Total Customer Value Management

Examples of Total Customer Value Management in the following topics:

• The Development of Value-Driven Firms

  • The values of an organization are just as important as the products they sell; having a strong value driven culture is important.
  • This was the precursor to customer value management, which has been practiced for the last 35 years, being incorporated into corporate thinking.
  • Some people focus on customer service, others on customer experience, others on lifetime value for a customer; many companies believe that having a customer service department is all it takes to create customer value.
  • A new practice called Total Customer Value Management (CVM) involves a total focus upon the customer.
  • Voice of Employee will be captured through the Customer Circles and Employee Value Add, and the Voice of Customer and Voice of Competitor will be captured by Customer Value Added (CVA).

• Competition Based on Value

  • For a firm to deliver value to its customers, it must consider what is known as the "total market offering. " This comprises the organization's reputation, staff representation, product benefits, and technological characteristics as compared to competitors' market offerings and prices.
  • The migration from product-oriented to customer-oriented strategies is called Total Customer Value Management (TCVM).
  • TCVM goes beyond conventional customer value management, which provides a rational set of techniques, methodologies, and strategies to weave the needs and wants of customers into the key process designs and management activities of the enterprise.
  • TCVM also creates value for employees, business partners (customers, delivery chain, supply chain, unions) and shareholders.
  • By assigning customer tasks to traditionally non-customer facing departments like IT, Finance, and HR, a Continuous Customer Improvement Program is created to ensure customer delight.

• TQM

  • Total quality management (TQM) is an integrative philosophy of management for continuously improving the quality of products and processes.
  • Total Quality Management (TQM) is an integrative philosophy of management for continuously improving the quality of products and processes .
  • TQM capitalizes on the involvement of management, the workforce, suppliers, and even customers in order to meet or exceed customer expectations.
  • The basic principles for the Total Quality Management philosophy of doing business are to satisfy the customer, satisfy the supplier, and continuously improve the business processes.
  • Some top companies not only provide quality products but also give extra service to make their customers feel important and valued.

• Adding Value

  • It is the process of communicating the value of a product or service through positioning to customers.
  • It also manages customer relationships in ways that benefit the organization and its shareholders.
  • For marketers to deliver value to a firm's customers, and also add value to the firm itself, they must consider what is known as the "total market offering. " This includes the reputation of the organization, staff representation, product benefits, and technological characteristics as compared to the market offerings and prices of competitors.
  • Conducting an effective customer value analysis can lead a company to creating an accurate value proposition.
  • A value proposition is a promise of value to be delivered and a belief from the customer that value will be experienced.

• Operations Management

  • Operations management is the management of processes that transform inputs into goods and services that add value for the customer.
  • Operations management is the management of processes that transform inputs into goods and services that add value for the customer.
  • The goal of operations management is to maximize efficiency while producing goods and services that effectively fulfill customer needs.
  • Countless operating decisions must be made that have both long- and short-term impacts on the organization's ability to produce goods and services that provide added value to customers.
  • The total time to get a computer repaired is now about two days.

• SIVA: Solution, Incentive/Information, Value, and Access

  • Customer-focused marketing is known as SIVA which provides a demand-centric alternative to the four P's supply side of marketing management.
  • The SIVA Model provides a demand and customer-centric alternative to the well-known four Ps supply side model (product, price, placement, promotion) of marketing management.
  • The customer-centric focus allows customers to feel cared for because they are offered a custom solution.
  • Value → Price The "Price" in the four Ps model is replaced by "Value," reflecting the total value gained through purchasing the product.
  • Value can be defined as the extent to which goods or services are perceived by customers to to meet their needs or wants.

• Long-Term Relationships: Satisfaction and Loyalty

  • Customers are willing to pay higher prices; they may cost less to serve and can bring new customers to the firm.
  • Customers' perceived value, brand trust, customers' satisfaction, repeat purchase behavior, and commitment are found to be the key influencing factors of brand loyalty.
  • Commitment and repeated purchase behavior are considered as necessary conditions for brand loyalty followed by perceived value, satisfaction, and brand trust.
  • Customer satisfaction is defined as "the number of customers, or percentage of total customers, whose reported experience with a firm, its products, or its services (ratings) exceeds specified satisfaction goals. " In a survey of nearly 200 senior marketing managers, 71% responded that they found a customer satisfaction metric very useful in managing and monitoring their businesses.
  • It is essential for businesses to effectively manage customer satisfaction.

• Supply Chain Management

  • Supply chain management is the management of the network of interconnected steps involved in the provision of product and service packages.
  • Supply chain management (SCM) is the management of a network of interconnected businesses involved in the provision of product and service packages required by the end customers in a supply chain.
  • Distribution network configuration: number, location and network missions of suppliers, production facilities, distribution centers, warehouses, cross-docks and customers.
  • Trade-offs in logistical activities: The above activities must be well coordinated in order to achieve the lowest total logistics cost.
  • Trade-offs may increase the total cost if only one of the activities is optimized.

• Special topic: just-in-time and lean systems

  • Just-in-time (JIT) is a management philosophy that originated in the 1970s.
  • The main goal of JIT is to eliminate anything that does not add value from the customer's perspective.
  • Non-value-added activities are referred to as "waste" in JIT.
  • unnecessary transportation (material handling, customer travel through a facility, etc. )
  • These improvements permit the organization to operate with less inventory, less costs, and faster response times in meeting customer needs.

• Service Marketing Management and Metrics

  • Marketing management is a business discipline which is focused on the practical application of marketing techniques and the management of a firm's marketing resources and activities.
  • A new P has been added making it a total of five P's.
  • Tasks for marketing management may include conducting a competitor and value chain analysis, putting together a brand audit, and assembling qualitative and quantitative research.
  • Marketing management therefore often makes use of various organizational control systems, such as sales forecasts, sales force and seller incentive programs, sales force management systems, and customer relationship management tools (CRM).
  • Marketers use these metrics and performance measurement as way to prove value and demonstrate the contribution of marketing to the organization.