American Consumer Service Index ACSI

American Consumer Service Index (ACSI) is the U.S. instrument that measures consumer satisfaction with goods and services. It is the only consistent, national, cross-industry measure that has been proved repeatedly reliable in results as evidenced by consistent research findings that show that ACSI data often predicts stock market performance (e.g. Fornell et al. *), consequently causing the Federal government, in 1999, to select it as the national metric for measuring consumer satisfaction. Over 55 Federal divisions have used it to measure citizen’s satisfaction with more than 110 services, organizations, and programs and it is used annually with more than 200 companies and in 43 industries.

The Index was created by the University of Michigan in partnership with the American Society for Quality (ASQ) and CFI Group, an international consulting firm and is produced by the American Customer Satisfaction Index LLC, a private company based in Ann Arbor, Michigan (Decie, Kearns & West). The data’s annual reports are used by researchers, government agencies, market analysts, and consumers.

The Index uses surveys and econometric modeling to assess consumer satisfaction. assesses consumer satisfaction. It interviews about 80,000 U.S. citizens annually according to certain key descriptive characteristics that are used to assess overall contentment with the product or service. Citizens are selected by randomized telephone calls. This random digit-dial method ensures the most accurate sampling possible of the American population. Respondents are screened so that a diversity of goods are covered ranging from Federal services to durable and non-durable goods and services.

The data is assessed according to a causal / structural equation model, which tests for causality between the hypothesized variables (in this case, consumer expectations, perceived quality, overall quality, and so forth) and consumer satisfaction with the particular service, product, or industry. Each company or organization is accorded an index score on a scale of 0-100 and the score given reflects a weighted average of three satisfaction questions asked of the consumer.

The national index score is created by weighing the combinative score by industry and sector. This national score reflects American satisfaction with the goods and services produced by the country and can inform macroeconomists of the trend of market appeal and improving or declining satisfaction with particular American services.

The 3 questions that the score is based on are the following: 1. One’s overall satisfaction with the product; whether the product fulfilled one’s expectations; and comparison of performance of product to ideal resolution. Each of these questions is measured on a scale of 1-10. See Table 1 for a quantitative comparison of the product / service questions and scores used to measure results:

Table 1: The Three Questions asked about the Product / Service and their Rating

Product / Service Questions



Satisfaction with service

Very dissatisfied

Very satisfied

Whether fulfills expectations

Falls short of expectations

Exceeds expectations

How performance correlates to the ideal

Not close to the ideal

Very close to the ideal

Employing the mathematical means of each question, the national ASCI is then calculated according to a mathematical formula, before its results are published and released to the public each quarter year.

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Memo 2

You are a research analyst who works for the executive of a large public sector organization (you may choose the organization). Your supervisor has asked you to review current research on public sector customer satisfaction. Explain what Fountain (2001) means when she discusses the paradoxes of public sector satisfaction. What, if anything, should your supervisor learn from Fountain’s analysis?

Fountain (2001) shows my supervisor how to achieve a more genuine, more ethical and, hence, possibly more enduring level of customer satisfaction, at the paradoxical cost of losing the ACSI rate in popularity.

Qualities of service can often become confounded one with the other. Fountain (2001) gives three instance of this. In the first, the quality of the actual service may become obscured by the intangible treatment that the customer may receive from service transaction or encounter. In other words, qualities such as cordiality, genuineness, friendship, and the reverse may result in client rating quality of service according to the intangible treatment received.

Secondly, consumers receive the end product through service delivery employees. It is the behavior if these employees towards the consumer that affects the way the consumer rates product (regardless of actual quality). Consumers, in other words, come into contact with service delivery personnel rather than with personnel such as factory workers who are in far more immediate contact with the product or service. This observation is related to the first.

Thirdly, the consumer’s input affects his opinion of product. His mood, manner of input and conduct, accuracy and willingness to supply needed information (and so forth) determine the quality of the product or service received. As a case in point, a sullen client who distorts his medical history will likely receive inadequate and incorrect medical treatment leading his to criticize that particular medical service when approached by the ASCI. The evaluation may well be incorrect.

The customer’s satisfaction is, hence, highly subjective, and it would be difficult to base any objective analysis on his or her opinion. When related to the ASCI scale that uses the mathematical formula of measuring arithmetic difference between the quality of service received and the quality of service expected by the customer (the consumer’s expectations), the result is actually highly suspect since the consumer may likely have formulated his opinion under subjective conditions. Too many variables, such as his personal social skills, possible prejudice towards employees of service, misunderstanding, and so forth, can bias his opinion and the quality of service / product may, indeed, be diametrically converse to client’s estimation.

What services would do, and many endeavor mightily to do this, is to then strive to please the consumer. The paradox here is that integrity and quality may be lost in the process. By becoming overly consumer centered, the quality of service / products may decrease since consumers may actually desire it thus. An example here could be the case of great literature being lost since consumers may render that literature as violent, grotesque, or sex-ridden. They would, therefore, render an institute that teaches that literature as low on their scale of satisfaction leading to academic, and business reports (for instance) concluding that the institute falls short of public expectations. The paradox, then, is that instead of pleasing the consumer, as the ASCI intends to accomplish with its report, consumers may actually destroy service excellence and much-needed political change.

Conclusively, what I would recommend my supervisor to derive from this exchange is the importance of combining two characteristics when dealing with her organization: firstly, the endeavor to please and satisfy the client by taking his or her consideration into account, and closely listening to his needs; but this should be integrated with integrity, i.e. The pursuit of excellence and needed change that is unaffected by client’s desires. The two may be difficult to achieve and the manager may lose popularity that may be reflected in the ASCI ratings. The manager has to ultimately decide which value is more important to her. America needs integrity.

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