Outsourcing Impact on loyalty in the organization - Dissertation Example

Among these underlying factors include the need to satisfy the following: (1) increase customer service satisfaction; (2) make use of efficient website; (3) offer flexibility in logistics services; (4) set high goal achievement and goal exceedance; (5) create a “proactive cost improvement” and “proactive performance improvement”; (6) establish a strong brand image; (7) promote partner-specific adaptations in 3PLs; (8) establish and maintain a high quality logistics service; and (9) increase operational performance.

To ensure that customer loyalty in logistics outsourcing is possible, this study highly recommends the need to establish a strong brand image, increase operational performance, and increase customer service satisfaction. Establishing a strong brand image is possible by continuously improve its operational performance in order to keep its customers satisfied. To increase both operational performance and customer satisfaction, investment in highly efficient website is a must. It is also important to use goal achievement and goal exceedance to closely monitor the company’s ability to meet or exceed the goals or expectations of its existing customers.

   The core dimensions of customer loyalty include not only retention but also extension, and referrals (Hartmann & de Grahl, 2011; Wallenburg & Lukassen, 2011; Wallenburg et al., 2010; Wallenburg, 2009). In general, customer loyalty is important because it can affect not only the customers’ intention to purchase and repurchasing the products and services offered by a particular company but also increase the quantity of their purchases, avoid switching behaviour, and encourages the customers to recommend their products and services through word-of-mouth (Khan, 2012; Cheng, 2011; Kerin, Hartley, & Rudelius, 2009; Rust, Lemon, & Zeithaml, 2004).

Furthermore, in the process of building customer loyalty, business organizations can increase their profitability by increasing their sales revenue and decreasing the overall operational costs (Kerin, Hartley, & Rudelius, 2009), increase their share in the market, increase price insensitivity, and strengthen customer retention (Khan, 2012; Guo, Xiao, & Tang, 2009; Kotler & Keller, 2006; Petterson, 2004).