All NSW public sector departments reported carrying out some initiatives consistent with at least one of the four customer service improvement principles in 2006-07. The level of activity, when measured in terms of the expenditure, varied significantly between departments.

Only five departments reported they funded and carried out initiatives in 2006-07 consistent with each of the four customer service improvement principles. They were the Australian Museum, Board of Studies, Newcastle Ports, NSW Police Force and Sydney Olympic Park Authority.

An index has been developed to indicate the extent to which all NSW government departments are implementing the four customer service improvement principles – customer feedback, re-design services, customise services, and support frontline employees.

The index is a weighted average of NSW public sector departments that have completed funded initiatives for each of the four S8 customer satisfaction principles. For example, if every department completed a funded customer satisfaction improvement initiative consistent with each of the four principles then the S8 Index would have a score of 100%.

The data from this Baseline Report show that the S8 Index for 2006-07 was 23%. This score will increase as departments implement initiatives to improve customer satisfaction with Government services.

There are statistically significant differences between small, medium and large departments in terms of their nature of their customer service improvement activities and the amount of human and financial resources allocated to the activity.

This suggests a certain threshold in department size is needed before departments can allocate employees and funding to customer service improvement mechanisms and operations.

Secondly the data suggest that when customer service mechanisms are established and operating, economies of scale make it easier for large departments to resource customer service improvement.

The implication of these findings is that innovative approaches to establish and operate customer service mechanisms are needed for small departments: for example, where it is not financially viable for a small individual department to fund a customer satisfaction survey, it could enter into an “add-on” arrangement with a large department (where the large department carrying out its own customer satisfaction survey would include some additional survey questions on behalf of the small department) or establish a “cluster” arrangement (where a number of small department combined their limited resources to fund a joint customer satisfaction survey).

The differences between small, medium and large departments also suggest a “one-size-fits-all” approach to customer service improvement is inappropriate, and customer service improvement strategies need to be tailored to the circumstances of departments.