07 November, 2023

Exception Management and Customer Satisfaction: The Dangerous Tango

In the fast-paced world of eCommerce fulfillment, exceptional customer satisfaction is not just about getting orders right, but how you handle exceptions when things go awry. Peter Davis, VP/GM of Fulfillment at WSI, shares insights on how to navigate shipment exception challenges, minimize disruptions, and create customer experiences that foster loyalty and growth. 


The Power of Exception Management

I recently had two starkly different experiences when getting food delivered. In the first instance, I ordered a sandwich and fries. Unfortunately, the fries didn’t come with the order. Not good (What’s that saying again? “Hell hath no fury like…a guy without fries”). I brought up the problem with the vendor and after a while, they issued me a small credit. On the second occasion, I ordered a pizza and salad. Though I was completely oblivious to the fact, the restaurant had forgotten to send the salad with the initial driver; however, they identified the issue before I did, and sent a second driver with the missing item.  

As you can probably guess, I preferred the second experience to the first one. And I would go further than that: I now have a strong affinity for the second restaurant since I feel they really cared about making my customer experience a great one.    

I believe the same phenomenon applies when it comes to warehouse fulfillment. Though it’s critical to minimize errors, the reality is that for any high-volume operation, occasionally exceptions will happen. None of us enjoy it, but we know that occasionally packages get lost or damaged, extreme weather causes delays, etc. It doesn’t matter who or what caused the error, or whose responsibility it was to fix the issue; the customer ordered a product from a brand, and that brand’s reputation ultimately suffers.   

This certainly highlights the importance of collaboration among all players in the supply chain to ensure exceptional customer experiences and brand integrity for all involved. But it also makes it especially clear how important it is for eCommerce brands to form collaborative, communicative partnerships with 3PLs and carriers who can be on the lookout for proactive solutions.


The Reality of Exception Management in a Fulfillment Center

One example of an exception we’ve seen is when a small parcel carrier fails to scan the package after it’s been put on the carrier’s truck. In this scenario, the warehouse has picked and packed the order, and the Warehouse Management System and Order Management System believe the order has shipped.  

However, no tracking information registers for the shipment, and the parcel carrier is not systemically aware of ever physically receiving the product. Often this means that the shipment will be lost. Without someone paying close attention to the tracking number, it may be weeks before anyone realizes there is a problem — and unfortunately, typically the person who finds out first is the customer. The merchant has found itself in the ticked-off-french-fry-universe.    

Numbers vary, but one industry expert I’ve spoken to suggests that during peak season, 1-5% of packages can fall into this failure-to-scan bucket. Across thousands of packages, this equates to many failed deliveries in which the merchant is forced to respond to upset customer inquiries when the merchant thought it did everything right.  

Proactive Strategies for Exception Management

Our advice is to put in place systems and standards that allow you to take a proactive rather than reactive approach. This will help your customers get their proverbial salads and avoid discontent. Here are two possible steps you can take.  

Implement Smart Software

First, implement software that not only aggregates tracking numbers, but also identifies when a “shipped” order shows no movement within 24-48 hours. This indicates that there was a problem with the shipment and triggers an internal investigation to understand and resolve the issue before the customer even knows there was a problem. It is not practical to manually monitor the progress of tens of thousands of orders (that’s a lot of orders to click through). Get software that identifies the exceptions for you so that your team can spend time solving actual issues. Your system should have an “Exceptions” dashboard so that any red flags are easily visible to your team members.  

Set Clear Expectations

Second, set an internal expectation for how to react when exceptions emerge. Again, the key is to move quickly. Standards will vary based on the merchant and its willingness to spend money to ensure a positive customer experience. For example, you may choose the standard that if the parcel carrier fails to scan the package and it is lost, then immediately ship a new package at an expedited carrier service level; or you may choose to use the same service level but notify the customer that there was a hiccup that has been resolved. The internal team should all be on the same page so that the appropriate steps are taken promptly. Most businesses aspire to perfect performance. The reality is that, whether it’s a best-in-class restaurant, carrier, or warehouse, occasionally mistakes will happen. How you can respond to and resolve those mistakes can be a determinative outcome for whether your customer stays loyal. When it comes to order fulfillment, choose a logistics partner that will give your customers the salad experience over the missing french fries.   


Deliver Exceptional Order Fulfillment Experiences with WSI

Partnering with WSI can revolutionize your fulfillment operations and help you excel in delivering exceptional customer experiences. With our smart software solutions, clear internal expectations, and collaborative approach, we can help you maintain your brand’s integrity. Connect with one of our logistics today!