The rise has been slow but relatively steady. In 1998, the first year that Logistics Management published the results of the annual Quest for Quality survey, 81 carriers and service providers made our Readers' Choice list. The following years, 76 and 74 companies, respectively, were cited for service excellence. Last year, the number climbed to 84. But this year, ironically in the midst of an economic downturn, a whopping 96 carriers and contract distribution companies earned accolades as the best of the best.

Our 19th annual Quest for Quality survey results reflect responses from more than 3,000 readers who completed our questionnaires. Earlier this year, we mailed 10 separate questionnaires covering the different modes of service to 14,000 magazine readers, all of whom buy transportation or third-party services. (By way of explanation, the Quest for Quality survey, which is the largest customer satisfaction study in the transportation/logistics field, was begun in 1983 by Distribution magazine, one of our predecessor publications.)

As in the past, our shipper readers filled out questionnaires asking them to rank their carriers' performance in five key areas vital to logistics excellence: on-time performance, value, information technology, customer service, and equipment and operations. Third-party logistics service providers, however, were judged on criteria that were more appropriate to their operations: carrier selection and negotiation, order fulfillment, transportation/distribution, inventory management and logistics information systems.

The scores shown in the tables that accompany each of the following articles are weighted scores that measure customer satisfaction in various performance areas. In the simplest terms, higher scores mean higher levels of customer satisfaction. The weighting is determined by the importance that readers attach to specific attributes used for rating the carriers (based on a five-point scale with 5 being the highest ranking).

Because readers assign different degrees of importance to these attributes when selecting providers for different tasks, there's a specific attribute value developed for each service category. (See Figure 1.) For instance, shippers generally regard on-time performance as the most important attribute when it comes to determining service excellence. As a result, the on-time performance attribute's weighting, although different for each mode, generally exceeds 4.0, while the weighting for the information technology and equipment and operations categories rarely reaches 2.0. The weighting for value is generally around 3.7 or 3.8, while customer service comes in at around 3.0.

Survey participants evaluate their vendors' performance on each of the five attributes, grading them on a scale of one to three (1 = poor, 2 = average, 3 = outstanding). The scores are then averaged for each category and each vendor. The weighted score is the product of the average importance rating for attributes in a category multiplied by the average performance score for vendors.

The weighted scores for the various vendors are then totaled and the average weighted score for each category is calculated. Service providers receive the "Readers' Choice" designation when their total score meets or surpasses the average total weighted score for their category. However, vendors must receive a minimum number of reader responses to earn an award (much as a baseball batter must have a certain number of plate appearances to qualify as a league-leading hitter).

Besides rating carriers' performance in general, the Quest for Quality survey asks shippers to appraise the performance of their core carriers, providers with whom they have long-term partnerships or contractual relationships. We conduct this separate appraisal because it provides some insight into whether shippers feel they experience higher or lower levels of satisfaction in an established relationship.

In the past, shippers have generally bestowed higher quality ratings on their core carriers than they did on non-core carriers. Core carriers, on average, score at least two points higher than their counterparts. Interestingly, that wasn't the case this year in five categories. Users of all types of truckload services, whether dry freight, high-value goods, household goods, heavy haul or bulk, gave higher marks to their non-core carriers. In fact, there was almost a 10-point difference in the overall satisfaction score for bulk motor carriers (31.49) and the core rating (22.82). (See Figure 2.)

One explanation for this anomaly may be the low percentage of shippers using core carriers in those categories. Only 20 percent of the shippers rating bulk motor carriers reported using core carriers. That pattern of low core-carrier usage held true for the other truckload categories as well. Only 27 percent of the respondents to the industrial and heavy-haul carrier questionnaire used core carriers, 30 percent in the case of high-value goods carriers, 32 percent for dry-freight haulers, and 38 percent for household goods carriers.

In all other cases save one, more than 40 percent of the users of a particular mode employed core carriers. In general, where users report a high degree of use of core carriage, they report a correspondingly high degree of core satisfaction. Take the air express category, for instance. Seventy-four percent of respondents in that group used core carriers. Those core carriers earned a 36.97-percent satisfaction rating, roughly three points higher than the overall customer satisfaction rating of 33.31.

The one exception here was rail. Although 58 percent of the rail questionnaire's respondents said they used core carriers, the rail core satisfaction rating of 31.64 was only marginally higher than the overall customer satisfaction rating of 31.33. It should be noted that many rail shippers have little choice of carriers because they are limited to doing business with the carrier whose tracks run beside their warehouses.

In the past, railroads tended to have the lowest overall satisfaction score. This year, however, high-value goods received the lowest rating, with 30.85. Railroads came in second lowest, though, with a 31.33 rating.

As for the highest rating, it went to the surface package carriers, whose overall score came in at 34.57. The second-highest overall satisfaction score was earned by the LTL carriers in the Midwest and North Central region—34.47. The same Midwestern motor carrier group, by the way, also received the highest core satisfaction score—39.41.