggests that the phenomenon being investigated comes from a population with a known mean or from a different population.

To test the second hypothesis, independent t-test was used since it is the most appropriate approach to establishing the existence of statistically significant differences in the averages of two unrelated groups. An independent t-test is usually used when the independent variable is categorical with two levels and the dependent variable is continuous. This is the case with the second hypothesis where the gender of the participants is the independent variable while the dependent variable is the extent to which customers are satisfied with the new loyalty rewards program at Computers R Us.

For hypothesis three, Pearson’s correlation was used as it is the ideal technique when one wants to test whether there is a linear relationship between two variables. Correlation is usually used for research seeking to test the existence of both associative and causal relationships.

To test the fourth hypothesis, Pearson’s correlation was also used. This is because just like in hypothesis three, the question sought to establish whether there exists any linear relationship between the two variables.

For the fifth and last hypothesis, the technique that was applied was regression analysis. This is because this approach is the most ideal in cases where the researcher seeks to predict a continuous variable from several independents variables.

Results, and Statistical and non-statistical interpretation

Hypothesis test 1

The result for the 1^st hypothesis test is shown in the table below.

One sample t-test for difference in current level of customer satisfaction

	Variable 1	Variable 2
	6.242857
Variance	2.714149
Observations
Pearson Correlation	0.202416
Hypothesized Mean Difference	0
	-34.5767
P(T<=t) one-tail	4.2E-125
t Critical one-tail	1.648498
P(T<=t) two-tail	8.4E-125
t Critical two-tail	1.965642

Statistical Interpretation

T-calculated (-34.5767) is less than t-critical (1.965642) and the p-value is greater than the level of significance which was set at 0.05. This means that the researcher has to accept the null hypothesis that the customer satisfaction levels at the moment do not differ from the management’s goal of 6 out of 10.

Non-statistical interpretation

The current average level of customer satisfaction (6.243) is fairly similar to the management’s goal of 6 out of 10. This means that the management has been able to achieve its target as far as the overall level of customer satisfaction is concerned.

Hypothesis test 2

The result for the 2^nd hypothesis test is shown is the below:

Independent t-test for difference between the satisfaction of male and female customers with the new loyalty rewards program at Computers R Us

Hypothesis test 3

The result for hypothesis test 2 is represented in table 3

Table 3: Correlation test for differences in the overall customer satisfaction across the following age groups: 1, 2, 3, 4 and 5

	-0.61459
	0.061589	-0.05659

Statistical interpretation

Column 1 represents age group and column 3 represents overall customer satisfaction. The correlation value (0.062) shows that the correlation between the two variables is positive. However, it is not statistically significant.

Non-statistical interpretation

The impact that age has on the overall levels of customer satisfaction is relatively weak. As such, there is no need for the company to focus on any particular age group as far as improving the overall levels of customer satisfaction is concerned.

Hypothesis test 4

The result for the 4^th hypothesis test is shown in the table below

Correlation test for differences in the responses to the initiatives of ‘increasing the level of advice CompleteCare staff provide on Computers R Us products and services’ and ‘the loyalty rewards program at Computers R Us’

	0.735443
	-0.27049	-0.35081

Statistical interpretation

Column 1 represents the responses to the initiatives of ‘increasing the level of advice CompleteCare staff provide on Computers R Us products and services and column 3 represents the loyalty rewards program at Computers R Us.’ The correlation value (-0.270) shows that the difference between the two set of responses is negative and worth taking note of.

Non-statistical interpretation

The difference in customer satisfaction for the responses to the initiatives of increasing the level of advice CompleteCare staff provide on Computers R Us products and services’ and ‘the loyalty rewards program at Computers R Us’ is relatively small

Hypothesis test 5

The outcomes of the 5^th hypothesis are represented in the following tables:

1. Impact of ‘decreasing response times in the CompleteCare division’ on the overall satisfaction of Computers R Us customers

SUMMARY OUTPUT
Regression Statistics
Multiple R	0.358866
	0.128785
Adjusted R Square
Standard Error	1.539567
Observations
					Significance F
Regression		146.4576	146.4576	61.78952	3.28E-14
Residual			2.370266
		1137.229
	Coefficients	Standard Error			Lower 95%	Upper 95%	Lower 95.0%	Upper 95.0%
Intercept	4.279634	0.260807	16.40917	4.58E-47	3.766976	4.792291	3.766976	4.792291
X Variable 1	0.333692	0.042451	7.860631	3.28E-14	0.250248	0.417137	0.250248	0.417137

1. Impact of ‘the level of advice CompleteCare staff provide on Computers R Us products and services’ on the overall satisfaction of Computers R Us customers

   SUMMARY OUTPUT
   Regression Statistics
   Multiple R	0.407128
   	0.165754
   Adjusted R Square	0.163758
   Standard Error	1.506548
   Observations
   					Significance F
   Regression		188.4997	188.4997	83.05101	3.36E-18
   Residual		948.7288	2.269686
   		1137.229
   	Coefficients	Standard Error			Lower 95%	Upper 95%	Lower 95.0%	Upper 95.0%
   Intercept	4.082046	0.248241	16.44386	3.23E-47	3.594089	4.570003	3.594089	4.570003
   X Variable 1	0.318212	0.034918	9.113232	3.36E-18	0.249576	0.386848	0.249576	0.386848

2. Impact of ‘the level of communication with staff and management’ on the overall satisfaction of Computers R Us customers

SUMMARY OUTPUT
Regression Statistics
Multiple R	0.412245
	0.169946
Adjusted R Square
Standard Error	1.502758
Observations
					Significance F
Regression		193.2674	193.2674	85.58166	1.16E-18
Residual		943.9612
		1137.229
	Coefficients	Standard Error			Lower 95%	Upper 95%	Lower 95.0%	Upper 95.0%
Intercept			16.28513	1.58E-46	3.558104	4.534956	3.558104	4.534956
X Variable 1	0.394044	0.042595	9.251036	1.16E-18	0.310318		0.310318

1. Impact of ‘new loyalty rewards program’ on the overall satisfaction of Computers R Us customers

SUMMARY OUTPUT
Regression Statistics
Multiple R	0.431175
	0.185912
Adjusted R Square	0.183964
Standard Error	1.488235
Observations
					Significance F
Regression		211.4241	211.4241	95.45783	1.92E-20
Residual		925.8044	2.214843
		1137.229
	Coefficients	Standard Error			Lower 95%	Upper 95%	Lower 95.0%	Upper 95.0%
Intercept	7.857465	0.180509		2.3E-157	7.502646	8.212283	7.502646	8.212283
X Variable 1	-0.32681		-9.77025	1.92E-20	-0.39256	-0.26106	-0.39256	-0.26106

Statistical interpretation

The regression analysis shows that decreasing response times in the CompleteCare division is responsible for 12.67% of the overall satisfaction of Computers R Us customers while the level of advice CompleteCare staff provide on Computers R Us products and services accounts for 16.38% of overall customer satisfaction. On the other hand the level of communication with staff and management’ accounts for 16.9% of overall customer satisfaction while new loyalty rewards program’ account for 18.4% of overall customer satisfaction.

Non-statistical interpretation

The different initiatives enacted by the company make a significant contribution to the overall levels of customer satisfaction, with new loyalty rewards program’ making the greatest contribution followed by the level of communication with staff and management’, the level of advice CompleteCare staff provide on Computers R Us products and services and finally decreasing response times in the CompleteCare division

Analysis and Summary of the statistical results

The findings from the statistical analysis reveal that the customers are fairly satisfied with the services offered by the company. From the one sample t-test of the customers’ overall level of satisfaction, it was revealed that current average level of customer satisfaction is 6.243, a figure slightly above the company’s target of 6 out of 10. This means that the company can set a slightly higher target given the large room for improvement that remains. In terms of the strategies that will be most effective in increasing the customer’s levels of satisfaction, the regression analysis reveals that focusing on new loyalty rewards program’ followed by increasing the methods of communication between the company and its customers will greatly contribute to customer satisfaction.

Recommendations

• Having achieved its initial target of an average score of 6 out of 10 in terms of overall customer satisfaction, the company needs to set a higher target, ideally 7.5 out of 10.

• The company needs to establish a strong presence on the social media as one approach of increasing the channels through which communication can take place between the entity and the customers. A strong presence on Facebook and Twitter will go a great way in making it easy for customers to communicate with company representatives.

References

Aliaga, M. & Gunderson, B. (2000) ‘Interactive Statistics’. Saddle River: Prentice Hall.

Black, K. (2009) Business Statistics: Contemporary Decision Making. 6^thedn. USA: John Wiley & Sons.

Broom, A. (2006). Ethical issues in social research. Complementary therapies in medicine, 14(2), pp.151—156.

Jackson, S.L. (2011) Research Methods and Statistics: A Critical Thinking Approach. 4^th edn. USA: Wadsworth.

Resnik, D. et al. (2010). What is ethics in research & why is it important. Research Triangle Park, North Carolina: National Institute of Environmental Health Sciences/National Institute of Health.

Schmidt, M.J. & Hollensen, S. (2006) Marketing research: an international approach. England: Pearson Education.