In the manufacturing age, creating a great customer experience involved focusing on product features (including aesthetics), reliable performance, easy availability, user training, and excellent after-sales support (for query handling and ticket management). Companies built customer experiences around their products by having strong R&D setups. They diligently studied customer preferences and evolving needs to incorporate them into products and features. Enhanced manufacturing and inventory management capabilities allowed companies to produce in high volumes, reducing costs (an essential aspect of CX) and offering consumers more choices (different features, colors, etc.). Using quality management tools reduced product quality variability, ensuring reliable performance. Evolving logistics and distribution management provided quicker and better product access for consumers. ‘Just in time’ manufacturing practices lowered inventory costs. Improved packaging not only enhanced visual appeal but also protected against transit damages.
With digitalization, we can enhance the customer experience design at every stage of their journey. Personalization options, like choosing your car’s color, and upholstery, or adding image embossing at the manufacturing stage, have become available. Customers can now order online and see inventory in real-time.
The Rise of Service Products
People buy products to address specific personal, business, or social needs. Initially, after purchasing a product, customers had to arrange other components to achieve their desired outcome. For example, buying a cake for a birthday party required arranging decorations, snacks, crockery, and other items to complete the event.
Seeing this, companies realized that bundling all necessary components to meet the customer’s end-use needs created new market opportunities and allowed them to charge a premium for the convenience provided. This led to the age of ‘service products.’
Pure product companies evolved to include ‘service products’ in their offerings. Examples include McDonald’s with event party packages, automobile companies with car rental services, restaurants with party catering, and beauty product companies with beautician home services.
Ensuring Reliable Service Products
Introducing ‘service products’ brought complexity, as all components had to perform flawlessly to deliver reliable service. Unlike manufacturing, where quality defects can be detected and corrected before reaching the customer, the production and consumption of ‘service products’ happen simultaneously. This makes defect-free delivery the primary target.
‘Service product’ companies need to apply quality tools more rigorously than pure manufacturing companies. However, they rarely use these tools with the same discipline. Service product companies often lack strong quality tools and data analytic skills, and many do not have dedicated quality departments to improve processes or manage variability.
The Role of Customer R&D in Service Product Companies
Unlike manufacturing companies with dedicated R&D departments, service product companies often lack structured methods for collecting customer needs and identifying expectation gaps. When market research is conducted, it usually focuses on uncovering competitive and market reach gaps or measuring customer satisfaction levels.
Service product companies rarely use CX tools like customer segmentation, customer journey mapping, and ServQual to uncover mismatches between customer expectations and company offerings. These tools, when applied as an R&D setup, can provide valuable insights for evolving offerings, similar to the role of R&D in manufacturing.
Establishing a ‘Customer R&D’ specialized cell in service product companies, staffed by CX professionals trained in uncovering evolving need-expectation gaps, can enhance the value of an organization. This approach mirrors the value enhancement provided by R&D departments in manufacturing companies.
Manufacturing Companies Can Learn from Service-Based Businesses
Manufacturing companies can significantly improve their after-sales experience by adopting practices from service product companies, which excel in delivering professional and responsive customer service.
Many iconic manufacturing companies suffer from weak after-sales support, investing minimally in policies, processes, and systems to address complaints about product deficiencies, delivery issues, installation, and training. This underinvestment often stems from the mistaken belief that after-sales support is merely a cost center.
In contrast, service product companies view after-sales as a crucial opportunity for experience creation and brand reinforcement. They invest in this area to enhance customer perception and strengthen their brand.
Manufacturers can enhance their after-sales support by adopting best practices from service product companies, including:
- Centralized Ticket Registration: Implement systems to streamline complaint and query management across multiple channels.
- Robust Query Management Systems: Utilize AI-enhanced systems for efficient and effective query resolution.
- Advanced Robotic Process Automation: Leverage automation to improve process efficiency and customer interaction.
By embracing these practices, manufacturing companies can improve their brand perception and generate valuable performance data to refine their processes.