Higher AdministrationAdministrative ServicesOutcome 5

Customer Service Policies

Importance of Customer Service The most important aspect of a

business... without good customer service there is no business!

Mission Statement A statement which is usually a couple of

sentences

Employees are encouraged to learn it, which shares the management’s vision of how the organisation hopes to grow and develop

DHL“DHL enhances the business of our customers by offering highest quality express and logistics solutions based on strong local expertise combined with the most extensive global network presence. Customers trust DHL as the preferred global express and logistics partner, leading the industry in terms of quality, profitability and market share”

IkeaIkea's mission is to offer a wide range of home furnishing items of good design and function, excellent quality and durability, at prices so low that the majority of people can afford to buy them.

Virgin Atlantic"To grow a profitable airline, where people love to fly and people love to work"

Customer Care Strategy A written statement of principles to ensure

that the customer gets what they want at the right standard, quality and price.

It will cover how the company will: Ensure the quality of its customer care Measure and test that customer needs are

satisfied Ensure service level agreements are in place Deal with customer complaints

Effect of Poor Customer ServiceDissatisfied customers leading to a high level of complaints

A bad reputation with the effect of a reduction in sales and therefore profits

Administrative Assistant – Role when Dealing with Complaints

Competence – professional and knowledgeable image, use the customers name when possible eg Miss Wright

Confidence – keep eye contact and smile at the customer with positive body language

Be Concerned – listen, be honest even if you have to give bad news

Be Courteous – be polite, don’t argue – even if the customer is shouting/being abusive – be assertive but not aggressive

Communicate – ask questions, take notes, pass on information, keep the customer informed

Customer Care Strategy The standards a customer can expect

A good customer service will allow an organisation to benefit from: Achieving customer satisfaction Increased sales Increased customer loyalty A good reputation Increased competitiveness Fewer complaints

Customer Service Level Agreement An agreement between the organisation and the customer

describing what the organisation promises to be able to do and what the customer can expect

States what, how and when the organisation intends to deliver

States what will happen if the organisation fails in its promise and commitment

Outlines the responsibilities of both parties Specifies any extra or hidden costs

Increases customer confidence and sets the standard for measurement and comparison with other organisations.

Customer ServiceBenefits of Good Service

Motivated and high performing staff

Satisfied and loyal customers who recommend the business

Reputation – attracting customers and staff

Competitive edge Increased market

share

Effects of Poor Service

Demoralised and demotivated staff

Dissatisfied customers won’t return or recommend – loss of income

Difficult to turn around a poor reputation

Loss of status in the market place

Downsize/increase spending on advertising/image

REMEMBER! Survival depends on the customer

Repeat customers are important customers

Satisfaction is essential and depends on high quality and continual improvement

Gerald Ratner He built up an extremely successful chain of jewellers during the 1980s, of which

he was chief executive. The shops shocked the formerly staid jewellery industry by displaying fluorescent orange posters advertising cut price bargains and by offering low price ranges.

Although widely regarded as "tacky", the shops and their wares were nevertheless extremely popular with the public, until Ratner made a speech at the Institute of Directors on 23 April 1991.

During the speech, he commented:“We also do cut-glass sherry decanters complete with six glasses on a silver-plated tray that your butler can serve you drinks on, all for £4.95. People say, "How can you sell this for such a low price?", I say, "because it's total crap."

He compounded this by going on to remark that some of the earrings were "cheaper than an M&S prawn sandwich but probably wouldn't last as long."

Customers exacted their revenge by staying away from Ratner shops. After the speech, the value of the Ratner group plummeted by around £500 million, which very nearly resulted in the firm's collapse. Ratner resigned in November 1992 and the group changed its name to Signet Group in September 1993.

Complaints Procedures Must be a specific policy in place to deal

with these customers – remember not everyone will complain

Sometimes referred to as Customer Retentions especially in Mobile/Broadband companies

Dealing with Complaints All complaints should be treated seriously and

logged They should be handled by specially trained

staff They should be acknowledged and the

customer should be kept informed of what is happening

Time limits should be established eg all complaints dealt with within 10 working days

The result of the investigation should be communicated to the customer

Why Don’t People Complain?

Take up too much

time

Too scared to approach

staff

Won’t make any difference

Who to complain

to?

Unpleasant nature of

dealing with complaints

Don’t want to make a

fuss

Evaluating Policy If the customer care policy is evaluated it

allows the organisation to: Monitor where complaints come from and

what they are about Target where training or changes in

procedures need to be introduced Assure customers of prompt attention at all

times Show commitment to customers,

encouraging their loyalty and gaining their trust and respect

Customer Focus Organisations who show a willingness to find and

eliminate customer problems achieve customer focus

How to improve: Listen to what the customer has to say Conduct focus groups Customer satisfaction survey Best customer service awards Provide customer service training Internal newsletter – sharing good practice Provide warranties, guarantees and refunds

Guarantees and Warranties A guarantee is a formal promise –

belief in product or service. Brings in more business even if ‘money-back’ guarantee offered.

A warranty states that a product/service will last for an appropriate length of time – if the need arises repairs/replacements offered at no extra cost

Internet ResearchVisit Trading Standards…

Look for advice leaflets for customers What products have been recalled in the

last week?

Visit Citizens Advice – Consumer Services How does the law protect your rights?

Customer Satisfaction Questionnaires – often need an incentive like entry into a

prize draw

Comment cards – not always taken seriously eg after a meal in a restaurant

Telephone – customers resent being interrupted at home, but often used as a courtesy call after eg home improvements to see if there are any problems (being pro-active)

Interview – time consuming and expensive, unpleasant if people are rude

Online surveys – often questions not read properly, often follows an online purchase

Loyalty CardsExamples: Boots, Tesco, Nectar (Sainsbury)

Rewards regular customers with ‘points’ which may translate to money off coupons

Used to gather spending habits of customers in order to alter prices and extend special offers.

Mystery Shopper This is a person who pretends to shop and

experience the service and care ordinary customers receive.

Feedback is then given to either praise employees, or to reinforce company policy.

Sometimes staff can become aware of the mystery shopper and don’t always cooperate and can even be hostile if they feel that they are being spied on.

What might be Mystery Shopped? Assessing Customer Service eg speed,

communication Assessing customer experience in store

eg cleanliness; product displays etc Assessing any hostility from company

employees Are customer needs being met? Are policies being followed? Sample employee’s product knowledge

Customer Focus Groups (1) Small groups of customers brought together to

provide the organisation with feedback on their goods and services, proposed new products and lines that are no longer profitable.

Feedback is immediate.

Sometimes a marketing organisation will carry out the research – so the participants don’t know which company they are reporting on.

Customer Focus Groups (2) Expensive to run – minimum would be

travel expenses for participants.

Information is only a sample of what all customers think at a certain point in time.

For a national perspective, focus groups would need to be held throughout the country – time consuming exercise.

Market Research Field Research

new information is gathered for the business.

what we have just looked at… (previous slides)

Desk Research Information which already exists eg government statistics, competitor

profiles, financial reports

Quality Management Systems

TQM (now just referred to as Quality Management)

All employees have an individual and a collective responsibility for quality.

Principle: “Get it right! First time! Every time!”

Investors in People Relates to staff training and development.

Awarded for 3 years, after which companies must reapply.

10 Key Indicators must be covered under 3 areas: Plan – Develop strategies to improve performance of

the organsiation Do – Take action to improve the performacne of the

organsiation Review – Evaluate the impact on the performance of

the organsiation

Investors in People

Benefits to Employer Improved morale and

motivation Increased productivity

and profit Training closely linked to

business objectives Increased customer

satisfaction Improved reputation Positive publicity

Benefits to Employee Recognition and

improved job satisfaction

Better communication on training and development issues

Pride in belonging to the organisation

Supportive working environment

Communicating with Customers First impressions count! Remember

body language and tone of voice.

If an irate customer can be calmed by a pleasant, courteous and competent assistant, then the heat will be taken out of the situation.

Call Centres Outsourcing to foreign call centres (eg India) may

anger and frustrate some customers if a complaint is not being treated seriously.

PlusNet (ISP) advertises a Yorkshire based call centre

In general this is a cost effective method of dealing with customers.

However, they can get easily confused if a large number of automated call menu options are presented

Complaints in Writing This creates a permanent record, replies

can be kept for future reference (especially if the customer contacts again).

Email is becoming more important, however this has the drawback that a customer might expect an immediate response.

E-commerce (Customer Service) A well-designed, easy to use and up-to-

date website will encourage customers.

Available 24/7 and as more people gain confidence in using the Internet this will save the organisation costs in terms of staff, storage and advertising.

Dealing with Customers Face to Face Can identify uncertainties

and clarify immediately Allows for subtle

questioning Demonstrations can be

given Body language can be read May help to defuse the

situation (personal contact) Up-selling may increase

sales

Higher AdministrationAdministrative ServicesOutcome 5