Measuring Customer Response

After emphasizing on customer response and its advantages it is also important to know how to measure these responses and what can be achieved after accurate measurement. For this it is necessary for an organization to incorporate following performance indicators:

  1. Productive Performance Indicator- The productive performance indicator determines the number of customer orders processed per human-hour. This order processing must be done is such a way that the time taken for processing is minimal to increase the productivity. Strategies used in customer service automation can bring immediate improvements in call center automation, internet ordering, contact management automation, EDI’s etc. Web integrated customer response systems cuts off the need to hire more employees as everything is automated.

  2. Financial Performance Indicator- The key financial performance indicator is Total Response Cost (TRC). By the use of TRC organization can easily compute the cost incurred for customer responses workflow, assets used, infrastructure used within organization, medium charges like internet and phone, income of executives etc. Some extended use of TRC is also to indicate the profitable aspects like which response was profitable and which was not. It can also compute which customers are profitable for the organization and which are not and which are they who can continue to give more profit in future. Total response cost is a powerful system which helps improving the financial aspects of organization by limiting the investments made by the organization and always keeps a check on customer response to enhance financial features.

  3. Quality Performance Indicator- The Primary quality performance indicator is Order Entry Accuracy (OEA) and First Time Fill Rate (FTFR). OEA is formulated as specific orders produced by customers per total order produced. FTFR is calculated by total products delivered per total products requested. There are many other indicators which help measuring quality performance of customer responses like Invoice Accuracy and Order Status communication accuracy. Invoice accuracy tool keeps a regular check on Invoice automation system and measure the accuracy of them. It is generally formulated as the total invoices with accurate match of items, prices and quantities etc per total invoices received. More the percentage produced by these tools more is the customer response value. It is necessary to measure quality performance so that the customers receive best services and customer satisfaction index always remain on top.

  4. Response Cycle Time Indicator- Response cycle time indicator is indicated by Order Processing Time (OPT). This calculates the time taken for the order; from time it was entered till the time it is delivered. One more important indicator called Order Entry Time (OET) is also installed which calculates the time taken from intimation of order until the order is captured or entered in the CRM system. This shows the time elapsed in the telephonic conversation or internet. By this the overall entry time taken by the executive to enter the details in the systems can be calculated. This is an important factor and can be used for increasing the productivity and for trying to reduce the time taken for order processing. Lesser the time taken to process the orders and entering the relevant information in the system, more are the chances to consume large number of customers in a given specific interval of time.

With the help of above discussed indicators or measurement tools customer response can efficiently be measured. Without having the knowledge of how the processes are performing and understanding which functional areas is lagging behind, improvement and enhancement cannot be done. Hence we can say that measuring customer response is the best strategy to improve it.


❮   Previous  Article Next  Article   ❯


Authorship/Referencing - About the Author(s)

MSG team comprises experienced faculty and professionals who develop the content for the portal. We collectively refer to our team as - “MSG Experts”. To Know more, click on About Us. The use of this material is free for learning and education purpose. Please reference authorship of content used, including link(s) to ManagementStudyGuide.com and the content page url.

Customer Relationship Management