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"Identify and evaluate the impact of information and communications technology in one marketing function" - Customer Service

Extracts from this essay...

Introduction

"Identify and evaluate the impact of information and communications technology in one marketing function" - Customer Service Introduction The rapid growth of information and communications technology (ICT) in the last two decades has affected business organisations profoundly. The shift from production-centric to customer-centric organisations has lead to increased focus on customer service and the use of technology in the area. This essay sets out to identify the impacts of ICT on customer service by first briefly revisiting the concept of customer service. The benefits of ICT are then highlighted by three main drivers of service encounter satisfaction, along with some industry examples. Finally a discussion is raised with regards to potential problems and challenges organizations face in successful implementation of the technology. Customer Service Revisited The major characteristics of services have been summarised by Lewis (1989, pp.4) as "intangibility, heterogeneity, perishability and inseparability of production and consumption"- where "production" in services refer to "performance". Due to the inseparability of production and consumption, both buyer and seller (i.e. customer and organisation/employee) interactions influences the performance process and the quality of the service provided (Lewis, 1989). The service encounter, according to Lewis (1989, pp.4), is the "direct interaction between... [an]...organisation's employees and its customers / clients". From the customer's point of perspective, the encounter itself is often the service in most situations (Bitner, 1990), cited in (Bitner, Brown & Meuter, 2000).

Middle

Customers are also given customised suggestions or advice in the form of recommendations based on their purchase history. FedEx, the shipping company, also provides its customers with SST opportunities. From order-taking to tracking and billing, every stage of the shipping process can be completed online (Bitner et al., 2000). The advantages are obvious: the SSTs can be accessed and transactions completed at anytime and anywhere the customers desire (Bitner et al., 2000), as these SSTs represent a "store that never closes" (Ritzer & Stillman, 2001). Effective Service Recovery Even with improved delivery and offerings, service encounters will never be totally successful (Bitner et al., 2000; Brown, 1997). Brown (1997) suggests that recovering from service failures, if conducted properly, strengthens customer loyalty, improves profitability and corrects weak links in processes. However, if the recovery is poorly handled, it can damage customer relationships, negative word of mouth, contribute to employee dissatisfaction and lowered profits. Studies by Johnson (1995) cited in (Bitner et al., 2000) have shown that successful service recoveries can lead directly to customer satisfaction, which in turn acts to retain the customer. Brown (1997) claims that the use of technology in service recovery can empower employees and customers. Technology can often provide frontline employees with the means to recover on the customers' behalf quicker, and often with fewer colleagues involved.

Conclusion

With new technology emerging everyday, there is a need for organisations to constantly train employees, especially those with service responsibilities, to upgrade their IT skills. Technical literacy of frontline employees is crucial to ensure smooth usage of software applications. Companies also need to understand the current technology landscape in context of their industry to be able to choose the most appropriate technology tools to meet challenges. All of these activities may result in a big strain on funds. Services performed over the Internet may also be subjected to risks of hackers hijacking and stealing sensitive material. The Internet's greatest openness and ubiquity are also its greatest weaknesses. Companies need to assure customers that safety measures are in place before customers will feel ready to perform online transactions. The success of technology is therefore, also heavily dependent on user acceptance. According to Parasuraman, (2004), the "techno-readiness" of consumers refers to the measure of mental readiness to embrace technology. Without a proper understanding of the techno-readiness of its customer base, companies may just find themselves investing heavily in facilities that may be under-utilised. Conclusion This essay has shown why organisations need to focus on customer service as a source of competitive advantage, and technology is one of the major determinants in improving service quality. From the impacts identified, the integration and implementation of technology in customer service areas of a business are massively beneficial. Yet at the same time, organisations should be aware of the consequences that the lack of proper management of ICT can have.

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