Customer Accommodation

89
Customer Accommodation

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Customer Accommodation. Customer Service: Where Logistics and Marketing Meet. Customer service objectives dictate logistics design. Customer service: a process for providing significant value-added benefits to the supply chain in a cost-effective way. - PowerPoint PPT Presentation

Transcript of Customer Accommodation

Page 1: Customer Accommodation

Customer Accommodation

Page 2: Customer Accommodation

Customer Service: Where Logistics and Marketing Meet

• Customer service objectives dictate logistics design.

• Customer service: a process for providing significant value-added benefits to the supply chain in a cost-effective way.

Page 3: Customer Accommodation

Customer Service: Where Logistics and Marketing Meet

• Customer service objectives dictate logistics design.

• Customer service: a process for providing significant value-added benefits to the supply chain in a cost-effective way.

Page 4: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Stock and Lambert “Strategic Logistics Management” (2001)

Page 5: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Written policy

Stock and Lambert “Strategic Logistics Management” (2001)

Page 6: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Written Policy--Based on customer needs.

Page 7: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Written Policy--Based on customer needs.--Define Standards.

Page 8: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Written Policy--Based on customer needs.--Define Standards.--Determine measure- ment.

Page 9: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Written Policy--Based on customer needs.--Define Standards.--Determine measure- ment.

County of Nottinghamshire,United Kingdom

Page 10: Customer Accommodation

We are committed to providing a high standard of customer service to all residents of Nottinghamshire.We have a Customer Service Code of Practice and Standards for our staff which gives a promise to you on what you can expect when you make contact with us.We aim to answer your telephone call within four rings.

We aim to respond to written correspondence within ten working days

If we feel that your query requires more detailed research or translation we will acknowledge your letter within five working days and respond fully to you within 20 working days

When you visit us, we will not keep you waiting for more than 20 minutes. County of Nottinghamshire,

United Kingdom

Page 11: Customer Accommodation

We are committed to providing a high standard of customer service to all residents of Nottinghamshire.We have a Customer Service Code of Practice and Standards for our staff which gives a promise to you on what you can expect when you make contact with us.We aim to answer your telephone call within four rings.

We aim to respond to written correspondence within ten working days

If we feel that your query requires more detailed research or translation we will acknowledge your letter within five working days and respond fully to you within 20 working days

When you visit us, we will not keep you waiting for more than 20 minutes. County of Nottinghamshire,

United Kingdom

Page 12: Customer Accommodation

We are committed to providing a high standard of customer service to all residents of Nottinghamshire.We have a Customer Service Code of Practice and Standards for our staff which gives a promise to you on what you can expect when you make contact with us.We aim to answer your telephone call within four rings.

We aim to respond to written correspondence within ten working days

If we feel that your query requires more detailed research or translation we will acknowledge your letter within five working days and respond fully to you within 20 working days

When you visit us, we will not keep you waiting for more than 20 minutes. County of Nottinghamshire,

United Kingdom

Page 13: Customer Accommodation

We are committed to providing a high standard of customer service to all residents of Nottinghamshire.We have a Customer Service Code of Practice and Standards for our staff which gives a promise to you on what you can expect when you make contact with us.We aim to answer your telephone call within four rings.

We aim to respond to written correspondence within ten working days.

If we feel that your query requires more detailed research or translation we will acknowledge your letter within five working days and respond fully to you within 20 working days

When you visit us, we will not keep you waiting for more than 20 minutes. County of Nottinghamshire,

United Kingdom

Page 14: Customer Accommodation

We are committed to providing a high standard of customer service to all residents of Nottinghamshire.We have a Customer Service Code of Practice and Standards for our staff which gives a promise to you on what you can expect when you make contact with us.We aim to answer your telephone call within four rings.

We aim to respond to written correspondence within ten working days

If we feel that your query requires more detailed research or translation we will acknowledge your letter within five working days and respond fully to you within 20 working days.

When you visit us, we will not keep you waiting for more than 20 minutes.

County of Nottinghamshire,United Kingdom

Page 15: Customer Accommodation

We are committed to providing a high standard of customer service to all residents of Nottinghamshire.We have a Customer Service Code of Practice and Standards for our staff which gives a promise to you on what you can expect when you make contact with us.We aim to answer your telephone call within four rings.

We aim to respond to written correspondence within ten working days

If we feel that your query requires more detailed research or translation we will acknowledge your letter within five working days and respond fully to you within 20 working days

When you visit us, we will not keep you waiting for more than 20 minutes. County of Nottinghamshire,

United Kingdom

Page 16: Customer Accommodation

When dealing with us:You can expect us to be welcoming, courteous, fair and respectful.

We will always be helpful and responsive, keep you informed and communicate clearly with you at all times

We will let you know what we can provide, who to contact and how to get in touch

We will aim to provide good quality information that is suited to your individual needs.

County of Nottinghamshire,United Kingdom

Page 17: Customer Accommodation

In return, we ask you to help us achieve our standards by being courteous and respectful towards us and help us to help you by providing the information we need.

County of Nottinghamshire,United Kingdom

Page 18: Customer Accommodation

Timeliness. We will provide an official grain inspection and weighing certificate within one full business day after completing your inspection. In our regulatory role, we will respond to your concerns and work to ensure fairness and equity in the marketplace.

Grain Inspection, Packers and Stockyards Administration (GIPSA) of USDA

Page 19: Customer Accommodation

Timeliness. We will provide an official grain inspection and weighing certificate within one full business day after completing your inspection. In our regulatory role, we will respond to your concerns and work to ensure fairness and equity in the marketplace.

Grain Inspection, Packers and Stockyards Administration (GIPSA) of USDA

Page 20: Customer Accommodation

We aim to:Answer all telephone calls within 4 rings (10 seconds)

New Standard for 2002/2003 

Our target for 2002/2003 85%

Tameside, United Kingdom

Page 21: Customer Accommodation

Respond to all service requests within three working days

Our target for 2001/2002

80%

Our success rate was 79%

Our target for 2002/2003

85%Tameside, United Kingdom

Page 22: Customer Accommodation

Provide trained staff who are polite and courteous

Our target for 2001/2002

40% Staff Customer Care Training

Our success rate was 41% (70 Staff) 

Our target for 2002/2003

100% (170 Staff)

Tameside, United Kingdom

Page 23: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Written Policy--Based on customer needs.--Define Standards.--Determine measure- ment.

Page 24: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Written Policy--Based on customer needs.--Define Standards.--Determine measure- ment.--Implement.

Page 25: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Page 26: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Customer told policy.

Organization Structure.

System flexibility.

Management Services.

Stock and Lambert “Strategic Logistics Management” (2001)

Page 27: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Stock and Lambert “Strategic Logistics Management” (2001)

Page 28: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

StockoutLevel

Stock and Lambert “Strategic Logistics Management” (2001)

Page 29: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Stockout leveltradeoff:customer serviceversusinventory carrying costs.

Page 30: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Customer service:Having the productwhen the customerwants it.

Page 31: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Inventory carrying costs:

Page 32: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Inventory carrying costs:

• Capital costs on inventory investment.

• Inventory service costs.

• Storage space costs.

• Inventory risk costs.

Page 33: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

In most cases inventory carryingcosts prevent us from providingthe demanded product 100%of time.

Page 34: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Percentage in-stock availabilityStock and Lambert “Strategic Logistics Management” (2001)

.

Inventory investment in $ thousands.

Page 35: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Percentage in-stock availabilityStock and Lambert “Strategic Logistics Management” (2001)

.

Inventory investment in $ thousands.

Increasing in-stock availability from 75%to 80%.

Page 36: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Percentage in-stock availabilityStock and Lambert “Strategic Logistics Management” (2001)

.

Inventory investment in $ thousands.

Increasing in-stock availability from 75%to 80%.

Increasesinventoryinvestmentby +/- 30%

Page 37: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availabilityStock and Lambert “Strategic Logistics Management” (2001)

.

Increasing in-stock availability from 80%to 90%.

Page 38: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availabilityStock and Lambert “Strategic Logistics Management” (2001)

.

Increasing in-stock availability from 80%to 90%.

Page 39: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availabilityStock and Lambert “Strategic Logistics Management” (2001)

.

Increasing in-stock availability from 80%to 90%.

Requires more thantwice as much inven-tory

Page 40: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availabilityStock and Lambert “Strategic Logistics Management” (2001)

.

Increasing in-stock availability from 80%to 90%.

Nearly triples our original investmentfor 75%

Page 41: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availabilityStock and Lambert “Strategic Logistics Management” (2001)

.

Increasing in-stock availability from 80%to 90%.

Nearly triples Our original investment

Page 42: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availabilityStock and Lambert “Strategic Logistics Management” (2001)

.

Increasing in-stock availability from 90%to 100%.

Page 43: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availabilityStock and Lambert “Strategic Logistics Management” (2001)

.

Increasing in-stock availability from 90%to 100%.

Page 44: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availabilityStock and Lambert “Strategic Logistics Management” (2001)

.

Increasing in-stock availability from 90%to 100%.

More thantriples ourinvestmentagain and is6x our originalinvestment

Page 45: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availability Increasing in-stock availability from 95%to 100%.

Stock and Lambert “Strategic Logistics Management” (2001)

Page 46: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availability Increasing in-stock availability from 95%to 100%.

IncreasesinventoryInvestmentby 50%.

Stock and Lambert “Strategic Logistics Management” (2001)

Page 47: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availability What level of customerwill provide competitivecustomer at reasonable cost?

Stock and Lambert “Strategic Logistics Management” (2001)

Page 48: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availability What level of customerwill provide competitivecustomer at reasonable cost?

95%?

Stock and Lambert “Strategic Logistics Management” (2001)

Page 49: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availability What level of customerwill provide competitivecustomer at reasonable cost?

97%?

Stock and Lambert “Strategic Logistics Management” (2001)

Page 50: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availability What level of customerwill provide competitivecustomer at reasonable cost?

98%?

Stock and Lambert “Strategic Logistics Management” (2001)

Page 51: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availability What level of customerwill provide competitivecustomer at reasonable cost?

93%?

Stock and Lambert “Strategic Logistics Management” (2001)

Page 52: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availability What level of customerwill provide competitivecustomer at reasonable cost?

When there is a stockout…

Stock and Lambert “Strategic Logistics Management” (2001)

Page 53: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availability What level of customerwill provide competitivecustomer at reasonable cost?

When there is a stockout…

If the customer is NOT a consumer (customer is a wholesaleror retailer)…

Stock and Lambert “Strategic Logistics Management” (2001)

Page 54: Customer Accommodation

Relationship Between Customer Service and Inventory Investment

0

100

200

300

400

500

600

75 80 85 90 95 100

Inventory investment in $ thousands.

Percentage in-stock availability What level of customerwill provide competitivecustomer at reasonable cost?

When there is a stockout…

If the customer is NOT a consumer (customer is a wholesaleror retailer), the customer may haveinventory/safety stock that allows them to service their customers.

Stock and Lambert “Strategic Logistics Management” (2001)

Page 55: Customer Accommodation

Customer Service Tradeoff

• Minimizing logistical costs while meeting predetermined levels of customer service.

Page 56: Customer Accommodation

Model of Consumer Reaction to a Repeated Stockout

Source: Clyde K. Walter, “An Empirical Analysis of Two Stockout Models,” unpublished Ph. D. Dissertation, Ohio State University, 1971.

Customer

3Lower

4Other size

2Same

1Higher

Anotherstore

6Ask here

again

5Specialorder

Switch stores

?

Substitute?

Switch brand

?

Substitute?

Switch price

?

No

No

Yes

Yes

Yes

Yes

No

No

Page 57: Customer Accommodation

Model of Consumer Reaction to a Repeated Stockout

Source: Clyde K. Walter, “An Empirical Analysis of Two Stockout Models,” unpublished Ph. D. Dissertation, Ohio State University, 1971.

Customer

3Lower

4Other size

2Same

1Higher

Anotherstore

6Ask here

again

5Specialorder

Switch stores

?

Substitute?

Switch brand

?

Substitute?

Switch price

?

No

No

Yes

Yes

Yes

Yes

No

No

Page 58: Customer Accommodation

Model of Consumer Reaction to a Repeated Stockout

Source: Clyde K. Walter, “An Empirical Analysis of Two Stockout Models,” unpublished Ph. D. Dissertation, Ohio State University, 1971.

Customer

3Lower

4Other size

2Same

1Higher

Anotherstore

6Ask here

again

5Specialorder

Switch stores

?

Substitute?

Switch brand

?

Substitute?

Switch price

?

No

No

Yes

Yes

Yes

Yes

No

No

Page 59: Customer Accommodation

Model of Consumer Reaction to a Repeated Stockout

Source: Clyde K. Walter, “An Empirical Analysis of Two Stockout Models,” unpublished Ph. D. Dissertation, Ohio State University, 1971.

Customer

3Lower

4Other size

2Same

1Higher

Anotherstore

6Ask here

again

5Specialorder

Switch stores

?

Substitute?

Switch brand

?

Substitute?

Switch price

?

No

No

Yes

Yes

Yes

Yes

No

No

Page 60: Customer Accommodation

Model of Consumer Reaction to a Repeated Stockout

Source: Clyde K. Walter, “An Empirical Analysis of Two Stockout Models,” unpublished Ph. D. Dissertation, Ohio State University, 1971.

Customer

3Lower

4Other size

2Same

1Higher

Anotherstore

6Ask here

again

5Specialorder

Switch stores

?

Substitute?

Switch brand

?

Substitute?

Switch price

?

No

No

Yes

Yes

Yes

Yes

No

No

Substitutemay be a wayto overcomestockout problemwithout increasinginventory.

Page 61: Customer Accommodation

Model of Consumer Reaction to a Repeated Stockout

Source: Clyde K. Walter, “An Empirical Analysis of Two Stockout Models,” unpublished Ph. D. Dissertation, Ohio State University, 1971.

Customer

3Lower

4Other size

2Same

1Higher

Anotherstore

6Ask here

again

5Specialorder

Switch stores

?

Substitute?

Switch brand

?

Substitute?

Switch price

?

No

No

Yes

Yes

Yes

Yes

No

No

Page 62: Customer Accommodation

Model of Consumer Reaction to a Repeated Stockout

Source: Clyde K. Walter, “An Empirical Analysis of Two Stockout Models,” unpublished Ph. D. Dissertation, Ohio State University, 1971.

Customer

3Lower

4Other size

2Same

1Higher

Anotherstore

6Ask here

again

5Specialorder

Switch stores

?

Substitute?

Switch brand

?

Substitute?

Switch price

?

No

No

Yes

Yes

Yes

Yes

No

No

Page 63: Customer Accommodation

Model of Consumer Reaction to a Repeated Stockout

Source: Clyde K. Walter, “An Empirical Analysis of Two Stockout Models,” unpublished Ph. D. Dissertation, Ohio State University, 1971.

Customer

3Lower

4Other size

2Same

1Higher

Anotherstore

6Ask here

again

5Specialorder

Switch stores

?

Substitute?

Switch brand

?

Substitute?

Switch price

?

No

No

Yes

Yes

Yes

Yes

No

No

Page 64: Customer Accommodation

Model of Consumer Reaction to a Repeated Stockout

Source: Clyde K. Walter, “An Empirical Analysis of Two Stockout Models,” unpublished Ph. D. Dissertation, Ohio State University, 1971.

Customer

3Lower

4Other size

2Same

1Higher

Anotherstore

6Ask here

again

5Specialorder

Switch stores

?

Substitute?

Switch brand

?

Substitute?

Switch price

?

No

No

Yes

Yes

Yes

Yes

No

No

Page 65: Customer Accommodation

Model of Consumer Reaction to a Repeated Stockout

Source: Clyde K. Walter, “An Empirical Analysis of Two Stockout Models,” unpublished Ph. D. Dissertation, Ohio State University, 1971.

Customer

3Lower

4Other size

2Same

1Higher

Anotherstore

6Ask here

again

5Specialorder

Switch stores

?

Substitute?

Switch brand

?

Substitute?

Switch price

?

No

No

Yes

Yes

Yes

Yes

No

No

Page 66: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Stock and Lambert “Strategic Logistics Management” (2001)

Page 67: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Order Information

Stock and Lambert “Strategic Logistics Management” (2001)

Page 68: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Order InformationGive customers goodinformation abouttheir order and your inventory

Give customers goodinformation abouttheir order and your inventory

Order Information

Stock and Lambert “Strategic Logistics Management” (2001)

Page 69: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Order InformationGive customers goodinformation abouttheir order and your inventory

Give customers goodinformation abouttheir order and your inventory

Order Information

Stock and Lambert “Strategic Logistics Management” (2001)

Page 70: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Order InformationGive customers goodinformation abouttheir order and your inventory

Give customers goodinformation abouttheir order and your inventory

Order Information

Stock and Lambert “Strategic Logistics Management” (2001)

Page 71: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Installation, warranty, alterations, repairs, parts

Stock and Lambert “Strategic Logistics Management” (2001)

Page 72: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Installation, warranty, alterations, repairs, parts

Some aspectsof reverselogistics

Stock and Lambert “Strategic Logistics Management” (2001)

Page 73: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Some aspectsof reverselogistics

Stock and Lambert “Strategic Logistics Management” (2001)

Page 74: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Stock and Lambert “Strategic Logistics Management” (2001)

Page 75: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Stock and Lambert “Strategic Logistics Management” (2001)

Page 76: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Stock and Lambert “Strategic Logistics Management” (2001)

Page 77: Customer Accommodation

Customer Service

Pretransaction Transaction PosttransactionWritten policy Stockout level Installation, warranty,

alterations, repairs, parts

Customer told policy Order information Product tracing

Organization structure Order cycle Customer claims, complaints, returns

System flexibility Expedited shipments Temporary replacement of products

Mgt. Services. Transshipment

System accuracy

Order convenience

Product substitution

Order Information

Give customers goodinformation abouttheir order and your inventory

Stock and Lambert “Strategic Logistics Management” (2001)

Page 78: Customer Accommodation

Measuring and Controlling Customer Service Performance

• Establish quantitative standards of performance for each service element.

• Measure actual performance for each service element.

• Analyze variance between actual service provided and standard.

• Take corrective action as needed to bring actual performance into line.

3-13

Page 79: Customer Accommodation

Customer Service Standards• Reflect the customer’s point of view.

• Provide an operational and objective measure of service performance.

• Provide management with cues for corrective action.

3-14

Page 80: Customer Accommodation

Gap Theory

Manager has customer service concept

Page 81: Customer Accommodation

Gap Theory

Manager has customer service concept

Employee learns manager’scustomer service concept.

Page 82: Customer Accommodation

Gap Theory

Manager has customer service concept

Employee learns manager’sCustomer service conceptInaccurately

Page 83: Customer Accommodation

Gap Theory

Manager has customer service concept

Employee learns manager’sCustomer service conceptInaccurately

There is nowa gap betweenmanager’s ideaand employee’sidea.

Page 84: Customer Accommodation

Gap Theory

Manager has customer service concept

Employee learns manager’sCustomer service conceptInaccurately

Customer has a conceptof what they want in service.

Page 85: Customer Accommodation

Gap Theory

Manager has customer service concept

Employee learns manager’sCustomer service conceptInaccurately

Customer has a conceptof what they want in service.

Customer’s idea of service is notthe same as employee’s. There is a gapbetween them.

Page 86: Customer Accommodation

Gap Theory

Manager has customer service concept

Employee learns manager’sCustomer service conceptInaccurately

Customer has a conceptof what they want in service.

There may also be a gap betweencustomer’s ideaof service andmanager’s ideaof service.

Page 87: Customer Accommodation

Gap Theory

Manager has customer service concept

Employee learns manager’sCustomer service concept

Customer has a conceptof what they want in service.

Manager mustdetermine customer’s ideaof service…

Page 88: Customer Accommodation

Gap Theory

Manager has customer service concept

Employee learns manager’sCustomer service concept

Customer has a conceptof what they want in service.

Manager mustdetermine customer’s ideaof service andcommunicateit to employeewho providesit for customer.

Page 89: Customer Accommodation

End of Program