Most operational supply chain issues fall into a few clear categories that, when approached in an orderly way, do not require drastic measures to solve. Our Supply Chain Issues series explores each of these categories and provides hands-on solutions for key decision-makers. To read the entire series please click here.
Buyers are fast losing patience with any purchase experience that fails to match their personal buying experience. Increasingly, they judge their purchases not only on product but also on supply chain efficiency.
“Today’s B2B buyers are now demanding a different kind of experience and relationship with providers — they want more control and self-service, they want to be treated as equal partners, and they expect experiences that are increasingly open, connected, intuitive, and immediate.”
Why should customers tolerate poor customer service?
Most companies have struggled to keep pace with these rapidly changing customer expectations. That is especially unfortunate for customer service teams trying to respond to customer WISMOs (“what is the status of my order”) with a visibility of sales orders and shipments that is patchy at best.
“Many companies lack visibility of their shipments in transit. This lack of visibility results in instability, unpredictability, delays and poor customer service.”
For customers, this is customer service from another age. Essentially, managing a sales order and keeping the customer updated without having full visibility from procure to pay, is a game of guessing and hoping. There will always be an element of luck as to whether the order will get through as planned so that the customer won't complain.
Supply chain visibility improves customer service
The solution is straightforward, provide the customer service team, and others too, full visibility of the orders and shipments. That has been very difficult until recently. Cloud-based technology changed that. And with full supply chain visibility, everyone benefits.
Full transparency of order status at any point from procure to pay.
Early notification of any event that might impact delivery followed by updates on how this problem is being overcome.
Orders delivered in full and on time.
The customer service team benefits
Customer service teams benefit through improved productivity, more proactive customer communication and faster responses to early warning signals.
Improved productivity: Customer service teams quickly and accurately answer order status requests from their customer and other key stakeholders, like procurement and sales teams. Better still, as with Amazon and courier companies, customers can directly access the information themselves.
More proactive communication:Rather than just responding reactively to customer requests, service teams can proactively communicate order status with customers. Proactive communication builds trust, confidence and is the type of experience customers increasingly expect.
Faster responses to early warning signals: Having full visibility should help nip problems in the bud. When an order is at risk, for instance, a problem with the product supplier or potential bottlenecks with the shipment, early detection gives more time and scope to resolve without moving the delivery date.
The following example is typical of when we commence engagement with a new company.
The customer service team was bogged down in order status requests and lost in transit issues. In total, there had been almost 100,000 customer service calls in the previous year, and their business was still growing fast. Tracking down answers to order status questions was taking 30 min per call on average. Breaking down the math, the company had spent 50,000 hours chasing down information. With a salary cost of $30 per hour, the customer service cost represented 1.5 million dollars.
We solved that problem by first deploying our visibility platform, integrating with all their couriers directly, so the customer service team, and other teams as well, had ready access to live order status. Secondly, we set up automated emails based on delivery SLAs from courier data to advise customers if an order was running slightly behind. Those two steps cut out that annual $250,000 cost. Now the customer service team is only dealing with escalated issues and concentrating on providing true customer service.
The entire supply chain ecosystem benefits
Full visibility is good news across the supply chain ecosystem, for product suppliers, logistics providers and carriers.
Key stakeholders benefit from effective communication and collaboration, improving customer service while at the same time reducing communication costs.
There are also operational efficiency gains, for forwarders decreasing dwell time when loading and unloading, and for carriers improving dock scheduling and vessel capacity utilization.
Having an early notification of potential problems further helps forwarders mitigate against risks of delay.
The company benefits in other ways too
Full order and shipment visibility helps the company on a broader scale. For instance, Gartner reports visibility solutions can reduce detention and demurrage fees by 25% on average.
Little wonder then, visibility across the supply chain topped the list of most important funded initiatives in the Gartner 2019 Supply Chain Technology survey.
Customer centricity in the supply chain
What is emerging, in Amazon's wake, is a customer centric supply chain. Evolving from its status as a cost center, the supply chain is integral to the shift from a product and sales focus to that of building customer relationships.
Achieving full supply chain visibility is indispensable for that. For the pioneers this is an attractive competitive differentiation. But all companies will benefit.
And with customer expectations continuing to rise, harnessing affordable technology to dramatically improve customer service couldn’t have come at a better time.