STRATEGIC LOGISTICS MANAGEMENT AYSU GÖÇER LOG 404

LOGISTICS CUSTOMER SERVICE STRATEGY an activity or function to be managed such as order processing or handling of customer complaints, actual performance on particular parameters, such as ability to ship complete orders for 98 percent of orders received within a 24-hour period, part of an overall corporate philosophy, rather than simply an activity or performance measures.

LOGISTICS CUSTOMER SERVICE STRATEGY Customer service is often confused with the concept of customer satisfaction Customer Satisfaction represents the customer’s overall assessment of all elements of the marketing mix: Product, Price, Promotion, and Place

LOGISTICS CUSTOMER SERVICE STRATEGY Customer service is a process for providing significant value added benefits to the supply chain in a cost- effective way.

LOGISTICS CUSTOMER SERVICE STRATEGY Logistics Customer Service A key area for creating customer value Creates value, loyalty and satisfaction through supply chain activities "Seven Rs“: company's ability to deliver the right amount of the right product at the right place at the right time in the right condition at the right price with the right information

LOGISTICS CUSTOMER SERVICE STRATEGY Customer Service MARKETING SIDE LOGISTICS SIDE

LOGISTICS CUSTOMER SERVICE STRATEGY Customer Service

LOGISTICS CUSTOMER SERVICE STRATEGY Customer Service Classifications pre-transaction elements Written statement of customer service policy Customers informed with a written statement of policy Organization structure System flexibility Management services

LOGISTICS CUSTOMER SERVICE STRATEGY Customer Service Classifications transaction elements stock out level order information availability system accuracy consistency of order cycle special handling of shipments transshipments order convenience product substitution

LOGISTICS CUSTOMER SERVICE STRATEGY Customer Service Classifications post-transaction elements installation warranty, repairs, service parts, product tracking customer complaints-claims returns product replacement

LOGISTICS CUSTOMER SERVICE STRATEGY Logistics Customer Service Customer service in B2B Customer service in B2C

LOGISTICS CUSTOMER SERVICE STRATEGY PERCEPTION & CUSTOMER SERVICE Customer Service as a key to understand a customer and his perceptions It doesn’t matter what a supplier does, instead what customers think the supplier does in the area of customer service matters

LOGISTICS CUSTOMER SERVICE STRATEGY

1. Market information gap: seller’s incomplete or inaccurate knowledge of customers’ service expectations. 2. Service standards gap: seller’s failure to translate accurately customers’ service expectations into specifications or guidelines for company personnel. 3. Service performance gap: lack of appropriate internal support systems (e.g. recruitment, training, technology, compensation) that enable company personnel to deliver to service standards. 4. Internal communication gap: inconsistencies between what customers are told the service will be like and the actual service performance (e.g. due to lack of internal communication between the service “promisers” such as salespeople) and service providers (such as after-sales service representatives)).

LOGISTICS CUSTOMER SERVICE STRATEGY SERVICE QUALITY an attempt to understand customer satisfaction from the perspective of the differences between customer perceptions and actual customer service on various attributes Perceived service quality is defined as the gap between expectations and perceptions (Parasuraman, Zeithaml, and Berry 1988)

LOGISTICS CUSTOMER SERVICE STRATEGY SERVQUAL Parasuraman et al. conducted empirical studies in several sectors to develop and refine SERVQUAL, a multiple-item instrument to quantify the service expectation perception gap along five generic dimensions: (1) Reliability: ability to perform the promised service dependably and accurately. (2) Responsiveness: willingness to help customers and provide prompt service. (3) Assurance: knowledge and courtesy of employees and their ability to inspire trust and confidence. (4) Empathy: caring, individualized attention the firm provides its customers. (5) Tangibles: appearance of physical facilities, equipment, personnel, and communication materials.

LOGISTICS CUSTOMER SERVICE STRATEGY LOGISTICS SERVICE QUALITY (LSQ) Researchers have begun to examine whether the service quality model can be used to measure logistics service. They have modified the original service quality by developing logistics attributes that fit into the previously customer-defined dimensions and identifying additional gaps that could be applied to the logistics service context.

LOGISTICS CUSTOMER SERVICE STRATEGY LOGISTICS SERVICE QUALITY (LSQ)

LOGISTICS CUSTOMER SERVICE STRATEGY HOW TO MEASURE CUSTOMER SERVICE ???

LOGISTICS CUSTOMER SERVICE STRATEGY Customer service can be measured in a number of ways. One can compare service levels against a norm, measure perceptions such as importance and satisfaction or measure utility. HOW TO MEASURE CUSTOMER SERVICE ???

LOGISTICS CUSTOMER SERVICE STRATEGY SERVICE LEVEL Service level is a limited measure of customer service because one can use only services about which management has formulated numerical policies or goals. Service levels are unique to individual firms and product lines of each firm. Very few firms have formulated specific, quantifiable objectives for handling returns at the retail level. (to pick up all damaged goods within five days, or to issue credit for returned goods within 20 days.) HOW TO MEASURE CUSTOMER SERVICE ???

LOGISTICS CUSTOMER SERVICE STRATEGY PERCEPTUAL MEASURES Importance and satisfaction measures are among the perceptual measures. (1)Data on perceptions contain the personal biases of the respondents. Thus, customers may tend to underrate their satisfaction. (2) There is no tested model to measure how much of which services are required by a given customer or group of customers. (3) There have been few or no studies of the stability of perceptions across respondents or over time. HOW TO MEASURE CUSTOMER SERVICE ???

LOGISTICS CUSTOMER SERVICE STRATEGY “How important service element is order cycle time?“ Standard order cycle time in the electrical equipment wholesale business is 2 days. Positive question: How valuable for your own operations or customer service would a 24 h order cycle time be?(Grades from 1 - not valuable to 5 - very valuable). Negative question: How disadvantageous for your own operations or customer service would a 3-day order cycle time be? (Grades from 1 - not disadvantageous to 5 - very disadvantageous). HOW TO MEASURE CUSTOMER SERVICE ???

LOGISTICS CUSTOMER SERVICE STRATEGY UTILITY Utility measures allow a manager to evaluate the tradeoffs between several customer services even when the services are expressed in different units (such as dollars, time or hours). The common unit of analysis is “utility”, although it is often transformed into dollars. HOW TO MEASURE CUSTOMER SERVICE ???