UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------------ HO HOANG VIET LINH LOW PERFORMING CUSTOMER SERVICE STAFF IN LAZMALL CHANNEL OF LAZADA VIETNAM MASTER OF BUSINESS ADMINISTRATION Ho Chi Minh City – Year 2020 1 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------------ HO HOANG VIET LINH LOW PERFORMING CUSTOMER SERVICE STAFF IN LAZMALL CHANNEL OF LAZADA VIETNAM MASTER OF BUSINESS ADMINISTRATION SUPERVISOR: Assoc. NGUYEN THI MAI TRANG Ho Chi Minh City – Year 2020 2 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Contents ACKNOWLEDGEMENT. 4 LIST OF ABBREVIATIONS:. 5 LIST OF TABLES.
6 LIST OF FIGURES. The first possible problem: Low performing Customer Service staff. The second possible problem: Complicated process. The third possible problem: Competitive market with increase in customer demand.
Bad experience with product quality and delivery service. Eliminating complicated process as main problem. Eliminating competitive market with increase in customer demand as main problem. Eliminating Bad experience with Product quality and Delivery service as main problem.
Identify Low performing CS staff as the main problem. Justify the importance of Low performing CS staff. Potential cause 1: Stress at work. Potential sub-cause 1: Lack of headcount due to wrong forecast.
Potential sub-cause 2: Too much distracting noise. Potential cause 2: Poor work engagement. Potential sub-cause 1: Lack of bonding in team. Potential sub-cause 2: Unpleasant task.
44 1 LUAN VAN CHAT LUONG download : add luanvanchat@agmail. Potential sub-cause 3: Limited praise and recognition. Potential cause 3: Robotic staff. Potential sub-cause 1: Lack of soft skill agent.
Potential sub-cause 2: Limited learning and development opportunity 48 5. Alternative solution 1: Design a set of team building activities. Alternative solution 2: Organize a buddy program. Alternative solution 3: Change in appraisal scheme to motivate agents.
Change plan design. 89 2 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com ACKNOWLEDGEMENT First of all, I would like to deliver my gratitude to ISB for giving me such valuable opportunity to apply all knowledge I have learned during my master of business administration course. I have been inspired a lot by enthusiastic and experienced professors and lecturers during my academic years. Specifically, I would like to sincerely thank my thesis supervisor - Assoc.
Nguyen Thi Mai Trang for her careful and clear guidance. I cannot have completed this thesis without her advice and support. She is the one who is delivering me the very first knowledge about problem solving in organization with all her passion. In addition, I would like to express my appreciation to all people who have co-operated very well with me for my in-depth interviews and are very willing to spend their precious time to share valuable information for me to add in my thesis.
Last but not least, I want to show my grateful attitude to my family members for the sympathy as they are always stand by me during my master thesis period. 3 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com EXECUTIVE SUMMARY Customer satisfaction is a term that many companies are trying to achieve in this modern economy, as customer is the base for any enterprise to survive. However, in recent report of Lazada, Lazmall team has been achieved lower customer satisfaction than target, which goes against expectation of the management team in the company. Lazmall team has been founded in 2018 with the purpose to bring out the extraordinary experience for customers who buy authorized products on this platform.
Therefore, in-depth interviews were conducted and data were collected to analysis the situation of Lazmall team. With the strong support of literature, the research comes up with some potential problems: Low performing customer service staff, complicated process, competitive market with increase in customer demand and bad experience with product and delivery service. After validation, the main problem as low performing customer service staff has been revealed. Further analyzing, the research shows some potential causes for the main problems, which are: Stress at work, no work engagement and robotic staff.
After that, the main cause was identified as lack of work engagement, and some alternative solutions for the main cause were designed. The best solution to solve the main cause has been chosen basing on its feasibility and the adaption with company‘s situation. In a word, the thesis investigate the central problem in Lazmall team of Lazada, the main cause of that problem and the proposed solution, in order to improve the customer satisfaction score in Lazmall channel. 4 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com LIST OF ABBREVIATIONS: CS: Customer service CSAT: Customer satisfaction DSAT: Dissatisfaction KPI: Key Performance Indicator SLA: Service Level Agreement Backlog: Ticket of customer that is not resolved within SLA NPS: Net Promoter Score SKU: Stock keeping unit SOP: Standard operation process 5 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com LIST OF TABLES Table 1 CSAT monthly of Lazada in 2019 Table 2 Ticket related to process of Lazmall in 2019 Table 3 E-commerce usage habit in Vietnam Table 4 Order beyond promised date divided by delivery method Table 5 Problem with Lazmall products received in 2019 Table 6 Call productivity of agents in campaign 11.2019 Table 7 Employee satisfaction toward company‘s physical working environment Table 8 Employee satisfaction of Lazada in 2019 Table 9 Quality scorecard result divided by criteria Table 10 Educational background of customer service employees in Lazada Table 11 Years of experience in same industry prior to Lazada Table 12 Cost for alternative solution 1 Table 13 Cost for alternative solution 2 Table 14 Cost for alternative solution 3 Table 15 Cost for selected solution Table 16 Action plan implementation LIST OF FIGURES Figure 1 Company structure of Lazada – Dec 2019 Figure 2 Lazmall customers by age – 2019 Figure 3 Lazmall customers by gender – 2019 Figure 4 Lazada customers‘ income by channel Figure 5 Lazada Customer service structure Figure 6 Lazmall CSAT and DSAT monthly Figure 7 CSAT Lazmall break down by agent‘s tenure Figure 8 Lazmall functional structure Figure 9 Lazmall DSAT root cause Figure 10 Potential problem diagram Figure 11 Lazada CS monthly quality score 2019 Figure 12 Quality score by tenure of Lazmall agent Figure 13 Lazada monthly backlog per headcount 2019 6 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Figure 14 Lazmall DSAT deep dive Figure 15 CS mistake contribution to DSAT in 2019 Figure 16 Process of handling transaction Figure 17 Traffic of users in Vietnamese Ecommerce Figure 18 Criteria cared by customer during shopping Figure 19 DSAT counts by contact reason Figure 20 Shipping and delivery issues contribution in Lazmall Figure 21 Net promotion score between Ecommerce site Figure 22 Potential causes Figure 23 Process of transaction handling in Lazada Figure 24 Updated cause effect map 7 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.
Company background Founded in 2012, Lazada Vietnam is a part of Lazada group – a Southeast Asia‘s leading E- commerce platform presenting in six countries. Lazada Group is majority owned by Alibaba Group Holding Limited. Lazada Vietnam is one of the pioneers in E-commerce industry, with its vision is to change Vietnamese consumer behavior, from traditional market to an online platform. On that platform, sellers can provide products from various categories like: Fashion and accessories, Health and Beauty, Groceries, Electronic products, Sport and toys, while shoppers can easily look for a product they want.
In a word, Lazada‘s mission is to deliver an ―Effortless shopping experience‖ to buyers, by offering them a huge marketplace whereby they can approach online to millions of products from thousands of sellers. Focused on delivering an excellent customer experience, Lazada Vietnam offers multiple payment methods including cash-on-delivery, comprehensive customer care and hassle-free returns through its own first- and last-mile delivery arm supported by different logistics partners. Organizational structure: James Dong is the Chief Executive Officer of Lazada Vietnam and Lazada Thailand. James joined Lazada in June 2018 as the CEO of Lazada Thailand and was appointed CEO of Lazada Vietnam one year later, in addition to his existing role.
Prior to joining Lazada, he was the Head of Alibaba Group Globalization Corporate Development and Business Assistant to Group Chief Executive Officer, Daniel Zhang. Under the CEO, there are six different departments, of which Customer Service belong to Customer care department. Figure 1: Company structure of Lazada – Dec 2019 (Source: Internal Lazada report 2019) 8 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com LazMall Launched on the Lazada platform in August 2018, LazMall connects shoppers to over 1,500 leading authorized brand distributors. Lazmall is the flagship stores of Lazada, with the mission is to provide genuine and trusted along with reliable service and quality assurance.
It is to say that Lazmall is a virtual mall, which allows Lazada to set a new higher standard in retail. Shoppers can check out with the assurance of 100% authenticity, 15-day hassle-free returns, and next-day delivery. All Lazmall products are distributed by the top famous brand like Apple, Samsung, Xiaomi, Laneige, Vichy, Za, Huggies, Pamper, Moony. For brands and sellers, LazMall offers an opportunity to create a customized experience for their customers.
Lazada, hence, decided to build a special team to take care of consumers for this mall, called Lazmall customer service agent (Lazmall CS). The requirements for those agents to be recruited to this channel is very high, in order to deliver the wow experience for customers. It has been a big honor for those employees who were chosen to serve customers in this special channel. According to an internal survey of Lazada Customer Care, Lazmall buyers‘ background is illustrated in the following figure: First of all, the customers‘ age in 2019 is shown below: Figure 2: Lazmall customers by age – 2019 (Source: Internal Lazada report 2019) 9 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com According to Figure 2, the participants who are from 25 to 35 years old accounted for the greatest portion with 41%, and the second majority are group between 36 to 45 years old.
Meanwhile, the group of under 25 and over 45 account for the smallest part, which are at 16% and 13% respectively. Below is the gender structure of the customer database in 2019: Figure 3: Lazmall customers by gender – 2019 (Source: Internal Lazada report 2019) For online shopping on Lazada, it is witnessed that women and men population account for almost equal part, which are 55% and 45% respectively. However, the proportion of female buyers is still higher than the percentage of male consumers in general. Next is the monthly income structure of purchasers on Lazmall compared to non-Lazmall channel in 2019: 10 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Figure 4: Lazada customers‟ income by channel (Source: Internal Lazada report 2019) At a glance, figure 4 shows that Lazmall customers have the major population (35%) with income varies between 16-20 million VND, while non-Lazmall customers‘ monthly income mostly under 15 million VND (33% at 10-15 million dong and 31% under 10 million dong).
It is obvious that Lazmall customers‘ earnings tend to be higher than non-Lazmall‘s. Symptoms In recent months, from October 2019, it is observed that Lazmall channel have the lowest customer satisfaction score (CSAT) among other channels, and the score seems to decrease by time and even under target. For lots of enterprises, controlling customer dissatisfaction (DSAT) is extremely essential to maintain a stable and profitable growth. (1) In the condition of growing markets and under intense competitive pressures, many companies are spending their efforts on retaining a loyal customer base.
Loyal consumers help on saving to service, are willing to spend more their time and money with the service & products, and open up a potential source for further business opportunities (1). The below graph the target set by Customer care department for the customer satisfaction score (CSAT).