Customer Service Strategy


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Customer Service Strategy

  1. 1.  Customer service Is the service or care that aconsumer receives before, duringand after a purchase. Its one ofthe factors that come in to playwhen a consumer is determiningbuying value, the other is thequality of the product or servicethat is being offered.
  2. 2.  Determine the most important service attributes formeeting and exceeding customers’ expectations. Determine the most important service attributes onwhich competitors are most vulnerable. Determine existing and potential service capabilities ofthe company Develop a service strategy that addresses important,enduring customer needs, exploits competitorvulnerabilities and fits the company’s capabilities andpotential.
  3. 3. Differentiation strategy Is an integrated setof action designed toproduce or deliver goodsor services that customersperceive as being differentin ways that are importantto them.
  4. 4. Strategic Customer Satisfaction Management Internal External Customer Customer Exhibit 5-1: Customer satisfaction Framework Customer Satisfaction need not to be limited to theexternal customers or those final buyers of the company’sproducts or services. Top Management must consider thebigger picture –that the customer is the benefactor of one’sproduct or service.
  5. 5. 1. Market Segmentation > Different groups of customers have different expectations, marketers must apply , must apply market segmentation to choose the specific type of customers or groups of customers that they can serve competently. 2. Leadership > Leadership is critical as decides on what kind of corporate vision and culture it wants.3. Feedback and Reward system > Customers Satisfaction measurement can be qualified.
  6. 6. 3 Groups of constituents to satisfy in order to qualify ashaving superior service quality. These are External Group,Customers & Internal Staff1. External Groups > Corporate image studies are conducted not only to determine the perception of specific community groups such as Stockholders, Financial Institutions, and Option Leaders towards the Company.
  7. 7. Exhibit 5-2: Awareness-Image Relationship% Awareness 100 Leadership Image Deficit 50 Awareness Deficit 0 Image 50 100 Rating Competitive Weakness >A high awareness level and a high image rating are best as they connote leadership position in the mind of consumer. On the other extreme, a low awareness level and a low image rating need correction. When an imbalance occurs, such as when awareness is a lot higher than image (or vice versa), improvement is needed.
  8. 8. Exhibit 5-3: Relative Importance Criteria Affecting Image High Importance FOCUS MAINTAIN Low High Rating Rating LOW OVERKILL? PRIORITY Low Importance >Efforts in improving the company’s image as well asany sift in perceptions about competitors are tracked toevaluate improvement and assess the relative standing ofthe company in the marketplace using the same grid as inexhibit 5-2.
  9. 9. > Critical issues are specific, highlyannoying incidents, which create customerdissatisfaction. > The improvement in customer satisfaction will increase customer retention and improve company’s profitability year after year.
  10. 10. DAMAGE IMPACT Low High POSIBLE COST SAVINGS LEVERAGE OPPORTUNITY OPPORTUNITY High X X Investment Consolidated Information Statements X Staff Responsiveness X Appearance Low CRITICAL MONITOR X Self- IMPROVEMENT SITUATION esteem REQUIRED Exhibit 5-4: MBL Priority Action Indicator > The critical issue to improved are those with high damageimpact to the company with low existing deliveryperformance versus customer expectation.
  11. 11. Exhibit 5-5: Critical Elements Monitor Example: Office Automation Supplier 350Critical a. InsufficientElement 300 customerIncidence contact 250 b. Difficulty to 200 contact service 150 department 100 c. Frequent maintenance 50 required 0 QUALITY IMPROVEMENT IMPLEMENTED 1 2 3 4 1 Quarter Time > As quality improvement programs are implemented, the arrows point to a downward trend indicating service improvement due to decreasing critical element incidence
  12. 12. Degree of Satisfaction > Their satisfactionand motivation are Low Highdetermined and theelements with highestimpact on productivity High Indirect Primary Mention Motivators Motivatorsand customer servicesare measured against Employeethe company’s Needsperformance. Secondary Selective Low Mention Motivators Motivators Exhibit 5-6: Staff Motivation Impact > The Primary Motivators for employees are those they frequently mention as their needs with expressed hope for a high degree of satisfaction.
  13. 13. > Secondary Motivators have lower degree of satisfaction and are frequently mentioned as a need. Degree of Satisfaction Low High High X Casual X Staff Wear on Provident Mention Weak ends FundEmployeeNeeds X Performance X Reward Schemes Low Alternate X Mention 5-1/2 day week Modern Uniform Exhibit 5-7: Example of staff Motivation Impact > The expectations for service Quality attributes such as politeness,and initiative which are rated as important by the customers must beknown and monitored with gasps signaling a possible need for stafftraining or re-orientation.
  14. 14. > An internal customer can be a co-worker, another department, or adistributor who depends upon us toprovide products or services which inturn are utilized to create a deliverablefor the external customer.
  15. 15. Buyer Process Seller Process A. Pre-Transaction1. Information Search 1. Marketing 2. And Sales2. Evaluate B. Transaction3. Purchase 3. Order processing4. Take Possession 4. Delivery5. Payment 5. Billing & Collection C. Post-Transaction6. Usage 6. After Sales Service Exhibit 5-8: Customer Satisfaction Guide Matching Buyer And Seller Process > Customer service can be expanded into three parts to comprise a full cycle instead of limiting it to the usual customer complaint, inquiry or claim. The 3 parts are: Pre-Transaction, Transaction and Post Transaction.
  16. 16. Exhibit 5-9: Expanded Customer Service Activities Pre- Transaction Training Post- Transaction @ (b)MAKETING AND SALES ORDER PROCESSING AFTER SALES SERVICE Organization Warranties Order entry Forecasting Parts & Services In stocks Inventory Management Customer Inquiries/ Quality Assurance Distribution points Complaints, Claims DELIVERY @ On Time Product condition upon approval Product Installation/ Manual Understanding Manual BILLING & COLLECTION Accuracy, Promptness, Courteous (b)
  17. 17. Marketing & Sales > Structure must come after strategy and not the otherway around as practiced by most companies. The firm’spolicies must be marketing oriented and not self-oriented. Order Processing > The entry of an order must be accurate and prompt considering the firm’s many internal needs for data gathering and analysis.Delivery > The now famous free delivery of food from fastfood stalls and restaurants are changing consumerdining habits.
  18. 18. A Note on Product Manuals > Most product manuals of technical products are not user friendly. Billing & Collection > A sale is not a sale until collected.After Sales Service > Customer service is most often limited to after-sales service.
  19. 19. Exhibit 5-10: Customer Service Improvement Cycle1. Identify room for improvement2. Describe the Customer’s need3. Prepare Service standards4. Test Standard if realistic5. Modify and adopt6. Monitor and improve
  20. 20. Exhibit 5-10: Customer Service Improvement Cycle1. Identify room for improvement > Nobody would make an effort to improve unless they realize that something is wrong.2. Describe the customer’s need > The hospital could make a simple telephone survey to ask the main companion of their patients how many minutes they be willing to spend in the casher’s office without feeling offended.3. Prepare service standards > Having defined customer’s need for quick processing of payment, systems must be reviewed and bottlenecks identified.
  21. 21. Exhibit 5-10: Customer Service Improvement Cycle4. Test Standards if realistic > The supervisor of the cashier can then test whether the 2 minutes waiting time as expected by customers can be done.5. Modify and Adopt > less ambitious goal such as 4-minutes be used as a transition goal to the final 2-minutes waiting time goal.6. Monitor and Improve > Periodic audit of standards must be done.
  22. 22. >The marketingtraining specialist,Mansmith and fielders,instituted a unconditionalmoney back warranty fortheir public seminars since1990, the only company todo so.
  23. 23. >Customers may bedisappoint once and they maynot give the company anotheropportunity to fail. Marketersmust, therefore, be happy thatcustomers are complainingabout their shortcomings , asthis will allow them theopportunity to rectify theirerror instead of not patronizingthem again.
  24. 24. >Customers SatisfactionSurveys- The survey is known for itsflexibility and wide variety of uses.Ranging from identifying qualitystrengths and weakness to trackingcustomers perceptions. >Quality Improvement Experiments- Unlike the survey, it is possible to make fairly strong casual inference if the experiment is properly conducted.
  25. 25. Critical Incidents- Respondents are askedto describe in story like fashion memorableevents, which would have affected theirsatisfaction or dissatisfaction . Problem Analysis- In general, such analysis involves effort to develop a list of problems and to evaluate the impact of problem on customers satisfaction.Conjoint Measurement- This can be useto align performance standards withcustomer expectations and to evaluate qualitybefore they are introduced.
  26. 26. >Customer service mustnot be superficial. A smilecampaign teachingsalesladies to always smile isgood but what is moreimportant is whether or notbehind those smiles, thesalesladies are capable ofanswering customer’squestions.
  27. 27. 1. Companies with parking space, instead of serving the space closest the company’s gate for the president of the company, why not reserve it for the customer. 2. For hotels, they can offer a money- back warranty if a cockroach is found in the hotel room of the customer.
  28. 28. 3. For school, customer-orientedadministrators can open more booths thatwill shorten lines during enrolment. Theycan also ensure that the education theyprovide students are relevant to theindustry by regularly consulting on schoolprograms. 4. For auto repair shops, automatically checking brake fluid, oil, water, batteries, clocks, ensuring a clean car even if customers didn’t ask for it may do wonders.
  29. 29. 5. For airlines, installing a video station inairports to record customer’s complaintsand suggestion may immediately help themcorrect the indifferent attitude of some oftheir staff. 6.For photocopiers, why not print a few dozen resume for job applicants.
  30. 30. 7. For business law firms,distributing a booklet on how to getstarted in business outlining how toregister, how to name your companyproperly and tips on how yourbusiness can survive can be given forfree. 8. For telecommunication companies like PLDT, offering free telemarketing seminars year round may improve their customer relations.
  31. 31. Customer service is a requirement in anycompetitive business. By developing a strategy to makecustomer service a differentiator, it can become acompetitive advantage in business. Using customersatisfaction surveys and focusing top customercomplaints and what causes biggest damage tocustomers, improvement projects or training can bedeveloped to reduce complaints and increase customersatisfaction. Looking at every step of customerengagement, from pre-transaction, to transaction andpost-transaction steps, careful attention to service andquality will help retain customers