MANAGING MARKETING PERFORMANCE Weekend Programme Day 2
What we're doing today? - am • 9.30am start • Review of Day 1 • Syndicate activities • Implementing Business Strategy • Reputation and CSR • Coffee • Service quality • Communications and relationships • Managing the marketing function • Quality and process management • Lunch at 1pm
What we're doing today? – pm • Managing the marketing function • Project management • Creativity and innovation • Managing external resources • Tea • Measurement, evaluation and control • Measurement and control • Measuring the value of marketing • Managing marketing performance • Day 2 Review • 4.30pm - Close
Syndicates • Exam group • Assignment group
CIM PROFESSIONAL PG DIPLOMA MANAGING MARKETING PERFORMANCE Session 7 IMPLEMENTING BUSINESS STRATEGY Reputation and corporate social responsibility
Learning outcomes At the end of the session, you will be able to: • Build sustainability into business and marketing activities (including the mix) through planning, the instillation of values and day-to-day management. • Build ethics into business and marketing activities (including the mix) through planning, the instillation of values and day-to-day management. • Propose a contingency plan and procedures to be taken in the event of a ‘crisis’ or threat to the reputation of the brand or the organisation (including communications with the press and stakeholders).
Ethics and the organisation; why are they important? • Ethics are about right and wrong • Cultural differences have an impact • Ethics dictate a company’s policies and standards of behaviour
Corporate ethics operate at 3 levels • The company’s relationships with society at large; • The impact of the company’s operations on the communities within which it operates and the people it employs; and • The behaviour of the company’s people
Organisations must take an ethical stance • Ethical stance: the extent to which a company will exceed its minimum obligation to stakeholders on ethical grounds. • Johnson and Scholes • Short term stakeholder interest • Long term stakeholder interest • Multiple stakeholder interest • Shaper of society
Corporate ethics are visible in corporate behaviour • Corporate ethics can be managed in two ways: • Compliance based: bureaucratic control • Integrity based: cultural control
Corporate ethics are visible in corporate behaviour Corporate governance is the conduct of an organisation’s senior officers.
What does social responsibility mean for marketing? • Consumer oriented marketing • Innovative marketing • Value marketing • Sense of mission marketing • ‘Responsible’ marketing • Societal marketing is a management orientation … in a way that preserves or enhances consumers’ and society’s well being. - Kotler
Why is corporate social responsibility (CSR) relevant? • Value-based marketing (VBM) addresses the expectations of customers and shareholders/owners • CSR addresses the expectations of the other stakeholders: • Society at large • Community • The environment • Interest groups
Useful web addresses • CIM Code of Professional standards • www.cim.co.uk/mediastore/constitution_2003.pdf • UK government gateway to CSR • www.societyandbusiness.gov.uk • Business in the community, 700 companies committed to CSR • www.bitc.org.uk • The tobacco companies (BAT, Phillip Morris) have extensive CSR material on their websites. See also the Portman Group. http://www.portman-group.org.uk
Portman Group "Just as people should show personal responsibility when drinking alcohol, companies must demonstrate responsibility in the way that they conduct their business. We work with the drinks industry to raise standards of alcohol marketing. We challenge companies to be socially responsible and inspire them to achieve best practice." David Poley Chief Executive, the Portman Group
Crises • 1984 – Union Carbide • 1987 - Townsend Thoreson • 1988 – Perrier • 1989 – Exxon • 1991 – Ratner’s • 1995 – Pepsi • 1995 – Intel • 1995 – Persil • 2000 – Ford/ Firestone • 2003 – SARS • 2004 – Coca- Cola
Crisis Management phases • Signal Detection • Preparation • Damage Containment/limitation • Recovery • Learning Source : Pearson et al (1997)
Individual retaliation • Try • www.untied.com • Enjoy!
Summary • Ethical approaches are fundamentally “….doing what you said you would do and not hurting anyone!!” • Corporately, CSR takes a stakeholder approach and considers all participants in the business • CSR can be a good idea for small & large business alike • CSR can be a strategic goal – e.g. Waitrose, Bodyshop, Co-oP bank etc.
CIM PROFESSIONAL PG DIPLOMA MANAGING MARKETING PERFORMANCE Session 8 IMPLEMENTING BUSINESS STRATEGY Service quality
Learning outcomes At the end of the session, you will be able to: • Identify ‘moments of truth’ in delivering a service and activities that may add further value and assess their likely impact on customers and intermediaries; • Propose and implement appropriate improvements to customer service by developing and enhancing customer care; and • Establish and apply techniques for managing and monitoring service quality, including the use of specific measures.
Moments of truth At Scandinavian Airlines (SAS) it is estimated that each year staff come into contact, for an average of 15 seconds, with 10 million customers around 5 times. As their President reflects: “Thus, SAS is created in the minds of our customers 50 million times a year, 15 seconds at a time. They are the moments when we must prove to our customers that SAS is the best alternative.”
Types of service encounters • Remote encounters • Customer contact through impersonal means. Eg computer interaction (ATM’s, web) • Phone encounters • Calling for information, placing orders and arranging for service • Face to face encounters • Direct personal contacts for any purpose eg sales or service delivery Shostack (1985)
Why is service quality so important? • Enormous growth of service sector since WW2 • Harder to define and judge than product quality • Intangibility • Providers must do their utmost to identify the expectations of target customers with respect to each specific service being offered
The customer journey • Identifies key processes at the customer interface • Understanding of these processes can enable improvements to be made to ensure positive experiences • Helps clarify customer needs and preferences • Information is gathered and stored – feeds into: • Development of processes • Staff training • Product/service development
Customer care programmes • Identifies customers • Establishes needs • Identifies what they want in terms of service • Sets standards • Monitors service regularly against standards • Takes action to improve
Service quality • Competitive advantage can be obtained by delivering consistently higher quality service than competitors • Customer service expectations must be exceeded • Internal marketing essential • Needs top management commitment • Standards must be set • Performance must be monitored
Syndicate work In groups of two, discuss and then comment on your company’s customer service strategy and performance. Does it meet and exceed customers’ expectations? Is it imbued within the organisational culture? Does your company leader drive this forward? 33
Service quality models • Grönroos • (1984) • The ‘Gap’ model • (Parasuraman et al 1985 and Zeithaml et al 1990) • SERVQUAL • (Parasuraman et al 1988, Zeithaml et al 1990, Parasuraman et al 1991)
Grönroos’s service quality model • Technical quality • What customer receives – the outcome of the process • Functional quality • How the customer receives the technical outcome “ the expressive performance of a service”.
The ‘Gap’ model • “A set of key discrepancies or gaps exists regarding executive perceptions of service quality and the tasks associated with service deliveries to consumers. These gaps can be major hurdles in attempting to deliver a service which consumers would perceive of being of high quality” Parasuraman et al 1985
Word-of-mouth Communications Personal needs Past experience Expected service CUSTOMER Gap 5 Perceived service Service delivery Gap 4 External communications to customers Gap 3 PROVIDER Service quality specifications Gap 1 Gap 2 Management perceptions of customer expectations Service quality gaps model(Parasuraman, Zeithaml and Berry, 1985)
Reasons for service quality gaps • GAP 1 – not knowing what customers expect • GAP 2 – the wrong service quality standards • GAP 3 – the service performance gap • GAP 4 – when promises do not match actual delivery • GAP 5 – the difference between customer perception and expectation
Determinants of service quality • Tangibles • Reliability • Responsiveness • Communication • Credibility • Competence • Courtesy • Understanding customers’ needs • Access Parasuraman et al 1985
10 Dimensions of quality Tangibles Reliability Responsiveness Competence Courtesy Credibility Security Access Communication Knowledge Word of Past Buyers’ Advertising mouth experience needs Expected service Perceived service quality Perceived service Determinants of perceived service quality Parasuraman et al 1985
SERVQUAL Model • Understanding customer expectations • Marketing research • Open communication with employees • Service Quality – • Dimensions • Reliability • Assurance • Tangibles • Empathy • Responsiveness • Service quality specifications • Service goals • Management commitment to service • quality • Employee performance • Employee training • Evaluation and compensation schemes Dibb, Simkin, Pride & Ferrell, 2001 Adapted from Parasuraman, Berry & Zeithaml - 1991 • Managing service expectations • Advertising • Good internal communications
SERVQUAL (Ziethaml and Bitner, 1988) tries to quantify service • Reliability: ability to perform the promised service dependably and accurately • Assurance: knowledge and courtesy of employees and their ability to convey trust and confidence • Tangibles: physical facilities, equipment, appearance of personnel • Empathy: caring individualised attention • Responsiveness: willingness to help customers and to provide prompt service
Usage of SERVQUAL • Service industries to understand perceptions of needs and to measure quality of delivery • Internal – to understand employees perceptions of service quality to achieve service improvement
The process • Customer survey to determine • The relative importance of each attribute • A measurement of performance expectations that would relate to an excellent company • A measurement of performance for the company in question
BENEFITS Provides A benchmark created by your customers Performance levels as perceived by them Suggestions Impressions from employees regarding customer expectations and satisfaction LIMITATIONS Include Validity of the 5 dimensions Applicability to all sectors Risk in using difference scores Measures in assessing the quality of information services SERVQUAL
The links • Excellence – Tom Peters 1982 • Market Orientation • Relationship Marketing
Common practices in excellent service companies • A strategic concept • A history of top management commitment to quality • The setting of high standards • Systems for monitoring service performance • Systems for satisfying complaining customers • Satisfying employees as well as customers Source : Kotler