Pisharodi, R MohanAuthor InformationView Profile. Logistics and Transportation Review; Vancouver Vol. 30, Iss. 1, (Mar 1994): 31.
Customer service s one of the most important components of a firm's logistics strategy and one of the main ingredients of its marketing mix. In general terms, customer service is the measure of how well the logistics system is performing in creating time and place utility for a product (Stock and Lambert 1987). Basically, it is the "marketing end" of the logistics system. It is a key link between the traditionally-defined marketing function and the logistics area of the firm (Langley and Holcomb 1992). Numerous articles and research studies have highlighted the importance of customer service as a component of the marketing mix (Cunningham and Roberts 1974; Shycon and Sprague 1975; Perreault and Russ 1976; Zinszer 1976; Uhr, Houck, and Rogers 1981; Ozment and Chard 1986; Sterling and Lambert 1987; La Londe, Cooper, and Noordewier 1988; Pisharodi and Langley 1991).
As is true of other marketing variables, the customer service offering of a firm is only as good as the customer's perception of it. No purely supplier-based indicator of customer service delivery can be said to be fully representative of its quality. Customer service is essentially a perceived variable (Pisharodi and Langley 1990) and therefore the customer plays the integral role in judging its quality. In fact, the customer's perception of customer service mediates the influence of any customer service strategy on customer response (Schary 1980).
The process of customer service delivery in a business relationship usually involves various individuals from the supplier organization, and often various individuals from the customer organization and facilitating agencies. As is typical of such perceived variables, the various participants and stakeholders involved in the process of customer service delivery are likely to have different perceptions of customer service and different criteria for its evaluation. Multiple perceptions of customer service have often been recognized as being dysfunctional to the achievement of organizational and inter-organizational goals (Levine and White 1961). In the distribution channel literature, numerous researchers have used differences in the perception of distribution services as indicators of conflict within channels of distribution (Rosenberg and Stern 1971; Lusch 1976; Kelly and Peters 1977; Mack and Snyder 1957).
The measurement and comparison of the customer service perceptions of different individuals within the same organization who are involved in the process of customer service delivery either as providers or as researchers has been a popular area of investigation (Zinszer 1976; Christopher, Schary, and Tage Skjott-Larsen 1979). Researchers have also studied the perceptions of key individuals from different organizations in vertical inter-organizational systems (La Londe and Zinszer 1976; Levy 1978, 1981, Pisharodi and Langley 1991, Hopkins, et al 1993). In order to assist logistics decision makers in developing effective customer service packages, customer service evaluation models have been developed which are based on the measurement of customer perceptions (Hutchinson and Stolle 1968; Simon 1965; Cunningham and Roberts 1974; Perreault and Russ 1974), supplier perceptions (Gilmour 1979), and supplier-customer differences in the perception of customer service issues (Levy 1978, 1981).
In logistics management, whenever the supplier measures customer perceptions (often with the help of a customer service evaluation model), an implicit assumption is made that knowledge of customer perceptions will assist the supplier in achieving a desired objective (or objectives), typically sales related. Since the quality of customer service is ultimately based on the customer's perceptions and evaluation, this is kin to making the supplier's perceptions of customer service more accurate (i.e., closer to those of the customer). If the supplier's perceptions can be brought closer to the customer's, it is assumed that the supplier will be able to develop and provide better service packages which will result in an increase in the customer's preference for the supplier.
In other words, similarity in supplier-customer perception should lead to greater preference for the supplier (subject to the nature of competition within that product category). In a dynamic competitive market, dyads with higher levels of similarity in the perception of customer service issues and levels are likely to be more successful. In dyads with lower levels of similarity (and higher levels of difference), the supplier is likely to find it more difficult to supply what the customer wants. In a dynamic competitive market, such a weakness is likely to result in general decline in the customer's preference for the supplier or in the breakup of the channel dyad.
In spite of its general acceptance, this assumed negative relationship between supplier-customer differences in the perception of customer service and customer preference for supplier has not been studied empirically. The results of an empirical study which tested this relationship is reported in this paper.
II. THE RESEARCH MODEL
The research model that was developed and tested is a simple three variable model (Figure 1). (Figure 1 omitted) The dependent variable is labelled Preference for Supplier. The independent variables are two constructs which are based on supplier customer differences in the perception of customer service levels. They are labelled Dissensus(1) in the Perception of Normative Service Levels and Dissensus in the Perception of Actual Service Levels.(2)
The separation of the concept of supplier-customer differences in perception into two constructs, one representing the normative level and the other representing the actual level of service offered is based on principles of perceptual congruity and the cybernetic principle of the negative feedback loop (Pisharodi and Langley 1990). The supplier and the customer are likely to have perceptions of the actual service levels being provided by the supplier as well as some comparison levels or norms against which these perceptions are compared. For instance the order cycle time of a supplier may be evaluated against what the customer feels is a reasonable order cycle time given his past experience with similar suppliers. Researchers have proposed a number of possible comparison levels such as the "ideal" norm, the "best brand" norm, and the "industry typical" norm (Woodruff, Cadotte, and Jenkins 1983). In the context of physical distribution dyads, the "ideal" norm representing the best possible service levels is probably unrealistic and is unlikely to be used as a comparison level by an experienced customer. The "best supplier" norm or the "industry typical" norm is likely to be used. In this paper, the term "normative level" represents the service level which is typical of the industry.(3)
In order to test the relationships described by the model presented in Figure 1, the following hypotheses were developed.
H1: There is a significant relationship between customer preference for supplier and supplier-customer differences in the perception of normative levels of customer service. Higher levels of difference are associated with lower levels of preference.
H2: There is a significant relationship between customer preference for supplier and supplier-customer differences in the perception of actual levels of customer service. Higher levels of difference are associated with lower levels of preference.
The supplier-customer differences stated in the hypotheses are interpersonal and inter-organizational constructs. They are the differences or "gaps" between the perceptions of two individuals representing two different organizations.(4) Although it was recognized by the researcher that direction of difference (i.e., whether supplier perception or customer perception is higher) may have an impact on the strength and direction of the relationship, since logistics literature did not provide enough direction on this matter, a priori expectations regarding the differential impact of positive versus negative dissensus on preference were not explicitly stated in the hypotheses. The statistics generated during the tests of the hypotheses were expected to yield useful information on the nature of the empirical relationship between the dissensus variables and preference for supplier.
Customer service s one of the most important components of a firm's logistics strategy and one of the main ingredients of its marketing mix. In general terms, customer service is the measure of how well the logistics system is performing in creating time and place utility for a product (Stock and Lambert 1987). Basically, it is the "marketing end" of the logistics system. It is a key link between the traditionally-defined marketing function and the logistics area of the firm (Langley and Holcomb 1992). Numerous articles and research studies have highlighted the importance of customer service as a component of the marketing mix (Cunningham and Roberts 1974; Shycon and Sprague 1975; Perreault and Russ 1976; Zinszer 1976; Uhr, Houck, and Rogers 1981; Ozment and Chard 1986; Sterling and Lambert 1987; La Londe, Cooper, and Noordewier 1988; Pisharodi and Langley 1991).
As is true of other marketing variables, the customer service offering of a firm is only as good as the customer's perception of it. No purely supplier-based indicator of customer service delivery can be said to be fully representative of its quality. Customer service is essentially a perceived variable (Pisharodi and Langley 1990) and therefore the customer plays the integral role in judging its quality. In fact, the customer's perception of customer service mediates the influence of any customer service strategy on customer response (Schary 1980).
The process of customer service delivery in a business relationship usually involves various individuals from the supplier organization, and often various individuals from the customer organization and facilitating agencies. As is typical of such perceived variables, the various participants and stakeholders involved in the process of customer service delivery are likely to have different perceptions of customer service and different criteria for its evaluation. Multiple perceptions of customer service have often been recognized as being dysfunctional to the achievement of organizational and inter-organizational goals (Levine and White 1961). In the distribution channel literature, numerous researchers have used differences in the perception of distribution services as indicators of conflict within channels of distribution (Rosenberg and Stern 1971; Lusch 1976; Kelly and Peters 1977; Mack and Snyder 1957).
The measurement and comparison of the customer service perceptions of different individuals within the same organization who are involved in the process of customer service delivery either as providers or as researchers has been a popular area of investigation (Zinszer 1976; Christopher, Schary, and Tage Skjott-Larsen 1979). Researchers have also studied the perceptions of key individuals from different organizations in vertical inter-organizational systems (La Londe and Zinszer 1976; Levy 1978, 1981, Pisharodi and Langley 1991, Hopkins, et al 1993). In order to assist logistics decision makers in developing effective customer service packages, customer service evaluation models have been developed which are based on the measurement of customer perceptions (Hutchinson and Stolle 1968; Simon 1965; Cunningham and Roberts 1974; Perreault and Russ 1974), supplier perceptions (Gilmour 1979), and supplier-customer differences in the perception of customer service issues (Levy 1978, 1981).
In logistics management, whenever the supplier measures customer perceptions (often with the help of a customer service evaluation model), an implicit assumption is made that knowledge of customer perceptions will assist the supplier in achieving a desired objective (or objectives), typically sales related. Since the quality of customer service is ultimately based on the customer's perceptions and evaluation, this is kin to making the supplier's perceptions of customer service more accurate (i.e., closer to those of the customer). If the supplier's perceptions can be brought closer to the customer's, it is assumed that the supplier will be able to develop and provide better service packages which will result in an increase in the customer's preference for the supplier.
In other words, similarity in supplier-customer perception should lead to greater preference for the supplier (subject to the nature of competition within that product category). In a dynamic competitive market, dyads with higher levels of similarity in the perception of customer service issues and levels are likely to be more successful. In dyads with lower levels of similarity (and higher levels of difference), the supplier is likely to find it more difficult to supply what the customer wants. In a dynamic competitive market, such a weakness is likely to result in general decline in the customer's preference for the supplier or in the breakup of the channel dyad.
In spite of its general acceptance, this assumed negative relationship between supplier-customer differences in the perception of customer service and customer preference for supplier has not been studied empirically. The results of an empirical study which tested this relationship is reported in this paper.
II. THE RESEARCH MODEL
The research model that was developed and tested is a simple three variable model (Figure 1). (Figure 1 omitted) The dependent variable is labelled Preference for Supplier. The independent variables are two constructs which are based on supplier customer differences in the perception of customer service levels. They are labelled Dissensus(1) in the Perception of Normative Service Levels and Dissensus in the Perception of Actual Service Levels.(2)
The separation of the concept of supplier-customer differences in perception into two constructs, one representing the normative level and the other representing the actual level of service offered is based on principles of perceptual congruity and the cybernetic principle of the negative feedback loop (Pisharodi and Langley 1990). The supplier and the customer are likely to have perceptions of the actual service levels being provided by the supplier as well as some comparison levels or norms against which these perceptions are compared. For instance the order cycle time of a supplier may be evaluated against what the customer feels is a reasonable order cycle time given his past experience with similar suppliers. Researchers have proposed a number of possible comparison levels such as the "ideal" norm, the "best brand" norm, and the "industry typical" norm (Woodruff, Cadotte, and Jenkins 1983). In the context of physical distribution dyads, the "ideal" norm representing the best possible service levels is probably unrealistic and is unlikely to be used as a comparison level by an experienced customer. The "best supplier" norm or the "industry typical" norm is likely to be used. In this paper, the term "normative level" represents the service level which is typical of the industry.(3)
In order to test the relationships described by the model presented in Figure 1, the following hypotheses were developed.
H1: There is a significant relationship between customer preference for supplier and supplier-customer differences in the perception of normative levels of customer service. Higher levels of difference are associated with lower levels of preference.
H2: There is a significant relationship between customer preference for supplier and supplier-customer differences in the perception of actual levels of customer service. Higher levels of difference are associated with lower levels of preference.
The supplier-customer differences stated in the hypotheses are interpersonal and inter-organizational constructs. They are the differences or "gaps" between the perceptions of two individuals representing two different organizations.(4) Although it was recognized by the researcher that direction of difference (i.e., whether supplier perception or customer perception is higher) may have an impact on the strength and direction of the relationship, since logistics literature did not provide enough direction on this matter, a priori expectations regarding the differential impact of positive versus negative dissensus on preference were not explicitly stated in the hypotheses. The statistics generated during the tests of the hypotheses were expected to yield useful information on the nature of the empirical relationship between the dissensus variables and preference for supplier.
Comments
Post a Comment