Effects of Business Level Strategies On Customer Satisfaction In Connect Fiji Ltd. Essay Sample
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1.0 Introduction Good customers are hard to keep, and even harder to replace. The best customers can make the differences between success and failure of a product, brand or business. Without customers, an organization merely generates cost – yet many organizations spend little time and effort understanding and developing customers. Every sound business is built around a simple proposition that it makes or does something so well that customers will pay for
well that customers will pay for the value being created; such that a business has to make money and gain loyal customers. It’s not an either; the two are opposite faces of the same coin. If a business doesn’t gain customers, it won’t survive to make money. And if it doesn’t make money, then the chances of business survival is less. Thus it’s important for firms to maintain their business as well as their customers and this can be done through the use of appropriate strategies in the firm and providing customer satisfaction at the very best level possible. Satisfaction that a customer gains from the services being provided is the major issue in business level strategy. This satisfaction is contributed from several different strategies used by the firm in order to operate the business.
Thus this research intends to identify the effect of business level strategy on customer satisfaction. To help understand the issue in a more realistic level, our research at Connect Fiji was conducted to help us analyzing the strategies used, how it provides for its customers and ways of implementing further improvements in their organization. With the use of interview, questionnaires and observation, we were able to identify the organization effectiveness in providing their services to its customers.
* To study and evaluate the effect of business level strategy on customer satisfaction at Connect Fiji.
In this project we will see the level of customer satisfaction in relation of the use of business level strategy. The overall focus of the study is the strategic management process in the organization and how they achieve sustained competitive advantage through providing customer satisfaction.
* Define what business level strategy is.
* How business level strategy is implemented in Connect Fiji with regards to its:
* Types of business level strategy used with internet service providers.
* Advantages of using business level strategy in the organization.
* What is value creation?
* Factors that contribute to customer satisfaction
* How to create value to customers in Connect Fiji?
* Outcomes of providing customer satisfaction.
* Effect of strategies on customer satisfaction in the organization.
* Recommended strategy that best supports Connect Fiji.
The project is done in Qualitative Method and other method that we used to collect the information needed to compile this project is outlined below:
Step 1 Material Gathering Methods
Primary and secondary methods were used for data collection:
1.) Primary data was collected through:
Thus the observation was done through a visit at Connect Fiji as customers. I was more observant particularly on how employer and employee go hand in hand in dealing with the customers.
We were unable to interview the connect manager, but to hand in the questionnaire. On other hand we were able to interview Mr Jignesh Chauhan The Manager of Unwired Fiji Ltd. They provide similar service to connect and we were able to get some information on the strategies used and how these strategies support the daily activities of the organization. An appointment was made in advance with the manager. Interview was taken as a method to find out information because through these we will be able to get direct answers as well as make clarifications. Refer to Appendix A
Secondly apart from the manager we were able to get some information from customers and staffs of Connect Fiji.
* The questionnaires were distributed when I went to interview the manager.
* 5 customers and 3 employees were asked to fill the questionnaire. The employees filled them during their free time and handed in.
* The questionnaire were randomly distributed based on the heterogeneous group, i.e., equally distributed among gender, ethnicity different ability and status.
Refer to Appendix B & C.
2.) Secondary data was collected through:
(i) Internet research
We browsed the websites and obtained some information based on the business level strategy.
(ii) Library Research
We also browsed books for journals and extra information on business level strategy.
Step 2 Analyses and Evaluation
* Comparing and contrasting the information collected.
* Matching facts with the statements.
Step 3 Final Report
* Drafting of the report
* Reviewing the report
* Proof reading
* Final drafting of the project.
1. The organizations policy of confidentiality was also a problem.
2. The business does not have much information online.
5.0 Literature Review
Purpose of this research project was to find out how Connect Fiji uses its business-level strategy to gain competitive advantage and earn above average returns and how they are available to satisfy their needs of their current and future customers.
Business-level strategy simply defines as an integrated and coordinated set of commitments and actions the firm uses to gain a competitive advantage by exploiting core competencies in specific product markets.
The customers play central role in success of business level strategies. In selecting a business-level strategy, the firm determines: Who it will serve? What needs those target customers have that it will satisfy? How those needs will be satisfied?
Purpose of a business-level is to differentiate the firm’s position from those of its competitors. There are fives types of business-level strategies: cost leadership, differentiation, focused cost leadership, focused differentiation and integrated cost leadership differentiation.
Definition of Business – level Strategy by various authors:
According to http://business-strategy-case.blogspot.com/2007/11/business-strategy-definition.html: Business Strategy is a term used in business planning that implies a careful selection and application of resources to obtain a competitive advantage in anticipation of future events or trends. Business Strategy is concerned more with how a business competes successfully in a particular market. It concerns strategic decisions about choice of products, meeting needs of customers, gaining advantage over competitors, exploiting or creating new opportunities etc. (Nov 16, 2007)
According to http://www.thinkingmanagers.com/business-management/business-strategy.php: Business strategy is the foundation of successful business. But there are, of course, different types of business strategy. The best business strategies must steer a course between the inevitable internal pressure for business continuity and the demands of a rapidly changing world for revolutionary business strategies. (June 06, 2006)
According to http://bx.businessweek.com/business-strategy/: A good business strategy defines the direction and scope of an organization over the long-term, and will advance the company’s resources and meet market needs. This topic will cover information on building a corporate strategy, including best practice tools and ideas. Business Strategy is part of Business Exchange,… moreA good business strategy defines the direction and scope of an organization over the long-term, and will advance the company’s resources and meet market needs.
According to Kathryn: Business level strategy is difficult to measure construct that can differ from competitor to compete within the same industry.
According to Korll: Business level strategies are same to corporate-strategies in that their focus on over all performance. In contrast to corporate level strategy, however, they focus on one rather than a portfolio of businesses.
5.1 Business level Strategy Practiced in the Organization
Views from authors on how Business – level Strategy is being or can be practiced by organization:
According to Berna: Product Differentiation is a competitive business strategy whereby firms attempt to gain a competitive advantage by increasing the perceived value of their products and services relative to the perceived value of other firm’s products and services.
According to Founder: Differentiation Strategy is an integrated set of action designed to produce or deliver goods or services that customers perceive as being different in ways that are important to them. It calls for you to sell non-standardized products to customers with unique needs.
According to Karun: Cost Leadership is the transition from a cost leadership strategy to a differentiation strategy a natural part of a repetitive cycle (Feb 2006).
According to Porters Five Forces: Differentiation involves making your products or services different from and more attractive those of your competitors.
According to: Porters five forces case interview Pre: Cost Leadership is about minimizing the cost to the organization of delivering products and services. The cost or price paid by the customers is a separate issue.
Valued strategies by Tim Smith PhD, 01-22-2003 in a Cost Leadership Strategy, company sell their outputs at low prices and costs to maintain margins. High volume, low cost production is their route to profits.
According to Sticky-Marketing .com monthly magazine: Cost Leadership is a strategy to have the lowest cost in the market; these means that you should be best placed during a price war and make the highest margins we the cost war does not occur. (21/10/2004).
According to www.alages.com/strategy/s10.php-10k-Cached – Similar pages Cost Leadership Strategy is much more than cost reduction initiatives that get lots of prominence in strategic planning and review session of any company as a means to improve the bottom line of the company by improving its efficiency.
According to: www.businessplans.org/Market.htm- a Cost Leadership Strategy is based the concept that you can produce and market a good quality product or service at a lower cost than your competitors.
According to www.cimdata.com/newsletter/2005/42/04/42.04.02.htm Cost Leadership as a strategy for capitalizing on changed market conditions at the right time. Cost Leadership is achieved by an organization that is in a position to bring a product to market that offers the lowest price and highest quality in a particular segment.
According to http://www.ecofine.com/strategy/Cost%20leadership.htm Cost leadership Strategy defined as a firm pursuing a cost-leadership strategy attempts to gain a competitive advantage primarily by reducing its economic costs below its competitors
According to: www.k8accesscenter.org/training_resources/documents/differentationstrategiestool. Cost Leadership Strategy is based on the enterprises ability to control their operating cost so well that they are able to price their products and services very competitively and still generate high profit margins, thus having a significant competitive edge.
According to www.quickmba.com/strategy/generic.shtml A Differentiation Strategy calls for the development of a product or service that offers unique attributes that are valued by customers and that customers perceive to be better than or different from the products of the competitors.
According to www.k8accesscenter.org/training_resources/documents/DifferentationStrategiesTool.doc: A Focus Strategy maybe the most sophisticated of the generic strategies, in that it is a more intense form of either the cost leadership or differentiation strategy.
5.2 Advantages of the Strategies
Views from authors on advantages of using Business – level Strategy on organization:
According to Kim. Yang, Jaekyung: Through innovative information technology (i.e. RFID- Radio Frequency Identification), which has enabled it to create an uncontested market space, electronic logistics business. (2007).
According to Bonney, Clark, Collins, Fearne: the application of the value chain analysis methodology to the Houston Farms value chain revealed the importance of strategy and robust processes in key areas for co-innovation- R & D and new product development. It is also revealed that small businesses can enjoy a degree of success as a result of comparative advantage in certain areas but sustainable competitive advantage cannot occur by chance- identifying the potential for co-innovations an important first step in the right direction. (2007).
According to ESCRITT: As the business grows, we need more team leaders and more managers. “The lure of the IBM brand and the ability to hold on to people are a competitive advantage for IBM compared with others service center operators”, she says. (2007)
According to Benko, Weisberg: The goal of course, is to foster competitive advantage by providing choices that are rewarding to the most talented men and women of current generations and also inviting the future ones, (2007).
According to Philips: “Organizations with solid environmental policies are gaining competitive advantage over other business.” (2007).
According to Hoskisson and Irelandusers.cba.siu.edu/abebe/MGMT481/documents/CH4.pp: An integrated and coordinated set of commitments and action the firm uses to gain a competitive advantage by exploiting core competencies in specific product markets.
According to Amit: “A firm pursuing a cost-leadership strategy attempts to gain a competitive advantage primarily by reducing its economic costs below its competitors.”
5.3 Value Creation
Value is a combination of benefits received and cost paid by the customer. In another words it is a measurement of product’s performance characteristics and by its attributes for which customers are willing to pay for. Value is created by exploiting competencies and attaining synergy.
Definition of value creation by various authors:
According to Ittner and Licker: “A better understanding of value creation can than is used as a basis for validation as well as decision making.” (Ittner and Larcker, 2003).
According to Paul O’Malley: For the customer, it entails making products and providing services that customers find consistently useful.
According to Smith Brock and Colgate Mark: “Creation for value for customers is a critical task for marketers, particularly when developing new products and services or starting new businesses.” The Journal of Marketing Theory and Practice Issue: Volume 15, Number 1/ Winter 2007 Pages: 7-23 Faculty of Business University of Victoria, Brutish Colombia, Canada.
According to Agitavi Research Corporation Limited (2006): In essence value creation can be characterised as a process that is dependent upon interaction and dialogue between buyers and sellers.
According to http://www.blendedvalue.org/: Value is what gets created when investors invest and organizations act to pursue their mission. Consists of economic, social and environmental value components-and that investors (whether market-rate, charitable or some mix of the two) simultaneously generate all three forms of value through providing capital to organization. And the outcome of all this activity is value creation
5.4 How Do You Create Value to Customers
Value is created by a product’s low cost, by its highly differentiated features or by or combination of both with its competitors’ offerings.
Suggestion from authors on how organisation should create value to customers:
According to Greg Kitzmiller: One key factor in value creation is innovation; another issue with value creation is communication.
According to Gronroos: “The customer value creation and delivery process was conceptualized as a triad, viewed through the lens of making, keeping and enabling promises.
According to Reichheld (et al): “Firms have increased their efforts to retain customers for various reasons, bur most often the reasons relate to the customers direct value to the company. Loyal customers can lead to increased revenues for the firm, result in predictable sales and profit streams.”
According to Webster and Kotler: “Compare the traditional transaction process with the increasingly favored view of marketing being based upon value creation and delivery, and upon developing long term relationships with suppliers and customers.”
According to Zenithaml and Bitner: “Yet, to more accurately access the full value of a loyal customer we believe firms must look beyond the influence of these direct measures.(i.e. firms should look beyond direct revenue streams and include the value of all the benefits associated with possessing a loyal customer.
5.5 Outcome of Customer Satisfaction
Customer satisfaction is a measure of how products and services supplied by a company meet or surpass customer expectation. Customer are satisfied when the product meet their expectation or beyond their expectation.
Some of the authors highlights the outcomes that can receive from customer satisfaction by providing them with value their perceived from product.
According to https://informs.emeetingsonline.com/emeetings/formbuilder/clustersessiondtl.asp?csnno=6414&mmnno=165: It is important for marketing practitioners to understand customers’ repurchase intentions and the factors that influence repurchase intentions because increased repurchases (customer loyalty) are important to profitability.
According to https://informs.emeetingsonline.com/emeetings/formbuilder/clustersessiondtl.asp?csnno=6414&mmnno=165: Recent papers showing how word of mouth affects directly to sales; for instance, in case of movie industry and online bookshop. Which enhances our understanding of the consequence of customer satisfaction that influences customer acquisition through a positive word of mouth spread by satisfied customers as well as customer retention.
According to http://www.busreslab.com/tips/tip11.htm: in measuring customer satisfaction is to see where a company stands in this regard in the eyes of its customers, thereby enabling service and product improvements which will lead to higher satisfaction levels.
According to http://www.surevista.com/benefits-customer-satisfaction.htmlz; Customer satisfaction reduces the price sensitivity, reduces switching to competitor, increases referrals and increases repeat purchases which lead to increase in revenue, reduce cost and maximize profits.
According to http://www.thetimes100.co.uk/theory/theory–customer-satisfaction–278.php: Gaining high levels of customer satisfaction is very important to a business because satisfied customers are most likely to be loyal and to make repeat orders and to use a wide range of services offered by a business.
According to http://www.toolbase.org/Best-Practices/Business-Management/Benefits-Satisfied-Customers: the benefits of customer satisfaction is lower marketing costs, lower selling costs, lower warranty costs and higher sales conversation ratios.
5.6 Background and Information about Connect Fiji
Connect Internet Services is the largest ISP in Fiji, offering a wide range of products and services for the consumer and business markets including dial-up access, broadband service, dedicated high-speed solutions, hosting, and Internet application development.
Connect is determined to help build a better Fiji by providing quality Internet and communications needs for its people and businesses, thereby making it easier for the country to communicate with the world. Connect continually strive to improve our products and quality of service to our customers.
Connect has dedicated, knowledgeable, experienced and innovative staff serving as IT engineers, technical officers, Internet application developers, programmers, corporate accounts managers and customer service officers. They combine their skills to provide products and services to your organization’s technology needs.
Connect has a determined team striving to make a difference in an ever changing networked society. They are a fully owned subsidiary company of Telecom Fiji Limited under Amalgamated Telecom Holdings. Connect Fiji Ltd. began in 1996 with the exclusive license to provide internet services throughout Fiji. They also provide various services to our customers within Fiji. Connect employs over 40 Staff and have offices in Suva, Nadi, Lautoka and Labasa.
The future plans for bandwidth, hardware, software and personnel are based on striving to maintain the highest level of quality Internet service; measured by response time, reliability and security as well as competent reliable customer care.
Connects Mission Statement
Connect understand that their customer’s need is paramount – therefore they have made it their aim to be #1 in the South Pacific delivering excellence in serves and technology.
It is their vision to be the best Internet Service provider in the South Pacific by providing world class services to all their customers.
Their goal is to ensure that they as a company maintain a high level of knowledge in the world of technology and impart this knowledge to their customers.
6.0 Data Analysis
The data analysis is from the organization perspective, staff perspective and customer perspective in view of customer satisfaction and how they sustain completive advantage compared to other internet service providers.
6.1 Managements Perspective
The business level strategy practiced by Connect Fiji Ltd is that: they sell internet services to others through satisfying the customer and make reasonable profit as well. Hence, they use cost leadership and differentiation strategy to sell their services to others depending on their package. They are focused on how to deliver a level of service to others. Their motive is to: “keep their customers smiling and satisfied”.
Moreover, they are in the market to make a profit. Thus, to engage as many as customer possible in perceiving the service provided and as when the customer is happy, they keep paying for the satisfaction provided to them through the product and service.
Thus, the factors to consider while implementing the strategies are Product, Price, Market and Value.
For Product – in their case, the product is their service that they provide. Thus, Connect is concerned with their product that; it is:
Easy to understand
Easy access to internet
It is hassle free
To keep it simple, flexible, robust
It works every time
Secondly Price- it should reflect the product. Hence, they believe that they have a fair price.
Thirdly, the Market factor. This includes:
Connect Fiji Ltd tells people what sort of products and services they offer.
Their motive is that at the end of the day, they want to provide world class services to all our customers.
They offer the best package deals
The customer should understand what they are buying according to their internet needs thus they have personnel’s who thoroughly explain to the customers regarding the different packages that they have to best suit their needs.
Their price is such that it fits the customer’s budget.
The fourth factor is Value. The value in this case is “what is the total number of brands for Connect Fiji”. Thus, they have various packages and plans to suit the customer’s needs. Such as personal & home plans, business plans, students & schools plans; more over, they also provide e-mail and web hosting service.
Regarding the customers of Connect Fiji, it can be said that; each customer has different needs. The customers explains everything regarding their need or the package they want, then the sales representative explains accordingly, to what is best that suits their need. But then the final decision is left on the customer to accept or choose other package.
In terms of maintaining customers, Connect Fiji provides 4 levels of help services to its customers. Firstly, the Helpdesk. Here, the personnel’s deal with any queries that customers have or any service interruptions that they face. Secondly, the level two consists of the technicians that visit homes of people to provide help and to solve the technical problems of the customers using the service. Thirdly, it is the Operations personnel’s. They monitor that the network is operating always. Fourthly, the Sales personnel’s. Their job is to attract and maintain the customers. They constantly ask the customers about how the service is working. Moreover, they are responsible for the cleaning and tidying up of the workplace so that other employees can start a fresh day at work.
However, Connect Fiji also faces difficulties with their customers. These are when the customers do not stay confined to the terms and conditions of the agreement with the ISP (internet service provider) such as:
When customers don’t pay their bills on time.
Customers at times forget on what they have bought and later on cause problems with the company regarding their usage.
Regarding usage, customers have to exercise some constraints.
Managing customer relations.
It can be said that Connect Fiji is operating effectively in the market as they have 21,000 customers. They believe that they are proving the best customer support by measuring their usage and upgrading.
All this is seen then a package is set up that would suit the needs of the individual customers to perceive the satisfaction and spread the word of mouth to other, that would help the organization to engage with newer customers.
6.2 Staffs Perspective
They think that they provide excellent products and services for the Fiji Community. A wide variety of packages to suit all users and excellent support services and are the leading internet service provider with network coverage Fiji wide.
According to them, customers are indeed satisfied with their service since they strive to be quick, efficient and ever ready to serve their customers.
6.3 Customers Perspective
Through the customer’s perspective, they think that they provide good service at a cheaper price compared to other internet providers. They are very much satisfied with the package that they have selected and the location of connect is convenient. The service offered is up to their standard requirement; but on other hand, they think that connect should upgrade speed a little more.
7.0 Business-Level Strategy
An organization’s core competencies should be focused on satisfying customer needs or preferences in order to achieve above average returns. This is done through Business-level strategies. Business level strategies detail actions taken to provide value to customers and gain a competitive advantage by exploiting core competencies in specific, individual product or service markets. Business-level strategy is concerned with a firm’s position in an industry, relative to competitors and to the five forces of competition.
Customers are the foundation or essence of a organization’s business-level strategies. Who will be served, what needs have to be met, and how those needs will be satisfied are determined by the senior management.
Who are the customers?
Demographic, geographic, lifestyle choices (tastes and values), personality traits, consumption patterns (usage rate and brand loyalty), industry characteristics, and organizational size.
What are the goods and/or services that potential customers need?
Knowing ones customers is very import in obtaining and sustaining a competitive advantage. Being able to successfully predict and satisfy future customer needs is important. (Perhaps one of Compaq’s mistakes was not understanding who their real customer was and what that customer — end user — wanted.)
How to satisfy customer needs?
Organizations must determine how to bundle resources and capabilities to form core competencies and then use these core competencies to satisfy customer needs by implementing value-crating strategies.
There are four generic strategies that are used to help organizations establish a competitive advantage over industry rivals. Firms may also choose to compete across a broad market or a focused market. We also briefly discuss a fifth business level strategy called an integrated strategy.
7.0.1 Cost Leadership
Organizations compete for a wide customer based on price. Price is based on internal efficiency in order to have a margin that will sustain above average returns and cost to the customer so that customers will purchase your product/service. Works well when product/service is standardized can have generic goods that are acceptable to many customers, and can offer the lowest price. A continuous effort to lower costs relative to competitors is necessary in order to successfully be a cost leader. This can include:
* Building state of art efficient facilities (may make it costly for competition to imitate)
* Maintain tight control over production and overhead costs
* Minimize cost of sales, R&D, and service.
How to Obtain a Cost Advantage?
* Determine and Control Cost
* Reconfigure the Value Chain as Needed
* Tunnel Vision
Value Chain – A framework that firms can use to identify and evaluate the ways in which their resources and capabilities can add value. The value of the analysis lays in being able to break the organization’s operations or activities into primary (such as operations, marketing & sales, and service) and support (staff activities including human resources management & procurement) activities. Analyzing the firm’s value-chain helps to assess your organizations to what you perceive your competitors value-chain, uncover ways to cut costs, and find ways add value to customer transactions that will provide a competitive advantage.
Value is provided to customers through unique features and characteristics of an organization’s products rather than by the lowest price. This is done through high quality, features, high customer service, rapid product innovation, advanced technological features, image management, etc. (Some companies that follow this strategy: Rolex, Intel, Ralph Lauren)
Create Value by:
* Lowering Buyers’ Costs – Higher quality means fewer breakdowns, quicker response to problems.
* Raising Buyers’ Performance – Buyer may improve performance, have higher level of enjoyment.
* Sustainability – Creating barriers by perceptions of uniqueness and reputation, creating high switching costs through differentiation and uniqueness.
Risks of Using a Differentiation Strategy
* Loss of Value
Porter’s Five Forces Model – Effective differentiators can remain profitable even when the five forces appear unattractive.
* Rivalry – Brand loyalty means that customers will be less sensitive to price increases, as long as the firm can satisfy the needs of its customers.
* Suppliers – Because differentiators charge a premium price they can more afford to absorb higher costs and customers are willing to pay extra too.
* Entrants – Loyalty provides a difficult barrier to overcome substitutes. Once again brand loyalty helps combat substitute products.
Using an Integrated Low-Cost/Differentiation Strategy
This new strategy may become more popular as global competition increases. Firms that use this strategy may see improvement in their ability to:
* Adaptability to environmental changes.
* Learn new skills and technologies
* More effectively leverage core competencies across business units and products lines which should enable the firm to produce produces with differentiated features at lower costs.
Thus the customer realizes value based both on product features and a low price.
However, organizations that choose this strategy must be careful not to; becoming stuck in the middle i.e., not being able to manage successfully the five competitive forces and not achieve strategic competitiveness. Must be capable of consistently reducing costs while adding differentiated features.
Benefits of Integrated Strategy : Benefits of Integrated Strategy Successful firms using this strategy have above-average returns Firm offers two types of values to customers some differentiated features (but less than a true differentiated firm) relatively low cost (but not as low as the cost leader’s price)
7.1 Customer Value
Increasing competition (whether for-profit or nonprofit) is forcing businesses to pay much more attention to satisfying customers. Customer satisfaction is an ambiguous and abstract concept and the actual manifestation of the state of satisfaction will vary from person to person and product/service to product/service. The state of satisfaction depends on a number of both psychological and physical variables which correlate with satisfaction behaviors such as return and recommend rate. The level of satisfaction can also vary depending on other options the customer may have and other products against which the customer can compare the organization’s products.
Customer value could be considered as the customer perception the trade offs between positive and negative consequences of a products acquisition and utilization in comparison to competitive products and service. It is especially important that a definition of customer value includes all benefits and sacrifices that customers may consider before buying a product because so many variables can be associated with customers’ perception on the quality of product and service. Customer value must also be managed by considering that buyers intend to gravitate towards products and service with higher perceived value.
The approaches that create value for customers at connect is by adding extension service, technical product features or supporting services to the core solution so that the total value of offering is increased. And according to them, they say that they strive to be quick, efficient and ever ready to serve their customers. As for the staffs they say that connect provides excellent products and services for the Fiji community, variety of packages to suit all the users.
Traditionally, value has been considered as a contrast between price and quality. These days’ customers expect to have high quality good at a reasonable price. Businesses with superior customer value positions have larger profit margins, so competitive organization must develop strategies for providing the highest level of customer value. Customer value requires organizations to assess customer’s perceived benefits and sacrifices and their relative importance to compare themselves with competitor firms and determine the best way to increase customers perceived value in order to gain the competitive edge.
7.1.1 Methods of Creating Value to Customers
The following methods have been used by Connect Fiji Ltd to create value to its customers:
* Special promotions example free installation and a month free off-charge during showcase.
* Toll free call service for enquiries.
* Special packages given to school and student for internet connections.
* Customer focus-creating a customer friendly environment.
7.1.2 Outcomes of Providing Customer Satisfaction
Turning satisfied customers into loyal customers. Meaning then the customers tend to enjoy the service quality perceived and likely to repeat that same experience again and again, and recommend about the service \ product that they perceive to others. While building on customer base, businesses at times tend to move too fast and focus on quantity rather than quality. Therefore focus must be maintained at every level in the organization.
Employees tend to enjoy their job duties in providing quality service according to the customer satisfaction, which in turn would stop or minimize the employee turnover rate.
Upon conducting this research, several sources that addresses the impact of customer satisfaction on loyalty to a particular service provider. Depending on the survey source, the customers that were given questionnaire to answer, claims that they are very much satisfied with the service quality that they perceived.
The customers who are not satisfied with the level of service the firm deliver, the firm can be assured that their will be a high level of turnover within the customer based. It is important to keep in mind the fact that a satisfied customer is not necessarily a loyal customer. Maintaining the desired level of customer base requires hard work, constant attention to the customer and diligence in delivering an expected service consistently.
Any customer can be satisfied by other internet service providers because the competition between them in offering different packages. Should the level of satisfaction be a matter then? Possibly, but not likely. The more likely scenario that gets played out is that as long as the level of satisfaction is perceived by the customer, they will tend to favor service provider with better packages.
A differentiated package helps in terms of building some degree of customer loyalty. Satisfaction allows the business to survive in the competitive environment. When an entity is able to achieve some degree of customer loyalty among its customer base, the rate of customer leakage drops and the service that customers acquire continues and likely to increase; therefore it is important to bind the customers.
Things to consider when attempting to build on customer loyalty:
* Let the customers know that the business is interested in them as a long term customer relationship. This implies that people are very much geared to being problem solvers for the customers.
* Think in terms of developing relationships with the customer. This means attempting to cultivate as many personal relationships as possible within the customer’s organization.
* Make every attempt to differentiate the product or service from the competitors
* Serve the customer at extremely high levels. This means that processes must be selectively chosen such as efficient services; sales personnel must be highly trained in customer service skills and must establish a culture with high expectations for serving the customer at very high levels.
* Allow customers to provide a feed back and when ever they feel there is a need to do so.
* Creates an environment of high accountability, high performance, high morale and high productivity. Happy and productive employees will do a lot to build customer loyalty.
7.2 Effects of the Strategies on the Customers
The following represent the effects of the strategies on the customers:
Cost Leadership Strategy
* Achieving lower cost of services-customer getting as low cost as possible.
* Making services more cost efficient- customers getting better and efficient service.
* Improved cost required for coordination of various services.
* Improved utilization of available equipment, services and facilities.
* Introducing new services/procedures quickly- customers get access to new products and services with a wide range of options to choose from.
* Providing services that are distinct from that of competitors- because of competition amongst the provider of the service, customers can get cost advantage that is, lower prices offered by the firms to maintain its customers and helps in recruitment of new customers.
* Offering a broader range of internet services packages than the competitors. Customers will get something different as what the other competitors provide.
* Improving the time it takes to provide services to customers- customers get assess to new products very frequently and quickly.
* Providing high quality services- consumers receiving high quality service.
The following recommendation can be considered by Connect Fiji Ltd to make their services more effective and efficient.
* We think that procurement (delivering additional value to the bottom line through new methods) work should be closely done with other business functions it can drive flexibility, ultimately making it expandable to customer needs and creating value to the company’s bottom line.
* At times some customers are unaware of the packages available at Connect Fiji Ltd, thus the firm should make an effort to make proper advertisement so that the customers are fully aware through advertising via radio and flairs since it’s cheaper.
* They should also allow customers to try out their new services for free or provide demonstration on how their new services work.
* Have some part-time employees to share the load during peak time.
* Have more call operators to reduce customer being put to hold.
* They should offer higher speed compared to unwired, this will help the recover lost customers who go for speed rather than capacity.
It is rationale for an organization to maintain its existing customers than to attract new customers. Loyal or regular customers continue buying products in the near future and they also recommend their product to other customers thus attracting more customers.
The business should always upgrade itself to the available competition so that it is able to achieve greater profit margin. This can be achieved by having a perfect knowledge about the market. After discovering what the customers want the business can begin to understand how their product gives value to the customers.
After conducting this research project, it be said that Connect Fiji Ltd has gained a lot by using its business level strategy. This does not mean that Unwired Fiji Ltd should be restricted to business level strategy only. Implementation of other strategies can make the business to be one of the most prominent internet service providers in Fiji.
* Annika R. Department of Marketing and Economic Geography, Swedish School of Economics and Business Administration, Finland
* Bernard Jaquier, Professor in Economics and Finance, Ecole Hoteliere de Laussane, Switzerland, 2003
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* Changu Kim Kyung Hoon Yang, Jaekyung Kim.Omega. Oxford: Aug 2008. Vol.36, Iss.4;pg.522
* Dess, G. Gregory and Lumpkin, G.T. Strategic Management: Creating Competitive Advantages, 2nd Edition, McGraw-Hill Irwin, New York, 2005.
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* Peter Fitzroy and James Hulbert, Strategic management Creating value in turbulent Times, John Wiley & Sons, 2005.
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