There is always the effort by commercial organizations to be leaders in their industry and increase their market share. In other words, every organization always tries to win over another’s customers by offering something of greater value or by other means. Competition is normal. In fact it is good in that it drives performance and innovation in organizations and benefits the customers. While farsighted organizations plot their way through the maze of competition to a strategic advantage, organizations that ignore […]
Jul
4
Jun
27
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What’s your organization’s value equation?
Service is an intangible and insubstantial commodity and its value is expected to be self-evident. However, for service organizations, there is difficulty in understanding value as experienced by customers. This can be simplified with the value equation which is shown below: R – Result This is the primary need of the customer. If I want to go to Abuja from Lagos, it’s just travel from A to B. Nothing more – nothing less. P – Process We can achieve the […]
Mar
11
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Understanding the Service-Profit Chain
The natural concept of chains is that they are as strong as their links. Hence to make a chain strong, the links must be made strong. The service-profit chain is based on this concept. A theory evolved by a group of researchers from Harvard University in the nineties, it dissects the levers that translate good service into profitability. These levers are represented by links in an eight-link chain as depicted below. The service Profit Chain The service-profit chain works this […]
Mar
7
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One question you need to ask your customers
When you deliver the right service at the right price, at the right time, and to the agreed-upon specifications, it does not lead to customer loyalty. This is because you’ve only made the customer satisfied and mere satisfaction does not lead to loyalty. In fact, independent studies confirm that customers who are merely satisfied are still very likely to purchase from another source. However, that is not to say that there is no correlation between customer satisfaction and loyalty. There […]
Jan
19
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Starting the year with a clear service concept
The service concept is a shared understanding of what the organization provides and what the customer receives. Although it’s a simple idea, the service concept is powerful and can be used as a central tool in the design, delivery and improvement of services. In fact, concepts are what customers actually buy, not the elements of service. For instance, an MBA student buys ‘employability’ from the business school and not the elements of service like lectures, books, and certificate. Similarly, a […]
Jun
14
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The customer satisfaction level that leads to loyalty
When you look at the relationship between customer satisfaction and loyalty, it would seem that it’s linear where a little more satisfaction results in an equivalent increase in loyalty. But that’s not the case. The graph below depicts what the relationship is in practical terms. As you can see, from highly dissatisfied to neutral (relatively happy), nothing much happens in terms of loyalty. Then, as satisfaction becomes more than mere satisfaction and turns into highly satisfied, loyalty increases sharply. What […]
Jun
7
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Service as competitive advantage
Increasing competition, declining sales and more service-aware customers are putting pressure on organizations to rethink and improve the levels of service that they offer. Hence, many organizations are recognizing that by improving the service provided, they can make significant and sustainable gains in the marketplace. Service and service delivery can be, and increasingly are, a competitive weapon. As highlighted in our previous write-up, “Understanding the service concept”, the effect of good service on creating valuable customers, increasing customer retention and […]
Jun
1
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Understanding the service concept
Good service creates customer satisfaction. Excellent service creates customer loyalty. Hence, by building service excellence into your organization, customer loyalty is increased which in turn results to profitable and sustainable business growth. Implementing an effective service strategy with a focus on retaining customers has proven to be more effective at increasing sales and profit, than mere marketing campaigns, promotions or advertising. Thus there is a strong correlation between service delivery and profit with research showing that a 5% increase in […]
May
9
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The opportunity in customer complaints
The way to satisfy customers is to meet their expectations and treat them well. However, no organization can achieve 100% customer satisfaction. There will always be some customer dissatisfaction due to a variety of reasons. Hence, it is inevitable that any organization that has customers will get complaints. But are there many dissatisfied customers who complain? Unfortunately, no. Many dissatisfied customers do not complain. And if a customer does not complain and has an issue that is not resolved, they […]
Feb
10
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Customer Satisfaction: In which of these quadrants would you place your organization?
The level of customer satisfaction determines how successful an organization will be. Hence it is important to have a good understanding of what makes customers truly satisfied. It will help you to know how your organization is doing and contribute in seeking ways of possible improvement. From the customers’ perspective, satisfaction is made up of two major components – Customer Experience and Service Outcome. Customer experience is the customers’ perception of the service process or product acquisition process. It is […]
