Is 99.9% Good Enough?

talks about News & Events on September 07, 2008

Google the phrase “99.9% is good enough” and see what comes back. For the most part you will uncover the following list:

  • $761,900 will be spent in the next 12 months on tapes and compact disks that won’t play.
  • 1,314 phone calls will be misplaced by telecommunications services every minute.
  • 103,260 income tax returns will be processed incorrectly this year.
  • 107 incorrect medical procedures will be performed today.
  • 114,500 mismatched pairs of shoes will be shipped this year.
  • 12 babies will be given to the wrong parents every day.
  • 14,208 defective personal computers will be shipped this year.
  • 18,322 pieces of mail will be mishandled in the next hour.
  • 2 million documents will be lost by the IRS this year.
  • 2 plane landings at Chicago O’Hare will be unsafe.
  • 2.5 million books will be shipped in the next 12 months with the wrong cover.
  • 20,000 incorrect drug prescriptions will be written in the next 12 months.
  • 22,000 checks will be deducted from the wrong bank accounts in the next 60 minutes.
  • 268,500 defective tires will be shipped this year.
  • 291 pacemaker operations will be performed incorrectly this year.
  • 3,056 copies of tomorrow’s Wall Street Journal will be missing one of three sections.
  • 5,517,200 cases of soft drinks will be shipped flat this year.
  • 880,000 credit cards will be produced with incorrect magnetic strips.

Although these statistics are now dated, the message is still clear. Quality (in fact, zero defects) matters because you may not get a chance to correct the mistake. In some situations and environments you just can’t depend on a mulligan, a do-over, or a re-load.

The concept of quality as it relates to the software industry generally blends three perspectives. First, in many industries software is mission critical; meaning the features must be reliable and always work. For example, a financial services organization is not going to tolerate bugs/defects that result in posting errors. A bank needs to keep their debits and credits in the correct column; it’s just one of those regulatory things! The second perspective that directly impacts the customer experience is technical support. In the case of an issue or problem users can be very unforgiving if prompt attention and follow-up is lacking. The third area involves innovation. Software users expect applications to continuously evolve to meet their ever changing needs and desires. Each perspective is important, and consistent quality practices will help business managers make customer-focused decisions.

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Vows to Higher-Quality

talks about News & Events on August 17, 2008

An article in the August 12th edition of the WSJ (“Ford Vows to Build Higher-Quality Small Cars“) noted that “The Dearborn, Mich., company promised… that its new compact and subcompact vehicles – due out in 2010 – will beat the industry average when it comes to quality.” The company’s goal is to “keep the number of quality problems – known in the industry as “things gone wrong” – at 800 per 1,000 vehicles.” I’ll have to admit that my family, including my three children, own five Toyota’s and that Ford would have an uphill battle to capture our attention at this point. How about you? Is it too late for Ford?

Has your company recently taken a vow to higher-quality? From the very beginning of understanding your customer’s needs, wants and desires through the development of customer loyalty you’ll find that quality can create a competitive advantage. Attracting new customers, expanding current relationships through cross selling and finally, retention, these are the drivers that represent revenue growth and research shows that quality impacts all three of those drivers.

The technology industry is no exception. Poor software quality (things gone wrong) – better known as “bugs” in the software industry, impact the top line, bottom line, and everything in-between; including the customer experience. In February Seapine Software introduced the quality-ready assessment. The QRA is a high-level evaluation tool that helps develop­ment organizations measure the state of their software quality-readiness in four key ALM competency areas. Those areas include tracking, testing, automation, and change. Nearly 1,000 individuals have now completed the QRA survey, and according to the results 65 percent of the respondents stated that building quality into their software was either a top or high priority. In addition, the survey found that the top two factors driving organizations to focus on application lifecycle management are:

  • The need to reduce risk by preventing poor quality from impacting customer satisfaction
  • The need to quickly respond to customer requests and requirements

The take away here is that you should not be placing your quality vows on hold because there is a high probability that your competition is moving full steam ahead.

If you would like to learn more about our research results, download the QRA Fast Facts Series white paper.

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The prefix meta- is used to mean about its own category. For example, under the umbrella of business intelligence you often hear the term “metadata” which means data concerning data. For purposes of this short post, “metaquality” could be described as the process and operations through which quality assurance impacts the quality of the customer experience (quality concerning quality) through all phases of the customer lifecycle. Your customers generally move through a decision making process which opens the gate for multiple functional areas to have potential impact on the customer experience:

  • Awareness and need identification
  • Explore and qualify alternatives
  • Solution discovery and evaluation
  • Negotiation and purchase decision
  • Implementation and post sales service
  • After purchase acclimation and evaluation

At each strategic stage of the process, research & development, marketing, sales, services and finance will have various levels of influence on the quality of the overall customer experience; which means quality assurance during all phases of the customer lifecycle is critical. In the Seapine Software Quality-Ready Assessment we asked respondents: “What level of priority does your company currently assign to building quality into your software development environment?”  Nearly 65% of our over 900 respondents rated their software quality initiatives as high or one of their top priorities. However; it also appears that many companies are still not committed to quality improvement.  In other words, they are only paying lip service about quality, and as a result there is a discrepancy with how their customers view the relationship.  Consider the following statistics from the Cutter Consortium, an IT advisory firm.

  • 32% of organizations say they release software with too many defects.
  • 38% of organizations believe they lack an adequate software quality assurance program.
  • 27% of organizations do not conduct any formal quality reviews.

The current combination of declining customer satisfaction levels and economic concerns is creating the perfect customer experience storm.  In this type of business climate those companies that focus on quality will be the ones that come out on top. That means a relentless and coordinated approach to quality improvement across all functional areas has never been more important.

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Software Quality as a Safe Haven

talks about News & Events on July 16, 2008

“I think we’re in flight-to-quality mode,” said Michael Gross, broker and futures analyst with OptionSellers.com. His quote came from a recent article in the Wall Street Journal where he was referring to the fact that gold futures rose as the market bought the metal as a safe haven against troubled markets. Many software development organizations are also in a “flight-to-quality” mode as they focus on software quality as a safe haven in regards to their customer loyalty strategies.

Seapine Software recently released the quality-ready assessment. The QRA is a high-level evaluation tool that helps develop­ment organizations measure the state of their software quality-readiness in four key ALM competency areas. Those areas include tracking, testing, change, and automation. Nearly 1,000 individuals have already completed the QRA survey, and according to the results 65 percent of the respondents stated that building quality into their software was either a top or high priority. In addition, the survey found that the top two factors driving organizations to focus on application lifecycle management solutions are:

  • The need to reduce risk by preventing poor quality from impacting customer satisfaction
  • The need to quickly respond to customer requests and requirements

Customer loyalty is hard won, which means software companies cannot risk the release of a buggy product. Yet development organizations still struggle to achieve quality and deliver products on time and within budget as the research also indicates that more than one-third of companies completed their application development on time and within budget less than 75 percent of the time. If these organizations release once a year, that means they are only on time and within budget once every four years.

For more details on this important topic I recommend that you download and read “Identifying the Cost of Poor Quality.”

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I serve as a member of the Advisory Council for CustomerThink.com.  CustomerThink is a global online community of business leaders who strive to create profitable customer-centric (CRM) business strategies.  The July CustomerThink editorial calendar focuses on the use of technology to power up customer management. In fact, the main focus is on how technology can help accelerate the success of customer-centric strategies. Customer feedback is critical to customer-centric strategies; if the truth be known, often times the feedback is not exactly good news. For example, software companies sometimes receive bug reports and feature requests from their customers. Yes, despite their best effort to ensure quality, a glitch in the software application may occur. And despite best efforts to really listen to their target market, there is always room for improvement, meaning feature requests.

Many times customers have to fill out a report form and either fax, mail, or email it to a technical support department where it is then hand-entered into the master bug database. This low-tech procedure provides no support for file attachments (for example – screen shots) and leaves room for communication error. In addition, the customer is not automatically notified that their issue has been added to future projects.

For ISV’s technology opportunities exist that allow for more effective and efficient beta programs and software releases. This technology allows customers to submit bug reports and feature requests directly into the issue management and defect tracking tool thus eliminating data entry errors and also saving data entry time. Are you likely to find these types of solutions under the normal CRM banner? No; but they are intended to keep your customer-focused strategy on track nevertheless.

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Last year was a good year for Navy football fans. Wins over Army, Air Force and Notre Dame resulted in a bowl game, and 8 win 5 loss season.

Over thirty years ago as a Midshipman 4th class (Plebe) I pledged my loyalty to the Navy blue & gold no matter the record. Coaches will change, players will change, but my loyalty to Navy football will remain the same.

Loyalty created through an emotional bond (like the loyalty you feel toward your alma mater) is powerful. How can you build customer loyalty and form emotional bonds?

  • Brand Quality: You need to start with a strong brand identity that your customers can identify with. Your brand must not only communicate a message, but also inform, motivate, and deliver as promised. The better your brand is at keeping its promises, the better your brand is at being trusted.
  • Learning Relationships: Organizations that implement learning relationships are better able to understand and anticipate a customer’s unique needs. Learning organizations understand that CRM means listening to the customer to learn instead of talking to the customer to sell. Customers in a learning relationship experience a heightened sense of vendor awareness and are more likely to be loyal because their vendor “knows” them.
  • Understand and Use technology to connect in positive collaborative ways: Customer connections that engender loyalty deliver a seamless experience across channels and touchpoints while demonstrating integrity and interest.
  • Ensure and Empower: Ensure high quality customer interactions that demonstrate a caring attitude by empowering your employees to resolve problems. You can’t build loyalty if you don’t truly care about your customers.

 

  • Great Service: Almost every customer has a technical / service support need at some point. Use support incidents as an opportunity to solidify relationships. By providing excellent service and quick resolution you can gain customer loyalty.
  • One view of the company: Despite the desires of corporate managers, the customer ultimately controls the relationship. If the customer is in control, doesn’t he need a 360 degree view of the company? True customer relationship management is a process of making it easier for the customer to do business with you. That’s what builds loyalty and profit. Make it easy for your customer to do business with you.
  • Layers: As SHREK might say… “customers have layers.” Relationships are built on trust and dialog. Give it time. Building genuine relationships with your customers takes time. Customer loyalty requires the care and commitment to take the time, invest the money, and have the patience to listen.
  • Dynamic / Real-time processes: Building relationships takes time; however, instant gratification has been a feature of our everyday lives for a long time. Give your customers their rewards now, and keep your promises on time.
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Last week I listened to a story about a small shoe repair shop as told by one of their long-time customers. It’s a heart-warming business story that I think you’ll enjoy. Blairsville Shoe Repair is located on Booger Hollow in the North Georgia mountain area. The sole proprietor is a cobbler at night – he holds down a delivery job during the day. His shoe repair business is built on a self-service model and depends on the honor system. Customers leave their shoes for repair in a converted newspaper vending machine located on his front porch. Shoes that are ready for pick-up as well as the money folder are also in the machine. Yes, the money folder – customers pick up their shoes and leave their payment, and in 25 years he has never come up short.

In today’s competitive environment we can read plenty about earning the customer’s trust. However; you don’t see much written about trusting the customer. Can you earn the customer’s trust without first trusting the customer? Free software evaluation downloads are a form of two-way “Booger Hollow” trust. The evaluator gets value in the form of free use of the software for a trial period (expensed R&D / intellectual property) in exchange for some degree of personal information. Now, the “exchange rate” is sometimes a point of discussion; that is to say, how much personal information is too much to ask for in exchange? It’s a difficult question and software vendors vary on the topic. How would you manage the exchange on Booger Hollow?

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A Reputation for Quality

talks about News & Events on June 04, 2008

Remember playing “Rock, Paper, Scissors?” The basics of the game consist of each player shaking a fist a number of times (priming) and then extending the same hand in a fist (rock), out flat (paper), or with the index and middle fingers extended (scissors).  Each of these is referred to as a throw, and which one wins is dependent upon the opponent’s throw.

  • Paper wins against Rock (paper covers rock)
  • Rock wins against Scissors (rock smashing scissors)
  • Scissors wins against Paper (scissors cut paper)

Under close examination many companies may find they are using a rock, paper, scissors business strategy. You know – prime the market with new product features, throw out a marketing campaign hoping to rock your prospects with creative copy, cover your defects with patch releases, and then cut your development time so you can do it again – only faster.

Your new product features might be on target, and your entertaining marketing copy may rock; however, your customers may still cut-out your business faster than you can scream “don’t run with scissors” if poor quality impacts their customer experience.  Research shows that your reputation for quality affects sales in three ways.  It will:

  1. Reinforce the confidence of previous customers
  2. Win new customers
  3. Induce customers of competing brands to switch

The cost of quality may seem high, but the cost of poor quality is still higher.  If you take steps to protect your reputation for quality you will be sure to win no matter what your competition is throwing.

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This expression means that it is better to try to avoid problems in the first place, rather than trying to fix them once they arise.  If that is so, and I do believe this homily is accurate, then “an ounce of prevention against poor software quality is worth a pound of customer loyalty, and a ton of corporate profits!”

How so?  Well, Seapine Software has now surveyed nearly one thousand software development and QA individuals through our Seapine Software Quality-Ready Assessment and found that 20% of organizations have limited ability to trace software development artifacts and that 19% of organizations do not track project data electronically.  The survey also uncovered that if software organizations release once per year that 34% of those organizations are only on-time and within budget once every four years.  Ouch!  What actions should they be taking to guard against poor software quality?  To find out take a look at our most recent QRA Fast Facts white paper: http://downloads.seapine.com/pub/papers/QRAFastFactsTrack.pdf

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The Wall Street Journal recently featured an article (“Consumers Are Downbeat on Economy” by Sudeep Reddy) that stated “Consumer sentiment about the economy dropped to a 28-year low amid surging gasoline prices, falling home prices and a weakening job market.”  When the economy tightens the ability to maintain a quality-focused customer experience can create a competitive advantage.  But does that theory really hold true as it relates to software development?  Do customers truly care about software quality?  After all, software doesn’t really wear out, spoil, or fall apart.  In fact, sometimes defective software works; as long as it’s used in exactly the same way once the bug is fixed.  So, unless we’re talking about applications that perform critical functions in highly public situations (regulatory and compliance related), such as public transportation, utilities or medical devices, the average consumer may not actually care that much about software quality … right?  Wrong.  Seapine Software has now surveyed nearly one thousand software development and QA individuals through our Seapine Software Quality-Ready Assessment and found that the top two factors driving organizations to focus on Application Lifecycle Management solutions are:

  • The need to reduce risk by preventing poor quality from impacting customer satisfaction (23.9%)
  • The need to quickly respond to customer requests and requirements (21.7%)

“The need to address compliance and regulatory issues” actually came in last with 5.4% of the vote.  Now don’t get me wrong, FDA regulations or the Sarbanes-Oxley Act, which makes executives personally responsible for the quality of their organizations financial reports, certainly forces executives to focus on accountability, traceability and quality related issues.  But it’s also true that when customers demand quality corporate executives almost always pay attention.  And based on the survey numbers, customers must care a great deal about software quality.

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