Digitalization to Enhance Customer Satisfaction at APM Terminals Essay

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In business, the significance of customer satisfaction cannot be overemphasized. Indeed, with increasingly many firms providing similar goods or services, dissatisfied customers can easily look for other alternatives. Accordingly, firms do whatever it takes to retain customers and keep them happy (Kumar, 2016). With tremendous technological advancements over the years, firms are ever more relying on information technology (IT) as a valuable driver of customer satisfaction (Mithas, Krishnan and Fornell, 2005; Ryding, 2010; Deloitte, 2013; Jan and Abdullah, 2014; Meige and Schmitt, 2015). Whether it is processing a customer order or automating luggage handling, firms in diverse sectors and industries have adopted modern technologies in an attempt to enhance process efficiency. In fact, most organizational processes have now been digitalized -- they require just a click of a button or little manual work. While digitalization has generated important benefits for organizations in terms of reducing operational costs, it has created immense value for their customers, hence increasing customer satisfaction.

One context where digitalization can have enormous value for the customer is the port industry. The industry is concerned with a plethora of services ranging from container handling and shipping to port management, and inland logistics (Branch, 2012). Industry players have increasingly adopted digital technologies in an effort to serve their customers better. Among other technologies, cargo tracking technologies, surveillance systems, sensor technologies, wireless technologies, mobile equipment, drones, 3D printing technologies, and analytics technologies are gaining popularity in the port industry. These technologies have proved to be valuable in ensuring timely shipping and cargo delivery, guaranteeing cargo security, maximizing port capacity, improving process efficiency, and reducing operational costs for both port operators and their clients (Accenture, 2016; Heilig, Schwarze and Vob, 2017).

Nonetheless, there is little empirical evidence of the relationship between digitalization and customer satisfaction in the port industry. Focusing on APM Terminals (APM), the present study sought to fill this gap in literature. The study specifically sought to examine how the organization can make use of digitalization to improve customer satisfaction. APM is a Dutch multinational container terminal company. With its headquarters in The Hague and under the ownership of the global conglomerate Maersk Group, APM provides terminal operations, cargo support, port management, and container inland services to hundreds of customers in more than 60 countries around the world. The company boasts over 70 port and terminal facilities as well as more than $4 billion in revenue as of 2016, making it one of the largest container terminals and port operating companies worldwide.

1.2 Conceptual Framework

Customer relationship management (CRM) literature strongly emphasizes the importance of healthy relationships between businesses and their customers (Ryding, 2010; Jan and Abdullah, 2014).

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Indeed, in the business world there has been a remarkable shift from product-oriented business to customer-oriented business (Mithas, Krishnan and Fornell, 2005). This has been informed by the need to lure new customer and maintain existing ones via long-term relationships. For a business organization, creating enduring relationships with customers entails undertaking activities aimed at establishing and maintaining a mutually beneficial relationship. The organization benefits through customer loyalty and profitability, while customers benefit by having their needs satisfied as per their expectations. For any prudent business organization, customer satisfaction is the prime goal (Bhatnagar, 2016)

The use of technology can drive customer satisfaction. Technology influences customer satisfaction by transforming customer service processes, increasing service quality, enhancing information exchange between businesses and customers, and boosting the organization-customer relationship (Ryding, 2010; Jan and Abdullah, 2014; Bhatnagar, 2016). Further, technology enables business organizations to lower operational and transaction costs, deliver offerings at a lower price, reduce delivery or wait times, as well as increasing the perceived value of products or services (Mithas, Krishnan and Fornell, 2005). This can have positive implications for customer satisfaction. Essentially, the study was based on the idea that technological adoption on the part of an organization drives customer satisfaction.

1.3 Problem Statement

Digitalization offers a valuable opportunity for enhancing customer satisfaction (Mithas, Krishnan and Fornell, 2005; Ryding, 2010; Jan and Abdullah, 2014). However, much of the literature in this area has paid attention to the impact of IT investments on tangible organizational performance measures such as productivity, profitability, and market value. In other words, there has been little attention to the connection between IT investments and intangible aspects such as customer satisfaction.

The scarcity of scholarly attention to the impact of digitalization on customer satisfaction is particularly true for the port industry. Much of the literature in this area focuses on organizational metrics such as container capacity, output, and cost savings, giving little or no attention to customer satisfaction and other customer metrics (Branch, 2012; Lee, Tongzon and Kim, 2012). The scarcity of research within the context of the port industry may be due to the fact that the port industry has been relatively sluggish in adopting digital technologies compared to other industries. Indeed, the port industry has remained mainly unchanged for the last 50 years, and has been slow to embrace new technology. This means that industry players continue missing important opportunities to increase customer satisfaction. In the port industry, digitalization can be valuable for improving the efficiency….....

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Accenture. (2016) Connecting ports driving future trade. Accenture [online] Available from: 29/accenture-connected-ports-driving-future-trade.pdf [Accessed 6 April 2017].

Bhatnagar, H. (2016) Customer satisfaction and technology in banking -- a scenario of Udaipur City. Arabian Journal of Business and Management Review, 6(4), 228.

Branch, A. (2012) Elements of port operation and management. New York: Springer.

Deloitte. (2013) The digital transformation of customer services. Deloitte [online] Available from: business/deloitte-nl-the-digital-transformation-of-customer-services.pdf [Accessed 6 April 2017].

Heilig, L., Schwarze, S. and Vob, S. (2017) An analysis of digital transformation in the history and future of modern ports. Proceedings of the 50th Hawaii International Conference on System Sciences, 1341-1350.

International Container Insurance (ICI). (2016) The digitization of ports: can the industry truly "connect the dots" between the different applications involved in port operations? [online] Available from: can-industry-truly-connect-dots-different-applications-involved-port-operations/ [Accessed 6 April 2017].

Jan, M. and Abdullah, K. (2014) The impact of technology CSFs on customer satisfaction and the role of trust. International Journal of Bank Marketing, 32(5), 429-447.

Kumar, V. (2016) Introduction: Is customer satisfaction (ir)relevant as a metric? Journal of Marketing, 80, 108-109.

Lee, S., Tongzon, J. and Kim, Y. (2012) E-transformation in port management: an empirical investigation. Paper presented at the Second Annual International Workshop on Port Economics and Policy, 10-11 December 2012, Singapore.

Meige, A. and Schmitt, J. (2015) Innovation intelligence: Commoditization. Digitalization. Acceleration. U.S.: Absans Publishing.

Mithas, S., Krishnan, M. and Fornell, C. (2005) Effect of information technology investments on customer satisfaction: theory and evidence. Ross School of Business Working Paper Series, Working Paper No. 971. [online] Available from &isAllowed=y [Accessed 19 April 2017].

Pernia, O. and Santos, F. (2016) Digital ports: the evolving role of port authorities. [online] Available from: [Accessed 6 April 2017].

Port Technology. (2015) Digitalization and the future of shipping. [online] Available from: chnology [Accessed 6 April 2017].

Ryding, D. (2010) The impact of new technologies on customer satisfaction and business to business customer relationships: evidence from the soft drinks industry. Journal of Retailing and Consumer Services, 17(3), 224-228.

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