Page 79 - DMGT523_LOGISTICS_AND_SUPPLY_CHAIN_MANAGEMENT

Logistics and Supply Chain Management

Notes Ann McLaughlin, Chairman, The Aspen Institute, described the return policy as symbolic
of Nordstrom’s authenticity. “They are authentic in that they say they’re going to do
something and they do it. They are authentic in how they represent themselves as a store
to the customer.” This is what she overheard a young woman in her twenties telling her
mother while shopping at Nordstrom, about a pair of shoes that she was unable to decide:
‘I really like them both, but if I decide when I get home that I don’t want one, I know that
I can always bring it back.’ “I don’t know how many times I’ve heard similar comments,”
she says. “That’s the authenticity of Nordstrom living up to their commitment on their
return policy. It emanates from their understanding of the customer.”
An executive with a well-known Swedish-based manufacturer had purchased some $2,000
worth of shirts and ties at Nordstrom’s Pentagon City, Virginia store. He had mistakenly
washed the shirts in hot water and they all shrank. On writing to the store, and admitting
that it was his mistake, he received a call from Van Mensah, a men’s apparel sales associate,
asking him to return the shirts – at Nordstrom’s expense – and he would replace those
shirts with new ones at no charge.

Question:
What drives Nordstrom’s sales personnel to out-perform all industry benchmarks? How
has Nordstrom motivated its in-store personnel to become profitable and unique?

Sources: Ron Zemke and Dick Schaff, The Service Edge, (New York: Plume, 1989)
3.5 Summary

 A customer who is a professional, like a chartered accountant, will be in a better position
to understand the savings account opening norms in a bank than an illiterate farmer.

 Service transactions and the quality of service delivery depend a lot on both the provider
and the customers carrying out their roles seamlessly as designed by the blueprints of
operations.

 The service marketer should stress on retaining customers, as they are less expensive than
customer acquisition.
 Marketing identifies the appropriate logistical performance.

 Customer service is a process for providing significant value-added benefits to the supply
chain in a cost-effective way.
 Three fundamental dimensions of customer service are identified: availability, performance,
and reliability.
 The performance cycle was positioned as the operational structure of logistics.
 Customer satisfaction is the degree to which customer expectations of a product or service
are met or exceeded.
 Logistics exists to satisfy customer requirements by facilitating important manufacturing
and marketing operations.
 Quality in service is as perceived by the customer. There is no other way to either
comprehend or administer.

 Customer success shifts the focus from expectations to the customers’ real requirements.

74 LOVELY PROFESSIONAL UNIVERSITY