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As mentioned previously, every company has multiple channels to market, including direct sales, eCommerce, retailers, and multi-tier distribution. These channels often have different owners with different performance indicators who all compete for the same supply. With limited supply, when every channel owner thinks theirs is the most important, the result is often siloed sub-optimization. One channel will perform better to the detriment of others.
Reduced visibility and transparency across the channels limit the company’s agility to allocate supply where it matters. This often manifest as large pools of disparate data that fail to yield profound insights into demand patterns and highest inventory availability, both through each channel and at an aggregated level over all routes to market.
End-to-end fulfillment, starting from order entry, finalizing with the order last-mile delivery, are disconnected across channels as well. Siloed infrastructure, segregation and granularity of tools and processes depending on the channel are primary culprits and drive high maintenance costs, limiting scalability across the company.
Customer management should be flexible to address the client’s various needs in terms of fulfillment and product. It should also be highly efficient, and this may create conflict. Excessive fulfillment customization (how customers can trigger and return orders, when they can change them, what quantity should be on order, etc.) disrupts an efficient modus operandi and impacts the final operations cost.
The explosion of stock-keeping units (SKU) across channels and poor governance have a similar cost implication and increase time-to-market. The SKU proliferation and variability of fulfillment options between the different channels deliver a false sense of increased customer service. In fact, a study by E2open reveals that in times of crisis such as the ongoing COVID pandemic, the ability to fulfill orders for all SKUs has drops. For the long tail of (usually slow-moving) SKUs, the drop was by 12% down to 78%. Not exactly great customer service! Striking the right balance between seamless customer experience and operations customization is a well-known challenge.
Knowing the customer’s history when it comes to post-sale service and support is also an area that is often disjointed, leading to delays and annoyance when the relationship between the brand and the customer is most fragile. What’s more, functional misalignment and lack of clarity regarding responsibilities can make finding the correct function to take care of the customer difficult, resulting in increased turnaround time.
For a customer who needs help, there is nothing more frustrating than being sent from pillar to post, having to repeat the order history and the specific problem at hand with no certainty of when, how or even if there will be a resolution. Research by Genesys shows that 29% of consumers rank problem resolution in the first interaction as the most valued form of customer support.
Unclear processes and responsibilities coupled with limited order visibility – especially if the order originated from the indirect channel – dramatically impact the efficiency of operations and customer satisfaction in an age when the customer doesn’t accept mediocre service or solutions anymore.
Approaches to achieving improved customer experience differ from company to company. They are rarely a conscious choice, often leading to a haphazard rather than planned and optimized set of actions.
While it may be easy to say, “Optimize across all channels simultaneously for the best corporate outcome,” doing so is more tricky! It requires complex tradeoffs that consider the different needs, options, and objectives for each channel and the strategic goals of the overall corporation, specialized skills and methodologies to manage tradeoffs and the right technology infrastructure to facilitate serving the customer well while minimizing the impact of the tradeoffs.
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