Advertisement

Customer Management

  • David Frederick Ross

Abstract

As far back as the turn of the twentieth century, business strategists have been wrestling with the theory and practice of integrating the customer with the supply chain. Writing in 1915, supply chain pioneer Arch W. Shaw described distribution as composed of two separate yet interconnected functions: demand creation and physical supply. Demand creation consists in the communication of the value found in the array of products and services a company offers that fulfills the wants and needs of the customer. However, even if a company has the best products and services in the marketplace, they possess no value if they are not available at the desired time, place, and cost wanted by the customer. It was physical supply’s (the supply chain’s) role to solve this basic problem of creating exchange value by ensuring that the flow of the output of production was matched to the customer’s requirements as efficiently and cost effectively as possible. Shaw felt that finding a solution “was the most pressing problem of the business man today” and “in this great task he must enlist the trained minds of the economist and the psychologist. He must introduce the laboratory point of view [1].”

Supplementary material

978-1-4899-7578-2_10_MOESM2_ESM.xlsx (14 kb)
Exercise 10.1 Financial affect of reducing cycle time (XLSX 14 kb)
978-1-4899-7578-2_10_MOESM3_ESM.xlsx (10 kb)
Exercise 10.2 Cost of preventing a stock out (XLSX 9 kb)
978-1-4899-7578-2_10_MOESM4_ESM.xlsx (29 kb)
Exercise 10.3 Service factor and fill rates for a safety stock policy (XLSX 28 kb)
978-1-4899-7578-2_10_MOESM5_ESM.xlsx (27 kb)
Exercises (XLSX 26 kb)
978-1-4899-7578-2_10_MOESM7_ESM.pptx (1.1 mb)
Chapter 10 (PPTX 1142 kb)

References

  1. 1.
    Shaw, Arch W. 1915. Some problems in market distribution, 41–44. Cambridge: Harvard University Press.CrossRefGoogle Scholar
  2. 2.
    This phrase was coined by Larry Seldin and Geoffrey Covin in their book Angel customers and demon customers, 7. New York: Portfolio, 2003.Google Scholar
  3. 3.
    All definitions from the APICS Dictionary used in this chapter are from the 14th edition, 2013.Google Scholar
  4. 4.
    For further discussion relating to channel systems see in Rangan, V. Kasturi. 2006. Transforming your go-to-market strategy: The three disciplines of channel management, 90–91. Boston: Harvard Business School Press; Ross, David Frederick. 2008. The intimate supply chain: Leveraging the supply chain to manage the customer experience, 1–22. Boca Raton: CRC Press; and Selland, Chris. 2004. Sell-side channel management. Aberdeen Group White Paper, September.Google Scholar
  5. 5.
    Peppers, Don, and Martha Rogers. 2005. Return on customer: Creating maximum value from your scarcest resource, 72. New York: Currency/Doubleday.Google Scholar
  6. 6.
    Authoritative discussions of the LCV metric can be found in Kotler, Philip, and Kevin Lane Keller. 2006. Marketing management, 12th ed, 148–152. Upper Saddle River: Prentice-Hall; Peppers and Rogers, 221–227, and Greenberg, Paul. 2004. CRM at the speed of light: Essential customer strategies for the 21 st century, 3rd ed, 655–662. New York: McGraw Hill.Google Scholar
  7. 7.
    Kotler and Keller, 149.Google Scholar
  8. 8.
    Parts of this section have been adapted from Ross, The intimate supply chain, 11–21.Google Scholar
  9. 9.
    These points have been summarized from Gupta, Sunil, and Donald R. Lehmann. 2005. Managing customers as investments: The strategic value of customers in the long run, 115–121. Upper Saddle River: Wharton School Publishing.Google Scholar
  10. 10.
    Thompson, Bob. 2006. Customer experience management: Accelerating business performance. CRMguru.com White Paper, June, 2.Google Scholar
  11. 11.
    Womack, James P., and Daniel T. Jones. 2005. Lean solutions: How companies and customers can create value and wealth together, 9–17. New York: Free Press.Google Scholar
  12. 12.
    The role of chief customer officer has its own website and membership. The website address is www.chiefcustomerofficier.com (accessed February 2014). The definition is found on the website.
  13. 13.
    Greenberg, Paul. 2001. CRM at the speed of light: Capturing and keeping customers in internet real time, xviii. Berkley: McGraw-Hill. Greenberg also devotes 33 pages of his first chapter to detailing a variety of comprehensive definitions. In his 4th edition of CRM at the speed of light (New York: McGraw-Hill, 2010) Green defines CRM as “a philosophy and a business strategy supported by a system and a technology designed to improve human interactions in a business environment.”Google Scholar
  14. 14.
    Dyche, Jill. 2002. The CRM handbook: A business guide to customer relationship management, 4. Boston: Addison-Wesley.Google Scholar
  15. 15.
    Sawhney, Mohan, and Jeff Zabin. 2001. The seven steps to nirvana: Strategic insights into e-business transformation, 175–181. New York: McGraw-Hill have been most helpful in writing the above two paragraphs.Google Scholar
  16. 16.
    Rossi, Ben. CRM Will Be at the Heart of Digital Initiatives for Years to Come. http://www.information-age.com/industry/software/123457714/crm-will-be-heart-digital-initiatives-years-come-gartner#sthash.Uhi8GWJR.dpuf. Accessed February 2014.
  17. 17.
    Dyche, p. 85.Google Scholar
  18. 18.
    Greenberg, CRM at light speed, 3rd ed, pp. 52–64.Google Scholar
  19. 19.
    Editor. 2013. “In customer relationship management, you must adapt to stay relevant” SupplyChainBrain 17(1): 56. January/February.Google Scholar
  20. 20.
    Peerless Research Group. 2013. Aligning order and fulfillment channels. White Paper, June, 3. There were actually 13 issues identified. Figure 10.7 is an abstract of the top 6 issues.Google Scholar
  21. 21.
    The classic view of the order cycle is found in LaLonde, Bernard, and Paul H. Zinszer. 1976. Customer service: Meaning and measurement, 272–282. Chicago: National Council of Physical Distribution Management.Google Scholar
  22. 22.
    These barriers are cited in Wang, Ray. 2009. 20 steps to delivering the perfect order. Forester White Paper, March, 2–3.Google Scholar
  23. 23.
    LaLone and Zinszer, pp. 272–282.Google Scholar
  24. 24.
    Zeithaml, Valerie A., A. Parasuraman, and Leonard L. Berry. 1990. Delivering quality service, 20–23. New York: The Free Press and Zeithaml, Valerie A., A. Parasuraman, and Leonard L. Berry. 1985. A conceptual model of service quality and its implications for future research. Journal of Marketing Fall: 41–50.Google Scholar
  25. 25.
    Gopal, Christopher, and Gerard Cahill. 1992. Logistics in manufacturing, 127–162. Homewood: Business One Irwin.Google Scholar
  26. 26.
    Zeithaml, V.A., A. Parasuraman, and L.L. Berry, Delivering quality service, pp. 9–13. Google Scholar
  27. 27.
    This exercise is based on the example in Chopra, Sunil, and Peter Meindl. 2010. Supply chain management: Strategy, planning, and operation, 4th ed, 294–295. New York: Prentice Hall.Google Scholar
  28. 28.
    This list is based on the list in Gopal and Cahill, 143–145 and the SCOR® Reference Model.Google Scholar

Copyright information

© Springer Science+Business Media New York 2015

Authors and Affiliations

  • David Frederick Ross
    • 1
  1. 1.APICSChicagoUSA

Personalised recommendations