Customer Service for Competitiveness

Customer service is a set of activities and programs designed and implemented by a business firm to make the buying experience more rewarding. These activities enhance the value of a product or service the customer gets from the seller. Customer service is the most important dimension of product/service offerings to the customer. Value-added customer service is leveraged to gain com­petitive advantage. Good customer service builds customer loyalty among the existing customers and generates positive word-of-mouth communication, which attracts new customers. In other words, customer service is the base for all customer relationship management (CRM) programs that many leading firms are implementing.

Customers base their evaluation of a service on their perceptions. These perceptions are affected by the actual service provided by the firm and the high degree of intangibility, which is sometimes very hard to accurately evaluate. Firms that are able to map these gaps accurately and try to bridge them with value-added service can succeed in enhancing the customer satisfaction level and remain competitive. The following are a few cues affecting customer perception of service quality:

  • Competence: The information provided by the firm through product brochures, manuals, web­sites, sales talk about the product, and the service offerings of the firm.
  • Reliability: Delivery of the product or services as promised in terms of place, time, and quality.
  • Responsiveness: Returning customer calls, e-mails, faxes, letters, and so forth on time and resolv­ing customer problems or complaints with speed during all three phases of transactions.
  • Transaction security: The confidentiality of customer information and transactions.
  • Trustworthiness: Built through evolving policies on product return, warranty and guarantee, and honouring commitments.
  • Access: This refers to the ease with which the customer will have access to information on products and services before placing an order, status of the order placed, and status of the product com­plaints, claims and damages in the post-sales phase.

These cues on customer perception of service quality stimulate satisfactory or unsatisfactory evalua­tions of the firm’s services. Hence, the firm needs to bridge service gaps (between perception and reality) to improve customer satisfaction with their services. These gaps may arise due to the following:

  • Communication—The actual service provided may be different from what is communicated through a promotional or advertising campaign.
  • Standards adopted—The service standards adopted may differ from the customer’s expectations.
  • Service delivery—The services provided may be different from the service standards of the firm.
  • Customer knowledge—The firm may fail to understand the customer’s perception of the service standard.

The firm’s aim should be to bridge these gaps to create a wider base of satisfied customers and to stimulate them for repeat purchases.

Logistics is a service function and has a large share in an organization’s success by delivering the product at the right place and at the right time. In logistics the customer is a place where the goods or services are delivered. For physical products, it may be a manufacturing plant, wholesaler, retailer, or end-user. For the service products it may be the point of sale of a service such as a hotel, bank or hospital. However, the focus here is customer service, irrespective of the ways, means, and methods being used to satisfy the customer. This approach requires marketing orientation to all the functional areas of the organization. Marketing is the central point of all business process. The objective of the marketing function is to identify the need of the customers and fulfil it at a price by generating profitable transactions. Logistics helps in creating time and place utility of the product that satisfies the customer’s need, which has both time and place as dimensions. In today’s competitive markets, the competitiveness of a firm is judged by how efficiently and effectively it manages the time and place dimensions of customer service to avail of the opportunity and create new opportunities for repeat sales to the same customers by delivering superior service. Hence, logistics competency is critical to customer service planning and needs to be developed as a core competency for sustainable competitive advantage not only for growth but also for survival.

Source: Sople V.V (2013), Logistics Management, Pearson Education India; Third edition.

One thought on “Customer Service for Competitiveness

  1. Sheryll Rushman says:

    It¦s really a great and useful piece of information. I am satisfied that you just shared this useful information with us. Please keep us informed like this. Thanks for sharing.

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