LO9-1 Describe how operations helps establish and meet commitments to customers
LO9-2 Define elements and measurement of customer service
LO9-3 Describe model of customer satisfaction
LO9-4 Explain importance of commitment to customer success
LO9-5 Describe technologies and relationships
LO9-6 Describe customer segmentation
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Copyright © 2014 McGraw-Hill Higher Education. All rights reserved.CHAPTER 9Customer Service ManagementMcGraw-Hill/IrwinLearning ObjectivesLO9-1 Describe how operations helps establish and meet commitments to customersLO9-2 Define elements and measurement of customer serviceLO9-3 Describe model of customer satisfactionLO9-4 Explain importance of commitment to customer successLO9-5 Describe technologies and relationshipsLO9-6 Describe customer segmentation 9–2Customer Management9–3Intense focus on understanding and providing customers with products/service they desireLO9-1Customer Service9–4Product Availability: inventory available when and where desired by customer Units Lines OrdersOrders Units Lines Delivered Delivered Delivered1,000 20,000 5,000 19,500 4,800 910Unit Fill Rate: % of ordered units delivered = 19,500/20,000 = 97.5%Line Fill Rate: order lines filled in total = 4,800/5,000 = 96%Order Fill Rate: orders shipped complete = 910/1000 = 91%Example 9-1LO9-2Lead Time Performance9–5Lead Time: time between start and end of an activity Design: conceptualize, design & testOrder: place and schedule for productionProcurement: source and arriveProduction: start to end of productionDelivery: warehousing & transportation to customerLO9-2Service Reliability: The Perfect Order9–6Service Reliability: performance of all order related activities error-freeIf a firm has 97% reliability on four attributes, the probability of a perfect order is .97x.97x.97x.97 = 88.5%The Perfect Order: delivered without failure in any order attributeCompleteOn timeDamage freeDocumentation correctExample 9-2LO9-2Limitations of Customer Service9–7Customer service involves specifying the firm’s commitment to availability, operational performance and reliability Order winners, qualifiers and losers Meeting or beating competitor levels Link to competitive strategy Link performance to customer satisfactionLO9-2Customer Satisfaction – Part I9–8Customer Satisfaction: meeting or exceeding customer expectations, including:Reliability: performance as promisedResponsiveness: prompt reply and resolutionAccess: easy to use communication channelsCommunication: proactive order notificationsCredibility: believable and honestLO9-3Customer Satisfaction – Part II9–9Customer Satisfaction: meeting or exceeding customer expectationsIt includes:Security: low risk and confidential Courtesy: polite, friendly and respectfulCompetence: able to performTangibles: physical appearanceKnowing the customer: responsive to unique customer needsLO9-3Customer Satisfaction Model GapsGaps occur at differences between:Knowledge: understanding of customer needsStandards: internal performance and customer expectationsPerformance: standard and actual performanceCommunication: actual performance and communications about performancePerception: customer’s view of performance and actual performanceSatisfaction: customer’s perceptions and expectations of performance9–10LO9-3Customer SuccessCustomer success requires a supplier to:Have a long-term relationship focusGain comprehensive knowledge of customer needsConsider the customer’s customersAdapt manufacturing and distribution9–11LO9-4Customer Relationship ManagementCustomer Relationship Management (CRM): technology-enabled data gathering about customers to develop strategic relationships9–12LO9-5Customer Management and Relationship Strategy 9–13LO9-6Customer Management Summary9–14Basic customer service includes availability, lead-time performance and service reliabilityOrder-to-Delivery lead time is importantSatisfaction is achieved by meeting or exceeding customer expectationsCustomer success focuses on strategic objectives and individual customer requirementsCRM involved data gathering and responding to the needs of specific customersMultiple types of relationships and levels of commitment
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