Case Study 5 – Customer Service
Background and Problem
The business, a medium sized player in the printing sector, had experienced a tapering off of sales growth due primarily to the loss of principals. In addition, credit control was being hampered by the requirement to issue an increasing number of credit notes, directly resulting in further delays in payments or collection by the sales representatives.
The causal factors of the increasing incidence of credit note were felt to be related to under-shipments and pricing errors. A side effect generated by the problem was increased tension between the Sales and Warehouse Departments.
The assessment was carried out by a FBA adviser included a study of the credit notes history, interviews with key personnel in Sales, Warehouse, Credit Control and a representative number of customers.
Following above, a meeting was facilitated by the FBA adviser with a cross – section of the departments involved and the senior management team. At the meeting the adviser presented a number of charts referring to the ideal form of Customer Service operations, the type of action-oriented Reports which should be produced, and the accountable parties.
These Reports would monitor the level of service actually recorded, versus targeted levels, segmented by Customer and Company operational perspectives. Under the above headings, various activities would be measured, including:
|Order fill ||Sales forecasting|
|Case fill ||Non-quality costs|
|On-time deliverables ||Stock cover|
|Refusals ||Asset turnover ratio|
|Invoice accuracy || |
A cross departmental team was appointed to progress agreed areas under the Customer Service banner. Specific areas were agreed to ensure the Reports were prepared on a regular and timely basis, populated using agreed terminology regarding causes, and the splitting of causes between ‘avoidable’ and ‘unavoidable’. In addition, it was agreed that an informal Survey of customers would take place using the Sales Force. This would elicit views regarding the intended improvements and a comparative assessment versus its main competitors.
A steady but discernible increase in sales resulted supported by an improvement in the customer satisfaction index. This will be monitored on an on-ongoing basis.