Connection Between Supply Chain and Customer Service
Of course, many big name companies understand the importance of the supply chain when it comes to driving up customer satisfaction. Apple, Johnson and Johnson, and Toyota are just a few. Amazon is perhaps the reigning champ when it comes to their supply chain and customer satisfaction. “Customers are influenced by their experience of the supply chain — even in the simplest terms, it’s easy to see that a late delivery can disappoint, whereas an expedited delivery can delight,” Callinan added.
Logistics and customer service make up the backbone of customer interaction
Logistics and customer service make up the backbone of customer interaction, yet many companies still haven’t discovered the best way to obtain the maximum value from either aspect.
A Case Study
At BlueGrace we have the privilege of serving a broad range of companies and industries. One company in particular highlights just how important strong supply chain management can be when it comes to customer satisfaction.
In this particular example, we worked with a company that is the leader in lifting and moving equipment rentals for the U.S. and maintains a comprehensive inventory of equipment. However, despite being best in class for customer service, the company began to suffer when rapid growth began to affect their supply chain.
“Within their industry, this company has a well-earned reputation for best in class customer service. However, faced with changes brought on by rapid growth, they experienced increased inventory management costs and a negative impact on invoicing as a result of delays associated with rentals placed in Off-Hire status but not yet returned to them.”
Given the changes and increased volume of demand, the supply chain became disrupted which then created a domino effect. Inventory management costs began to rise while invoicing suffered because the supply chain stuttered. As a result, a company who typically excels in customer service started lacking which hurt the business as a result.
Through our four step transportation management process, the solution left the company in much better standing:
- Discover – Research and analysis of current processes,
- Engineer – Build the solution and plan for integration of process improvements,
- Execute – Implement recommendations/support and finally
- Perform – Measure, review and ongoing process improvement
Improved return rental cycle time by 7.3 days, reduced pickup information errors by over 95% and sped up invoicing of returned equipment by 80%.
With the solution in place, the company was able to improve their return rental cycle time by 7.3 days, reduce pickup information errors by over 95% and speed up invoicing of returned equipment by 80%. By making these improvements to the supply chain and making the process more efficient the level of customer satisfaction rose significantly.
This goes to show just how truly interconnected the supply chain is with good customer service. Customer service and the supply chain are the building blocks for any good business foundation. Handling them both properly is what separates a good business from a great business.
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