You are on page 1of 19

1. Background of the Study Retail Industry is one of the fastest growing sectors of the economy here in the UK.

Over the years retail industry has been on the path of growth and improvement by concentrating on the customer service. Customers are the main focus of all companies and also al industries. Without the customer satisfaction it is quite hard to achieve the desired level of growth. For retail industry in the UK customers are being treated very efficiently in general. Through the customer service and its management retail industry is always trying to improve the performance of the business to achieve the long term growth. There might be a relationship between the (CSM) customer service management and the industrys business performance. To explore the relationship a study can be undertaken and that is why this research will be trying to explore the relationship between the industrys customer service management and its performance of the business. 1.1 Statement of the problem A huge competition is one of the key features of the retail industry in the UK. That is why the customers are now having the chance to choose from various alternative companies within the industry according to their convenience. Thus to be the leader within the industry or market each of the retail business company needs to determine or identify the factors that is related to customer service management and the overall performance of the business in order to achieve the growth through an improvement of business performance. In the retail industry customer service management is the key aspect to deal with. To find out how customer service management can affect the business performance in the retail industry. 1.2 Purpose of the study The main goal or aim of this research study is to investigate whether there is any kind of relation between customer service management and business performance in the UKs retail industry or not. Business growth is one of the key things which are wanted by every company and industry to be achieved. For the organizational growth and improvement business performance has to be considered very seriously. The will add more knowledge on the issue of organizational performance related to customer service management and personal query on the issue will be answered that can increase the knowledge to deal with business performance. 1

2. Research Questions and objective

2.1 Research Question The research questions for the study are, 1. Is there any relationship between the management of customer services and performance of the retail industry business in the UK? 2. How the present level of customer service management affects the business performance 2.2 Research Hypothesis The hypothesis of the research is, 1. I the UK retail industry customer service management and business performance is related with each other significantly.

2.3 Objectives The objectives of the study are, 2. To find out the customer service management practices in retail industry in the UK 3. To what extent the industry is ensuring best practice of customer service 4. What is the level of business performance of the industry 5. How the customer service management is affecting the level of business performance 6. What are the areas of customer service management can be improved f there is any shortfall to achieve the better business performance.

3. Literature Review Two important things are going to be looked at and studied in this research. One is obviously the customer service management and its affectivity which very much important for the achievement of good business performance. That is the reason why two concepts are considered for the research specifically the customer service management and the business performance. 3.1 Business Performance In most of the cases organizational success depends upon the business performance. Both the financial and non-financial terms can be used to measure the business performance. (Bontis, 1998; Bontis et al., 2000). Profits, return on investments and sales turnover are the objective measures of the performance of the business whereas the perceived measures is related to the productivity in a particular industrys context and also the departments and individuals within it. Objective measures can rebalance the perceived measures of the performance of business (Dess and Robinson, 1984). There is a strong correlation between the objective measures and perceived measures (Lyles and Salk, 1996; Hansen and Werner, 1989; Bart et al., 2001). Earlier research studies from Bontis (1998) and Bontis et al. (2000) indicated that the perceived measures is a variable tool to measure the performance of the business (See Table 1). The model given by Bontis (1998) is used to measure the perceived business performance. From the table II the perceived measures have a significant and positive relationship with the measures of return of sales and return of assets. The approach has involved the appraisal of an enterprise within the organization, the departments and individuals (Table 2). Bontis (1998) has suggested that the variables in organizational level have some positive impacts on the objective business performance and also are important indicators of the concept of perceived business performance measures. These variables reflect to the success of the enterprise or industry, meeting customer needs, securing future performance and the respect earned within the industry. Bontis and Fitzenz (2002), Bart et al. (2001) and Bontis (1998) also suggested that variables in the individual level have a significant impact on the objective business performance that includes sentiment of the employees (i.e. satisfaction, motivation and the commitment towards the organization) as these are important indicators of perceived business performance measures, too.

Table 1: Measures of Business Performance Variables manifesting PBPM B1 Enterprise is successful B2 Enterprise meets its clients needs B3 Enterprises future performance is secure B4 Enterprise is well respected within the industry B5 Department makes a strong contribution to the organization B6 Departments perform well as a team B7 Departments meet their performance targets B8 Individuals are satisfied with working here B9 Individuals are generally happy working here B10 Individuals are satisfied with their own performance Source: Bontis (1998) and Bontis et al. (2000) Table 2: The Level and forces deriving the PBPM variables Variables manifesting PBPM B1 Enterprise is successful B2 Enterprise meets its clients needs B3 Enterprises future performance is secure B4 Enterprise is well respected within the industry B5 Department makes a strong Departmental (Functional) Bontis (1998) Crossan and Hulland (1997) Lyles and Salk (1997) Individual (Operational) Bontis and Fitz-enz (2002) Bert et al. (2001) Level Organizational (Strategic) Sources Bontis (1998) Crossan and Hulland (1997)

contribution to the organization B6 Departments perform well as a team B7 Departments meet their performance targets B8 Individuals are satisfied with working here B9 Individuals are generally happy working here B10 Individuals are satisfied with their own performance 3.2 Customer Service Management

Customer service management is the process or way organizations manage their customer services to create value and satisfaction (Kotler et al., 2001 Gabbott, 2004). This can be said as the way to deliver the services to the customers in order to meet the customer needs and desires which lead them towards the satisfaction. In the retail industry context in the UK, customer services are meant to help and assist the customers to get the products and services desired by them by various level counter based or non counter based customer service assistants at floor level and corporate level. Several dimensions of the CSM have to be considered in order to achieve the efficient and effective customer services. Always the customers are considered as the driving forces of the organizations and industries which keenly desire success. Customers are like that force which create a situation where the survival of the enterprise most of the times depends on them (Lewis, 2000, Kotler et al., 2001, Kotler 2000). In most of the situations customers show their wise behavior when they choose the right products which fulfill their desires and needs. Moreover the intensified competition within the industry and outside the industry gives them a room to switch from one product to another very frequently whenever they want to do so. In the highly competitive retail industry it is very much a common phenomena now these days.

Khong and Richardson (2003) good customer relations has been suggested in order to achieve a good have suggested in order to achieve a good customer service management. According to Kotler (2005, p.45) customer service is all activities involved in making it easy for customers to reach the right parties within the company and receive quick and satisfactory service, answers and solutions of problems. Thus as a consequence, customer service gives a basis to retain the customers. When the rate of customer retention is high then it would be said that the services are provided to the customers ensure their satisfaction. Thus customer retention indicates customer (Kotler et al., 2001, pp. 665-73; Kotler, 2000). Customer satisfaction from the definition give by Kotler (2000) is a persons feelings of pleasure or disappointment resulting from comparing a products perceived performance (or outcome) in relation to his or her expectations. By summarizing it can be said that customer service management has a positive association with customer retention and satisfaction.

3.3 Customer service management and business performance relationship

Khong and Recharson (2003) have said that, perceived business performance is closely and positively associated with the customer service management. Researches like Agus et al. (2000) and Bontis et al. (2001) conducted I Malaysian industries are one of good indicative literatures on the aspect which shows the relationship between CSM and business performance. Cravens and Piercy (2003) has shown market orientation as a philosophy contriving the process of delivering the value of the customers. Higher customer value ensures greater level of performance (Slater and Narver, 1994; Mullins and Larreche, 2006). Slater and Narver (1994) , Mullins (2006) and Cravens and Piercy (2003) have explained how customer service management can be a part of the market component and also how enhance the customers value leading to an improved business performance of an organization or industry.

4. Methodology
4.1 Research design The research is designed based on relational study which includes one dependent and one independent variable. This research is a relational study and relational study always needs two variables to find out the correlation between those two variables. According to William, and Anuchit (2002), relational study is a study where a relationship is determined between two or more variables.

This study is designed on the basis of correlation. An elaborated questionnaire will be used to measure the relationship between the two variables. Questionnaire is always a good means of data and analysis of the data collected through questionnaire is always easy. The research will be a qualitative one rather than quantitative one. Qualitative research gives a chance to analyze the situation or data more precisely and elaborately with an in-depth study on those.

4.2 Instruments for Research Questionnaire will be one of the instruments for the research and many other previous researches those were dedicated to find out the relationships between two variables. The acceptable range of the Alpha value will be the 0.50 although sometimes greater than 0.50 value is accepted. The questionnaire will be consisted of two sections. The first section will be comprised of ten questions which will try to find out organizational positions, situation of departments and assessment of individuals that can cover industrial strategy, functions and operations. In the second part of the questionnaire there will be ten more questions directed towards the customer managers of different companies within the retail industry. They will be asked to give their opinions regarding the two variables. From the second part of the questionnaire it will be cleared whether there is a relationship between the two variables or not. All questions will be scaled as ranging 1 to 5. All questions will be ranging from 1 to 5. Five point Licker scale will be used to
construct the customer service management and perceived business performance measures (Khong and Richardson, 2003).

4.3 Research Sampling For this research the customer managers both at shop level and corporate level from four big retail companies in the UK will be the sampling to collect the data. Customer managers from the 4 big representatives of the UK retail industry like Sainsburys, Tesco, Asda, M&S will be the population for the sample. To collect and determine the sample of the research the nonprobability convenient sampling will be the technique used. 25 customer managers will be selected conveniently from each of the company mentioned earlier and the total size of the 7

sample population will be 100. Personal contact i.e. the respondents will get the explanation in details about the survey and it is the data collection method for the study where the respondents will also have personal approaching from the researcher to give some more scenarios beyond the questionnaire. 4.4 Data Collection A survey interview will be the data collection method on the issue of the relation between CSM and business performance. A questionnaire will be used comprising 20 questions divided in two sections. This survey interview will be the source of primary data and the secondary data will be the contents or literatures on the concepts of customer service management and business performance. Comparing the both results from the primary and secondary data will be a good strategy to analyze the data. There might be some difference in the results between the previous contents or literatures and fresh primary data collected through the use o tool survey questionnaire on the issues which is the theme of this research. During the primary data collection it will be a chance to ask few informal questions as an informal discussion regarding the issue of customer service management and business performance. So these are the data collection method where the primary one will be the survey questionnaire and secondary one will be the available previous researches and literatures.

4.5 Data analysis Collected data will be analyzed after doing the correlation test among the two variables. The variables are Customer service management Business perfromance

Correlation test is one of the key statistical analyses to analyze the data with mathematics and some quantitative view points. After that on the basis of the correlation test it will be analyzed as 8

qualitatively actually the correlation result is going to be analyzed. When the qualitative analysis will come into the work the data gathered from the observation and conversation, which were meant to be done more informally, will also be analyzed. This analysis will be checked by the chi square test because it is necessary to look at is there any difference between result assumed and the actual result. Through the chi square test the hypothesis is checked. To identify any deviation of hypothesis this statistical tool will be used and on the basis of the result of deviation or non deviation the qualitative judgment has been drawn. The reasons of the deviation and the result of correlation will be analyzed trough the qualitative view point. 4.6 Justification of the methodology chosen The methodology chosen for the research method is accurate enough because the research study will try to explore a correlation between the two variables set earlier for the study. The two variables will be judged mathematically after the opinions of customer service managers on the issue of business performance and its relationship with customer service management. Thus to have the opinion it is very much necessary to collect the data as primary from the view points of the customer service managers of four big retail companies in the UK. Without a good survey primary data will not be available that is why the survey with questionnaire is very much important. The content analysis or the secondary data from the previous researches is also justified because previous researches on the likewise topic can give basis to relate the changes occurred mean time and generalization of the data analysis.

4.7 Validity, reliability and generalisability The retail industry is one of the sectors of the economy which is considered as the continuous growing industry. Thus to explore the issues of the business growth due to the customer service management is an issue which is very much valid for this era and the reliability of the research will be achieved by the methods and data will be used for the research findings. Data for this research will be reliable as it will include survey interview as primary source and relevant literatures as secondary where the secondary data will not be from the outdated versions of

previous researches. Thus reliability will be achieved very easily. The inference of the research can be generalized because there would be more research on the same topic as it has been said earlier that the retail industry is one of the top most concerns of the business analyst and economists over the years. By the previous researches and potential future ones this research can be one of the linking bridges between those to create some general inferences regarding the stated problem.

5. Access and Resource application For this research the resources will be, 1. Ability of the researcher to analyze the business cases and growth types 2. Researcher should have the knowledge base to identify the key issues and factors of the customer service management and its implications over the business growth 3. A good management of time and cost 4. Previous researches and literature search and also the analysis of those


5. Statistical tool usability 6. Availability of the survey participants 7. Short or brief informal discussion with the survey participants 8. A good understanding of the researcher to write the final report of the research See bibliography as a secondary source of data and information.

6. Action Plan The action plan will be as like the chart given below, Activities To develop research instruments Literature review Field research training Data Collection 11 May June July August

Data analysis Draft report Interim Presentation Final report

7. Structure of the report The overall structure of the report will be divided by chapters. The structure of the report will be as like below, 1. Chapter 1: Introduction- it will include the objective and purpose of the study including the background of the study and the theoretical framework or conceptual framework. 2. Chapter 2: Literature review will be the section where the reviewed literatures on the topic and related issues give a detail idea about the issue and concept on the basis of which the data analysis will be doe and also the inference will be drawn. 3. Chapter 3: It will give idea about the used research methodology 4. Chapter 4: Data analysis 5. Chapter 5: Findings and recommendations 6. Chapter 6: Conclusion The report will be referenced as Harvard referencing style.

Reference Baier, Decker, Schmidt, Gaul (2005) Data Analysis and Decision Support, prentice hall. Bontis, Nick, Hulland, John and Crossan, Mary M., (2002) Managing An Organizational Learning System By Aligning Stocks and Flows. Journal of Management Studies, Vol. 39, pp. 437-469 Buckley and Caple (2000) The Theory & Practice of training 4th edition, Mc graw. hill. 12

Daniels,J and Radebaugh, L and Sullivan, D (2004) International Business: Environments and Operations, Pearson Education.

Dess G. Gregory, Robinson B. Richard Jr. (2006) Measuring organizational performance in the absence of objective measures: The case of the privately-held firm and conglomerate business unit, Strategic Management Journal, Volume 5 Issue 3, Pages 265 - 273

Dr. Kothari, C. R (2005) Research Methodology: Methods & Techniques,New Age Publishers,. Frank & Rison (1978) Training Methods and Organisation Development, Elsevier. Gubrium, J. F (2005) Qualitative research methods, sage publications. Hostein, J.A. & Gubrium, J. F (1995) Research methods: the active interview, sage publications. Creswell, J. W (2002) Research Design: Qualitative, Quantitative, and Mixed Method Approaches, Sage Publications. Kumar, R (2005) Research Methodology: A Step-by-Step guide for Beginners, Causeway press Ltd. Khong Kok Wei, Richardson, Stanley (2003) Business process re-engineering in Malaysian banks and finance companies, Managing Service Quality, Vol 13, Issue 1, p. 54-71 Lyles, M. A. (2996) Knowledge Acquisition from Foreign Parents in International Joint Ventures: An empirical examination in the Hungarian context, Journal of International Business, Vol 27, Issue 4, P-877-903 Stredwick, J (2006) An introduction to Human Resource Management, 2nd edition, Elsevier. Stranks, W & Jeremy (2006) Health and Safety, Prentice Hall.


Wilson, A (2003) A Marketing research , Prentice Hall. Wong, V (2005) principle of marketing, 5th edition , Causeway press Ltd. Yin , R.K (2003) Design and Methods, kogan page.

Bibliography For the research

Anderson, E., & Sullivan, M. (1993). "The antecedents and consequences of customer satisfaction for firms". Marketing Science, 12(1), 125-143. Anderson, E. W., & Fornell, C. (1994). ``A framework for comparing customer satisfaction across individuals and product categories''. Journal of Economic Psychology, 12(2), 267-286. Anderson, E. W., Fornell, C., & Lehmann, D. R. (1994). Customer Satisfaction, Market Share, and Profitability: Findings from Sweden. Journal of Marketing, 58(4), 53- 66.


Anderson, J. C., & Narus , J. A. (1990). " A model of distributor firm and manufacturer firm working partnerships". Journal of Marketing, 54(January), 42-58. Anderson, R. E., & Srinivasan, S. S. (2003). "E-satisfaction and e-loyalty: a contingency framework". Psychology and Marketing Letters, 20(2), 123-138. Armstrong, G., & Kotler, P. (1996). Principles of Marketing ( seventh ed.): India: Prentice Hall Arora, R., & Stoner, C. (1996). The effect of perceived service quality and name familiarity on the service section decision. Journal of Service Marketing, 10(September), 201-222. Asubonteng, P., McCleary, K. J., & Swan, J. E. (1996). SERVQUAL revisited: a critical review of service quality. Journal of Services Marketing, 10(6). Athanassopoulos, A., Gounaris, S., & Stathakopoulos, V. (1999). Behavioral responses to customer satisfaction: an empirical study. European Journal of Marketing, 35(5), 687-707. Athanassopoulos, A. D. (1997). Another look into the agenda of customer satisfaction: focusing on service providers' own and perceived viewpoints. The International Journal of Bank, 7(5), 152-165. Anderson, E.W. and Fornell, C. (2000), Foundations of the American customer satisfaction index, Total Quality Management, Vol. 11 No. 7, pp. 869-82.

Aaker, D.A. and Day, G.S. (1986), Marketing Research, 3rd ed., JohnWiley & Sons, New York, NY,pp. 443-53. Agus, A. (2001), A linear structural modelling of total quality management practices in manufacturing companies in Malaysia, Total Quality Management, Vol. 12 No. 5, pp. 561-73. Anderson, E.W. and Fornell, C. (2000), Foundations of the American customer satisfaction index, Total Quality Management, Vol. 11 No. 7, pp. 869-82.


Bateson, J. (2002a), Are your customers good enough for your service business?, Academy of Management Executive, Vol. 16 No. 4, pp. 110-21. Bateson, J.E.G. (2002), Consumer performance and quality in services, Managing Service Quarterly, Vol. 12, pp. 1-7. Bank Negara Malaysia (2000), Consolidation on domestic banking institutions, available (accessed 6 June 2000). Bitner, M.J. (2001), Servicescapes: the impact of physical surroundings on customers and employees, Journal of Marketing, Vol. 56, pp. 57-71. Bitner, M.J., Ostrom, A.L. and Meuter, M.L. (2002), Implementing successful selfservice strategies, Academy of Management Executive, Vol. 16 No. 4, pp. 96- 108. Bowen, D.E. (1986), Managing customers as human resources in service organizations, Human Resource Management, Vol. 25, pp. 371-83. Carmines, E.G. and Zeller, R.A. (1979), Reliability and Validity Assessment, Sage Publications, Newbury Park, CA, pp. 59-70. Cateora, P.R. and Graham, J.L. (1999), International Marketing, 10th ed., The McGraw- Hill Companies, New York, NY. Christopher, M. and Wills, G., (1974) Developing Customer Service Policies, International Journal of Physical Distribution & Materials Management, , pp. 321-5.

Cunningham, M.T. and Roberts, D.A., (1974) The Role of Customer Service in Industrial Marketing, European Journal of Marketing, Spring, pp. 15-29.


Christopher, M., Schary, P. and Skjott-Larsen, T., (1979) Customer Service and Distribution Strategy, John Wiley & Sons, New York, NY Dess, G.G. and Robinson, R.B. (1984), Measuring organizational performance in the absence of objective measures: the case of the privately-held firm and conglomerate business unit, Strategic Management Journal, Vol. 5 No. 3, pp. 265-74. Filiatrault, P., Harvey, J. and Chebat, J.C. (1996), Service quality and service productivity management practices, Industrial Marketing Management, Vol. 25 No. 3, pp. 243-55. Green, P. and Wind Y., (1973) Multi-attribute Decisions in Marketing: A Management Approach, The Dryden Press, Hinsdale, IL, 1973. Hansen, F., (1976) Psychological Theories of Consumer Choice, Journal of Consumer Research, Vol. 3 No. 3, December 1976, pp. 117-42. Hopkins, D.S. and Bailey, E.L., (1970) Customer Service: A Progress Report, The Conference Board, New York, NY, p. 1. Hutchinson, W.M. and Stolle, J.F., (1968) How to Manage Customer Service, Harvard Business Review, November- December, pp. 85-96. LaLonde, J. and Zinszer, P.H., (1976) Customer Service: Meaning and Measurement, National Council of Physical Distribution Management, Chicago, IL, p. 156. LaLonde, B.J. and Levy, M., (1977) Customer Service: A Distributor-Packer/Processor Perspective, Frozen Food Factbook Levy, M., (1978) Methodology for Improving Marketing Productivity through Efficient Utilization of Customer Service Resources, PhD thesis, Ohio State University, Columbus, OH


Perreault, W.D., Jr, (1973) The Role of Physical Distribution Customer Services in Industrial Purchasing Decisions, PhD thesis, University of North Carolina, 1973, p. 15. Perreault, W.D. and Russ, F.A., (1976) Quantifying Marketing Trade-offs in Physical Distribution Policy Decisions, Decision Sciences, pp. 186-201.39 CREATIVE Perreault, W.D. and Russ, F.A., (1973) Improving Physical Distribution Service Decisions with Trade-off Analysis, International Journal of Physical Distribution & Materials Management, 1973, pp. 117 27. Perreault, W.D. and Russ, F.A., (1974) Physical Distribution Service: A Neglected Aspect of Marketing Management, MSU Business Topics, summer, pp. 37-45. Schary, P. and Becker, B., (1976) Product Availability and the Management of Demand, European Journal of Marketing, pp. 127-35. Simon, L.S., (1965) Measuring the Market Impact of Technical Service, Journal of Marketing Research, February, p. 32. Tucker, F.G., (1980) Customer Service in a Channel of Distribution: The Case of the Manufacturer Wholesaler-Chain Drug Retailer Channel in the Prescription Drug Industry, PhD thesis, Ohio State University, Columbus, OH Willett, R.P. and Stephenson, P.R., (1969) Determinants of Buyer Response to Physical Distribution Service, Journal of Marketing Research, August, 1969, pp. 279-83. Wagner, W., (1975) Formalisation of the Customer Service Functions in Distribution, International Journal of Physical Distribution & Materials Management , 1973, pp. 15975.USTOMER SERVICE MANAGEMENT Zinszer, P.H., (1976) Customer Service as an Element of the Marketing Mix: The valuation of a Descriptive Model of Customer Service, PhD thesis, Ohio State University,


Columbus, OH, p. 80.