What It Takes To Be A Winner

To determine the winners of the BusinessWeek Customer Service Champs, we first turned to J.D. Power & Associates, which measures customer satisfaction. Its research includes data on a range of industries such as airlines, hotels, and automakers. Because we were interested in measuring customer service, we used only results related to what customers think about a company's "processes" (its return policies or reservation procedures, for instance) and its "people" (their friendliness, say, or expertise levels). Therefore, our results may differ from J.D. Power's customer satisfaction rankings, which consider product quality, presentation, and price. We reserved the right to cut from our initial ranking companies about whom unfavorable information has come to light.

We began by aggregating the scores for each individual brand across the complete studies in J.D. Power's 2006 database. (A bank, for instance, might have separate studies that analyze a customer's branch, car loan, and mortgage experiences.) Only brands with at least 100 responses and with both "process" and "people" scores were considered.

We then eliminated industries that cater to niche markets, such as motorcycles, and about which consumers rarely make decisions based on service, such as homebuilders. To create a more nationally oriented list, we removed brands that did not have at least $1.5 billion in annual revenues. (If a brand's parent company is in a similar business, its annual revenues were measured instead.) To compare industries across standard measures, we used a consistent set of J.D. Power's studies in each industry and eliminated brands that did not appear on them all. Finally, in order to compare similar companies within a category, we removed dial-up-only Internet providers and hoteliers that were not in the upscale or luxury categories or did not have a significant U.S. presence.

To supplement the brands in J.D. Power's database, we also surveyed 3,000 BusinessWeek readers and asked them to nominate three companies they felt were best and three they felt were worst at providing customer service. More than 1,000 readers responded with 2,423 "votes" and 1,850 "complaints." For brands that received a high number of votes and a low number of complaints and were not part of J.D. Power's research, we created a Web-based questionnaire and surveyed at least 100 customers.

Finally, we aggregated both sets of data, combining the people and process scores to establish the "Service Score." The people score was weighted at 63% and the process score at 37%. (We used percentages that represented their average importance to determine J.D. Power's satisfaction scores.) Then, because we were comparing very different industries--booking a romantic weekend at the Four Seasons is a far cry from trying to dissect a monthly wireless bill--we gave credit for ranking high within an industry. Brands that ranked first in their category received 100 bonus points; those ranking second were awarded 50. We subtracted 50 points from each brand that fell below third place and 100 points from those that came in last in categories with at least five brands. We then translated the numerical scores for people and process into 10 letter grades.

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