Consistency (dependability ): value it more than speed. To achieve it, you need to remove variability of order cycle. Flexibility (agility) : responsiveness of order cycle. Transparency: you customers want perfection- a reality that led to the development of the “perfect order” concept. Transparent service can help your customers compensate when the unexpected happens . Modern technology such as bar codes, RFID tags, and satellite tracking makes real-time transparency feasible and affordable . Order transparency improves planning, execution, and evaluation. Protection against disruption (service recovery): because service failures are inevitable, you need to establish contingency plans to recover from disruptions. For those disruptions that do occur, having considered the “what-if” scenarios before the service failure occurs will help you recover more quickly and effectively. Some companies resolve service failures so successfully that customer satisfaction actually increases following the disruption. This reality is known as the “service recovery paradox” . Operational efficiency : to efficiently provide the service customers need. Customers expect to pay as little as possible. A simple two-step process to match service offerings to customer needs: 1) identify the relevant cost-service tradeoffs 2) run the numbers to assess the cost and benefits of service offerings. Methods for establishing a customer service strategy 1) Determine channel service levels based on knowledge of consumer reactions to stock-outs 2) Examine cost/revenue trade-offs 3) Use ABC Analysis for customers and products
4) Conduct a customer service audit Key accounts merit consistently outstanding service, while transactional relationships deserve fair, efficient service. Pareto’s Law (The 80-20 rule) 80% of your revenues are driven by your most important 20% of customers. Strategic key accounts (typically 5-10%) make up a huge share of sales, profits, and growth. They are classified as “A” customers and receive the most customized service. The other key accounts are labeled “B” customers and receive high levels of service. The remaining 80% (transactional) of customers are labeled “C” and receive high levels of standardized service. Applying Pareto’s law typically includes two steps 1) Classify companies by sale 2) Modify classification based on strategic issues (qualitative) Customer profitability analysis The goal of logistics customer service is to support profitable customer relationships.
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- Fall '14