Recommendations to improve service quality for imported cargo at CFS warehouse at greenport viconship

MINISTRY OF TRANSPORTATION MINISTRY OF EDUCATION & TRAINING VIETNAM MARITIME UNIVERSITY STUDENT NAME: TRAN THI DUC HANH DISSERTATION GLOBAL STUDIES AND MARITIME AFFAIRS RECOMMENDATIONS TO IMPROVE SERVICE QUALITY FOR IMPORTED CARGO AT CFS WAREHOUSE AT GREENPORT - VICONSHIP HAI PHONG – 2015 MINISTRY OF TRANSPORTATION MINISTRY OF EDUCATION & TRAINING VIETNAM MARITIME UNIVERSITY STUDENT NAME: TRAN THI DUC HANH CLASS: GMA02 DISSERTATION GLOBAL STUDIES AND MARITIME AFFAIRS RECOMMENDATIONS TO IMPROVE SERVICE QUALITY FOR IMPORTED CARGO AT CFS WAREHOUSE AT GREENPORT - VICONSHIP Supervisor: Vu Thi Thu Hang Division: Global Studies and Maritime Affairs Faculty: Economics HAI PHONG – 2015 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP PREFACE The work outlined in this dissertation was carried out in the Warehouse Department, Green Port, VICONSHIP, where I undertook my internship, over the period from August 2015 to the end of September 2015 I declare that this report is my own unaided work It has not been submitted before If violated, I am solely responsible for and bear the punishments of the Institution and University Student Name and Signature Tran ThiDucHanh Tran ThiDucHanh – GMA02 Page i Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP ACKNOWLEGEMENT Firstly, I would like to express my sincere gratitude to my supervisor Ms Vu Thi Thu Hang for her continuous support, patience, motivation, and immense knowledge Her guidance was very helpful for me during the time of research and writing of this thesis My sincere thanks also go to Ms Tran Phuong Anh, Manager of Warehouse Department at Greenport – VICONSHIP, who provided me an opportunity to join their team as intern, and Ms Nguyen Thi Ngoc Thuy, my instructor at the company, who thoroughly guided me during my internship Without they precious support it would not be possible for me to conduct this research Tran ThiDucHanh – GMA02 Page ii Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP TABLE OF CONTENTS Preface i Acknowledgement ii Table of Contents iii List of Symbols, Abbreviations v List of Tables and Graphs vi List of Figures vii INTRODUCTION Necessity Research object Research methodology Research scope Research findings CHAPTER 1: LITERATURE REVIEW 1.1 CFS warehouse 1.1.1 Definition of CFS warehouse 1.1.2 Services at CFS warehouse 1.2 Service quality 1.2.1 Definition of service quality 1.2.2 Tools to evaluate service quality 1.2.3 Evaluation methodology CHAPTER2: EVALUATION OF SERVICE QUALITY OF CFS WAREHOUSE AT GREENPORT Tran ThiDucHanh – GMA02 Page iii Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP 2.1 Introduction about the company 2.1.1 Introduction about VICONSHIP 2.1.2 Introduction about the subsidiary of the field trip 13 2.1.3 Business fields of CFS warehouse at GREENPORT 16 2.1.4 Detailed process of unstuffing imported cargo at CFS warehouse 16 2.2 Result of evaluation 22 2.2.1 Overall information about sample 22 2.2.2 Analyzing mean expectation score 22 2.2.3 Analyzing mean perception score 26 2.2.4 Analyzing gap score between expectation and perception 29 CHAPTER 3: RECOMMENDATIONS TO IMPROVE CFS WAREHOUSE SERVICE QUALITY 32 3.1 Identifying factors that need to be improved 32 3.2 Recommendations to improve service quality at Greenport CFS warehouse 33 3.2.1 Important factors that need to be improved instantly 33 3.2.2 Other factors that should be improved in the long-term 36 CONCLUSION 38 Reference 39 Appendices 40 Tran ThiDucHanh – GMA02 Page iv Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP LIST OF ABBREVIATIONS CFS Container Freight Station IPA Important – Performance Analysis D/O Delivery Order Tran ThiDucHanh – GMA02 Page v Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP LIST OF TABLES TABLE 1: List of variables TABLE 2: Greenport Facilities 13 TABLE 3: Distribution of respondent 22 TABLE 4: Summary of the customers‟ expectation score 22 TABLE 5: Summary of the customers‟ perception score 26 TABLE 6: Summary of gap score between expectation and perception 29 Tran ThiDucHanh – GMA02 Page vi Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP LIST OF FIGURES FIGURE 1: Important – Performance Matrix FIGURE 2: Organization chart of VICONSHIP 10 FIGURE 3: Growth of revenue of VICONSHIP from 2009 to 2014 12 FIGURE 4: Profit after tax of VICONSHIP from 2009 to 2014 12 FIGURE 5: GREENPORT general terminal layout 13 FIGURE 6: Racking system at Greenport CFS warehouse 15 FIGURE 7: General unstuffing process at GREENPORT CFS warehouse 16 FIGURE 9: Distribution of the expectation scores 25 FIGURE 10: Distribution of the perception scores 28 FIGURE 11: Distribution of variables in the I-P matrix 32 Tran ThiDucHanh – GMA02 Page vii Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP INTRODUCTION Necessity Together with shipping lines, consolidators and forwarders, CFS warehouses play the role as an essential part of the transporting network for import and export cargoes Regarding the service quality of CFS warehouses in the city of Haiphong, Greenport CFS warehouse is assumed to be in the top positions However, there has not been any official research before which measured this level of service quality Therefore, this research was conducted in order to find out how the Greenport CFS warehouse is actually providing its service and what the warehouse manager board can to further improve the warehouse service Research object The focus of this dissertation is to evaluate the quality of service provided at CFS warehouse at Greenport – VICONSHIP and then figure out several possible recommendations to improve the situation Research methodology Questionnaires were sent out to customers to collect data for evaluation Then, RATER model and Importance – Performance matrix, along with data analysis, were used to measure service quality at Greenport CFS warehouse Research scope The research was carried out at Greenport CFS warehouse in a period of more than one month from August 2015 to the end of September 2015 The data used for evaluating the service quality of the warehouse was also collected in this period of time Research findings It was found that the service quality at Greenport CFS warehouse has not met the expectation of the customers, since the overall perception score is lower than the overall expectation score Through evaluation process, five factors that need to be improved have been determined At the end of the research, several recommendations for each of the abovementioned five factors were given Tran Thi Duc Hanh – GMA02 Page Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP The 21 warehouse always provide satisfactory answers towards any RES3 4.132 complaint The warehouse always collect feedbacks about their services and RES4 reflect on their improvement 22 Overall perception score 2.868 3.987 (Source: author) Mean Perception score Score 0 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Variable Figure 10: Distribution of the perception scores (Source: author) Regarding the warehouse performance, almost all factors have quite high perceptions scores of around 4.0, meaning, in general, the warehouse is operating well Among the surveyed factors, ‘providing error-free documents’ gets the highest score of 4.842, while ‘easy contact and ready access to warehouse staff’ is at the second rank with 4.711 point Greenport CFS warehouse is also highly appropriated for its ‘quick response to customers’ requests’ (4.684) and providing service with ‘reasonable cost‟ (4.658) The majority of the rest is at the mediumhigh level of 3.8 to 4.4 At the end of the list are four following factors: ‘information being kept confidential by the warehouse’ (3.368), ‘warehouse staffs’ Tran Thi Duc Hanh – GMA02 Page 28 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP understanding of needs and requirements of each customers’ (3.105), ‘collecting feedbacks from customers and improving later’ (2.868) and ‘well dressing’ (2.868) 2.2.4 Analyzing gap score between expectation and perception Table 6.Summary of gap score between expectation and perception No Research Measurement items Code Gap score REL1 -0.106 REL2 -0.447 REL3 -0.474 REL4 -0.289 The warehouse always produces error-free invoice and related REL5 documents 0.316 variables The warehouse always provide fast service The warehouse always provide always provide services on time The warehouse service in a consistent manner Reliabilities The warehouse always ensure safety and security to our ships/shipments The warehouse always offers REL6 The staffs in the warehouse always demonstrate good knowledge of our needs and requirements A1 -0.131 Warehouse staffs have the ability to solve unexpected problem A2 0.027 A3 -0.5 A4 0.236 10 competitive price of service Assurance The staffs have courtesy while working with customers Information of customers is always Tran Thi Duc Hanh – GMA02 Page 29 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP kept confidential by Greenport CFS warehouse The level of Information Communications Technology applications in customer service at the warehouse is comprehensive 11 A5 -0.185 T1 -0.21 The staff are well dressed T2 0.342 14 The employees get sufficient support from company to their jobs well T3 0.21 15 Costs of warehouse service are satisfactory T4 0.132 E1 0.079 E2 -0.132 E3 0.105 The warehouse has sufficient equipments and facilities to handle 12 cargoes 13 Tangibles It is easy to contact and get access to the staff of Greenport CFS 16 warehouse The staff in the warehouse always demonstrate good understanding of 17 Empathy the needs and requirements of each customer and can give back clear and appropriate responses The warehouse always take good 18 care of every customers without being partial 19 The staff in the warehouse always RES1 respond quickly to any requests 0.368 Warehouse staffs can flexibly solve RES2 unexpected problems for the benefits -0.526 Responsiveness 20 Tran Thi Duc Hanh – GMA02 Page 30 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP of the customers The 21 warehouse always provide satisfactory answers towards any RES3 0.053 complaint The 22 warehouse always collect feedbacks about their services and RES4 -1.053 reflect on their improvement Overall gap score -0.105 (Source: author) In general, half of the surveyed factors are evaluated to be under expectation level with gap scores being negative numbers „Collecting customers’ feedback and improving later’ has the biggest gap score of -1.053, being much higher than the second group which includes „flexibly solving problems for the benefits of customers’ (-0.526), „courtesy of staff when working with customers’ (0.5),„providing service in a consistent manner’ (-0.474) and „providing service on time’ (-0.447) The overall gap score for all dimensions is also negative (-0.105), meaning that the customers‟ expectation has not yet been satisfied by the service provided at Greenport CFS warehouse And therefore, it can be concluded that carrying out improvements is necessary for the warehouse Tran Thi Duc Hanh – GMA02 Page 31 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP CHAPTER 3: RECOMMENDATIONS TO IMPROVE CFS WAREHOUSE SERVICE QUALITY 3.1 Identifying factors that need to be improved The I-P matrix 4.75 4.5 20 4.25 Importance score 11 12 21 22 16 15 19 18 3.75 14 3.5 Variable 3.25 17 10 2.75 13 2.5 2.25 2.5 2.75 3.25 3.5 3.75 4.25 4.5 4.75 Performance Score Figure 11: Distribution of variables in the I-P matrix From this chart, factors that should be prioritized to improve are:  Factor – REL3: “The warehouse always provide service in a consistent manner”  Factor 20 –RES2: “Warehouse staffs can flexibly solve unexpected problems for the benefits of the customers” These two factors are in the Quadrant I – “Concentrate here” of the matrix, meaning that they are important for the customers and can significantly affects the perception of customers of the overall warehouse service quality However, the warehouse has not yet performed well enough because the performance score for Tran Thi Duc Hanh – GMA02 Page 32 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP both factors are lower than the average level Therefore, REL3 and RES2 should be prioritized to improve first Apart from these, the warehouse should also improve other factors with big gap scores, namely:  Factor 22 – RES4: “The warehouse always collect feedbacks about their services and reflect on their improvement” (gap score: -1.053) As can be seen from the Importance – Performance matrix above, RES4 is in the Quadrant III – “Low Priority” However, its Importance score is just a little below the average level, showing that this factor is fairly important to customers Meanwhile, its Performance score is around the bottom of the ranking list, leading to the biggest gap score (-1.053) among all surveyed factors which mean the customers‟ expectation is nowhere near being satisfied Shortening this gap should be the second priority of the warehouse  Factor – A3: “The staffs have courtesy while working with customers” (gap score: -0.5) A3 is in the Quadrant II – “Keep up the good work” but its Performance score is not very high In fact, this score is just around the medium level The warehouse not have to prioritize this factor if they not have enough resources because A3 is still at the good-enough level; however, if the warehouse can improve this, it can help to enhance the level of customer satisfaction and eventually the overall quality of warehouse service With factor 13 – T2: “The staffs are well dressed” which has lowest performance score, the warehouse management should also pay attention to improve it 3.2 Recommendations to improve service quality at Greenport CFS warehouse 3.2.1 Important factors that need to be improved instantly a) Factor REL3: “The warehouse always provide service in a consistent manner” According to my observation at the warehouse, the work here does not always follow the standard process and working regulations, for example: Tran Thi Duc Hanh – GMA02 Page 33 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP  Sometimes the attitude of staff towards customers is not as good as normal When there are more containers to be handled, all staffs have more work to and they are more stressful and cannot maintain the perfectly professional manner when dealing with customers‟ complaint In some cases, the staff shows the attitude of discontent or even speaks in loud voice with customers who require quick release of cargoes  After unstuffing process, cargoes should be moved into the warehouse with position code/record for each shipment so that when the customers come to receive their shipment, warehouse staff can locate exactly the position of the shipment and take it out quickly At Greenport CFS warehouse, however, forklift drivers freely place them on any rack that has blank space and warehouse keepers just remember that shipment‟s position and get them back out when customers come to claim their shipment Usually, warehouse keepers are able to locate exactly the needed shipment; however, in some cases, they forget the location and have to look for it and the customer has to wait for a while This practice violates step in the Unstuffing container process  A couple of cargo handling workers sometimes smoke near the warehouse This is considered a danger for the safety of the cargo as it may cause a fire In fact, these actions have not yet lead to any major incident because the Greenport CFS warehouse is still of small scale, and these minor process violations are not considered serious problems and still acceptable However, this practice may cause the impression of unprofessional manner, and eventually lower the prestige of the company Below are some of my recommendations for the warehouse to fix this problem:  Organize an official training day for all staffs and workers about the standard process of warehouse operation  Impose stricter regulations about maintaining the discipline during the whole shift: workers have to follow the working regulations (no eating, drinking or smoking in the warehouse area, wear uniform properly for safety reason, no Tran Thi Duc Hanh – GMA02 Page 34 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP chatting in the shift, etc.) and warehouse keepers have to manage the operation following the standard process  Check the warehouse operation randomly and unexpectedly to detect violations and have punishment for those who violate the rules  Promote the professional business culture among all staffs Enhance their awareness about the importance of workplace attitude towards the customer satisfaction level  Encourage staff/worker who has good manner and performs best in the month through giving incentives (award or a small amount of extra money) b) Factor RES2: “Warehouse staffs can flexibly solve unexpected problems for the benefits of the customers” In my opinion, this problem happens partly due to the business culture differences Most of warehouse keepers at Greenport are elderly people, while representatives of client companies who directly go to the warehouse to business are young people In some cases, the warehouse keepers might not show proper respect and politeness towards these young customers when a conflict occurs due to unexpected situations (damage of cargoes, mistakes in documents, delay in unstuffing/releasing cargoes, etc.) Regardless of whether the warehouse is right or wrong, professional response and polite manner is a must for any service provider Besides, among approximately 70 people currently working at Greenport CFS warehouse, there are only a few people being able and having competency to solve the unexpected incidents In order to ease this problem, here are a few suggestions:  Officially train all workers, warehouse keepers and office staffs about response manner towards customers Even when the worker cannot solve the problem or provide the customers with sufficient answer, he or she still needs to react professionally and politely guide the customers to the person in charge of solving that problem  Check regularly for violations, punish the misconduct and at the same time encourage the right and proper manner It is necessary to enhance the awareness of all staffs about the importance of professional working style Tran Thi Duc Hanh – GMA02 Page 35 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP  In any cases, absolutely avoid arguing or blaming the customers First impression is important, so it will be better if warehouse staffs instantly show their sincere and willingness to cooperate with client companies to find out the cause and solution for the problems This attitude may ease the customers, help to solve the problem more quickly and, more importantly, raise the customers‟ perception of warehouse service quality 3.2.2 Other factors that should be improved in the long-term a) Factor RES4 : “The warehouse always collect feedbacks about their services and reflect on their improvement” Even though problems are not likely to happen very often at the warehouse, it does not mean there is never anything going wrong An official feedback collecting system not only allows the customers to effectively show their experience with the service and express their desire but also helps the warehouse manager to know how the warehouse is running and in which aspect they should improve At the moment, there is no frequent practice of collecting customers‟ feedback at Greenport CFS warehouse And in case any undesirable problem occurs, customers often complain directly with the workers or staffs they are working with, and these complaints are not recorded officially This is partly because the problems are not very serious, and partly because there are no ready tool or channel for the customers to leave their feedbacks In my opinion, Greenport CFS warehouse can open an online feedback form and attach the link in the signature of every email they send to their customers If the customers have any feedback, they can instantly report to the warehouse manager via this link For the customers who directly go to the warehouse, there should be a feedback box available all the time with papers and pen so that customers can leave their comments any time they want to And for each three or six month, Greenport CFS warehouse should carry out an official survey about all dimensions of service quality and ask all the customers to join b) Factor – A3 : “The staffs have courtesy while working with customers” For this problem, training about response manner towards customers can be a possible solution As mentioned above, raising the awareness of all workers and Tran Thi Duc Hanh – GMA02 Page 36 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP staffs about the importance of professional working style is necessary Warehouse manager should have a plan to check regularly for violations, punish the misconduct and at the same time encourage the right and proper manner c) Factor 13 – T2: “The staffs are well dressed” This factor got a very low importance score, meaning the customers not consider it an important variable which strongly affects the quality of the service However, in the long term, if the warehouse can improve this factor, it can help to create a more professional image and to enhance the prestige of the company The warehouse should impose the regulation about wearing uniform and safety clothing properly and neatly during the whole shift This should be checked before every shift and if any uniform violation is identified, that worker should be warned or punished if they keep repeating that mistake Tran Thi Duc Hanh – GMA02 Page 37 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP CONCLUSION This dissertation aims to evaluate the unstuffing service quality at Greenport CFS warehouse and thenceforth suggest several ideas to improve the situation Applying RATER model and Importance-Performance matrix, the author has conducted a survey to measure the service quality at the warehouse via feedbacks of customers In conclusion, Greenport CFS warehouse is providing unstuffing service at a fairly good level since its overall performance score is quite high Nevertheless, there are still a couple of factors related to working manner of staffs that could be improved further to enhance the overall quality of this service As this research was conducted by an undergraduate student in a limited time period of approximately one month, it may contain several errors Similar studies on larger scale and in a longer period of time should be accomplished in the future to produce more accurate results Tran Thi Duc Hanh – GMA02 Page 38 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP Reference Dahlgaard-Park, S C.-K.-Y (2013) Diagnosing and prognosticating the quality movement – a review on the 25 years quality literature (1987–2011) Total Quality Management & Business Excellence , 1-18 Nigel Hill, J B (2003) How to Measure Customer Satisfaction Gower Publishing Parasuraman, A Z (1985) Conceptual Modal of ServiceQuality and Its Implications for Future Research Journal of Marketing , 49, 41-50 Parasuraman, A Z (1988) SERVQUAL: A multiple item scale for measuring consumer perceptions of service quality Journal of Retailing , 1240 Martilla, J.A and James, J.C (1977) Importance–Performance Analysis Journal of Marketing 41, 13–17 VICONSHIP Introduction Retrieved from http://www.viconship.com Tran Thi Duc Hanh – GMA02 Page 39 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT - VICONSHIP APPENDIX - QUESTIONNAIRES Questionnaires I am a student of Vietnam Maritime University I am currently conducting a research about quality of unstuffing service at Greenport CFS warehouse I would highly appreciate if you can spend some of your precious time to complete the following questions Please be noted that there is no absolutely right or wrong answers All of you answers are equally valuable to my study I commit to keep your personal information confidential and would not use it for any other purposes outside of this research Question 1: Please indicate your acceptance level for the statements as follows by circling the number Please be noted that there are two questionnaires put together, one involves your expectation and the other expresses your perception: (1: ABSOLUTELY DISAGREE; 2: DISAGREE.;3: NEUTRAL; 4: AGREE; 5: ABSOLUTELY DISAGREE) No Details Reliabilities The warehouse always provide fast service The warehouse always provide services on time The warehouse always provide service in a consistent manner The warehouse always ensure safety and security to our ships/shipments The warehouse always produces error-free invoice and related documents The warehouse always offers competitive price of service Assurance The staffs in the warehouse always demonstrate good knowledge of our needs and requirements Tran Thi Duc Hanh – GMA02 Expectations Perceptions How important is this item to you? Level of satisfaction with this item 1 2 3 4 5 1 2 3 4 5 5 5 5 5 Page 40 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT - VICONSHIP Warehouse staffs have the ability to solve unexpected problem The staffs have courtesy while working with customers 10 Information of customers is always kept confidential by Greenport CFS warehouse 11 The level of Information Communications Technology applications in customer service at the warehouse is comprehensive Tangibles 12 The warehouse has sufficient equipments and facilities to handle cargoes 13 The staff are well dressed 14 The employees get sufficient support from company to their jobs well 15 Costs of warehouse service are satisfactory Empathy 16 It is easy to contact and get access to the staff of Greenport CFS warehouse 17 The staff in the warehouse always demonstrate good understanding of the needs and requirements of each customer and can give back clear and appropriate responses 18 The warehouse always take good care of every customers without being partial Responsiveness 19 The staff in the warehouse always respond quickly to any requests 20 Warehouse staffs can flexibly solve unexpected problems for the benefits of the customers 21 The warehouse always provide satisfactory answers towards any complaint 22 The warehouse always collect feedbacks about their services and reflect on their improvement Tran Thi Duc Hanh – GMA02 5 1 2 3 4 5 1 2 3 4 5 5 5 1 2 3 4 5 1 2 3 4 5 5 5 5 5 5 5 5 5 Page 41 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT - VICONSHIP Question 2: Please check the type of company you are working for: Type of company Freight forwarders and logistics companies Import-export companies Shipping lines Others Check Other comments: ……………………………………………………………………………………………………………………………… …….……………………………………………………………………………………………… ………………………… ……….…………………………………………………………………………………………………………………………… Thank you for your support! Tran Thi Duc Hanh – GMA02 Page 42 ... Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP CHAPTER 1: LITERATURE REVIEW 1.1 CFS warehouse 1.1.1 Definition of CFS warehouse In general, CFS. .. document This information is important for Tran Thi Duc Hanh – GMA02 Page 16 Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT VICONSHIP CFS warehouse in... The warehouse always provide fast service The warehouse always provide services on time Code REL1 REL2 Page Recommendations to improve service quality for imported cargo at CFS warehouse at GREENPORT