Customer Service as a Strategy: A Parcelforce Worldwide case study 1

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Customer Service as a Strategy: A Parcelforce Worldwide case study

http://businesscasestudies.co.uk/parcelforce-worldwide/customer-service-as-a-strategy/introduction.html#axzz3TauR0frS

Introduction

- Parcelforce Worldwide is part of the Royal Mail Group Ltd. Royal Mail Group has three main operating brands:• The Post Office Ltd provides counter services to the high street

customer• Royal Mail manages the delivery of letters and packets• Parcelforce Worldwide provides express parcel delivery services for businesses and consumers- Parcelforce Worldwide has over 30,000 business customers in the UK- It handles 200,000 parcels a day- It has a turnover of £382 million- It has 23 partners across 30 European countries and access to Postal

Administrations through the Universal Postal Union- It operates:

- Business to Business (B2B) services, delivering parcels and supplies from companies to other companies - Business to Consumer (B2C) services, delivering parcels to individuals

in their homes

http://businesscasestudies.co.uk/parcelforce-worldwide/customer-service-as-a-strategy/introduction.html

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Need for Change

- In 2002, Parcelforce Worldwide was making a loss- In response, those managing the business decided to change the type of service it offered- Instead of unguaranteed parcel deliveries typically taking between two and four days, Parcelforce Worldwide decided to focus on time and day guaranteed, express delivery- As a result of these changes, Parcelforce Worldwide also increased operational efficiency. The business: - Reduced the number of staff it employed - Closed some of its depots - Opened a new, technologically advanced sorting centre in CoventryThese changes enabled Parcelforce Worldwide to achieve its financial targets- It recognized that more could be done to improve efficiency- It wanted to cut absenteeism staff taking unauthorized or sick leave and reduce the time lost as a result of accidents at work- To do this, Parcelforce Worldwide introduced a more decentralized approach to management. This gives depot managers greater decision- making accountability to improve the effectiveness of the operation in their local area


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Differentiation

- Parcelforce Worldwide has developed a unique selling proposition (USP) based on high-quality customer service- Parcelforce Worldwide works in partnership with customers, such as the UK's examination boards, to develop and deliver services to meet specific needs. During exam season, Parcelforce Worldwide delivers millions of exam papers, scripts and coursework

This case study examines how a strategy focused on customer service can contribute to long term business development

Business Strategy

- Businesses have aims and objectives- Aims are the long-term targets of the business- Objectives are the steps that help to achieve these aims- Objectives should always be SMART (specific, measurable, achievable, relevant and set within a timeframe)- By carrying out a SWOT analysis, a business can identify the best strategies to pursue


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Parcelforce & Business Strategy

Parcelforce Worldwide has:- Operational strategies to improve its efficiency and meet customer needs better- Promotional strategies to strengthen its brand presence in key markets- Growth strategies to expand its business outside its core national marketsFor example, the parcel delivery industry has consolidated across the world. This means that there are now fewer global players, but each has a relatively larger market share. Parcelforce Worldwide needs to compete with these global rivals. To increase its market share, it needs either to grow its existing business or merge with other parcel delivery businesses

Customer Service as Strategy

- Customer service means talking and listening to customers The key parts of this customer service are: - Time: making sure that deliveries are on time - Visibility: letting the customer follow a parcel through online tracking - After-sales service: ensuring that any problems are dealt with courteously and promptly


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Customer Service as Strategy

- Parcelforce Worldwide has identified that its organizational structure is a key strength- Its people are essential to supporting quality customer service. For instance, drivers need to work with depot staff so that parcels are loaded in the right order for delivery

Diversity

- Parcelforce also needs to ensure that services are accessible by all customers- Society is now more diverse, with a larger proportion of the population aged over 60 and with more people from different ethnic backgrounds For example, Parcelforce Worldwide makes sure that: drivers write delivery cards that can be easily read by people with sight problems or by those who do not speak English as a first language- Employees learn the best way of communicating with customers with disabilities- The company also needs to find out what its customers want so that it can provide additional services;For example, in this way, Parcelforce Worldwide discovered that some customers were concerned about the affects of carbon emissions on the environment. It therefore offers a 'carbon neutral parcel' option. The customer pays a few pence more to offset the carbon impact of delivering the parcel


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Corporate Responsibility

- Parcelforce Worldwide takes its corporate social responsibility (CSR) seriously- This means providing benefits for employees, customers and the communities in which it operates- Its CSR programme focuses on; - Health and safety - Environment - Supporting local communities - DiversityFor example:- Reducing the carbon footprint of the business- Supporting local communities through involvement in education- Removing barriers to its services for all customers


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Implementation of Customer

Service

- To improve its customer service, Parcelforce Worldwide has undertaken

a “gap analysis”. This is a detailed exercise that assesses: - where the business is now - where it wants to be - what it needs to do to achieve that and howCustomer service has an impact in six main areas of the business: 1. Deliveries to the customer providing timely delivery, prompt response to queries, clear documentation. 2. Re-deliveries ensuring clear procedures are in place3. Collections from customers providing a timely service with documentation4. End-to-end parcel location (tracking) an online service with easy-to- use screens means customers can find out when a parcel has been delivered5. Customer contact improving customer communications and providing help by web or by telephone 6. Making claims making it easy for people to claim if things go wrong In each of these areas, Parcelforce Worldwide has identified best practice in the industry. It compares its performance by benchmarking itself against competitors. It then assesses how to improve its processes to achieve best practice.


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Evaluating the Impacts, Costs &

Benefits of Customer

Service

- Training to Employees: A customer-orientated needs appropriate training to ensure employees have the skills to meet customer needs- Measuring Performance: 1. Measures customer service by using key performance indicators (KPIs). These set targets for factors such as response times, numbers of staff trained and levels of after-sales service 2. Uses a balanced business scorecard to record progress against below mentioned four targets;- Financial includes operating margin, average unit cost- Process includes on-time deliveries and collections, attempted deliveries- Customer focus includes customer satisfaction scores, complaints- Employee/teams measured by opinion surveys

By tracking performance on a regular basis, Parcelforce Worldwide can identify areas that are performing well, as well as those that need to be improved


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Conclusion- Parcelforce Worldwide is a major player in the parcel delivery market in

the UK- It also provides international services by partnering with other providers around the globe- The parcel delivery market is highly competitive. Parcelforce Worldwide

needs to differentiate itself from the competition. It has adopted a strategy based on quality customer service- It has improved efficiency and changed its focus from volume (the number of parcels carried) to value (what the customer wants - getting parcels there on time)- Parcelforce Worldwide regards its people as its most important asset. It

is developing the skills of its people to deliver high levels of customer service

By putting customers at the heart of its strategy, Parcelforce Worldwide aims to achieve competitive advantage


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Using Technology to Improve Economies: A Vodafone Case Studyhttp://businesscasestudies.co.uk/vodafone/using-technology-to-improve-economies/introduction.html#axzz3TxMOkB5P

Introduction- Vodafone is a leading international mobile communications company with interests in 27 countries and partnership agreements with a further 40 countries- It has over 71,000 employees throughout the world and in 2008 had more than 289 million customers

VisionVodafone's vision is 'to be the world's mobile communications leader' and a key component of this is to ensure that customers trust and admire the company

Approach to Business

- It is two fold;To provide product extension - Developing new ways of delivering products and services helps to keep existing customers and attract new ones. For example, 3G technology has improved the ability and quality of transferring voice and data. Very fast internet speeds allow extended services such as video calling, music downloads, mobile television and email messagingTo look for opportunities in emerging markets- These include some of the world’s more remote areas, including parts of Africa, where many people do not yet have access to a mobile phone. Vodafone is committed to providing these markets with the technology to develop communication that will help both economically and socially. There are now more than four billion mobile phones across the world and 64% of all users live in a developing country.

http://businesscasestudies.co.uk/vodafone/using-technology-to-improve-economies/introduction.html

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Economy: Concept

- An economy is a system which tries to balance the available resources of a country (land, labor, capital and enterprise) against the wants and needs of consumers. It deals with three key issues: 1. what is produced 2. how it is produced 3. who gets what is produced

Economic System

Planned Economy Mixed Economy Market Economy


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The government makes all decisions for society. Producers only make what they are instructed to make. Benefits most workers are employed and most people enjoy a similar basic lifestyle.ProblemsA planned economy gives little capacity for development, so growth and investment is limited.the infrastructure is usually under-developed as government spends on other areas such as defense, wages are state-controlled, so people have less motivation to perform at higher levels

Economic System

Planned Economy Mixed Economy Market EconomyThe government's role is limited to providing legislation to protect businesses and consumers and making sure no single business or organization restricts competition. It also provides essential services (like police and defence) and ensures the country's money supply is stable. FeaturesCustomer driven economyif customers do not buy and demand falls, then a business must make less, be more efficient or produce an alternative productDrawbacksIt could lead to inequality in society In times of economic crisis, without govt intervention, nation’s economy would fail

The mixed economy is a combination of both planned and market economies, eg: the UK and the USA. Even a communist country like China has an economy which relies on a mixture of state and private enterprise:In a mixed economy, the government contributes and controls some resources and the market controls the rest.The proportion of each contribution may vary. For example, in some Scandinavian countries, the state provides a very high level of social benefits but charges high taxes. In the USA, public benefits (such as free national health care) are minimal. The UK position is somewhere in between.


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Developed Mixed Economies

Developing Market Economies

Developing Planned/ Command Economies

-Developed mixed economies such as the UK produce large numbers of goods and services to meet consumer needs- In this type of economy, where customers have choices, Vodafone needs to differentiate itself in the market-It relies on its strategic mix of; - Innovation in products and services - Customer focus - Its responsible approach to business to meet consumer demand and develop long-term customer relationships

- In the UK's developed market, Vodafone provides its customers with the benefit of:• Network coverage for calls and data across almost 100% of the population• A wide range of handsets and airtime plans to suit every type of customer

and use• Access to messages, email, the internet and the sharing of images, videos and music through mobile phones

- In developed economies, mobile phones are considered a normal part of life - Vodafone's integrated mobile system can be used for business, education or socializing- The latest handsets allow people to keep in touch with family and friends through emails, messaging and networking sites such as Facebook and Twitter, play online games, listen to music or watch TV in any location


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- Developing economies are those countries in the middle or bottom layers of the socioeconomic pyramid- These countries often face great difficulties in improving their economies- Features of Developing Economies: - The population lives on very low incomes (typically less than $2 or about £1 per day) - Poor infrastructure such as transport (roads or railways) or local government - Poor communication systems - Low levels of basic health and education - Low Gross National Product (GNP)Kenya: Over 75% of the country's workforce is in agriculture which can be affected by the climate. Telephone landlines are scarce, expensive and difficult to install. Kenya has just 450 bank branches. 80% of Kenyan adults have no bank account. Vodafone in Kenya:-Vodafone in partnership with Safaricom also recognized the need to improve the movement and security of money to allow small businesses to grow- As a solution, Vodafone set up M-PESA (literally 'mobile money') working with funding from the Financial Deepening Challenge Fund (FDCF). This is a UK fund established to aid international development- M- PESA provides a simple, secure, low-cost money transfer system: A customer goes to an accredited M-PESA 'top-up' shop and, in return for cash, has credit registered on their phone via the M-PESA system (rather like a pay-as-you-go top up).


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- The customer receives a text message to confirm the transaction- They can either store this on their phone until needed or they can forward it to someone else.- When needed, the credit can be converted back into cash at any registered M-PESA agent or even via an ATM (cash) machine- Vodafone takes a small commission on the transfer- There are over 2,200 M-PESA registered agents in petrol stations, supermarkets and other retail bases across Kenya and five million subscribers- For example M-PESA has helped small businesses such as taxi drivers by enabling them to receive money for fares without having to drive around with lots of cash in their cars- M-PESA has also been used to buy everyday items, as well as to pay the rent, send funds to other people or buy phone airtime- It has even been used to pay school fees, as secondary schooling is not 'free' in Kenya- By providing safe, secure transfer of money, Vodafone's M-PESA system has; - helped small businesses become more financially secure - provided a safe way for wage earners to send money back home to their families - solved the problems of carrying around large amounts of cash

Following these achievements in Kenya, Vodafone has extended M-PESA into other emerging markets including Tanzania and Afghanistan.


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Conclusion- Vodafone uses the capabilities of the mobile phone to bring value to both developing and developed economies- The impact of mobile technology on developed markets over recent years has been immense and has focused on providing added value to customers through new and improved functions and features- By comparison, the impact of technology on emerging markets such as Kenya has provided a real lifeline both to individuals and to small businessesWith growth in the provision of mobile phones, Vodafone has enabled great improvements in facilitating the flow of money and information, which is vital for economic growth


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• http://www.global-strategy.net/what-is-global-strategy/

• http://businesscasestudies.co.uk/business-theory/strategy/developing-a-global-strategy.html#axzz3TIgA0cYA

• http://csis.org/files/publication/130129_competitiveness_Lenovo_casestudy_Web.pdf

• http://businesscasestudies.co.uk/vodafone/using-technology-to-improve-economies/conclusion.html#axzz3TPs2HwGa

• http://businesscasestudies.co.uk/parcelforce-worldwide/customer-service-as-a-strategy/introduction.html#axzz3TauR0frS

• http://businesscasestudies.co.uk/kelloggs/balancing-the-marketing-mix-through-creative-and-innovative-strategies/introduction.html#axzz3TIgA0cYA

• http://businesscasestudies.co.uk/aldi/creating-value-through-the-marketing-mix/introduction.html#axzz3TIgA0cYA

• http://www.1000ventures.com/business_guide/case_studies_main.html

• http://businesscasestudies.co.uk/case-studies/by-industry/automotive.html#axzz3TPs2HwGa

http://www.global-strategy.net/what-is-global-strategy/

http://www.global-strategy.net/what-is-global-strategy/

http://businesscasestudies.co.uk/business-theory/strategy/developing-a-global-strategy.html



http://csis.org/files/publication/130129_competitiveness_Lenovo_casestudy_Web.pdf

http://csis.org/files/publication/130129_competitiveness_Lenovo_casestudy_Web.pdf

http://businesscasestudies.co.uk/vodafone/using-technology-to-improve-economies/conclusion.html






http://businesscasestudies.co.uk/kelloggs/balancing-the-marketing-mix-through-creative-and-innovative-strategies/introduction.html



http://businesscasestudies.co.uk/aldi/creating-value-through-the-marketing-mix/introduction.html



http://www.1000ventures.com/business_guide/case_studies_main.html

http://www.1000ventures.com/business_guide/case_studies_main.html

http://businesscasestudies.co.uk/case-studies/by-industry/automotive.html

http://businesscasestudies.co.uk/case-studies/by-industry/automotive.html

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Customer Service as a Strategy: A Parcelforce Worldwide case study 1