How Dave Power Became ‘Voice of the Customer’

James David Power III will be inducted into the Automotive Hall of Fame in Dearborn, MI, on July 24.

It’s a fitting tribute to the man who, perhaps more than anyone else, forced automakers globally to raise their quality levels, thanks to his deep-dive independent research measuring consumer satisfaction – or lack of it – about the products they buy and drive.

Today, at 83, he’s best known for his name on the widely publicized J.D. Power Awards resulting from consumer surveys covering everything from cars to computers, cell phones, airlines, real estate, recreational vehicles, cable/satellite TV and more. The company tracks 12 industries in all.

Power founded his company in 1968. He sold it to McGraw-Hill in 2005 and departed in 2009. But even as an octogenarian he remains active in automotive affairs, education and philanthropy.

Power details his life story in his autobiography, Power, written with Sarah Morgans and Bill Thorness (362 pages, Fenwick Publishing Group, www.fenwickpublishing.com).

Power, who grew up in Worcester, MA, has had a long history in automotive affairs. While earning his MBA at the University of Pennsylvania’s Wharton School of Business he worked with other students in analyzing American Motors, and early on worked for Ford and Buick.

In launching his firm, Power came up with a unique idea: Talk directly to customers about their problems, likes and complaints. Automakers traditionally relied upon in-house surveys, which he felt could be skewed based on what management wanted to hear, or were limited to input from gun-for-hire marketing contractors and focus groups.

Power’s forte was independence and conducting large-scale surveys to get at what consumers actually think about what they buy. Eventually, he syndicated his industry wide studies, kept the details private to subscribers but publicized basic findings, including rankings by brand, which was not always received kindly among those companies that finished poorly. Conversely, the “winners” couldn’t wait to brag.

Thus was born the J.D. Power Awards, with fees charged to those wishing to ballyhoo their rankings in advertising. It was formed as a separate entity to avoid a conflict of interest because JDP also was obviously collecting revenues from clients for the studies.

Power  tracks the company from the earliest days to the present. It’s filled with anecdotes such as his self-financed first small mail survey in Southern California put together with his late wife, Julie, on their kitchen table (which survives). They attached quarters to elicit responses.

His first major breakthrough was winning a contract from Toyota, which in 1968 was just getting started in the U.S. market.

Other Japanese automakers soon joined, including Mazda, which was riding a wave of popularity with its Wankel rotary engine. JDP research showed buyers were having trouble with engine failures caused by a faulty O-ring. That produced national headlines, while simultaneously establishing JDP’s credibility as a firm that did not shy away from controversy.

Power’s close early association with Japanese automakers caused a perception of bias in Detroit circles that took years to overcome, especially because the Japanese usually finished ahead of Detroit Three brands in publicized results for the entire world to see.

Similarly, Power became an idol of car dealers who historically have been at odds with the “factory” over any number of issues. Long an advocate of streamlining the often chaotic and costly way of distributing vehicles, to him the dealer connection was a natural progression of his thinking.

His autobiography is filled mostly with ups but with a few downs as well. It is not always easy to follow the chronology of events, and the narrative sometimes is a bit redundant.

In a WardsAuto interview, Power says he purposely chose an editor, writer and publisher with no prior involvement in the auto industry. “It was designed to be as far away from other car books as possible. I wanted it to be for students as well. I tried to point out it’s how you treat people that’s important,” he says.

Power’s gentlemanly demeanor helped win over critics. “We didn’t tell (clients) what they did wrong but what to do right,” he says. “I don’t think we showed bias; the research itself set the tone.”

Under his leadership, J.D. Power and Associates literally sliced and diced nearly every aspect of vehicle ownership, starting with its Customer Satisfaction Survey in 1981.

Vehicle performance and dependability ratings were followed by separate ratings for customer retention (loyalty), initial quality and used-vehicle satisfaction. Under McGraw-Hill, a Navigation Usage and Satisfaction Survey has been added.

What’s his advice for marketing folks? “Believe in yourselves and don’t take any shortcuts. Persistence pays off,” he says.

And what was his recipe for success? “We talked to real customers, followed up with phone calls and they told us what they wanted to tell the manufacturers.”

That clearly wasn’t always what some automakers wanted to hear, but Power is widely credited with the fact that vehicle quality is at near-parity today as automakers have responded en masse to “the voice of the customer,” as writ large by Dave Power.