Integrated Order Fulfillment Will Make Your Employees Happy, Increase Customer Loyalty and Reduce Costs

Why do they make it so hard to buy?

Many companies make it difficult for me to buy from them. Whether I am spending a small amount for personal use or a large amount for business use, my experience is the same: inattentive salespeople, computer-attended endless-loop phone menus and indifferent customer service representatives. I sometimes wonder if companies really want my business. If so, why do they make it so difficult?

As a business person, I realize companies need to increase revenue and manage costs to grow profit. Any way to increase revenue without excessive sales costs should help my business. To that end, I recognize that it's cheaper to keep customers coming back than chase new ones. I think of all the things that take time away from selling or make it hard to get from a "yes" to a contract; they cost money and customers. If you can't keep customers happy at a reasonable cost, you aren't likely to stay in business. Yet not all businesses operate as though they hold that same tenet. They should.

Here's an effective approach to gaining customer loyalty while managing the cost of customer acquisition: Create a seamless customer interaction that allows the customer to spend the least amount of time to get the right products, at the best value, in the shortest possible time, with the best support. In other words, make it easy for them to buy!

Providing real-time inventory and order information makes it easier for your customers to buy from you. Not having real-time inventory and order information available to customers makes the buying process more difficult for the consumers and reduces the likelihood they will buy from you. If your sales staff is stuck researching this information for the customer, it is taking time from selling, negatively impacting revenue generation.

A good business strategy, focused from the customer's perspective, will put in place the tools to improve the way you interact with your customer. This strategy has three components:

• First, identify your customer's optimal buying experience. What would make it as easy as possible for your target customer to buy from you?
• Second, define the strategic goals and objectives that would provide your customer with the optimal buying experience. Everyone who "touches" or has an impact on customers should have activities and metrics that help improve the buying experience. Optimize communication flows around the way your customer seeks information. Tailor business software to facilitate good customer interaction.
• Third, implement your strategy and monitor customer feedback, making mid-course corrections as necessary.

Lost sales
Consider a Chattanooga, Tennessee-based media production company that sells its products over multiple channels, including the Internet, telephone, mail and fax.

Several years ago, the company was not meeting its revenue goals. Most of its business at that time was in-bound telephone orders. It saw a drop in sales per call at the same time as it was becoming clear that the Internet was a good sales channel for its products.

Executives assessed their situation and realized they hadn't evolved from a mail-order company to a robust, Internet-age retailer. They needed to provide their customers with an e-commerce buying experience while continuing to serve the many customers who still placed phone orders. All customers, regardless of how they contacted and did business with the company, were expecting the same speed and flexibility. They wanted to place orders quickly, to have access to order status as the order was being prepared and to be able to dynamically change orders up until time of packaging.

But the order-entry department was not tied to order assembly, packing, shipping or billing. Therefore, people working order entry had no effective way of helping a customer determine the status of an order or dynamically changing that order up to time of packing. They also had no way to confirm that the desired items were available to be ordered. This resulted in orders taken that could not be fulfilled by the stated promise date. They could not easily cross-sell or up-sell; an important revenue contributor. Orders were canceled or worse yet returned.

Orders were typically small in dollar value but containing numerous components. The company could not cost-effectively use customer service to chase down material availability or order status. That information was found in other departments. Because customer service did not have real-time access to all customer and order information, reps were having difficulty providing customers with order status accurately and cost-effectively.

No matter how many people the company hired, the process wasn't getting better because the business was without a customer-centric business strategy. The organization was overstaffed and inefficient.

Executives realized they could address some issues by adding staff and shortening communications paths among customer-facing personnel. However, they recognized that such an approach would be cost prohibitive and would become more so as the company grew. These measures would not be able keep up with the real-time pace of the Internet. New people or communications improvement would not provide the necessary real-time information. To address these issues, management decided to revolutionize the company's customer strategy, tearing down departmental boundaries and implementing business software.

The company estimated the implementation cost of integrating the entire order-fulfillment process at $100,000, with ongoing costs of about $20,000 per year, offset by increased revenue. Everyone involved in serving the customer had real-time access to information and the ability to act upon it. Internet customers and telephone-order-entry personnel had accurate real-time information of inventory availability, ensuring that an order could be filled as expected. They eliminated communication errors in communication across activities, thereby ensuring shipping accuracy and billing accuracy. Internal waste was eliminated.

The result? Business doubled with no additional staff.

Helping your customer will help you if you develop your business strategy with the goal of getting everyone involved in helping the company sell—and doing it to improve revenue. Simply put, you:

• Minimize sales and sales support costs.
• Improve customer loyalty.
• Make more money.

What could be better?

Jerry Sparger, founder of management consultancy Global Business Solutions, brings 40 years of senior management and consulting experience to helping clients focus their business on acquiring and retaining loyal customers. GBS provides customer-centric organizational assessment, strategy and process development workshops and skills development.