Insight

Stand out from the crowd

Driving superior customer experience through your supply chain

Mark Levy

Mark Levy

Advisory Managing Director/Supply Chain Planning Lead, KPMG US

+1 949-295-2912

Jeffry Coble

Jeffry Coble

Director, Advisory, C&O Commercial, KPMG US

+1 678-772-2190

John Witt

John Witt

Manager, Advisory, C&O Commercial, KPMG US

+1 248-229-8801

Stand out from the crowd: Driving superior customer experience through your supply chain

The COVID pandemic has clearly heightened awareness of the importance of the supply chain in customer experience. Years ago, retailers learned that, to create customer ”stickiness,” they needed to better manage service after sales. Based on what we have seen over the past two years, better service during sales is now needed to maintain ”stickiness.”

The public attention has mostly been focused on when supply chains have not been able to deliver as customers expected, which unfortunately has impacted many customers. In fact, 87 percent of consumers say they were negatively affected by supply chain issues over the last 12 months and 82 percent are scared that supply chain issues will ruin their life plans such as special occasions and even buying school supplies. 1

Supply shortages, delivery delays, lost items, and a lack of visibility across supply chains have left customers frustrated with many companies including established brands who were previously thought of as highly reliable. Sixty percent of consumers have been unable to purchase certain items due to shortages, and 51 percent were forced to cancel orders due to delays.

These issues have gone beyond simple annoyance for many customers to impact important occurrences in their lives, which are often the “make or break” moments for customer experience. Forty-three percent of consumers blamed missed gifts for special occasions on supply chain issues and 17 percent have said that they have hurt people they care about as a result of missed gifts.1

With these developments, supply chain leaders have been working overtime to make sure they are not the next brand with embarrassing headlines about their inability to meet customer expectations. While defensive actions may be necessary in the short-term, leading companies should take this opportunity to go on the offensive to put customer experience at the forefront of their supply chain strategy.

How can companies do this? Below are four ways to drive a customer experience focus within the supply chain function:

  • Engage in customer experience initiatives: Far too often, customer journey mapping, design thinking and other customer experience initiatives have been limited to customer-facing and design-focused teams. This often leads to solutions that fit well for those functions but do not take into consideration the supply chain that is needed to deliver these solutions. It also has led to supply chain teams being among the last to know about operational changes that result from these initiatives.

Having supply chain at the table from the beginning will allow supply chain teams to help craft these initiatives and be ready to deliver on them. While the “art of the possible” is a great mantra for customer experience, the engagement of supply chain teams will help allow this critical portion of the organization to be ready to make “possible” a reality.

  • Connect all supply chain work to customer outcomes: Traditionally, some in supply chain organizations thought customer experience was not their concern but rather the domain of sales or customer service. A company needs to make clear customer experience is everyone’s concern as customers are the lifeblood of the company.

The best way to do this is to align how the work of each person in an organization impacts customer outcomes. Customer experience metrics such as perfect order and on-time in full delivery rates should be traced throughout the supply chain organization so each area (and team members within that area) understands the role they play in performance levels.

  • Leverage customer feedback data through actionable analytics: Gathering and understanding customer feedback is a key component to managing customer experience. Customers will often identify issues before internal teams do and their feedback will either validate or counter what internal data is showing.

Supply chain teams should harness this customer feedback data to both stay ahead of issues that may be developing and to get proactive guidance on what they can be doing to better serve their customers. Analytical capabilities that can take raw customer feedback, identify trends, and connect these trends to specific supply chain areas will allow supply chain leaders to have the insight they need to help reduce customer concerns. Customers are asking for this as  94 percent of consumers want more support from brands to help ease their worries.1

  • Focus on visibility for customers: In so many cases of the recent supply chain challenges, a chief complaint among customers was the lack of transparency and visibility from companies about the status of their order and when they could expect it to be ready/delivered. This focus is borne out in the sentiment of surveyed consumers in that 63 percent want more regular updates about shipping status and 59 percent want more transparency about inventory.1 A lack of visibility can lead to very costly consequences to companies as 84 percent of consumers in a recent survey said that delays would cause them to cancel their order.1 These cancellations will drive a significant cost of managing cancelled orders, many of which were already in process.

Companies can change this dynamic by better communicating and tracking the steps in their production/fulfillment process. This entails being always able to see where your order is, what steps it needs to pass through to be fulfilled/delivered, and the expected timeline for each step. If done correctly, these order status and fulfillment timelines will be dynamic with real-time updates based on changing conditions (supply shortages, delivery delays, etc.). This real-time information will also be extremely helpful for internal teams to know when an order will come their way so they can be ready to smoothly fulfill their step(s) in the process.

A focus on customer experience is a new enduring reality. All functions will be expected to be focused on how they can play their part in delivering high-quality and satisfying customer experiences. Supply chain leaders can meet this challenge by integrating customer experience into the core of their supply chain strategy through active engagement in customer experience initiatives, a customer-centered operating mindset, actionable customer analytics, and an enhanced focus on providing visibility for customers.