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Customer Service as a Strategy: A Parcelforce Worldwide case
study
Introduction
- Parcelforce Worldwide is part of the Royal Mail Group Ltd. Royal Mail
Group has three main operating brands:
• The Post Office Ltd provides counter services to the high street
customer
• Royal Mail manages the delivery of letters and packets
• Parcelforce Worldwide provides express parcel delivery services for
businesses and consumers
- Parcelforce Worldwide has over 30,000 business customers in the UK
- It handles 200,000 parcels a day
- It has a turnover of £382 million
- It has 23 partners across 30 European countries and access to Postal
Administrations through the Universal Postal Union
- It operates:
- Business to Business (B2B) services, delivering parcels and supplies
from companies to other companies
- Business to Consumer (B2C) services, delivering parcels to individuals
in their homes
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Customer Service as a Strategy: A Parcelforce Worldwide case
study
- In 2002, Parcelforce Worldwide was making a loss
Need for Change - In response, those managing the business decided to change the type
of service it offered
- Instead of unguaranteed parcel deliveries typically taking between two
and four days, Parcelforce Worldwide decided to focus on time and day
guaranteed, express delivery
- As a result of these changes, Parcelforce Worldwide also increased
operational efficiency. The business:
- Reduced the number of staff it employed
- Closed some of its depots
- Opened a new, technologically advanced sorting centre in Coventry
These changes enabled Parcelforce Worldwide to achieve its financial
targets
- It recognized that more could be done to improve efficiency
- It wanted to cut absenteeism staff taking unauthorized or sick leave
and reduce the time lost as a result of accidents at work
- To do this, Parcelforce Worldwide introduced a more decentralized
approach to management. This gives depot managers greater decisionmaking accountability to improve the effectiveness of the operation in
their local area
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Customer Service as a Strategy: A Parcelforce Worldwide case
study
Differentiation
- Parcelforce Worldwide has developed a unique selling proposition
(USP) based on high-quality customer service
- Parcelforce Worldwide works in partnership with customers, such as
the UK's examination boards, to develop and deliver services to meet
specific needs. During exam season, Parcelforce Worldwide delivers
millions of exam papers, scripts and coursework
This case study examines how a strategy focused on customer service can
contribute to long term business development
Business
Strategy
- Businesses have aims and objectives
- Aims are the long-term targets of the business
- Objectives are the steps that help to achieve these aims
- Objectives should always be SMART (specific, measurable, achievable,
relevant and set within a timeframe)
- By carrying out a SWOT analysis, a business can identify the best
strategies to pursue
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Customer Service as a Strategy: A Parcelforce Worldwide case
study
Parcelforce &
Business
Strategy
Parcelforce Worldwide has:
- Operational strategies to improve its efficiency and meet customer
needs better
- Promotional strategies to strengthen its brand presence in key markets
- Growth strategies to expand its business outside its core national
markets
For example, the parcel delivery industry has consolidated across the
world. This means that there are now fewer global players, but each has
a relatively larger market share. Parcelforce Worldwide needs to
compete with these global rivals. To increase its market share, it needs
either to grow its existing business or merge with other parcel delivery
businesses
Customer
Service as
Strategy
- Customer service means talking and listening to customers
The key parts of this customer service are:
- Time: making sure that deliveries are on time
- Visibility: letting the customer follow a parcel through online tracking
- After-sales service: ensuring that any problems are dealt with
courteously and promptly
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Customer Service as a Strategy: A Parcelforce Worldwide case
study
Customer
Service as
Strategy
Diversity
- Parcelforce Worldwide has identified that its organizational structure is
a key strength
- Its people are essential to supporting quality customer service. For
instance, drivers need to work with depot staff so that parcels are
loaded in the right order for delivery
- Parcelforce also needs to ensure that services are accessible by all
customers
- Society is now more diverse, with a larger proportion of the population
aged over 60 and with more people from different ethnic backgrounds
For example, Parcelforce Worldwide makes sure that: drivers write
delivery cards that can be easily read by people with sight problems or
by those who do not speak English as a first language
- Employees learn the best way of communicating with customers with
disabilities
- The company also needs to find out what its customers want so that it
can provide additional services;
For example, in this way, Parcelforce Worldwide discovered that some
customers were concerned about the affects of carbon emissions on the
environment. It therefore offers a 'carbon neutral parcel' option. The
customer pays a few pence more to offset the carbon impact of
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delivering the parcel
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Customer Service as a Strategy: A Parcelforce Worldwide case
study
Corporate
Responsibility
- Parcelforce Worldwide takes its corporate social responsibility (CSR)
seriously
- This means providing benefits for employees, customers and the
communities in which it operates
- Its CSR programme focuses on;
- Health and safety
- Environment
- Supporting local communities
- Diversity
For example:
- Reducing the carbon footprint of the business
- Supporting local communities through involvement in education
- Removing barriers to its services for all customers
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Customer Service as a Strategy: A Parcelforce Worldwide case
study
Implementation - To improve its customer service, Parcelforce Worldwide has undertaken
a “gap analysis”. This is a detailed exercise that assesses:
of Customer
- where the business is now
Service
- where it wants to be
- what it needs to do to achieve that and how
Customer service has an impact in six main areas of the business:
1. Deliveries to the customer providing timely delivery, prompt response
to queries, clear documentation.
2. Re-deliveries ensuring clear procedures are in place
3. Collections from customers providing a timely service with
documentation
4. End-to-end parcel location (tracking) an online service with easy-touse screens means customers can find out when a parcel has been
delivered
5. Customer contact improving customer communications and providing
help by web or by telephone
6. Making claims making it easy for people to claim if things go wrong
In each of these areas, Parcelforce Worldwide has identified best
practice in the industry. It compares its performance by benchmarking
itself against competitors. It then assesses how to improve its processes
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to achieve best practice.
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Customer Service as a Strategy: A Parcelforce Worldwide case
study
Evaluating the - Training to Employees: A customer-orientated needs appropriate
Impacts, Costs & training to ensure employees have the skills to meet customer needs
- Measuring Performance:
Benefits of
1. Measures customer service by using key performance indicators
Customer
(KPIs). These set targets for factors such as response times, numbers
Service
of staff trained and levels of after-sales service
2. Uses a balanced business scorecard to record progress against below
mentioned four targets;
- Financial includes operating margin, average unit cost
- Process includes on-time deliveries and collections, attempted
deliveries
- Customer focus includes customer satisfaction scores, complaints
- Employee/teams measured by opinion surveys
By tracking performance on a regular basis, Parcelforce Worldwide can
identify areas that are performing well, as well as those that need to be
improved
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Customer Service as a Strategy: A Parcelforce Worldwide case
study
Conclusion
- Parcelforce Worldwide is a major player in the parcel delivery market in
the UK
- It also provides international services by partnering with other
providers around the globe
- The parcel delivery market is highly competitive. Parcelforce Worldwide
needs to differentiate itself from the competition. It has adopted a
strategy based on quality customer service
- It has improved efficiency and changed its focus from volume (the
number of parcels carried) to value (what the customer wants - getting
parcels there on time)
- Parcelforce Worldwide regards its people as its most important asset. It
is developing the skills of its people to deliver high levels of customer
service
By putting customers at the heart of its strategy, Parcelforce
Worldwide aims to achieve competitive advantage
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Using Technology to Improve Economies: A Vodafone Case Study
Introduction
Vision
Approach to
Business
- Vodafone is a leading international mobile communications company
with interests in 27 countries and partnership agreements with a further
40 countries
- It has over 71,000 employees throughout the world and in 2008 had
more than 289 million customers
Vodafone's vision is 'to be the world's mobile communications leader'
and a key component of this is to ensure that customers trust and admire
the company
- It is two fold;
To provide product extension - Developing new ways of delivering
products and services helps to keep existing customers and attract new
ones. For example, 3G technology has improved the ability and quality
of transferring voice and data. Very fast internet speeds allow extended
services such as video calling, music downloads, mobile television and
email messaging
To look for opportunities in emerging markets- These include some of
the world’s more remote areas, including parts of Africa, where many
people do not yet have access to a mobile phone. Vodafone is
committed to providing these markets with the technology to develop
communication that will help both economically and socially.
There are now more than four billion mobile phones across the world
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and 64% of all users live in a developing country.
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Using Technology to Improve Economies: A Vodafone Case Study
Economy:
Concept
- An economy is a system which tries to balance the available resources
of a country (land, labor, capital and enterprise) against the wants and
needs of consumers. It deals with three key issues:
1. what is produced
2. how it is produced
3. who gets what is produced
Economic System
Planned Economy
Mixed Economy
Market Economy
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Using Technology to Improve Economies: A Vodafone Case Study
Economic System
Planned Economy
Mixed Economy
Market Economy
The government makes all
decisions for society. Producers
only make what they are
instructed to make.
Benefits
most workers are employed and
most people enjoy a similar basic
lifestyle.
Problems
A planned economy gives little
capacity for development, so
growth and investment is limited.
the infrastructure is usually
under-developed as government
spends on other areas such as
defense, wages are statecontrolled, so people have less
motivation to perform at higher
levels
The mixed economy is a
combination of both planned and
market economies, eg: the UK and
the USA. Even a communist country
like China has an economy which
relies on a mixture of state and
private enterprise:
In a mixed economy, the
government contributes and
controls some resources and the
market controls the rest.
The proportion of each contribution
may vary. For example, in some
Scandinavian countries, the state
provides a very high level of social
benefits but charges high taxes. In
the USA, public benefits (such as
free national health care) are
minimal. The UK position is
somewhere in between.
The government's role is limited
to providing legislation to protect
businesses and consumers and
making sure no single business or
organization restricts
competition. It also provides
essential services (like police and
defence) and ensures the
country's money supply is stable.
Features
Customer driven economy
if customers do not buy and
demand falls, then a business
must make less, be more efficient
or produce an alternative product
Drawbacks
It could lead to inequality in
society
In times of economic crisis,
without govt intervention,
nation’s economy would fail 12
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Using Technology to Improve Economies: A Vodafone Case Study
Developed
Mixed
Economies
Developing
Market
Economies
Developing Planned/
Command Economies
-Developed mixed economies such as the UK produce large numbers of
goods and services to meet consumer needs
- In this type of economy, where customers have choices, Vodafone needs
to differentiate itself in the market
-It relies on its strategic mix of;
- Innovation in products and services
- Customer focus
- Its responsible approach to business to meet consumer demand and
develop long-term customer relationships
- In the UK's developed market, Vodafone provides its customers with the
benefit of:
• Network coverage for calls and data across almost 100% of the
population
• A wide range of handsets and airtime plans to suit every type of customer
and use
• Access to messages, email, the internet and the sharing of images, videos
and music through mobile phones
- In developed economies, mobile phones are considered a normal part of
life
- Vodafone's integrated mobile system can be used for business, education
or socializing
- The latest handsets allow people to keep in touch with family and friends
through emails, messaging and networking sites such as Facebook13and
Twitter, play online games, listen to music or watch TV in any location
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Using Technology to Improve Economies: A Vodafone Case Study
Developed
Mixed
Economies
Developing
Market
Economies
Developing Planned/
Command Economies
- Developing economies are those countries in the middle or bottom layers
of the socioeconomic pyramid
- These countries often face great difficulties in improving their economies
- Features of Developing Economies:
- The population lives on very low incomes (typically less than $2 or about
£1 per day)
- Poor infrastructure such as transport (roads or railways) or local
government
- Poor communication systems
- Low levels of basic health and education
- Low Gross National Product (GNP)
Kenya: Over 75% of the country's workforce is in agriculture which can be
affected by the climate. Telephone landlines are scarce, expensive and
difficult to install. Kenya has just 450 bank branches. 80% of Kenyan adults
have no bank account.
Vodafone in Kenya:
-Vodafone in partnership with Safaricom also recognized the need to
improve the movement and security of money to allow small businesses
to grow
- As a solution, Vodafone set up M-PESA (literally 'mobile money') working
with funding from the Financial Deepening Challenge Fund (FDCF). This is
a UK fund established to aid international development
- M- PESA provides a simple, secure, low-cost money transfer system:
A customer goes to an accredited M-PESA 'top-up' shop and, in return for
cash, has credit registered on their phone via the M-PESA system (rather
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like a pay-as-you-go top up).
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Using Technology to Improve Economies: A Vodafone Case Study
Developed
Mixed
Economies
Developing
Market
Economies
Developing Planned/
Command Economies
- The customer receives a text message to confirm the transaction
- They can either store this on their phone until needed or they can
forward it to someone else.
- When needed, the credit can be converted back into cash at any
registered M-PESA agent or even via an ATM (cash) machine
- Vodafone takes a small commission on the transfer
- There are over 2,200 M-PESA registered agents in petrol stations,
supermarkets and other retail bases across Kenya and five million
subscribers
- For example M-PESA has helped small businesses such as taxi drivers by
enabling them to receive money for fares without having to drive around
with lots of cash in their cars
- M-PESA has also been used to buy everyday items, as well as to pay the
rent, send funds to other people or buy phone airtime
- It has even been used to pay school fees, as secondary schooling is not
'free' in Kenya
- By providing safe, secure transfer of money, Vodafone's M-PESA system
has;
- helped small businesses become more financially secure
- provided a safe way for wage earners to send money back home to their
families
- solved the problems of carrying around large amounts of cash
Following these achievements in Kenya, Vodafone has extended M-PESA
into other emerging markets including Tanzania and Afghanistan. 15
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Using Technology to Improve Economies: A Vodafone Case Study
Conclusion
- Vodafone uses the capabilities of the mobile phone to bring value to
both developing and developed economies
- The impact of mobile technology on developed markets over recent
years has been immense and has focused on providing added value to
customers through new and improved functions and features
- By comparison, the impact of technology on emerging markets such as
Kenya has provided a real lifeline both to individuals and to small
businesses
With growth in the provision of mobile phones, Vodafone has enabled
great improvements in facilitating the flow of money and information,
which is vital for economic growth
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http://www.global-strategy.net/what-is-global-strategy/
http://businesscasestudies.co.uk/business-theory/strategy/developing-a-globalstrategy.html#axzz3TIgA0cYA
http://csis.org/files/publication/130129_competitiveness_Lenovo_casestudy_Web
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http://businesscasestudies.co.uk/vodafone/using-technology-to-improveeconomies/conclusion.html#axzz3TPs2HwGa
http://businesscasestudies.co.uk/parcelforce-worldwide/customer-service-as-astrategy/introduction.html#axzz3TauR0frS
http://businesscasestudies.co.uk/kelloggs/balancing-the-marketing-mix-throughcreative-and-innovative-strategies/introduction.html#axzz3TIgA0cYA
http://businesscasestudies.co.uk/aldi/creating-value-through-the-marketingmix/introduction.html#axzz3TIgA0cYA
http://www.1000ventures.com/business_guide/case_studies_main.html
http://businesscasestudies.co.uk/case-studies/byindustry/automotive.html#axzz3TPs2HwGa
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