The Research on Scheduling Model of Online Service in Electronic Commerce :Perspective of the Service Profit Chain Mi-yuan Shan, Xue-lin Zhou*, Ren-long Zhang School of Business Administration, Hunan University, Changsha, China (*zhouxuelin0309@163.com) Abstract - The emergence of electronic commerce (ecommerce) has changed the consumption concept of customers. They usually pay more attention to the customer service quality of Network platform apart from the convenience and risk of shopping environment. With the characteristics of virtuality and information sharing under the e-commerce environment, buyers and sellers cannot contact face to face. It makes enterprises a lot of difficulties such as low customer satisfaction, lack of loyalty and weak profitability following the communication barrier. This paper first applies the theory of Service Profit Chain (SPC) to solve the problem of online service scheduling in ecommerce and establishes a mathematical model in which the whole customers’ service value can be maximized. Then via numerical test, we verified the effectiveness and feasibility of the model. The results show that this research has good practicability and generalization for improving customer satisfaction in e-commerce. Keywords –Electronic commerce, online service, scheduling model, Service Profit Chain, service value I. INTRODUCTION The homogenization of products and technology innovation intensifies the fierce competition for market share of electronic commerce (e-commerce) businesses thus force them to focus on online service management. However, it is a common phenomenon that service resource shortages, low efficiency and effectiveness of services, and poor responsibility often occur in the existing e-commerce platforms, the above defects of online service management may lead to a loss of customers due to the dissatisfaction. This affects the profitability of enterprises severely. Current researches on customer satisfaction focus on the integration and innovation of customer service mode, service strategies optimization in e-commerce, papers considering the issue of online service scheduling are still rare. Jun Xu made detailed analysis about the progress of customer service and incisively summarized the suggestions to improve service management that enterprises should equip some service auxiliary tools to support service measures [1]. Qingjiang Wei formulated the service strategies of pre-sale, sale and after-sale stages to improve customer satisfaction and customer loyalty [2]. Quan Fang studied the customer service center of network platform [3]. Firstly he analyzed the existing problems and weaknesses, on the basis he set up the structure of service center and reviewed the functional module and business flow. Although the elements were systematic and comprehensive, the model was still a conceptual one and lack of optimization approaches. Xiaohong Liu and Xianyi Zeng presented a model of Customer Satisfaction Index in e-commerce using fuzzy techniques to evaluate the quality of service [4]. The paper did not suggest how to improve customer satisfaction. In recent years, foreign researchers have achieved some success. Sungjoo Lee, Yongtae Park studied on the classification of e-commerce service and the strategic management based on customers’ perception [5]. For the purpose, online services were identified from Korean Portal Sites and classified by 11 variables representing customer perceptions about service characteristics in the e-commerce context. Godwin J.Udo, Kallol K.Bagchi and Peeter J. Kirs examined the dimensions of web service quality based on e-customers’ expectations and perceptions after that they developed operational web service quality construction, and analyzed their relationships between customer satisfaction and behavioral intentions in an e-business environment [6]. The research showed that the direct cause influencing customer satisfaction was the contact progress of online service in e-commerce. So studies on e-commerce service system have important significance in-depth. Basic queueing systems involve organized queues where units are dealt with according to their order of arrival [7]. Nonetheless, this traditional first-come first-served rule isn’t applied to the service strategy in improving customer satisfaction; we should seek a new service rule on customer priorities to optimize the combination order which contribute the improvement of e-commerce’s customer satisfaction. With regret, there is no one submitting an effective intelligent optimization model to solve the online service scheduling because of the limitations of previous studies. As there is much room for improvement for the theories and methods in online service scheduling, we will introduced the theory of Service Profit Chain(SPC) into the customer services management, and design a scheduling model based on the customer value equation in order to help enterprises improve the customer satisfaction and achieve sustained profits. We hope to provide reference and guidance for e-commerce’s online service management. Internal External Customer Business strategy and service delivery system Concept of service Target market Employees Loyalty Service Satisfaction efficiency Ability Service quality Service value= (process quality + result)/ (price paid + service cost) Employee Customer satisfaction Profit The lower cost of service The higher efficiency of service The less probability of customer loss The greater probability of service contact success The less loss of service Profitability Customer loyalty The better quality of service The higher price paid The more agile service response mechanism The more scientific and reasonable order of service The higher profitability of enterprises Fig.2 the mapping relationship of online service value in e-commerce Fig.1 the Service-profit chain II. THEORY OF SERVICE-PROFIT CHAIN The theory of SPC was put forward by James L. Heskett and so on in 1997[8]. After integrating the Strategic Services theory and the relationship between customer loyalty and employee loyalty as well as corporate profits [9] [10], SPC systematically describes the circular relationship with enterprises, customers, employees and profits. The logical connotation is described as: growing enterprise profit and rising profitability mainly come from the improvement of customer loyalty; customer loyalty is the direct result of customer satisfaction and the satisfaction degree depends on the perceptive service value which is created by the staff; in the end the internal service quality determines their satisfaction. The structure of SPC is shown as figure 1. There are two circles, one is staff circle, the other one is customer circle that are linked up by delivery services (ie, service value equation). The entire dynamic interaction process of service value delivering is the key to service, called "service encounter". American scholar Keaveney conducted a survey of 838 cases leading the customers to choose competitors in e-commerce [11]. The results found that the failure of service encounter is the second reason after a critical service mistake, accounting for 34%, other reasons including deception, unfair pricing, service failure dissatisfaction. These findings are in accordance with Godwin J.Udo that the customers’ satisfaction depends on the online service in e-commerce. Enterprises should pay attention to the value of delivery services during the service encounter that passed to customers for each service process, so it can experience the high-quality service, the higher the value of services the more satisfaction, thus the enterprises will gain more profits. After reviewing the theory of SPC, this paper proposes a mapping model of online service value based on the characteristics of e-commerce and online service factors as figure 2. The SPC theory is very useful to solve online service scheduling problem for e-commerce enterprises which gives important enlightenment. The service value equation directly affects customers’ conversion in the state of satisfaction and dissatisfaction. This suggests that enterprises must give full play to the regulatory role of the service value equation. If e-commerce enterprises provide customers with the greater value of services, the more satisfaction customers gaining, there must be a higher profit value generated for enterprises. Therefore, this paper designs a scheduling model of e-commerce’s online service from the perspective of SPC to improve customer satisfaction. III. MODEL BUILDING OF E-COMMERCE ONLINESERVICE SORTING A. Problem Description Many service systems require customers to make an appointment prior to receiving service [12]. In a period of time, service requests of customers on the platform form the tasks of online service personnel. Call center must allocate reasonable tasks to the online service staff as soon as possible under the condition of limited resources in order to meet the need of customers. The expression of service scheduling is shown as figure 3 below. Customer service scheduling must pay attention to the value of services for customers. Improving the whole value of services will be able to improve customer satisfaction from an overall point. So we can select different customer service staff and optimize the combination of customers’ order to maximize the service value of all customers in a specified period of time. The following from resources environment, the action mechanism, target of online service scheduling to describe the operation of ecommerce online customer service. customer1i …… customer12 customer11 service personnel 1 customer2j …… customers in queue customer22 customer21 service personnel 2 customern 2 C. Parameters and Variables Description …… …… …… …… …… customernj 4 ) Each customer can’t accept multiple clients’ service requests simultaneously. Only when one online service personnel finishes the task for a specific customer he or she can continue to the next task and each service process is not allowed to interrupt; i =the service outcomes and process quality for customern1 service personnel n Fig.3 The expression of service sorting 1) Resources environment: In general, in order to meet the different scales of customers, the call center requires a certain number of online service personnel at the same time whose efficiencies are different to handle the requests for the purpose of realizing the parallel service assignments. 2) Action mechanism: The service value is constrained by transaction cost, service process quality and the results. We try to introduce the service value equation into the scheduling model to make the integration of the SPC and the service scheduling management method. The aim of customer satisfaction maximization promotes more customers to be satisfied also reduces the cases of customer dissatisfaction. 3) Target of online customer service scheduling: In the process of online service encounter, efficient and agile service channel and response rate can improve the quality of service. If customers do not get services in their acceptable time, it will cause hysteresis loss denoted by Tij which greatly affects the quality of service. Tij and i have obvious decreasing correlation. i represents the service outcome and process quality for one customer. Equally, i can be expressed by Tij , the greater i the smaller Tij . Meanwhile, the time cost and service price i is directly reflected in transaction price Pi and hysteresis cost a j Tij , the importance of transaction relies on the client himself. All the factors of the service value equation and Tij establish a quantitative relationship. The purpose of online service scheduling is maximizing the service value i of overall customers in a waiting i time. each customer; i = the time cost and transaction price; m = the quantity of service requests at a specific moment; i = the number of service requests; n = the quantity of online service personnel; j = the number of online service personnel; Sij = the beginning time of online service personnel j handling service request i ; Tij = the delay time of online service personnel j handling service request i ; d i = the waiting time of customer i acceptable; Pi = the transaction price of customer i ; a j = the unit time cost of delay for online service employee j ; x(t )ij = 0 or 1, online service personnel j provides service for customer i at time t . D. Model Construction Objective function: i i 1 i m f max i M , M 1, 2, i S T ij t 0 j 1 x(t )ij 1 i M Smax (3) n i Pi a j Tij x(t )ij i M (4) t 0 j 1 Smax n t 0 j 1 1)One service request corresponds to one customer; 2)All the online service staff are vacant at initial moment; 3 ) The service personnel handle the requests submitted during the same period, and each customer’s service waiting time is limited. Beyond the waiting time it means hysteretic and affects the service value; , m and x(t )ij 1 (2) 1 n max x B. Mode hypotheses (1) Constraints: Tij max[( Sij di ) x(t )ij , 0] Smax m ( t ) ij 1 n x t 0 i 1 j 1 ( t ) ij i M (5) m (6) x(t )ij 0,1 i M ; j N , N 1, 2, , n (7) From the general perspective of enhancing customers’ satisfaction, the objective function (1) denotes that the goal of online service scheduling model is to maximize overall customers’ service value. When the objective value is a maximum, all the values equaling to 1 are the optimal combination results of customer service scheduling. The constraint condition (2) denotes the delay time of online service personnel j handling service request i . In the equation, x(t )ij =1 fixes on the service task which customer i is assigned to service personnel j . If the time when customer service personnel j receive the request of customer i exceeds the acceptable waiting time, the service delays and the value of Tij is equal to the difference of service beginning time and waiting time. If within the customer’s expectation, the service doesn’t delay and the value of Tij is 0. The constraint condition (3) represents that Tij measures the service outcome and process quality i for customer i . The longer Tij , the smaller i . The constraint condition (4) denotes each customer’s transaction price and time cost due to service delay. The constraint condition (5) ensures that a specific customer can only be one customer service personnel service once, which S max says the beginning time of service for the last one, x(t )i1 , x(t )i 2 , , x(t )in only one value is 1, all the rest are 0. The constraint condition (6) ensure that all customers have access to services, the amount equal to the total number of m . The constraint condition (7) gives the range of decision variables x( t )ij , when x( t )ij =1, it suggests that online-service employee j services customer i at time t , otherwise 0. IV. NUMERIC EXPERIMENTS the calculation number of the optimal solution based on their average values of 10 repeated tests, and in Table II, we show the optimal outcome for each problem size. Table Ⅰ Statistical analysis of test results (10,4) The optimal solution 0.0651 The worst solution 0.0185 (30,4) 0.1273 0.0635 (20,5) (40,5) 0.1172 0.1663 0.0508 0.0917 Problem size Average value Number 0.03419 7 0.09717 5 0.06602 0.12295 5 4 Table Ⅱ The optimal sort results results (10,4) j (30,4) (20,5) (40,5) 1 7,4,6 7,28,17,4 15,11,5 3,37,29,1,6,26,38 2 3,9,2,1 27,22,23,26,14, 18,13,11,5,24 17,19,2 4,28,25,9,35,16, 8,24,30,21 3 5,10,8 19,9,10,16,6,2, 25,8,20,15,1 7,20,8,4 13,27,23,36,7,15 21,29,3,30,12 10,16,1,9,18 2,34,22,20,14,12, 33,17,11,10,5 5,14,12,3,13 40,31,18,19,39,32 4 5 Fig. 4 the Gantt chart of problem size (10,4) In this section we take the following four groups of problem size ( m , n ) to compare the performance of the scheduling model. The testing parameters are randomly generated for each problem size. Each transaction price requested by the corresponding customer service obeys uniform distribution in the interval [25,150]; the service beginning time Sij obeys uniform distribution in the interval [0, 10]; and the acceptable waiting time d i for the waiting customer obeys uniform distribution in the interval [3, 10]. Each unit time cost a j (unit: RMB/time) of lag service by the corresponding service personnel is set to be 1, 2,…, n respectively. To avoid each customer service staff have different beginning time, the initial time of service task received by all service staff are set to 0. All of the scheduling model are implemented by Matlab language, and were run on a PC with Windows XP system, where CPU is 1.60 GHz and the memory is 2GB. In Table I, for each problem size, we report the optimal solution, the worst solution, the average value and Fig. 5 the Gantt chart of problem size (30,4) Fig. 6 the Gantt chart of problem size (20,5) Fig. 7 the Gantt chart of problem size (40,5) The above Gantt charts show the optimal combination result for each problem size. Such results guarantee that the model can obtain a general service with maximum value. The horizontal results show the special order of a number of customers assigned to each customer service personnel, and the length of stripes denotes the length of time, which implies that each customer has different service duration. Especially, the first Gantt chart shows that for the case of ( m , n ) = (10, 4), the fourth customer service staff is free, which implies that he is not assigned any tasks. In this experiment, the results of solving the model appear to be reasonable and reliable, except for the first case, that is, one customer service personnel is not assigned any tasks, but other’s task distribution is more evenly distributed. These shows that the optimal results can be a reasonable allocation of resources, avoid waste of resources, and each customer service personnel has clear division of labor. In specific, as the customer number increase, the objective function value under the corresponding problem size increases approximately vs. the number of customers, while the calculation number of optimal solution decreases as the number increase. It may be explained by that as the increase of customer number, the computational complexity of the solving the model is also increase, but this also can be accepted. In conclusion, the model could be used to solve the e-commerce online customer service scheduling problem in a certain data scale, and the results of the model have certain validity and feasibility. Optimal customer service scheduling combination for improving customer satisfaction has a certain reference value. V. CONCLUSION Due to the significance both in real world and theory, scheduling has always been an important branch in the research of combinatorial optimization. The paper attempts to study the online service scheduling problem in e-commerce and apply the SPC theory to the circumstance for the purpose of improving and perfecting the management of online service. With maximizing the whole customers’ service value as goal, we have designed the model. Then the validity and applicability of the model have been verified by taking a numerical example. Therefore, the scheduling model research of online service has both theoretical and practical significance in improving customer satisfaction to e-commerce enterprises. Above work provided a foundation for further studies into online service scheduling. However, the scheduling model in the paper only considered the best combination of stable quantity and scale in a closed state, but ignored that the number of customers’ service request is dynamic in the situation of real world. Therefore, further research will continue to enrich the variables and parameters for establishing a more realistic scheduling model and utilize a new algorithm to enhance the effectiveness and robustness of model by improving the solution speed. 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