Supply Chain Management Common Learning Block III Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.

13-2 Creating Successful Relationships Successful Businesses Rely on Customers Successful Links among Supply Chain Members: Customers’ Customer Suppliers’ Supplier Partnerships share both Rewards & Risks LO1

13-3 Creating Successful Relationships Not all partnerships are beneficial Firms should seek strategic partnerships to increase their competitive advantage Goal should be to build cohesion in the partnership Watch for partnerships that lead to poor world-class customer service experience LO1

13-4 Team Work Understand the goals of the organization Open Communication Excellent Listening Skills Mutual Accountability Diverse Skills Attitude of continuous improvement Influence the delivery of products and services LO2

13-5 Effective Communication with Customers Companies generate revenue from customers Customer satisfaction impacts profitability levels Profits lead to: Hiring of new staff Expansion LO3

13-6 Relationship Between Companies and Their Employees Excellent employer/employee relationships lead to high customer satisfaction levels Successful Customer Relationships require Full Communication within the supply chain for: Product makers/developers Stockers in the stores Customers who purchase the products LO4

13-7 Positive Communication Communication Occurs: Face-to-face / Over the phone / Through mail Positive Communication Includes Verbal & non-verbal communication Emphatic Responses / Active Listening / Opposing Opinions / Open Feedback Feedback determines customer satisfaction levels and leads to positive issue resolution LO5

13-8 Products and Service Knowledge Customer decision-making is influenced by employee knowledge of products and services Employee product knowledge creates opportunities for effective customer relationships. LO5

13-9 Customer Satisfaction Model Customer Service Model is the acknowledgement that different customers have different levels of expectations Levels of expectations can be based on: Word-of-mouth communications Personal Needs Past Experiences LO6

13-10 Gap – Customer Satisfaction Model Primary concern is the gap between what customers expect to receive and what they received When Management is not aware of customer expectations, then: Market research is incomplete or non-existent Lack of communication with customers LO7

13-11 Gap – Standards & Performance Internal standards must meet customer expectations Standard set for product or service performance must equate to what actually happens for customers LO7

13-12 Gap – Communication & Perception Standard – Knowing what customers expect requires building internal standards to meet those expectations. False Marketing – Gap between actual performance and what is communicated Perception – Gap between perception of products or services and the actual product or service. Customers are satisfied when their perception exceeds their expectations LO7

13-13 Customer Satisfaction Limitations Generalizing Customer Service relationship advantages over competitors might not be a good approach: Upper Management might think that satisfied customers equate to pleasure with suppliers Expectations might not have been exceeded Satisfied customers do not make loyal customers and might switch to a competitor Generalization leads to misinterpretation of needs and expectations as customers are unique LO8

13-14 Types of Customer Relationships Supply chain means managing the flow of product and information. Customers should be differentiated based on their needs and the supply chain should adapt to those needs B2B – Relationships between companies B2C – Relationships between company and customer LO8

13-15 Types of Customer Relationships Determined by the profits and revenues the relationship generates Smaller amount of customers generate high profit and revenue for firms (those customers will be treated with customer success approaches) Segmenting customers helps determine how much to invest in Supply Chain Mgmt. Strategize on Supply Chain Improvements Personal Needs Past Experiences LO6

13-16 Customer Relationship Management Strategy CRM (Customer Relationship Management) strategies helps develop different strategies to better serve a variety of customers Requires continuous improvement Large companies use different software as part of their CRM to collect data from customers LO8

13-17 Customer Relationship Management Strategy Conscious effort to increase profits while strengthening customer relationships CRM combines the efforts of Sales, Service, Support & Quality to provide customer service that delights customers Before, during, and after transactions, CRM builds relationships to create loyalty, identify new opportunities, and listen to the needs of all customers. LO6