Customer Experience: The new measure for Supply Chain excellence
- 9 February 2018
- Written by: Yves Bemelmans
- Category: Supply Chain
27 PERCENT – This is the alarming low percentage of companies who believe they offer superior service compared to their competitors and believe that improving customer experience is a priority for them(Gartner 2017 research). So the question which leaves us perplexed is why is this percentage so low? It is clear that customers are influenced by their experience of the supply chain —even in the simplest terms, it’s effortless to see that a late delivery can disappoint, whereas a timely delivery can rejoice.
However, one of the reasons why many organizations are not attaining supply chain excellence is because they do not give much attention to logistics and customer service.These two functions tend to experience the largest volume of customer interactions, yet most organizations have not yet worked out how to derive more value from these roles.Customer effort in terms of interacting, engaging and purchasing from your company should be a key concern for all supply chain professionals. Measuring customer effort is one of the best ways to assess customer satisfaction and understand if you are delivering a great customer experience.
The Omnichannel experience
By taking a look at your company’s omnichannel offerings and capabilities, you can determine and lighten customer struggles. Omnichannel can be described as various channels where customers interact and engage with your company in a consistent way.
Hence companies get to know who their customers are and their experiences are consistent across all channels. In this way, no matter which channels your customers use, they are able to get the same tailored experience. This allows a business to appear as a single brand through different channels. Despite the fact that most businesses know that they have to offer multiple channels through which their customers can interact, very few of these organizations have mastered an effective omnichannel experience.
A research by Oracle Retail highlights the fact that omnichannel shoppers are considerably more valuable than single-channel shoppers. This is why businesses are very committed to omnichannel strategies. The 2014 survey report, “The Omnichannel Challenge: Strategies that Work,” shows that about 45% of retail executives believe omnichannel shoppers are 11 to 50 % more valuable than single-channel shoppers.
Furthermore, the report specifies that the three most significant ways that their value is measured are (1) frequency of shopping trips, (2)total dollar value of purchases over time and (3)average basket size. Such outcomes clearly show the importance of focusing on the omnichannel experience, simplifying it and reducing the struggle of customers while they interact with your company. Having a budget and an executive team on board with resources is equally essential. After that, there are two more essential steps:
- The corporate culture needs to be taken into consideration. For instance: departments need to start talking to each other, working together, and sharing data and information. The aim is to help everyone understand how they affect the customer experience and that every department touches a single experience in one way or another. A journey map is the best tool to understand this concept.
- It is important to share data to attain the objectives. It is the responsibility of the chief information officer to prioritize this work, as the key to an improved omnichannel experience and hence a reduction in customer effort is data. This must be shared across departments and channels. To make this happen, it is important to have the right architecture and infrastructure to capture information, centralize it and get it into the hands of the right people at the right time in a good format, through which actions can be taken.
Technology and customer experience
Technology is another essential element which determines customer experience. The supply chain can create a seamless experience for a customer with the right technology. Organizations will increasingly use technology in this way to empower their customer-facing staff, and to measure, improve and personalize many aspects of the customer experience. A report by the International Data Corporation predicts the following:
- By the end of 2018, half of the manufacturers will be using analytics, IoT, and social collaboration tools to extend the integrated planning process across the entire enterprise in real time. Complexity continues to grow for global supply chain organizations and as requirements to be more customer (or even consumer) centric through things like customization/personalization, the planning challenge also grows. There is also pressure on manufacturers to better collaborate with suppliers and customers, and while that requirement is not new necessarily, the tools to enable more effective collaboration have improved considerably. As new data sources become available, and practical, from nontraditional sources like social media tools and IoT (sensors), the best-in-class planning companies will integrate these in real time with traditional ERP-based data — and they will do it across the entire enterprise in real time.
- By 2020, smart postponement techniques and additive (3D) manufacturing will have been deployed by one-third of the manufacturers, thus reducing delivery latency by up to 50%. Technology is fundamentally disrupting traditional business processes, and the logistics and inventory management processes are no exception. Increasingly, organizations are experimenting with ways in which to leverage modern technology in order to accelerate speed in logistics while reducing waste and managing costs. A significant driver of this change is the rapidly evolving demands of today’s customers that not only expect product variety and customization but also accelerated delivery. Historically, this has been a challenge, as companies would have to either keep excess inventory in region or be able to support customers with expedited freight.
These are just examples of things that we expect to see in the supply chain over the next few years that are a direct result of companies needing to raise their supply chain game and become more agile to meet increasing customer and consumer expectations and experiences. Whether these specific predictions come true or not is less important than the fact that supply chains are currently struggling in a consumer-centric world.
A big responsibility lies on the shoulders of Supply chain management professionals who need to implement strategies in their operations so as to alleviate customer efforts. It is essential to ensure an omnichannel experience to customers and hence allow them to have a seamless and personalized experience no matter the channel they choose to interact with. Through the use of technology, proper communication as well as a good supply chain training and development program, this objective can be attained. So what are you doing today to turn your supply chain into a powerful source of competitive advantage?