Which is more important to customers: delivering the right product or service, or eliminating problems in that product or service?According to a working paper titled “The Impact of Reliability and Customizability on Customer Satisfaction for Goods Versus Services,” the answer depends on what the customer is buying. The authors, Michael D. Johnson of the University of Michigan's School of Business Administration and Lars Nilsson, a Ph.D. candidate at Linköping University in Sweden, discovered that although customer satisfaction depends on both meeting customers' needs and doing so in a trouble-free way, the relative importance of customization and reliability changes dramatically depending on whether the company is delivering goods or services.For service businesses, especially, it turns out that reliability (eliminating “things gone wrong”) is more important than customization (fitting customer needs perfectly). That seems to challenge the conventional wisdom that a service company's ability to customize its service to individuals is a primary driver of value, and it's a strong indicator that service businesses shouldn't abandon initiatives to improve internal processes as they strive to meet customer needs.Johnson and Nilsson studied five years of data (1994 through 1998) on 188 companies from the American Customer Satisfaction Index.
