Customer Service

Importance of Customer Service

1. Customer service level measures effectiveness
of integrated logistics
2. Improved Customer service makes business
grow
3. Makes customers loyal, added value (service)
can “lock up” the customers
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 4. Provides edge in competitive business
5. Delivers seven rights to customer (Seven R
rule) right product, right quantity, right
condition, right place, right time, right
customer, right cost

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 Seven R rule (Seven Rights)
• Above are components of customer service
• Deliver value to customer
• Provide edge in competition
• Any disruption in the above causes breakdown
of customer service

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 Objectives of Customer Service
 Delivering 100% perfect orders
 Creating competitive value by delivering seven
R value (seven rights) to customers
Three levels of customer service
How do we direct organizational efforts to deliver
customer service?
 Perform Customer service as an activity. Relate
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customer service to activities
  Pursue customer service targets as
performance measures
 Practice customer service as philosophy.
Think customer service while working

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 Factors or components of customer service
1. Product availability
2. Order cycle time
3. Dependability in terms of lead time, Safe
delivery, Correct orders
4. Communications
• Ease
• Correctness
• Promptness in response (rapid response) 6
 5. Convenience (customer’s)/Flexibility
(supplier’s)
• Customer’s expectation of service differs from
case to case
• Customers grouping should be done to
recognize varied needs
• Customize the service to suit the needs of
customer categories 7
Categorization of Customer Service Elements
Pre-transaction Elements
Customer service policy
Organizational Structure for customer service
System flexibility
Management services

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 Transaction Elements
Minimize stock-out
Give order information whenever required
Perform elements of order cycle
Expedite shipments
Minimize transshipment (intermediate
destinations)

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 Maintain system accuracy (minimize errors)
Meet order convenience
Do product substitution to maintain service level
Post-transaction Elements
Installation, warranty, repairs, alterations, parts
Product tracing
Customer claims, complaints, returns
Temporary replacement of products
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 Customer service strategies
Customer audit to ascertain how customers
define their expectation
• Shortest lead-time?
• Consistent lead-time?

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Categorize customers, A,B,C - All customer
accounts [profitability] are not same, identify
salient features of customer service
• Packaging
• Number in package
• Time of delivery
Decide degree of customization of service

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 The order cycle system

Order Order
receipt processing

Conversion
process

Order Order
shipment preparation

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