ACSI releases annual report on federal servicesANN ARBOR—Believe it or not, filing taxes has become a more favorable experience for Americans than flying on commercial airlines, according to the American Customer Satisfaction Index (ACSI) released today.

In its annual report on how satisfied Americans are with federal government agencies, the ACSI shows that the score for the Internal Revenue Service has improved 11 percent from last year and 22 percent since 1999. While still relatively low, the IRS score of 62 (out of a possible 100) is still higher than the airlines’ recent score of 61 (as measured by the ACSI in the first quarter of this year—well before the Sept. 11 attacks and the subsequent impact on air travel).

“These would be noteworthy improvements for any organization in any industry, but they are even more notable in view of the ‘business’ of the IRS,” says Claes Fornell, professor of business and director of the University of Michigan Business School‘s National Quality Research Center, which compiles and analyzes the ACSI data. “It is difficult to imagine a society in which people would be more satisfied with tax collection than with competing companies from which purchases are neither mandatory nor without alternatives of choice.”

Fornell says that high satisfaction among individuals filing tax returns electronically—who largely view the process as simple and efficient and who receive tax refunds faster—is a major reason for the IRS’s better ACSI score.

“The IRS has adopted some of the private sector’s techniques, such as actively listening to their customers, then changing processes, reallocating resources and focusing technology to enhance the overall tax-filing experience,” says Jack West, past president of the American Society for Quality, a partner in producing the ACSI.

While the IRS showed the biggest improvement among the government agencies measured by the ACSI, almost all agencies included in both this year’s and last year’s reports improved in customer satisfaction. The exceptions were the Food & Drug Administration (FDA), which showed no change in its score of 68, and the Social Security Administration (SSA), which slipped from 84 to 82—still among the highest agency scores.

The overall ACSI score for government agencies is up from 68.6 a year ago to a current mark of 71, a 3.5 percent increase. Federal services pertaining to benefits (e.g., SSA, Veterans Health Administration), public information (e.g., Centers for Disease Control and Prevention, Student Financial Assistance, Bureau of Labor Statistics), and recreational land use (e.g., Fish & Wildlife Service, Army Corps of Engineers) fared well, with scores ranging from the 70s to the 90s, for the most part.

Regulatory agencies (e.g., FDA, Occupational Safety & Health Administration, Federal Aviation Administration), in general, scored in the 50s and 60s.

“These agencies face a more complicated challenge as they have both an enforcement task, as well as a service mission,” Fornell says. “The latter can legitimately be subjected to feedback in the form of customer satisfaction, but the enforcement task is more intricate and issues other than individual satisfaction come into play.”

Overall, Fornell says that providing high levels of satisfaction with government services is a way to increase public trust, which is one reason the ACSI in the public sector is important.

“Contrary to the private sector, the dissatisfied recipient of government services can rarely punish a faltering service provider by taking his or her business elsewhere or by demanding a lower price,” he says. “There is no market feedback that forces the service provider to improve or signals what to improve. In this sense, the ACSI is a substitute for market forces.

“Similarly, as government expenditure as a percentage of national income declines, it becomes essential to allocate public resources in such a way that better service can be provided to a growing number of citizens. Measures such as the ACSI make it feasible to better balance cost with quality of service. Indeed, the service improvements realized by the IRS from electronic filing is but one example of this.”

Finally, Fornell says that although the impact of the Sept. 11 terrorist attacks on customer satisfaction with federal agencies was not measured directly, it is possible that government services may have benefited from “greater effort and understanding from both service providers and recipients, as the country unites against a common foe.”

The ACSI is a national economic indicator of customer evaluations of the quality of goods and services available to household consumers in the United States. It is updated each quarter with new measures for different sectors of the economy replacing data from the prior year.

In December of each year, the ACSI issues a report on satisfaction of recipients of services from the federal government. Agency participation is voluntary. This year, 53 different customer groups served by 39 agencies were measured.

The index is produced by a partnership of the U-M Business School, American Society for Quality and CFI Group, and supported in part by Market Strategies Inc., a major corporate sponsor. The Federal Consulting Group, a franchise within the Department of the Treasury, is the executive agent for the ACSI and the federal government.

Agency scores can be found on the U-M Business School’s Web site (www.bus.umich.edu/acsi) and on ASQ’s Web site (www.asq.org). The Web site for CFI Group is www.cfigroup.com.

ACSI Scores for Federal Government 2001

ACSI Overall Federal Government Score with Historical Scores of Agencies Measured 1999-2001

American Customer Satisfaction IndexClaes FornellAmerican Society for Qualitywww.bus.umich.edu/acsiACSI Scores for Federal Government 2001ACSI Overall Federal Government Score with Historical Scores of Agencies Measured 1999-2001