StatePride Industrial Laundry Customer Value Creation - Assignment Example

Topic: Pride Value Creation Pride Industrial Laundry Value Creation Introduction StatePride is one of the firms that are involved in the laundry business, a business which has several big players. For it to remain competitive in the industry, it has to make the customers it has the priority and hence give the appropriate treatment to each on the clients it deals with. Apart from this, value creation are mechanisms that the firm employs in making the clients it has remain loyal as well as use them to attract more of the new clients. An organizational Analysis - Mechanisms Employed in Value Addition StatePride has Mr. McDonald as the manager and he has invested in knowing how to please the customer through value addition to the services he offers. How provides more product features to the products that his customers uses such as logos on the mat at the entrance of the doors with other relevant writings. The main service he is entitled to is the cleaning and maintaining the quality of the fabrics he is brought from the customers and on such additional benefits, the customer will expect to pay for benefits that satisfy needs, but nothing more. Other customer value addition mechanisms include the mat’s cleanliness, timeliness, and service delivery as well as StatePride’s response to requests for additional mats or replacement of dirty mats in an emergency which the customer values largely. Office functions such as invoicing and flexibility in regard to the responsibilities that the customer is entitled to comes as a whole package with the company. The employees are also expected to include other value additions such as attitude and helpfulness of the laundry’s customer service representatives as well as the clarity of communications between these people and the customer. Currently StatePride has placed its emphasis not on the total costs that are incurred by the customer but on the value of the long-term relationship. Such costs may include the square footage within the customers’ facility required for uniform lockers. Other associated costs normal business functions such as personnel time needed to check-in product and account for returns, accounting department time to process invoices, or workers’ time to fill out repair tags as this is handles by the firm in remitting its services. All potential and the current customers need to be alerted that StatePride seeks to drive down the total costs over the long term and hence increasing its core clientele. The pricing of the firm is reduced considerably as it does not incorporate the various loss and abuse charges, wastewater surcharges, name and emblem charges, or setup charges which have an adverse cost to the client. The concern here is only concerned with the invoiced price coupled with his company’s associated costs and the supplier’s continuing ability to provide the required quality level of service, (Porter, 1985) For this firm, the value concept is simple and straightforward: increase the benefits and increase the value or decrease the price paid and/or associated costs and increase the value. The customer will pay up to the perceived value and not a penny more! And, if the price paid is less than the perceived value received, so much the better for the customer which will make StatePride his favorite place when the need for the various services offered arises Customer Value Analysis - Changes that Need to Occur According to Johnson & Weinstein (2004), the definition of value is the excess offered of the benefits received from the resource over the cost of the resource which is the amount of sacrifice that a customer has let go to be able to get such a service. This definition as clearly emulated by StatePride lacks the attribute to assess the levels to which such customer value can be measures in terms of the relevance and the needs of the customers. The building of the long-term relationship of the clients with StatePride has been the main focus, a move which can be straightforward seen as the driving factor behind the monetary aspects beneficial to the firm. On the other hand, this can be viewed as the intellectual capital that has been provided by the intangible relationship value Strategically, StatePride’s look at the value chain has to bear in mind the general cost cutting measures and the approach to increasing the value that has been attributed to the consumer. Each phase of the chain provides an opportunity to increase a customer’s benefits or to decrease costs in development of StatePride’s suppliers and delivery of their goods/services, and finally into the customers’ systems as the products are used. StatePride need to go beyond the simple definition of value as benefits less sacrifices and to identify dimensions of intangible value to the seller in a business to business buyer seller relationship as these are the attributes to construct. This will come in form of intellectual capital that is not physically measured but rather monetarily beneficial to both StatePride and the customers it engages business with. Other intellectual assets applying in this case can come in the form of free advice, unregistered but codified knowledge as well as the after sales services which as common to even its competitors in this market. Customer Perception StatePride has established a customer value analysis tool that looks into the whole value addition process to all the parties involved in business which incorporates the suppliers as well as the customers such as DownEast Plumbing. This tool establishes that the greater the understanding of buyer needs and requirements as well as the uniform supplier’s capabilities and requirements, the better is the ability to generate greater value for customers that comes with a working relationship. Customers are impressed by a working relationship that allow evaluation of capabilities and requirements and provide possible alternatives with the objective of increasing benefits and reducing costs resulting into a win-win situation to all the parties. The customers are satisfied when their emphasis on comfort as much as appearance is met and their images enhanced. The suppliers as well are much more recommending the 100% cotton shirts and pants on the basis of StatePride’s salesperson’s knowledge and support, recommending such for a long lasting fabric. The customers are much more impressed with the recommendations including the use of the wrinkle resistant fabric with excellent wearer comfort which the laundry also benefits by eliminating pressing and decrease labor cost. This shows the win-win situation expected from a value chain analysis for such a case study Attributes not Receiving Adequate Attention The adoption of customer value in management’s mission and vision statements means that customer retention which involves relationship management becomes the primary vehicle for market success, (Johnson & Weinstein, 2004); Enhanced customer value goes beyond isolated transactions and builds long-term bonds and partnerships in the market place as stronger customer/corporate ties changes buyers to advocates. From this case analysis, it can be visible that the corporate markets have been neglected at the expense of the individual customer value approach. This area needs to receive the adequate attention it deserves for StatePride to capitalize on both the individual customer base as well as the corporate potential that is left under-utilized in this industry. Human attributes in the marketing aspects of a business comprise three subcategories in the intellectual capital literature involving competence, attitude and the intellectual agility of a firm’s personnel, (Woodside, Golfetto & Gibbert, 2008) All these have to be incorporated as a package in the delivery of the customer value as these are the buyer’s boundary personnel who work in the relationship with the seller. The interpersonal skills in StatePride as a firm is much more focused on the outward picture as opposed to developing the internal personnel picture to be placed out in the market. This is a key role of the various departmental managers that should ensure the satisfaction of the personnel who are entitled with the sole purpose of ensuring that the customers are satisfied too and maintain a long-term relationship According to Gibbert, Woodside & Golfetto (2009), the model of the relationship value has to include a future financial projection performance which has not been put into perspective in firm. The financial books have the ability to say a lot to the customer in terms of the survival of the firm as well as the anticipated growth, in turn, this affects the future decisions of the customers in maintaining the same brand or shifting to a new brand. Conclusion Although StatePride deals in a diverse and congested market, it has maintained its relevance and the drive to remain in business, this can be attributed to the above summarized mechanisms as well as the attitude and preference of the existing clientele base. With this regard, it is commendable to say that StatePride is doing well but still needs to improve on the various aspects that add relationship value. References Gibbert, M., Woodside, A. G., & Golfetto, F. (2009). Creating and managing superior customer value. Bingley: Emerald Group Publishing Limited Johnson, W. C., & Weinstein, A. (2004). Superior customer value in the new economy: Concepts and cases. Boca Raton, Fla. CRC Press. Porter, M.E. (1985) Competitive Advantage, NY: The Free Press Woodside, A. G., Golfetto, F., & Gibbert, M. (2008). Creating and managing superior customer value. Bingley, Eng.: Emerald JAI Read More