Which incremental innovations should we offer? Comparing importance–performance analysis with improvement-gaps analysis

Abstract

This paper compares how two different versions of Importance-performance analysis (IPA) and Improvement-gaps analysis (IGA), which is a fusion of the Kano model with IPA, assess the possible impact of incremental innovations on customer satisfaction. A total of 303 users of a health diagnosis service answered questions regarding 21 service attributes, of which three were incremental innovations at the time of research. The results confirm that diagonal IPA overcomes the limitations of the original IPA due to the high correlation of the stated importance with customer satisfaction. However, it also shows that diagonal IPA and traditional IPA are unable to identify which incremental innovations should/could be offered. The present research shows that IGA overcomes not only the problems of original IPA, but also those of both IPA methods regarding the identification of the possible impact of incremental innovations on customer satisfaction. It is a simple method to be used by managers and practitioners. Furthermore, this paper shows that using the expected dissatisfaction of customers represents a different way to evaluate attributes' importance.