Purpose – The purpose of this paper is to contribute to the literature on customer orientation by developing and empirically testing a model that attempts to explain the elements that constitute customer orientation and that, in turn, influence customer satisfaction. In particular, this study focuses on how service firms design, collect, analyse and use customer-satisfaction data to improve service performance. This study has the following three research objectives: to understand the process and, as a consequence, the phases of customer orientation; to investigate the relationships between the different phases of customer orientation and customer satisfaction; and to examine activities in the different phases of customer orientation that result in higher customer satisfaction. Design/methodology/approach – This study, combining quantitative and qualitative research, is based on a cross-sectional survey of 320 service firms and a multiple case study of 20 organisational units at a large service firm in the European telecom industry. Findings – The results show that customer orientation consists of a process that includes three phases: strategy, measurement and analysis and implementation. Contrary to previous research, implementation has the strongest influence on customer satisfaction. In turn, customer satisfaction influences financial results. In-depth interviews with managers provided insights into the specific activities that are key for turning customer-satisfaction measurements into action. Originality/value – This research contributes to the literature on customer orientation by developing and empirically testing a model that attempts to explain what constitutes customer orientation and, in turn, influences customer satisfaction and financial results. Given the large amount of research on customer satisfaction, studies on how service firms collect and use customer-satisfaction data in practice are scarce.