Assignment - Customer Service Standardisation
Content
Table of Content 1.0 Executive Summary 2.0 Chapter 01 - Introduction 3.0 Chapter 02 – Profile 4.0 Chapter 03 - Literature Review 5.0Chapter 04 – Data Analysis & Findings 6.0Chapter 05 - Recommendations & Conclusion - Recommendations and action plan for Customer Service Standardisation 1. Developing the role of Customer Service through proper establishment of a Marketing Department with in the group 2. Carrying out a thorough research internally and externally on Customer Service 3. Building objectives and strategies for future Customer Service implementation process 4. Developing segmented customer profiles and evaluating the attractiveness of each segment 5. Selecting the profitable segments for targeting 6. Identifying different customer service levels for each targeted segments, developing and communicating the chosen concepts to respective customer segmentation handling staff 7. Implementation of a Continuous monitoring and evaluation system on the Customer Service Process 8. Regular staff meetings and briefings regarding Customer Service process and to gather feedback on customers and market. 9. Installing a proper CRM Software in order to provide guidance for marketing and customer service functions of the company 10. Adding a Web Blog and upgrade the current website to gather customer feedback and improve customer services Organisation’s Resource Capability and Capacity needed to deliver proposed recommendations and action plan Conclusion 7.0 Chapter 06 - References
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1.0 Executive Summary The Acuity Logistics (Pvt) Ltd. belongs to the Acuity Logistics Group of companies, which operates in the Shipping and Freight Forwarding industry which is highly competitive and dynamic. The key competitors in the market are Expolanka, Freight Links, DHL, Aitken Spence, John Keels and Hellman Logistics. Acuity Logistics holds 7% of market share and generates 450,000 – 500,000 US $ worth of monthly sales on average and also has gained the status as the emerging market leader. This report acts as an organizational benchmark and a template for current and future Customer Service Standardisation Process. It includes a comprehensive analysis and plan on how to carry out a comprehensive customer service standardisation and implementation process internally and externally. The existing process is evaluated against recognized customer service practices in order to identify the gaps and inconsistencies that exist in the current process and practices. This project report includes a critical analysis on the research findings of Acuity Logisticsand the recommendations for the Customer Service standardisation process and to develop the role of marketing of the company. The Current Organisational Structure and the Role of Marketing and customer service within the organisation, the improvements that can be delivered to develop the process, the Management and Leadership of Synergy, Organisation’s Resource Capability and Capacity needed to deliver proposed recommendations, Key deliverables, Budget, schedules are more elaborated through out the project report. The implementation of a CRM System, Proper Evaluation and Monitoring System, a Customer Service Division with in the group and the Web Blog and up gradation will boost the interest of customers and employees towards business and will help to rejuvenate the role of customer service within the organisation, while standardising the process to meet the business and customer needs. The report suggests a proper evaluation and monitoring process for Customer Service within Synergy and a comprehensive action plan to carry out the tasks step by step toward the completion. The project will rejuvenate and strengthen the sales and operation of Acuity providing the support to lead a step ahead in its second half of first decade.
2.0 Chapter 01 – Introduction 2
The Customer Service standardization assignment will be done on Acuity Logistics (Pvt) Ltd., which is well known as a market leader and the group’s core business evolves around freight forwarding. The Acuity Logistics (Pvt) Ltd. is a public quoted, group of companies; with four fully own subsidiaries and two joint venture companies. It was found on the 5th October 2004 as a fully fledged freight forwarding outfit. Acuity Logistics in its short history in the industry of logistics in Sri Lanka has managed to create a remarkable impact with its unique innovative strategies and has been a one of the most sought after logistics provider. (Half a Decade, 2009) Acuity Logistics has shown qualities of a "true leader of the new generation" who goes beyond the boundaries of conventional freight forwarding. When competitors are restricted their standard defined systems Acuity Logistics always tries to adopt a customized handling procedure as per the individual needs of different customers. (Annual Report 2009 - 2010) The Company's objective is to provide reliable and quality service, which is strongly supported by professionalism. The staff is trained and equipped with the knowledge and industry experience. The prime focus is to provide a quality service with enhanced benefits through innovative value additions embedded with reliability. Acuity Logistics believes "business as usual no longer good enough". It has understood that in the present context it is expected to unburden the customers with ground breaking logistics solutions and Acuity Logistics always looks towards the ability to move rapidly into innovative solutions. Acuity Logistics won the silver award for “Service providers to Exporters – Large Category” awarded by the National Chamber of Exporters for the valued contribution made during the year 2008. (Chamber of commerce, 2010)
3.0 Chapter 02 - Profile
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The Acuity Logistics (Pvt) Ltd. mostly cater to the customers fall under Business to Business (B2B) category. Business to Consumer (B2C) customers also are been served with some specialised services. The customer base of Acuity Logistics is over 5000 and the customers who do shipments with the company continuously in every month exceed 500, which is a comparatively higher amount in relation with competitors of the industry. The customers of the company has been segmented into major three categories as, Tea, Rubber and Coconut taking into consideration the traditional highest export sectors of the country. Some of the Key Clients of the company are, Bridport Aviation Lanka (Pvt) Ltd, Latex Green (Pvt) Ltd, Comfortwear (Pvt) Ltd, Singer (Sri Lanka) Limited, Royal Ceramics Lanka Ltd, Ceylon Biscuits Limited, Maliban Biscuits Manufactures Ltd, Line Aqua (Pvt) Ltd, Cecil Food (Pvt) Ltd, Lalanka Solid Waste Management, Minra Garments (Pvt) Ltd, St. Regis Packaging (Pvt) Ltd, Uniwell Microsystems (Pvt) Ltd, Marie de Classique Attire (Pvt) Ltd, Renuka Agro (Pvt) Ltd., Diamond Lanka International (Pvt) Ltd. Global Allianz (Pvt) Ltd, Amarlee Trading (Pvt) Ltd., Ally Weerasinghe (Pvt) Ltd. Fontera (Pvt) Ltd., and Wayamba Lanka (Pvt) Ltd. Current Service Range Using Synergy’s talents, expertise, infrastructure, personalized service together with the overseas network partners it is assured that the speedy, convenient delivery at a competitive cost level. • • • • • • • • • • Sea Freight Forwarding for both Exports and Imports Air Freight Forwarding for both Exports and Imports Land Transportation Sea Air Services Multi Country Consolidation Customs House Brokerage Transshipment Operations Door to Door Service Air Cargo Consolidation Exhibition Cargo Handling
4.0 Chapter 03 - Literature Review
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5.0 Chapter 04 – Data Analysis & Findings
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Acuity Logistics is more sales oriented and profits concerned than service standards or wholesome marketing. But they understand that the relationships with stakeholders are important. The goals, objectives and primary purpose of Acuity Logistics towards business and customers are available in the company website and in the company profile for the employees to read and understand. The goals set have not been changed over the past six years but a failure to adhere to the primary objectives is visible from the management and operational staff. The Organisational Structure itself shows the importance of relationship management. Therefore the company has the Customer Service Division under a separate General Manager. The Sales Division is also under a General Manager and the Managing Director also directly looks into its operation, since its success is important. But the Operations Division is placed under Assistant General Managers giving them a minor importance. The Finance Division is also overlooked directly by the Finance Director since the management believes in the financial stability of the company for the business success. The monthly profitability analysis and debtor follow-ups and payment collections are done well through several meetings per week.
Finance Director Managing Director
General Manager Customer Service
General Manager – Sales & Marketing
2 Marketing Consultants
Asst. General Manager Operations
Asst. General Manager – Import Consolidation
Asst. General Manager – Specialised Exports Senior Manager Finance
Senior Manager – Sales
Manager - Sales
2 Managers– Import & Export
Manager– Export Consolidation
Manager– Offshore Businesses
Manager–Custom House Brokerage
The communication of the organization is down ward. The internal communication of Acuity Logistics is high with the company employees, management including the whole structure. The special messages are being circulated via medias as phone calls, e- mails, intranet and the notices. Therefore the functional efficiency of the company is high. The management makes most of the decisions and no
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importance is given to the operational employees’ feedback or experience to improve the accuracy of the decisions. But the feedback of sales people are very much appreciated and taken into consideration. The procedures of day to day work or guide lines are not stated anywhere in the website or in any other material for the employees’ to read the information. No training philosophy or methods are practiced within the organization. Employees learn new things and on the job training is gained completely through experience. Self directed learning methods or resources are not available. Not even department wise discussions held to update knowledge and solve problems within the department. Most of the supportive staff towards the organization is from sales that are generally believed as people who earns more and appreciated by the management. The operations, customer service and accounts staff is having comparatively low salary scales and also they are only interested finish off the work leisurely and leave office by 5.00pm without having more commitments and responsibilities daily. The motivation levels are very low for the employees of the company other than well doing sales staff. Acuity Logistics has a self supported finance. The invoices for the shipments are billed to the customers as soon as the shipment is over. The profit margin levels differ based on the customers knowledge, industry and shipment conditions. The profit gained out of a shipment is more than 40% most of the time. The management encourages employees to finish the invoicing and calculate the Profit and Loss immediately once a shipment is done and pass the closed job file to the accounts department. The finance division and management make sure to collect the payments as soon as possible or within the given credit period. The payment follow ups are done continuously with the direct involvement of the Finance Director. No proper evaluation or quality of service rendered is measured. No service standards or deadlines for completion of servicing tasks for customers are implemented to make sure the service is provided and done well. No importance is given to current customer complaints, feedbacks or to solve out service issues. The organisational culture is friendly in surface but inter-departmental and intra-departmental issues are existing. But the objective of the Synergy management is, not to have any misunderstandings and conflicts within the divisions. The sales and marketing division has minor disputes with Operations Division and with the Custom House Brokerage time to time when servicing customers, but those are being solved with the involvement of the department heads. As per senior staff member of the organisation, the organisational culture does not provide a healthy environment for the employees to work happily and for the business to grow further. The employees’ dissatisfaction has badly resulted in customer dissatisfaction as well. Segmentation-Targeting-Positioning Acuity Logistics being a very profit concerned and sales oriented organisation, Marketing has not been a good idea for them since inception. The lack of knowledge on long term benefits of adopting marketing has made the standards of the company very low in terms of servicing customers. A process called “Segmentation – Targeting – Positioning” is almost in the level of non existence! A mere and very basic segmentation of customers can be identified but no specific targeting or clear positioning has been done ever since the company started six years back. Non existence of a Marketing Division can be identified as the reason for absence of segmentation, targeting and positioning.
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Segmentation The customers of Acuity Logistics are broadly segmented in to two categories as Business to Business (B2B) and Business to Consumer (B2C). The B2B segment has been re-segmented based on the type of industry they operate in as
1. 2. 3. Tea Rubber Coconut related products and food 4. 5. 6. 7. Dry food Fresh, frozen food and perishables Garments International Aviation products
Targeting The Acuity Logistics identifies its target customers under two, very broad categories as Exporters and Importers. The management or the staffs have no idea on further targeting of customers. The Acuity Logistics basically tries to target all the exporters and importers of the country without identifying specific profitable segments out of them. Though this poor strategy has been profitable for the company so far, it will not support the company to remain in the competition and make long term profits. The aggressive selling and the thorough follow-ups of the sales people have made the company very profitable even without proper targeting. But the efforts of the sales people will be much effective and productive which will bring in more benefits to the company in terms of profits and reputation if the organisation is going to practice a proper method of Targeting. Positioning Acuity Logistics has two positioning statements, which they call it as ‘company motto’, leading to confusion. “Beyond Boundaries....” is mentioned in the website and in the company profile given to new customers. “The Global Logistic Provider...” is mentioned in the e-mail signatures and in the name board of the company. The lack of marketing knowledge has lead to the unclear positioning and the staff has no idea why and for what it is been written. Even the management has different ideas and no body knows what the correct positioning statement of the company is or whether both have been suggested deliberately with a good reason. The proper resource requirements as Skills, Market Knowledge, Supply Requirements, Finance, Time and Industry and Competitor Information are essential to do meaningful, effective Segmentation, Targeting and Positioning. SWOT Analysis
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Strengths 1. Competitive Ocean Freight rates. 2. Quality services and good service environment. 3. Strong office and Agency Network around the world. 4. Track and Tracing Facility for shipments. 5. Proper profiling of the customer before breaking into accounts. 6. The healthy, strong relationships built with shipping lines and other stakeholders (helps to get cheaper rates than other freight forwarders in the country.) 7. Experienced management and employees. 8. Experienced sales team with rich contacts with customers. Opportunities 1. To adopt latest technology and implement an internal working system to minimize the time occupied for manual work and to service customers faster. 2. Developing a CRM system to manage customer relations more efficiently. 3. Planning more training programmes for customer service staff and employees to improve their knowledge on work. 4. Doing surveyors on employee satisfaction levels to prevent high employee defection. 5. To be marketing focused and building the brand ‘Acuity’ in peoples mind through proper strategic marketing campaign.
Weaknesses 1. Lack of a customer relationship management system. 2. Lake of training programmes for employees. 3. High employee defection. 4. Lack of usage in latest technologies as wireless networks and systems. 5. Lack of education of customer service employees to understand the management concept and to service the customers. 6. Lack of brand building and focus on marketing. Threats 1. New freight forwarders entering to the industry. 2. Faster and quality services provided by other freight forwarders through latest technology and standardized working environment. 3. New and existing freight forwarders establishing stronger relationships with shipping lines and government. 4. Other freight forwarders matching the ocean freight rates provided by Acuity. 5. Competitors approach towards the best performing employees of Acuity. 6. Proper Segmentation, Targeting and Positioning done by competitors attracting customers more to competitor brands.
Audit Findings 1. The company is sales and finance oriented; no marketing concepts are being practiced. (Refer Marketing Organisation Audit - Marketing staff reporting to the Managing Director and Finance Director in Organisation Structure) 2. Tries to give more priority for customer relationship management but sales has become the major perseverance. (Refer Customer Service Division under organisational structure) 3. Operation and Customer service is given low priorities while Sales and Finance attracts the top management concentration. (Finance Division is directly overlooked by the Finance Director and Operations Division is placed under an Assistant General Manager, Refer Organisational Structure) 4. The company practices are not as per the vision set. 5. Acuity Logistics is an active member of industry related organisations. 6. Marketing information, planning and control system is maintained up to a standard with industry and competitor information. 7. Profitability analysis and payment follow ups are done well, making the financial flow of the company healthy. 8. Functional Efficiency is high within the organisation. 9. Sales staff is given more appreciation and motivation than operations, customer service or accounts staff. 10. Management is highly interested in increasing sales force than operation or customer service work force.
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11. No training programmes are done for employees or any encouragement given for individual education. 12. Employees need to be given more industry related trainings and marketing knowledge to enhance standards and result customer satisfaction. 13. No proper service or quality standards set as per international level. 14. No priority is given for customer feedbacks, complaints or suggestions to improve services. 15. Organisational Culture is friendly in surface only. Disputes exist within departments due to various reasons. 16. Employee dissatisfaction has badly resulted to increase customer dissatisfaction. 17. More customer segments need to be identified through a thorough industry research and studying the customer base of the company. 18. More specific and proper methods must be used to do target profitable customer segments out of the huge list of customer segments. 19. Clear positioning statement must be chosen and well defined to avoid confusion and not to damage brand image of the company. 20. A Marketing Division needs to be established to concentrate on marketing and do proper Segmentation, Targeting and Positioning. 21. Experienced sales team can be motivated to improve and make problematic service areas profitable. (Refer Strengths under SWOT) 22. The bargaining power of Shipping lines, air lines and customers are high since the Colombo Freight Forwarding market has become very competitive. 23. The profit contribution of Air Freight Consolidation division is the lowest in Synergy, making the company lowest contributor and lowest market share owner of the total Air Freight Export Consolidation industry of the country. 24. The Air Freight Export Consolidation is a high growing; profitable industry in the Sri Lankan Freight Forwarding industry, but Acuity Logistics is not yet even entered the competition. 25. The growth of Air Freight Consolidation Division is very low over the past 10 years and further growth has not happened during last two years from 2008 – 2010. 26. The performance including work process, customer base, sales & marketing activities of the division must be closely investigated and monitored to improve the Air Freight Export Consolidation service within Acuity
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6.0 Chapter 05 – Recommendations & Conclusion The Action Plan for the customer service standardisation is given below with the time lines and cost involved per each major project.
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Project Developing the role of Customer Service through proper establishment of a Marketing Department within the group Carrying out a thorough research internally and externally on Customer Service Building objectives and strategies for future Customer Service implementation process Developing segmented customer profiles and evaluating the attractiveness of each segment Selecting the profitable segments for targeting Identifying different customer service levels for each targeted segments, developing and communicating the chosen concepts to respective customer segmentation handling staff Implementation of a Continuous monitoring and evaluation system on the Customer Service Process
Month 1
Week 1
Month 2 Week 2 Week 3
Week 4
Week 1
Month 3 Week 2 Week 3
Week 4
Total cost
$3,000.00
$1,000.00
$ 500.00
$ 500.00
$ 500.00
$ 1,000.00
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Acuity Logistics being a well recognized freight forwarder in the Sri Lankan Shipping and Freight Forwarding industry, more contribution towards customer satisfaction must happen and making it possible has to be re-thought and improved in terms of gaining a competitive edge towards the organization through proper Customer Service and its standardisation. The below stated Marketing Project and action plan will be helpful to boost and regain market share and customers’ loyalty towards the company and to lead a step ahead towards business expansion in the next half of the successful decade. The major changes and improvements that need to be done with in Acuity to bring upon changes are, 1. The company must adopt marketing concepts and be more relationship marketing oriented and customer driven to grow as an organization in the industry, than being more sales and profits oriented. 2. Employees must be trained well on technical knowledge and marketing practices, while motivating all the staff of the organization to result employee and customer satisfaction in return and to eliminate departmental disputes. 3. The problematic service areas of the company must be improved as well as proper service and quality standards must be implemented with the help of experienced sales staff. 4. The Segmentation, Targeting and Positioning process must be investigated and planned well in order to make the efforts of sales staff effective and to maximize long term profits. 5. The customer services provided by the company need to be re-looked at and a strategic plan needs to be made to overcome its unsuccessful existing conditions.
1. Developing the role of Customer Service through proper establishment of a Marketing Department within the group When looking at Acuity’s existing internal environment it is a very clear fact that the company work force is 75% involved in hard core sales while the remaining 25% is involved with customer service, operational work and finance. This is very much proven through the organizational structure itself. The customer service division also having a separate sales team with a Senior Sales Manager is a good proof. The Finance division also being directly monitored by the Finance Director, while the Managing Director overlooks the total rest of the company, shows how high the management interest on financial operation and stability of the company.
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Finance Director Managing Director
Sales
General Manager Customer Service
General Manager – Sales & Marketing Involved in hardcore sales Asst. General Manager Operations Asst. General Manager – Import Consolidation Asst. General Manager – Specialised Exports
2 Marketing Consultants
Senior Manager – Sales
Senior Manager Finance
Manager - Sales
2 Managers– Import & Export
Sales
Manager– Export Consolidation
Manager– Offshore Businesses
Manager–Custom House Brokerage
Diagram 1.4 – The Clear Domination of Sales over the Organisatinal Structure The less customer driven and pure sales and finance oriented nature of Acuity Logistic swill result in utter customer dissatisfaction. The absence of marketing oriented culture and organizational structure in Acuity Logistic swill not help to retain customers’ long term and create value for them. It will not only badly result in customer satisfaction, but also on employee satisfaction and relationships with stakeholders as well. The absence of a Human Resource Division in a company which has a total number of employees more than 200, clearly shows the top management interest towards limiting expenses and cost cutting within the group. Sales under customer As per the internal records and facts brought by some employees of the company, the very slow growth of Air Freight Export Consolidation service of Acuity Logistics has been stopped at 5% in 2008, due to some service failures occurred and badly done customer service. A significant drop in the total customer base of Acuity Logistics is highly visible as per the Annual Report, 2009 – 2010. The sales and operation staff also have mentioned about customer dissatisfaction and decreasing customer loyalty levels of customers in their monthly feedbacks. Therefore a proper Marketing Division must be implemented and marketing orientation and concepts must be adopted to retain profitable customers and build a sustainable competitive advantage through services provided by Acuity.
service
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2.
Carrying out a thorough research internally and externally on Customer Service A comprehensive research needs to be carried out to identify segmentation variables and segmenting the customer base accordingly. Acuity Logistics needs to analyze data through a clear outline of their development potential and possible benefits for the organization, relative to consumer mindset and competition. A primary research on the customer satisfaction will be carried out with the involvement of staff, customers and other stake holders. A secondary research also will be carried out to gather information about market, customer preferences and competitor information and finally on the customer service of the company.
3.
Building objectives and strategies for future Customer Service implementation process The objectives and strategies need to be defined in line with the company’s core objectives and policies and it will be a guide for future Customer Service Standardisation process going to be done. The key objectives are, 1) Identify any Key issues and inconsistencies in Customer Service process carried out by the organization. 2) Providing current and future recommendations to enhance and re-structure the Customer Service process of the organization. 3) Implementation process from project initiation to termination for the suggested recommendations for Customer Service Standardisation process.
4.
Developing segmented customer profiles and evaluating the attractiveness of each segment Once this step is done, the company will have a clear set of customer groups who uses company’s services throughout the year. The attractiveness of the customer segments will be evaluated during the project.
5.
Selecting the profitable segments for targeting The most attractive customer segments for targeting will be selected by looking at the Project 04 deliverables. The company will have a list of targeted customer segments at the end of the sub project.
6.
Identifying different customer service levels for each targeted segments, developing and communicating the chosen concepts to respective customer segmentation handling staff The suitable positioning concepts and positioning statements will be decided at the completion of the project. The development and communication of the chosen positioning concepts will also be done as the second step of the project and they will be communicated to the staff and continuous trainings will take place.
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7.
Implementation of a Continuous monitoring and evaluation system on the Customer Service Process This will allow the organization to identify the effectiveness, problems and inconsistencies that may exist in the of the Customer Service process. Once issues are identified the immediate corrective measures can be implemented.
8.
Regular staff meetings and briefings regarding Customer Service process and to gather feedback on customers and market. This will be helpful for the staff to be much more informed about the new customer service process carrying out within the organization and its purpose, which will support them to service customers with a good understanding on what they do and why they do it. This need to be carried out with the direct involvement of the Marketing department and this is important immensely since most of the employees are doing direct sales. Further brainstorming sessions will be helpful to build more effective campaigns for customer service with the different collaborative perspectives of the employees.
9.
Installing a proper CRM Software in order to provide guidance for marketing and customer service functions of the company The management must take the initiative to obtain and record customer information in a very organized methodical manner than it happens currently. Therefore accordingly customized CRM software needs to be installed within the company, which will maintain individual customer profiles and customer data of different defined segments of the organization. Further it must be fed with information as company anniversaries, birthdays and other special occasions of customers. It will be helpful to build a healthy relationship with customers and to improve customer satisfaction and loyalty.
10. Adding a Web Blog and upgrade the current website to gather customer feedback and improve customer services This needs to be done immediately to gather more customer and market information to get more input for customer service process. The blog will be helpful in terms of getting customer feedback on services, service providers’ feedback and other stake holder comments and views on how the business functions. The customer and stakeholder satisfaction levels also can be measured through short questionnaires and pop out comment boxes.
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Organisation’s Resource Capability and Capacity needed to deliver proposed recommendations and action plan 1.1 Resource Reviews A separate budget for the project will be allocated and an additional amount of $ 1000 is allocated as reserves and will be used if necessary, if price variations occur. The Marketing Manager will be responsible for managing and monitoring the expenditure as the project start moving forward. 1.2 Personnel Requirements The Marketing Manager will be appointed from the existing employees and executives for the marketing team will be hired from existing staff as well as from outside. 1.3 Project Termination The project will be terminated once all the sub projects are successfully completed within the time frame mentioned and once the recommendations are implemented within the company for the evaluation and monitoring of the customer service process. 1.4Project Evaluation The evaluation of the project while the project is in progress is done by the Evaluation System established. Once the project is terminated the evaluation will be done by the management in collaboration with the Marketing Manager on its achievement of the objectives set. Further the project will be evaluated in terms of cost, time and quality. Conclusion The above mentioned process and the action plan will be helpful for the Acuity Logistics to lead a step ahead within the competition and be a leader in the industry with regained customer satisfaction and loyalty
7.0Chapter 06 – References
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1
1.0 Executive Summary The Acuity Logistics (Pvt) Ltd. belongs to the Acuity Logistics Group of companies, which operates in the Shipping and Freight Forwarding industry which is highly competitive and dynamic. The key competitors in the market are Expolanka, Freight Links, DHL, Aitken Spence, John Keels and Hellman Logistics. Acuity Logistics holds 7% of market share and generates 450,000 – 500,000 US $ worth of monthly sales on average and also has gained the status as the emerging market leader. This report acts as an organizational benchmark and a template for current and future Customer Service Standardisation Process. It includes a comprehensive analysis and plan on how to carry out a comprehensive customer service standardisation and implementation process internally and externally. The existing process is evaluated against recognized customer service practices in order to identify the gaps and inconsistencies that exist in the current process and practices. This project report includes a critical analysis on the research findings of Acuity Logisticsand the recommendations for the Customer Service standardisation process and to develop the role of marketing of the company. The Current Organisational Structure and the Role of Marketing and customer service within the organisation, the improvements that can be delivered to develop the process, the Management and Leadership of Synergy, Organisation’s Resource Capability and Capacity needed to deliver proposed recommendations, Key deliverables, Budget, schedules are more elaborated through out the project report. The implementation of a CRM System, Proper Evaluation and Monitoring System, a Customer Service Division with in the group and the Web Blog and up gradation will boost the interest of customers and employees towards business and will help to rejuvenate the role of customer service within the organisation, while standardising the process to meet the business and customer needs. The report suggests a proper evaluation and monitoring process for Customer Service within Synergy and a comprehensive action plan to carry out the tasks step by step toward the completion. The project will rejuvenate and strengthen the sales and operation of Acuity providing the support to lead a step ahead in its second half of first decade.
2.0 Chapter 01 – Introduction 2
The Customer Service standardization assignment will be done on Acuity Logistics (Pvt) Ltd., which is well known as a market leader and the group’s core business evolves around freight forwarding. The Acuity Logistics (Pvt) Ltd. is a public quoted, group of companies; with four fully own subsidiaries and two joint venture companies. It was found on the 5th October 2004 as a fully fledged freight forwarding outfit. Acuity Logistics in its short history in the industry of logistics in Sri Lanka has managed to create a remarkable impact with its unique innovative strategies and has been a one of the most sought after logistics provider. (Half a Decade, 2009) Acuity Logistics has shown qualities of a "true leader of the new generation" who goes beyond the boundaries of conventional freight forwarding. When competitors are restricted their standard defined systems Acuity Logistics always tries to adopt a customized handling procedure as per the individual needs of different customers. (Annual Report 2009 - 2010) The Company's objective is to provide reliable and quality service, which is strongly supported by professionalism. The staff is trained and equipped with the knowledge and industry experience. The prime focus is to provide a quality service with enhanced benefits through innovative value additions embedded with reliability. Acuity Logistics believes "business as usual no longer good enough". It has understood that in the present context it is expected to unburden the customers with ground breaking logistics solutions and Acuity Logistics always looks towards the ability to move rapidly into innovative solutions. Acuity Logistics won the silver award for “Service providers to Exporters – Large Category” awarded by the National Chamber of Exporters for the valued contribution made during the year 2008. (Chamber of commerce, 2010)
3.0 Chapter 02 - Profile
3
The Acuity Logistics (Pvt) Ltd. mostly cater to the customers fall under Business to Business (B2B) category. Business to Consumer (B2C) customers also are been served with some specialised services. The customer base of Acuity Logistics is over 5000 and the customers who do shipments with the company continuously in every month exceed 500, which is a comparatively higher amount in relation with competitors of the industry. The customers of the company has been segmented into major three categories as, Tea, Rubber and Coconut taking into consideration the traditional highest export sectors of the country. Some of the Key Clients of the company are, Bridport Aviation Lanka (Pvt) Ltd, Latex Green (Pvt) Ltd, Comfortwear (Pvt) Ltd, Singer (Sri Lanka) Limited, Royal Ceramics Lanka Ltd, Ceylon Biscuits Limited, Maliban Biscuits Manufactures Ltd, Line Aqua (Pvt) Ltd, Cecil Food (Pvt) Ltd, Lalanka Solid Waste Management, Minra Garments (Pvt) Ltd, St. Regis Packaging (Pvt) Ltd, Uniwell Microsystems (Pvt) Ltd, Marie de Classique Attire (Pvt) Ltd, Renuka Agro (Pvt) Ltd., Diamond Lanka International (Pvt) Ltd. Global Allianz (Pvt) Ltd, Amarlee Trading (Pvt) Ltd., Ally Weerasinghe (Pvt) Ltd. Fontera (Pvt) Ltd., and Wayamba Lanka (Pvt) Ltd. Current Service Range Using Synergy’s talents, expertise, infrastructure, personalized service together with the overseas network partners it is assured that the speedy, convenient delivery at a competitive cost level. • • • • • • • • • • Sea Freight Forwarding for both Exports and Imports Air Freight Forwarding for both Exports and Imports Land Transportation Sea Air Services Multi Country Consolidation Customs House Brokerage Transshipment Operations Door to Door Service Air Cargo Consolidation Exhibition Cargo Handling
4.0 Chapter 03 - Literature Review
4
5.0 Chapter 04 – Data Analysis & Findings
5
Acuity Logistics is more sales oriented and profits concerned than service standards or wholesome marketing. But they understand that the relationships with stakeholders are important. The goals, objectives and primary purpose of Acuity Logistics towards business and customers are available in the company website and in the company profile for the employees to read and understand. The goals set have not been changed over the past six years but a failure to adhere to the primary objectives is visible from the management and operational staff. The Organisational Structure itself shows the importance of relationship management. Therefore the company has the Customer Service Division under a separate General Manager. The Sales Division is also under a General Manager and the Managing Director also directly looks into its operation, since its success is important. But the Operations Division is placed under Assistant General Managers giving them a minor importance. The Finance Division is also overlooked directly by the Finance Director since the management believes in the financial stability of the company for the business success. The monthly profitability analysis and debtor follow-ups and payment collections are done well through several meetings per week.
Finance Director Managing Director
General Manager Customer Service
General Manager – Sales & Marketing
2 Marketing Consultants
Asst. General Manager Operations
Asst. General Manager – Import Consolidation
Asst. General Manager – Specialised Exports Senior Manager Finance
Senior Manager – Sales
Manager - Sales
2 Managers– Import & Export
Manager– Export Consolidation
Manager– Offshore Businesses
Manager–Custom House Brokerage
The communication of the organization is down ward. The internal communication of Acuity Logistics is high with the company employees, management including the whole structure. The special messages are being circulated via medias as phone calls, e- mails, intranet and the notices. Therefore the functional efficiency of the company is high. The management makes most of the decisions and no
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importance is given to the operational employees’ feedback or experience to improve the accuracy of the decisions. But the feedback of sales people are very much appreciated and taken into consideration. The procedures of day to day work or guide lines are not stated anywhere in the website or in any other material for the employees’ to read the information. No training philosophy or methods are practiced within the organization. Employees learn new things and on the job training is gained completely through experience. Self directed learning methods or resources are not available. Not even department wise discussions held to update knowledge and solve problems within the department. Most of the supportive staff towards the organization is from sales that are generally believed as people who earns more and appreciated by the management. The operations, customer service and accounts staff is having comparatively low salary scales and also they are only interested finish off the work leisurely and leave office by 5.00pm without having more commitments and responsibilities daily. The motivation levels are very low for the employees of the company other than well doing sales staff. Acuity Logistics has a self supported finance. The invoices for the shipments are billed to the customers as soon as the shipment is over. The profit margin levels differ based on the customers knowledge, industry and shipment conditions. The profit gained out of a shipment is more than 40% most of the time. The management encourages employees to finish the invoicing and calculate the Profit and Loss immediately once a shipment is done and pass the closed job file to the accounts department. The finance division and management make sure to collect the payments as soon as possible or within the given credit period. The payment follow ups are done continuously with the direct involvement of the Finance Director. No proper evaluation or quality of service rendered is measured. No service standards or deadlines for completion of servicing tasks for customers are implemented to make sure the service is provided and done well. No importance is given to current customer complaints, feedbacks or to solve out service issues. The organisational culture is friendly in surface but inter-departmental and intra-departmental issues are existing. But the objective of the Synergy management is, not to have any misunderstandings and conflicts within the divisions. The sales and marketing division has minor disputes with Operations Division and with the Custom House Brokerage time to time when servicing customers, but those are being solved with the involvement of the department heads. As per senior staff member of the organisation, the organisational culture does not provide a healthy environment for the employees to work happily and for the business to grow further. The employees’ dissatisfaction has badly resulted in customer dissatisfaction as well. Segmentation-Targeting-Positioning Acuity Logistics being a very profit concerned and sales oriented organisation, Marketing has not been a good idea for them since inception. The lack of knowledge on long term benefits of adopting marketing has made the standards of the company very low in terms of servicing customers. A process called “Segmentation – Targeting – Positioning” is almost in the level of non existence! A mere and very basic segmentation of customers can be identified but no specific targeting or clear positioning has been done ever since the company started six years back. Non existence of a Marketing Division can be identified as the reason for absence of segmentation, targeting and positioning.
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Segmentation The customers of Acuity Logistics are broadly segmented in to two categories as Business to Business (B2B) and Business to Consumer (B2C). The B2B segment has been re-segmented based on the type of industry they operate in as
1. 2. 3. Tea Rubber Coconut related products and food 4. 5. 6. 7. Dry food Fresh, frozen food and perishables Garments International Aviation products
Targeting The Acuity Logistics identifies its target customers under two, very broad categories as Exporters and Importers. The management or the staffs have no idea on further targeting of customers. The Acuity Logistics basically tries to target all the exporters and importers of the country without identifying specific profitable segments out of them. Though this poor strategy has been profitable for the company so far, it will not support the company to remain in the competition and make long term profits. The aggressive selling and the thorough follow-ups of the sales people have made the company very profitable even without proper targeting. But the efforts of the sales people will be much effective and productive which will bring in more benefits to the company in terms of profits and reputation if the organisation is going to practice a proper method of Targeting. Positioning Acuity Logistics has two positioning statements, which they call it as ‘company motto’, leading to confusion. “Beyond Boundaries....” is mentioned in the website and in the company profile given to new customers. “The Global Logistic Provider...” is mentioned in the e-mail signatures and in the name board of the company. The lack of marketing knowledge has lead to the unclear positioning and the staff has no idea why and for what it is been written. Even the management has different ideas and no body knows what the correct positioning statement of the company is or whether both have been suggested deliberately with a good reason. The proper resource requirements as Skills, Market Knowledge, Supply Requirements, Finance, Time and Industry and Competitor Information are essential to do meaningful, effective Segmentation, Targeting and Positioning. SWOT Analysis
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Strengths 1. Competitive Ocean Freight rates. 2. Quality services and good service environment. 3. Strong office and Agency Network around the world. 4. Track and Tracing Facility for shipments. 5. Proper profiling of the customer before breaking into accounts. 6. The healthy, strong relationships built with shipping lines and other stakeholders (helps to get cheaper rates than other freight forwarders in the country.) 7. Experienced management and employees. 8. Experienced sales team with rich contacts with customers. Opportunities 1. To adopt latest technology and implement an internal working system to minimize the time occupied for manual work and to service customers faster. 2. Developing a CRM system to manage customer relations more efficiently. 3. Planning more training programmes for customer service staff and employees to improve their knowledge on work. 4. Doing surveyors on employee satisfaction levels to prevent high employee defection. 5. To be marketing focused and building the brand ‘Acuity’ in peoples mind through proper strategic marketing campaign.
Weaknesses 1. Lack of a customer relationship management system. 2. Lake of training programmes for employees. 3. High employee defection. 4. Lack of usage in latest technologies as wireless networks and systems. 5. Lack of education of customer service employees to understand the management concept and to service the customers. 6. Lack of brand building and focus on marketing. Threats 1. New freight forwarders entering to the industry. 2. Faster and quality services provided by other freight forwarders through latest technology and standardized working environment. 3. New and existing freight forwarders establishing stronger relationships with shipping lines and government. 4. Other freight forwarders matching the ocean freight rates provided by Acuity. 5. Competitors approach towards the best performing employees of Acuity. 6. Proper Segmentation, Targeting and Positioning done by competitors attracting customers more to competitor brands.
Audit Findings 1. The company is sales and finance oriented; no marketing concepts are being practiced. (Refer Marketing Organisation Audit - Marketing staff reporting to the Managing Director and Finance Director in Organisation Structure) 2. Tries to give more priority for customer relationship management but sales has become the major perseverance. (Refer Customer Service Division under organisational structure) 3. Operation and Customer service is given low priorities while Sales and Finance attracts the top management concentration. (Finance Division is directly overlooked by the Finance Director and Operations Division is placed under an Assistant General Manager, Refer Organisational Structure) 4. The company practices are not as per the vision set. 5. Acuity Logistics is an active member of industry related organisations. 6. Marketing information, planning and control system is maintained up to a standard with industry and competitor information. 7. Profitability analysis and payment follow ups are done well, making the financial flow of the company healthy. 8. Functional Efficiency is high within the organisation. 9. Sales staff is given more appreciation and motivation than operations, customer service or accounts staff. 10. Management is highly interested in increasing sales force than operation or customer service work force.
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11. No training programmes are done for employees or any encouragement given for individual education. 12. Employees need to be given more industry related trainings and marketing knowledge to enhance standards and result customer satisfaction. 13. No proper service or quality standards set as per international level. 14. No priority is given for customer feedbacks, complaints or suggestions to improve services. 15. Organisational Culture is friendly in surface only. Disputes exist within departments due to various reasons. 16. Employee dissatisfaction has badly resulted to increase customer dissatisfaction. 17. More customer segments need to be identified through a thorough industry research and studying the customer base of the company. 18. More specific and proper methods must be used to do target profitable customer segments out of the huge list of customer segments. 19. Clear positioning statement must be chosen and well defined to avoid confusion and not to damage brand image of the company. 20. A Marketing Division needs to be established to concentrate on marketing and do proper Segmentation, Targeting and Positioning. 21. Experienced sales team can be motivated to improve and make problematic service areas profitable. (Refer Strengths under SWOT) 22. The bargaining power of Shipping lines, air lines and customers are high since the Colombo Freight Forwarding market has become very competitive. 23. The profit contribution of Air Freight Consolidation division is the lowest in Synergy, making the company lowest contributor and lowest market share owner of the total Air Freight Export Consolidation industry of the country. 24. The Air Freight Export Consolidation is a high growing; profitable industry in the Sri Lankan Freight Forwarding industry, but Acuity Logistics is not yet even entered the competition. 25. The growth of Air Freight Consolidation Division is very low over the past 10 years and further growth has not happened during last two years from 2008 – 2010. 26. The performance including work process, customer base, sales & marketing activities of the division must be closely investigated and monitored to improve the Air Freight Export Consolidation service within Acuity
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6.0 Chapter 05 – Recommendations & Conclusion The Action Plan for the customer service standardisation is given below with the time lines and cost involved per each major project.
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Project Developing the role of Customer Service through proper establishment of a Marketing Department within the group Carrying out a thorough research internally and externally on Customer Service Building objectives and strategies for future Customer Service implementation process Developing segmented customer profiles and evaluating the attractiveness of each segment Selecting the profitable segments for targeting Identifying different customer service levels for each targeted segments, developing and communicating the chosen concepts to respective customer segmentation handling staff Implementation of a Continuous monitoring and evaluation system on the Customer Service Process
Month 1
Week 1
Month 2 Week 2 Week 3
Week 4
Week 1
Month 3 Week 2 Week 3
Week 4
Total cost
$3,000.00
$1,000.00
$ 500.00
$ 500.00
$ 500.00
$ 1,000.00
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Acuity Logistics being a well recognized freight forwarder in the Sri Lankan Shipping and Freight Forwarding industry, more contribution towards customer satisfaction must happen and making it possible has to be re-thought and improved in terms of gaining a competitive edge towards the organization through proper Customer Service and its standardisation. The below stated Marketing Project and action plan will be helpful to boost and regain market share and customers’ loyalty towards the company and to lead a step ahead towards business expansion in the next half of the successful decade. The major changes and improvements that need to be done with in Acuity to bring upon changes are, 1. The company must adopt marketing concepts and be more relationship marketing oriented and customer driven to grow as an organization in the industry, than being more sales and profits oriented. 2. Employees must be trained well on technical knowledge and marketing practices, while motivating all the staff of the organization to result employee and customer satisfaction in return and to eliminate departmental disputes. 3. The problematic service areas of the company must be improved as well as proper service and quality standards must be implemented with the help of experienced sales staff. 4. The Segmentation, Targeting and Positioning process must be investigated and planned well in order to make the efforts of sales staff effective and to maximize long term profits. 5. The customer services provided by the company need to be re-looked at and a strategic plan needs to be made to overcome its unsuccessful existing conditions.
1. Developing the role of Customer Service through proper establishment of a Marketing Department within the group When looking at Acuity’s existing internal environment it is a very clear fact that the company work force is 75% involved in hard core sales while the remaining 25% is involved with customer service, operational work and finance. This is very much proven through the organizational structure itself. The customer service division also having a separate sales team with a Senior Sales Manager is a good proof. The Finance division also being directly monitored by the Finance Director, while the Managing Director overlooks the total rest of the company, shows how high the management interest on financial operation and stability of the company.
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Finance Director Managing Director
Sales
General Manager Customer Service
General Manager – Sales & Marketing Involved in hardcore sales Asst. General Manager Operations Asst. General Manager – Import Consolidation Asst. General Manager – Specialised Exports
2 Marketing Consultants
Senior Manager – Sales
Senior Manager Finance
Manager - Sales
2 Managers– Import & Export
Sales
Manager– Export Consolidation
Manager– Offshore Businesses
Manager–Custom House Brokerage
Diagram 1.4 – The Clear Domination of Sales over the Organisatinal Structure The less customer driven and pure sales and finance oriented nature of Acuity Logistic swill result in utter customer dissatisfaction. The absence of marketing oriented culture and organizational structure in Acuity Logistic swill not help to retain customers’ long term and create value for them. It will not only badly result in customer satisfaction, but also on employee satisfaction and relationships with stakeholders as well. The absence of a Human Resource Division in a company which has a total number of employees more than 200, clearly shows the top management interest towards limiting expenses and cost cutting within the group. Sales under customer As per the internal records and facts brought by some employees of the company, the very slow growth of Air Freight Export Consolidation service of Acuity Logistics has been stopped at 5% in 2008, due to some service failures occurred and badly done customer service. A significant drop in the total customer base of Acuity Logistics is highly visible as per the Annual Report, 2009 – 2010. The sales and operation staff also have mentioned about customer dissatisfaction and decreasing customer loyalty levels of customers in their monthly feedbacks. Therefore a proper Marketing Division must be implemented and marketing orientation and concepts must be adopted to retain profitable customers and build a sustainable competitive advantage through services provided by Acuity.
service
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2.
Carrying out a thorough research internally and externally on Customer Service A comprehensive research needs to be carried out to identify segmentation variables and segmenting the customer base accordingly. Acuity Logistics needs to analyze data through a clear outline of their development potential and possible benefits for the organization, relative to consumer mindset and competition. A primary research on the customer satisfaction will be carried out with the involvement of staff, customers and other stake holders. A secondary research also will be carried out to gather information about market, customer preferences and competitor information and finally on the customer service of the company.
3.
Building objectives and strategies for future Customer Service implementation process The objectives and strategies need to be defined in line with the company’s core objectives and policies and it will be a guide for future Customer Service Standardisation process going to be done. The key objectives are, 1) Identify any Key issues and inconsistencies in Customer Service process carried out by the organization. 2) Providing current and future recommendations to enhance and re-structure the Customer Service process of the organization. 3) Implementation process from project initiation to termination for the suggested recommendations for Customer Service Standardisation process.
4.
Developing segmented customer profiles and evaluating the attractiveness of each segment Once this step is done, the company will have a clear set of customer groups who uses company’s services throughout the year. The attractiveness of the customer segments will be evaluated during the project.
5.
Selecting the profitable segments for targeting The most attractive customer segments for targeting will be selected by looking at the Project 04 deliverables. The company will have a list of targeted customer segments at the end of the sub project.
6.
Identifying different customer service levels for each targeted segments, developing and communicating the chosen concepts to respective customer segmentation handling staff The suitable positioning concepts and positioning statements will be decided at the completion of the project. The development and communication of the chosen positioning concepts will also be done as the second step of the project and they will be communicated to the staff and continuous trainings will take place.
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7.
Implementation of a Continuous monitoring and evaluation system on the Customer Service Process This will allow the organization to identify the effectiveness, problems and inconsistencies that may exist in the of the Customer Service process. Once issues are identified the immediate corrective measures can be implemented.
8.
Regular staff meetings and briefings regarding Customer Service process and to gather feedback on customers and market. This will be helpful for the staff to be much more informed about the new customer service process carrying out within the organization and its purpose, which will support them to service customers with a good understanding on what they do and why they do it. This need to be carried out with the direct involvement of the Marketing department and this is important immensely since most of the employees are doing direct sales. Further brainstorming sessions will be helpful to build more effective campaigns for customer service with the different collaborative perspectives of the employees.
9.
Installing a proper CRM Software in order to provide guidance for marketing and customer service functions of the company The management must take the initiative to obtain and record customer information in a very organized methodical manner than it happens currently. Therefore accordingly customized CRM software needs to be installed within the company, which will maintain individual customer profiles and customer data of different defined segments of the organization. Further it must be fed with information as company anniversaries, birthdays and other special occasions of customers. It will be helpful to build a healthy relationship with customers and to improve customer satisfaction and loyalty.
10. Adding a Web Blog and upgrade the current website to gather customer feedback and improve customer services This needs to be done immediately to gather more customer and market information to get more input for customer service process. The blog will be helpful in terms of getting customer feedback on services, service providers’ feedback and other stake holder comments and views on how the business functions. The customer and stakeholder satisfaction levels also can be measured through short questionnaires and pop out comment boxes.
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Organisation’s Resource Capability and Capacity needed to deliver proposed recommendations and action plan 1.1 Resource Reviews A separate budget for the project will be allocated and an additional amount of $ 1000 is allocated as reserves and will be used if necessary, if price variations occur. The Marketing Manager will be responsible for managing and monitoring the expenditure as the project start moving forward. 1.2 Personnel Requirements The Marketing Manager will be appointed from the existing employees and executives for the marketing team will be hired from existing staff as well as from outside. 1.3 Project Termination The project will be terminated once all the sub projects are successfully completed within the time frame mentioned and once the recommendations are implemented within the company for the evaluation and monitoring of the customer service process. 1.4Project Evaluation The evaluation of the project while the project is in progress is done by the Evaluation System established. Once the project is terminated the evaluation will be done by the management in collaboration with the Marketing Manager on its achievement of the objectives set. Further the project will be evaluated in terms of cost, time and quality. Conclusion The above mentioned process and the action plan will be helpful for the Acuity Logistics to lead a step ahead within the competition and be a leader in the industry with regained customer satisfaction and loyalty
7.0Chapter 06 – References
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