Professional Documents
Culture Documents
L
inda Dolinová, Human Resources manager for the Sunpharma Group, looked
over the results from the Mystery Shopper visits that had been conducted a
month earlier, in January 2011. On the whole, the evaluation was positive, but
the agency’s report highlighted some deficiencies in customer service. Linda thought
this was a pervasive problem among pharmacists throughout Slovakia. To her it
seemed only natural that they didn’t have good customer service skills, since they were
not trained in such things in school, but these skills were important for Sunpharma as
it rolled out its new corporate strategy. Linda had asked to meet with Friedrich Plail,
Sunpharma’s CEO, to discuss the Mystery Shopper report and its implications for her
unit’s activities. As she prepared for her meeting with Mr. Plail, she asked herself, What
would be the best way to teach “soft skills” to pharmacists who prided themselves on their
technical knowledge? How should she prepare for this meeting and what should she propose
to the CEO?
Sunpharma
Sunpharma’s first retail pharmacy was opened in 1998 in Slovakia’s second largest city,
Košice, in eastern Slovakia. The next year two new pharmacies were opened—one each
in Košice and Prešov. A year or two later Sunpharma acquired a pharmacy in centrally
located Poprad. (See Exhibit 1 for a map of Slovakia with Sunpharma locations.)
In August 2009, Sunpharma’s founder decided to sell the company. The new man-
agement moved the company headquarters from Prešov to Bratislava, the capital city,
as this location was more convenient for the new management. All of the original
employees working in the Prešov headquarters were given an option to relocate but
only two people accepted. This resulted in the development of a completely new man-
agement team.
Linda Dolinová was hired in November 2009, as a part of Sunpharma’s new organi-
zation. Linda had worked in human resources since 2002, shortly after completing her
master’s degree in human resources management. She had worked as an HR specialist
for several large Slovak companies, most recently for the biggest telecommunication
Copyright © 2012 by the Case Research Journal and by Katarína Lacková and Michaela Polaková, Come-
nius University in Bratislava Faculty of Management, and Joan Winn, University of Denver. The authors
are indebted to CRJ editor Debbie Ettington and three anonymous reviewers for their substantive and
detailed critique and suggestions. The case is intended to be used as the basis for class discussion rather
than to illustrate the effective or ineffective handling of a managerial situation.
Improving Customer Service in Sunpharma Pharmacies 65
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company in the country. She had also received accreditation in training and develop-
ment from the ministry of education for the Slovak Republic in 2005, and considered
herself an expert in recruitment, motivation, and performance management.
By 2011, the Sunpharma organization included twenty-seven corporate employees
in departments of purchasing, finance, marketing, human resources, and operations.
These corporate staffers supported Sunpharma’s 203 pharmacy employees in thirty-five
pharmacies—most of which were located in shopping centers or medical clinics. (See
Exhibit 2 for Sunpharma’s organizational structure.) Exhibit 3 shows annual revenues
for the individual pharmacies in Sunpharma’s portfolio.
66 Case Research Journal • Volume 32 • Issue 3 • Summer 2012
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corporation, but each pharmacy had its own owner. Legislation to relieve this lim-
itation was in parliament, and the creation of chains of corporate pharmacies was
expected to be legalized in December 2011. The new law would also lessen restrictions
on generic drugs by removing the requirements that prescriptions specify a commer-
cial name directly instead of the chemical composition.
Pharmacy Design
Traditional Slovak pharmacies had no self-service section—that is, all products were
accessible only to the employees. Between the consumer and pharmacist there was a
desk with a glass wall display barrier that had a small gap through which the phar-
macist would deliver the assortment of goods and collect money from customers.
(See Figure 1.)
Improving Customer Service in Sunpharma Pharmacies 67
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Figure 1. Traditional Slovak Pharmacy Interior
In a departure from the structure of the traditional pharmacy, every new Sun-
pharma pharmacy was designed as a modern open space with a large self-service sec-
tion. (See Figure 2.) In Sunpharma pharmacies, most items were self-service, and only
prescription medications required the help of a pharmacist. This allowed customers to
examine the products on the shelves closer and at their leisure, reading the informa-
tion on the package and comparing brands and ingredients. At traditional pharmacies,
customers waited in line to speak with a pharmacist and there was implied pressure to
complete their transactions quickly, without purchasing additional products. The open
space pharmacies allowed a more relaxed atmosphere where pharmacists could assist
in selection of both prescribed and self-service products, after the customer perused
the aisles. In addition to an assortment of OTC medications, the open space shelves
contained nutrition and vitamin supplements, cosmetics, common sanitary goods,
and other items for personal health and hygiene.
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Sunpharma was not the only “new concept” pharmacy in Slovakia. Dr. Max, like
Sunpharma, was a network of pharmacies noted for its large selection of OTC prod-
ucts and a personal approach to customers. Like Sunpharma, Dr. Max pharmacies
were located in shopping centers and medical buildings. However, Sunpharma prided
itself on its wider product assortment, especially in cosmetics and specialty products,
and its emphasis on quality of product knowledge and advice.
Sunpharma Strategy
Friedrich Plail and his management team wanted Sunpharma to be the most popular
pharmacy in Slovakia, renowned for its world class professionals and comprehensive
services including drug consultation and price-comparison information, and comple-
mentary services such as blood pressure and cholesterol screening, fat measurements,
and dermatology advice. Another chance to achieve higher revenues was to attract
customers who purchased OTC drugs as demand and availability were increasing.
Sunpharma set up a loyalty program that gave customer discounts, and promoted Sun-
pharma’s offerings. As competition increased, these differences in quality and service
became increasingly important. The company’s mission statement was:
To be a long-time favorite and the most in-demand pharmacy renowned for world class
professionals, comprehensive services and an individual approach. Respecting ethics
in business; providing a polite, pleasant and professional demeanor to customers and
to business partners (physicians and suppliers), as well as high professionalism should
facilitate achievement of this goal.
Linda Dolinová believed this strategy depended on the pharmacists providing high-
quality services, attentive to customer needs. Linda was confident that Sunpharma had
competent employees, but she thought that Sunpharma needed to do a better job of
showing them what areas of their work they needed to master to do their job in accor-
dance with the company’s strategic goals. In Linda’s opinion, achieving these goals
depended on the level of customer service.
Improving Customer Service in Sunpharma Pharmacies 69
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She explained:
Customer service means having a friendly and patient approach. Communication with
customers often means a lot of explaining to people who are a little bit nervous. Phar-
macists have to understand the importance of their role is not only in dispensing pre-
scribed drugs and preparing the medications. They have to realize that their behavior
could influence whether the customer comes back or not.
Professional demeanor was also essential for good relationships with business part-
ners such as physicians, pharmaceutical firms and other product suppliers, pharma-
ceutical schools, and training institutions. Creating and maintaining a network of
contacts with pharmaceutical firms and suppliers kept everyone abreast of industry
changes and helped maintain inventory control. Open and honest communication led
to better working conditions and more efficient operations. Cooperative marketing
with pharmaceutical firms yielded supplementary revenues from product promotion.
Cooperation with pharmaceutical schools allowed Sunpharma to build relationships
with future pharmacists, and benefited the schools by informing them about what was
needed in practice. Ideally, this dialogue influenced curriculum changes in order to
prepare pharmaceutical students for their future job.
The new open self-service concept had been well received by Sunpharma’s employ-
ees. Some of the pharmacists had initially expressed skepticism about the remodeling,
but when they saw the results they were very pleased as well. They had already expe-
rienced changes in customer expectations for accessible product displays and more
personal attention, and understood Sunpharma’s proactive efforts to modernize with
the times. Seven pharmacy locations had been remodeled in 2008, four more in 2009,
and another two in 2010.
Organizational Culture
Linda thought that organizational culture also played an important role in pharma-
cist behavior and willingness to change. Individual pharmacies had cultures that were
influenced by specific characteristics of the particular responsible pharmacist in each
pharmacy. In 2011, Sunpharma was a young company, with many recent graduates
among its pharmacy staff. Sunpharma’s management team wanted to create a com-
mon corporate culture and espoused a corporate values statement:
Sunpharma’s organizational culture focuses on people. People are the most important
factor for this organization which is why it is not oriented toward creating and main-
taining a system, which usually leads to putting the person out of this system. Sun-
pharma tries to support human faith in the ability to change the environment, provides
time for learning, and shows the importance of training and learning for the everyday
work of employees. Corporate values are openness, commitment, initiative, profes-
sionalism and respect.
These behaviors were still new to a country that was used to top-down manage-
ment practices and adherence to rigid policies. Customer service relied on open com-
munication and flexibility. Good working relationships relied on mutual confidence
and cooperation. Responsible pharmacists needed to understand that they were part of
a team that included laboratory technicians and paramedical personnel; the pharmacy
could not run without a concerted effort of everyone working in the pharmacy.
Friedrich Plail had instituted company-wide management activities with Sunphar-
ma’s values and strategy in mind. Regular meetings, for all managers and responsible
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pharmacists, were organized twice a year. These meetings provided an opportunity for
upper management to keep everyone informed about the operational and strategic
situation of the organization, reiterating their vision, expectations, ideas and values
important for the organization’s success. These corporate-wide meetings also included
an opportunity for one or two credit seminars for responsible pharmacist recertifi-
cation, and informal activities for idea-sharing and networking among responsible
pharmacists.
Linda observed that many employees, including pharmacists, stayed at Sunpharma
because of its “employee friendly” organizational culture. Several of the newer phar-
macist hires commented that Sunpharma’s culture was unique and they felt better
working for Sunpharma than its competitors that did not communicate so openly or
empower their employees to make decisions with their teams. Employee turnover for
Sunpharma pharmacies was under 10 percent, which was low by industry standards.
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The training currently provided by Sunpharma and its contracted providers was not
oriented toward customer service and did not address these changing expectations for
the pharmacist’s role. Linda recognized that increasing the proficiency of pharmacists
was required by law, but she also understood that the changing nature of pharmacists’
work required more than technical or pharmaceutical knowledge. The modern phar-
macist was expected to be a customer’s personal advisor and consultant and this new
role necessitated communication and interpersonal skills seldom addressed in their
university training or certification. (See Exhibit 6 for the pharmacist job description
used by Sunpharma.)
Hana Kubová, one of Linda’s assistants, reminded Linda that they were not “start-
ing from scratch” in developing a training system. She pointed out,
We already provide certain training activities and we are also working on fostering a
continuous-learning culture. Important documents and information that employees
need to carry out their work or to understand the philosophy, direction and values
of the company are presented at the new-employee orientation organized by our HR
department and are available for all employees through our intranet. As every employee
has to sign a document stating he has read all the directives published through our inter-
nal network, everyone should know that our priority is to focus on human resources
and their development.
Linda acknowledged Hana’s point, but was afraid that few people paid attention to
the document they signed when they were hired. Linda responded,
Yes, we try to ensure that training and development are seen by all employees as an
important part of their working lives. But, first and foremost, we need to focus on the
pharmacists. Continuing education for them is required by law, and they are in the best
position to model behavior for the other employees.
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natural that they do not know how to do it, which is another reason why we need to
start to pay attention to their training in these areas as well. The loyalty program was
not mentioned in any of the thirty-five visited pharmacies.
Hana frowned. “The report was not very positive about sales skills. Mr. Plail will
not be happy about that. And what about other employees? We also have to deal with
their training, not only that of the pharmacists.”
“Of course,” agreed Linda, “but everything cannot be done at once. It seems to me
that since the pharmacists are the only ones who are able to issue prescribed drugs,
training them should be our priority.”
“Or at least, the first step,” added Hana.
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training. This should serve as a linchpin to employee training and development. It
assists us in identifying the competencies for certain positions and helps us to iden-
tify important competencies that we should be focusing on and developing in our
employees. It is these competencies that should be integrated into our training system
and learning plans. This approach is also a way to ensure that we are training people in
something that is really important for their work. Developing these skills and charac-
teristics should lead to improved effectiveness and productivity, but more importantly,
increased satisfaction for our customers and patients will ultimately be reflected in
improved sales results.
Linda was well aware of the importance of the task assigned to her. A well-designed
training system could help increase the competitiveness of the company substantially.
There were a lot of ideas that should be included in the system, but she also needed to
be mindful of financial and time constraints. In addition to the direct costs, each train-
ing activity required some time off for employees participating in training activities.
Part of Linda’s task would be to find qualified replacements in the pharmacies during
the training sessions.
Earlier in the year, Linda had prepared a preliminary budget, totaling 3,390 EUR
for training headquarters personnel and 5,640 EUR for the pharmacies. (See Exhibits
8, 9, and 10.) Linda’s current plan proposed 2 percent of current revenues for train-
ing. Now, with the new emphasis on customer service, she wondered if these amounts
would be sufficient. (Exhibit 11 gives cost estimates of different training seminars in
Slovakia in 2011.) Linda knew that Mr. Plail supported training and development
initiatives for employees, but he had said, “Every coin has two sides,” and he always
looked at balancing costs and benefits for the company.
She knew that the CEO expected her to present a draft of the training system pro-
posal, but she did not want to rush her decision at the expense of quality. In her head
she was contemplating the various advantages and disadvantages of each possibility.
“Which factors are the most important? Which of them do I need to take into consideration
in designing the training system? What strategy should I use to create an effective training
system?” she thought as she was navigating through the results of the mystery shopping
report and browsing through the articles. “And how do I convince the CEO that this is
what we need?”
She wanted to make sure that he understood how important employee training was
for the company to achieve its strategic goals, since it would take strong support from
the top to get people to buy into a new way of doing business.
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Exhibit 1: Map of Slovakia, Showing Number of Sunpharma Pharmacies in each Region
The Slovak Republic is located between Austria and the Czech Republic on the west, Poland on the north, Ukraine on the east and
Hungary on the south. In 2011, its population was approximately 5 million people. Source: adapted from www.d-maps.com. The map
was edited and the number of pharmacies added.
Improving Customer Service in Sunpharma Pharmacies 75
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Exhibit 2: Organizational Structure of Sunpharma Group (as of April 2011)
Chief Executive
Officer (1)
Lawyer (1)
Chief Operating
Officer (1)
E-shop
IT specialist (1)
specialist (1)
HR
Accountant (6) Assistant (1)
officer (2)
Pharmacist
Financial Maintenance
officer (1) technician (1) Pharmaceutic
laboratory
technician
Archivist (1)
Paramedical
personnel
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Exhibit 3: Sunpharma Company Gross Turnover (Revenues)
Revenues in EUR3
Pharmacies 2008 2009 2010
SUNPHARMA 1, s.r.o. inactive 535 924 557 683
SUNPHARMA 2, k.s. 1 560 454 1 643 910 1 757 498
SUNPHARMA 3, s.r.o. 468 347 497 923 522 389
SUNPHARMA 4, k.s. 880 948 906 121 763 157
SUNPHARMA 5, k.s. 1 747 899 1 824 865 1 853 257
SUNPHARMA 6, k.s. 1 453 391 1 635 965 1 625 303
SUNPHARMA 7, s.r.o. 536 790 584 187 536 102
SUNPHARMA 8, k.s. 1 377 003 1 300 936 1 086 708
SUNPHARMA 9, k.s. 2 113 948 2 008 901 2 030 608
SUNPHARMA 10, k.s. 3 074 597 3 748 863 3 461 315
SUNPHARMA 11, k.s. 2 872 437 2 901 399 2 928 550
SUNPHARMA 13, k.s. 2 407 062 2 183 209 2 193 791
SUNPHARMA 14, k.s. 1 815 557 1 827 169 1 946 097
SUNPHARMA 15, k.s. 835 238 759 087 641 243
SUNPHARMA 16, k.s. inactive 1 158 097 1 137 807
SUNPHARMA 17, k.s. 2 083 891 1 914 027 1 599 747
SUNPHARMA 18, s.r.o. 277 811 403 073 410 669
SUNPHARMA 19, s.r.o. 264 267 772 830 inactive
SUNPHARMA 20, k.s. 400 489 932 324 1 071 489
SUNPHARMA 21, s.r.o. 5 672 303 806 483 329
SUNPHARMA 22, s.r.o. 129 345 459 590 060
SUNPHARMA 23, s.r.o. inactive 361 499 563 209
SUNPHARMA 24, s.r.o. inactive 104 430 528 514
SUNPHARMA 25, k.s. 130 730 266 844 619 540
SUNPHARMA 26, k.s. inactive 22 341 719 341
SUNPHARMA 27, s.r.o. 9 177 6 168 140 865
SUNPHARMA 28, s.r.o. 223 778 inactive 198 603
SUNPHARMA 29, s.r.o. 104 224 117 511 227 949
SUNPHARMA 30, s.r.o. 368 005 137 651 249 307
SUNPHARMA 31, s.r.o. 35 139 82 049 202 941
SUNPHARMA 32, s.r.o. 287 139 inactive 18 144
SUNPHARMA 33, s.r.o. inactive 584 524 301 002
SUNPHARMA 34, s.r.o. inactive inactive 501 261
SUNPHARMA 35, s.r.o. 368 446 395 744 49 087
SUNPHARMA 36, s.r.o. 481 488 399 985 13 418
Headquarters
PASIMUS 1 913 110 1 910 782 merged into
PRIMUS 126 764 44 018 SUNPHARMA SLOVAKIA
SUNPHARMA SLOVAKIA 1 476 321
Note: s.r.o. (spolocnost s rucenim obmedzenym) designates a limited liability company (corporation); k.s. (komanditna spolocnost)
is a special limited partnership. These abbreviations are usually part of the company name.
Improving Customer Service in Sunpharma Pharmacies 77
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Exhibit 4: Population and Pharmacy Density in Slovakia
Region Number of Number of Number of Inhabitants per Inhabitants per Pharmacists per
Inhabitants pharmacies pharmacists pharmacy pharmacist pharmacy
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Exhibit 6: Job Description for Pharmacist
Job description
Position: Pharmacist
Dispensing prescribed drugs, OTC drugs, medical devices and complementary health aids,
compounding individually prepared drugs in accordance with good production practice, stand-
Description of the position:
ards and pharmacopoeia. Complies with the provisions of the Act no. 140/1998 and Act no.
139/1998 of narcotic drugs and psychotropic substances.
Responsible for:
• Compounding individually prepared drugs in accordance with the principles of good production practice, applicable stand-
ards and pharmacopoeia.
• Dispensing prescribed drugs, OTC drugs, medical devices and complementary health aids.
• Processing of prescriptions and medical voucher by computing.
• Providing advice to patients regarding proper use, dosage, side and natural effects of medicines.
• Checking the status of inventory, ordering medicines, medical devices and complementary assortment of pharmacy.
• Checking the quality of drugs, taking drugs and raw materials in the stock records.
• Verifying the correctness of the deposit and storage of medicines and medical supplies.
• Coordinating the work of pharmacy lab technicians.
• Ensuring the implementation of marketing activities in pharmacies and coordinating purchases with the purchasing depart-
ment.
• Preparing the details and documentation for updating the company web site.
• Cooperating with other departments within the company as well as with responsible pharmacists in other pharmacies.
• Performing other duties assigned by the supervisor.
Competencies:
Education:
Pharmaceutical faculty—field of study: pharmacy
Experiences:
Ability to direct and open communication, team spirit, ability to set priorities, work organization,
Abilities:
time management
Personal qualification: Autonomy, initiative/proactive, reliable, responsible, loyal, positive thinking, self-reflection
Ability to make decisions, ability to implement laws in practice, conceptual thinking, initiate
Core/Key competencies:
problem solving, ability to learn and progress
Improving Customer Service in Sunpharma Pharmacies 79
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Exhibit 7: Summary of Mystery Shopping Report4
Method
Mystery shopping—trained mystery shoppers visited each pharmacy in the role of real customers with a prepared “mystery story.”
Every pharmacy was visited once by one mystery shopper.
Mystery Story
“Good morning, I don’t feel well.”
Detailed specification: Mystery shopper in the role of customer visited the selected pharmacy. According to the mystery story, he
asked pharmacist for help in choosing a non-prescription cold medication. After the initial information about not feeling well, the
initiative was left to the pharmacist. At the end, the customer/mystery shopper left with the selected product that he bought.
Main objective: Identification of the current level of customer service during the sale of a non-prescription medicine.
Secondary objective: Identification of major deficiencies in customer service.
Purchased goods: Non-prescription medication for initial cold symptoms according to the requirements of the mystery shopper.
Main areas of interest of the mystery shopping:
• Exterior and interior of the pharmacy (cleanliness and atmosphere in the pharmacy).
• Greetings and salutation of pharmacist.
• Appearance of the sales person (clothing and name badge of pharmacist).
• The process of drug selection (detection of health problems, suitable product offering, provided information about offered drugs).
• Completion of the sales talk (cross-selling, thank you for visiting and farewell to the customer).
• Loyalty Program (offering a loyalty program and information about its benefits).
• Communication and professional skills (pharmacist’s ability to answer questions, his attention to the customer).
• Overall assessment of pharmacy visit (overall customer satisfaction, pros and cons of the visit).
Summary of Results
Positive Results
• Environment of pharmacies (exterior and interior) is rated as clean. Customers feel comfortable in Sunpharma pharmacies.
• Pharmacy staff is attentive upon arrival of a customer. All customers were served as soon as possible. Waiting time was 1.6 minutes.
• Greeting and establishment of eye contact upon welcoming of the customer was never missing.
• Sunpharma pharmacists were evaluated as professionals. Customers had no problems with getting answers to their questions.
• Pharmacists knew assortment of products of the pharmacy in which they worked. Alternative drugs for the health problems of
a customer were offered in 97 percent of cases.
• Communication skills (pharmacist’s ability to answer questions, attention to the customer) of pharmacists were evaluated
positively. However, deficiencies in active approach to customers were found, notably greetings and salutation from the phar-
macist, detection of health problems, suitable product offering, information about offered drugs, cross-selling, thank you for
visiting and farewell to the customer and offering the loyalty program and providing information about its benefits.
Negative Results
• Overall customer service index rating averaged 72 percent, which means there is still some room to improve levels of cus-
tomer service.
• Identification of needs and symptoms of health problems of the customer was lacking. Pharmacists offer a suitable product for
the customer only in response to customer questions.
• The results show deficiencies in the sale of suitable medicine for the customer. Providing information about offered products
was low (59 percent). Customers are often not given information about the product’s price before buying the product (45
percent). Information about possible alternatives (59 percent) or pharmacist‘s recommendation (62 percent) is also missing
in many cases.
• Loyalty program information was completely absent in all sales transactions. None of the pharmacies mentioned it during
mystery shopping visits.
• Customers would appreciate a more personal approach by pharmacists. When evaluating the pharmacist’s approach to the
customer, details like lack of smile (56 percent), thanks for the visit (59 percent) or name badge (50 percent) are very important.
• Pharmacists lack sales skills. Cross-selling was part of just 35 percent of sales transactions.
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Exhibit 7: Summary of Mystery Shopping Report (continued)
Return visit
Definitely yes 41%
Somewhat yes 21%
Neither yes or no 26%
Somewhat no 9%
Certainly not 3%
Sub-index
Exterior and interior of pharmacy 92%
Greetings and salutation 88%
Appearance of the sales person 50%
The process of drug selection 66%
Completion of the sales talk 52%
Communication and professional skills 86%
Overall index 72%
Improving Customer Service in Sunpharma Pharmacies 81
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Exhibit 8: Training Budget per Person for Sunpharma Headquarters Personnel for 2011 (in Euros)
Exhibit 9: Estimated Employee Compensation by Department for Sunpharma Headquarters for 2011 (in
Euros)
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Exhibit 10: Estimated Cost of Employees (Total Compensation) and Training Budget for 2011
(in Euros, per Pharmacy)
Improving Customer Service in Sunpharma Pharmacies 83
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Notes
1. By comparison the Czech Republic had roughly one pharmacy for every 5,500 inhabitants.
2. Over-the-counter (OTC) medications were those that could be bought without a prescription
from a doctor. In the United States, the term could refer to non-prescription medicines and
nutritional supplements, which could often be purchased in drugstores, supermarkets and ser-
vice stations. In Slovakia, OTC medications could only be purchased in pharmacies. In general
in Europe many medications that were easily purchased in the U.S., like ibuprofen, were more
closely regulated.
3. Inactive means pharmacies were closed for remodeling and later reopened in the same location
or in a different location (a few moved to another city). Some pharmacies, for example #32,
35, and 36, were closed for only a few months before reopening later in the year. Sunpharma
Slovakia, the company headquarters, was an independent company in 2010. This was expected
to change in 2012 with the new legislation.
4. These are excerpts from the 32 page report.
5. Training cost depends on provider.
84 Case Research Journal • Volume 32 • Issue 3 • Summer 2012
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