Question

Case 1: Use of Technology

Federal Express (FedEx) was founded about 50 years ago. It handles on an average of 3 million package-tracking requests on a daily basis. To remain ahead of its competitors, FedEx strives on customer service by keeping a comprehensive website, FedEx.com. It increases customer service and reduces costs. For example, each request for information which can be retrieved from the website rather than by the call centre help FedEx to save an estimated $1.87. The costs for FedEx have been reduced from more than $1.36 billion per year to $21.6 million per year by customers using the website instead of the call centre calculating each package-tracking request costs Federal Express 3 cents.

Another know-how that improved its customer service is Ship Manager, an application installed on customers’ sites so users can determine shipping charges, weigh packages, and print shipping labels. Customers can also tie their invoices, billing, accounting and inventory systems to the application, Ship Manager.

Nevertheless, Federal Express still spend almost $326 million annually on its call centre to reduce customers’ annoyance when the website is down or when customers have difficulty using it. It uses CRM software called Clarify in its call centres to ensure customer service representatives’ job easier and to speed up response time.

Answer the following questions:

a)     What is the importance of technology to ensure high-quality customer service?

b)    Can you estimate Federal Express’ annual savings from using information technology?

c)     Can you give a few examples of information technologies used by Federal Express?

d)    What is the role of the application ‘Ship Manager’?

e)    Your overall observations and learning from the above case study.

Answer 1

a.) FedEx as maintains a personal website for providing details to its customers in a much optimised manner, This way the customer is not waiting for call waiting time to reach customer support, apart from will save the burden of sharing all the details with the care executive rather fetching from Fedex website will be smooth process.

b.) Yes, for every information that a customer access using online mode rather than calling the care support, the company saves $1.87. So, on a yearly basis, the company saved huge as the cost reduced from $1.36 billion to $21.6 million just from adopting the technology.

c.) Company uses ship manager which is an application that helps customer to determine shipping charges, tieing invoices, bookings etc. Apart from this, company uses fedex.com which is a great web based information gateway for its customers where customers can easily track deliverables and other related information. CRm software is another used by fedex to facilitate its call center employees.

d.)  Ship manager which is an application that helps customer to determine shipping charges, weigh packages and print shipping labels etc. The application also helps to tie theinvoices, billing, accounting and inventory systems to the application.

e.) Adapting the technology and implexmenting it to operation should be company's primary objective for proper resorce management. Just by adopting with the technology, fedex managed to cut down its operating cost by more than 90%.