MNG93003 Industry Research: Analysis of BIC Services Client Decline

This report investigates the factors contributing to the decline in existing clients at BIC cleaning services, an Australian-based company. The study examines the impact of customer relationship experience, employee performance, and customer loyalty on client retention. Conducted through secondary data collection, including interviews with company managers, the research highlights the importance of employee performance and customer service quality. The findings reveal a need for improved customer relationship management, better staff-client interaction, and employee training. The report recommends strategies to enhance customer satisfaction and retain existing clients, emphasizing the significance of communication, loyalty programs, and sales tactics in maintaining a competitive edge in the service industry. The study also includes a review of relevant literature, a discussion of the research findings, and ethical considerations.

Running head: INDUSTRY RESEARCH
Evaluating the factors leading to decline in existing clients
Name of the Student:
Name of the University:

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Executive Summary
The study is reflecting on factors lead to loss of existing customers of service industry and
improve over customer satisfaction. The satisfaction level of customers are varied from
person to person and also from service to service. The rate of satisfaction is dependent on
other factors like customer service experience, customer loyalty and sales tactics. This
research study is seek to evaluate factors lead to the customer dissatisfaction and loss of
existing customers. The selected industry partner is BIC cleaning services operated in
Australia. The research study is being conducted to analyze three independent variables such
as customer relationship experience, employee performance and customer loyalty. The study
is conducted using secondary data collection method by interviewing four managers from the
selected company. It is facilitated to analyze the factors of customer dissatisfaction based on
the secondary data research. The researcher also included ethical considerations for
performing the secondary research.
The findings of the study showed that there is a strong relationship between employee
performance as well as customer satisfaction. In the company, the managers and employees
are providing most concern to service quality as well as service price rather than customer
relationship. There is lack of interaction among staffs and clients lead to not solving
customer’s complaints. The study is recommended to focus on customer relationship manager
to retain existing clients. The customers are expected to get better cleaning services, better
interaction with staffs and training of staffs to gain skills.

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Table of Contents
1. Introduction and research problem.....................................................................................4
1.1 Introduction.................................................................................................................4
1.1.1 Background of the study and overview of industry partner.................................4
1.1.2 Purpose of study and summary of report structure..............................................4
1.2 Research problem........................................................................................................5
1.2.1 Problem statement................................................................................................5
1.2.2 Research aim and questions.................................................................................5
2. Literature review................................................................................................................6
2.1 Introduction.................................................................................................................6
2.2 Factors lead to decline in number of existing clients..................................................6
2.2.1 Poor customer service experience........................................................................6
2.2.2 Out of date sales tactics........................................................................................7
2.2.3 Failed loyalty programmes...................................................................................8
2.3 Comparison of the three factors.......................................................................................9
2.4 Role of communication to retain existing clients of BIC.................................................9
2.5 Impact of bad customer relationship on loss of clients..................................................11
2.6 Strategies used to retain clients......................................................................................12
2.7 Conceptual framework...................................................................................................13
2.8 Summary........................................................................................................................14
3. Research design................................................................................................................15

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3.1 Research Approach........................................................................................................15
3.2 Research Design.............................................................................................................15
3.3 Research Philosophy......................................................................................................15
3.4 Data collection...............................................................................................................16
3.5 Data analysis..................................................................................................................16
3.6 Sample size.....................................................................................................................17
3.7 Sampling method...........................................................................................................17
3.8 Ethical consideration......................................................................................................17
4. Research findings.............................................................................................................19
4.1 Customer Relationship...................................................................................................19
4.2 Employee Performance..................................................................................................20
4.3 Customer Retention........................................................................................................22
5. Discussion........................................................................................................................24
5.1 Implications of the findings.......................................................................................24
5.2 Comparison of findings with the literature................................................................24
5.3 Answer to the research questions..............................................................................25
6. Recommendations............................................................................................................26
7. Conclusion and limitations...............................................................................................28
References................................................................................................................................29
Appendix..................................................................................................................................35
1. Interview data from the managers.................................................................................35

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1. Introduction and research problem
1.1 Introduction
1.1.1 Background of the study and overview of industry partner
Globalization is increasing competitive tendencies in market, therefore it becomes
easier to the business to cross their borders and compete in the market. Due to advancement
in technology, change in expectations of customers as well as high market competition are
significant cause of issues related to quality of the customer services (Yang, Guo and Wang
2018). This study is reflected on evaluating the factors which can lead to decline in existing
clients of the service industry.
In this research study, the industry partner is BIC cleaning services Australia, has
delivered personalized and integrated cleaning services to property owners of Australia since
1989. It is operated in Sydney, Melbourne, Adelaide, Perth and Brisbane. The company has
servicing sites across Australia are 3,250 client sites. My relation with the organization is that
I am working in the organization and my building working site address is 45 Clarence Street,
Wynyard, Sydney. Working with the partners, the service industry delivered full range of
cleaning services like cleaning, window cleaning, waste management as well as hygiene
services. The management approach of the company is building strong relations with their
clients for creating sustainable as well as bright future ( Ngo and Pavelková 2017). The
cleaning services is located at high competition in Australian market, as other companies are
providing same services. However, the company faces issues like they are losing their
existing clients due to poor customer service expectations and failed to gain customer loyalty.

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1.1.2 Purpose of study and summary of report structure
The purpose of this study is to identify the factors which can lead to reduce of the
existing clients of BIC. Due to losses of clients, the service industry faces issues of bad
customer relationship influences in loss of clients and loss of market value in Australia.
Therefore, this study is conducted to evaluate those factors and implement strategies to retain
existing clients. This study is also focused on evaluating how the management
communication skill helps the company to retain existing clients.
Introduction section d4scribes the research problem, questions and background of the
study with introducing the industry partner. Literature review section supports the theoretical
arguments of the selected title. Methodology is used to provide details of methods used to
collect data for this study. Findings will represent the results of the analysis in order to
selected research questions. Results are being interpreted in light of selected questions plus
discussed in discussion section with other literature. Recommendations section provides
guidance based on report findings and related to the theoretical base. Finally, conclusion will
discuss the implications of the research results and literature review.
1.2 Research problem
1.2.1 Problem statement
The problem of this research is that due to loss of the existing customers, the company
had lost the number of contracts in past couple of weeks. The company has lost around 40%
of the existing clients lead to lessen their market value and profitability in the service
industry.
1.2.2 Research aim and questions
The aim of this research study is to evaluate the factors leading to decline in number of
existing clients in BIC.

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Research Question 1: To what extent does management communication skill helps to
retain existing clients of BIC?
Research Question 2: To what extent does bad customer relationship influence the loss
of clients?
2. Literature review
2.1 Introduction
As per the research done by Ascarza (2018), customer loyalty to particular company
or brand is getting decreased. Customers today do not hesitate to switch brands, pointing out
that in near future the rule of 20 percent customers accounting for almost 80 percent of the
companies’ turnover will get changed. There are high chances that this famous rule can turn
into 60-40 ratio gradually becoming a 50-50 rule. This shift in behaviour of the customers
raises questions on the marketing tactics being used. Loss of clients can be attributed to many
reasons such as much number of available options, better services offered by competitors and
lack in communication skills of the customer service department.
2.2 Factors lead to decline in number of existing clients
2.2.1 Poor customer service experience
As per the research done by Bernabé-Moreno et al. (2015), customer service can be
said to be one of the essential services in digital age. The ultimate aim of a company or brand
is to attract customers and retain the old ones. Poor customer services offered is supposed to
be one of the major reasons behind the loss of clients. Studies suggest that providing bad
customer services and lack of focus on the client base can have drastic effect on company as
a whole and not just the bottom line. The customers want quick response to the issues raised
by them and expect that their issues are resolved as soon as possible. The companies who fail
in render quick services lose customers. The customer services offered by a company can be

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said to be as the main pillar of the business. There are many reasons behind the failure of
companies such as BIC to cater to the needs of the customers. Lack in communication skills
plays a major role and then comes keeping the issues ticket raised by customer pending for a
long time. The unavailability of customer service executives when the customers are trying to
reach is considered as one of the reasons for the loss of clients. The clients’ expect that the
company should give their issues a priority and resolve them as soon as possible but when
they find the company is failing to do this they prefer shifting their choice (Alshurideh 2016).
There are instances where the client did not get satisfactory answers for his issue or the
customer executive could not communicate well which made him give bad reviews about the
products and services of the company. Whenever a client comes to a company he expects to
get best services and gets disappointed if the services offered are not up to mark.
2.2.2 Out of date sales tactics
As per the research done by Hamilton, Rust and Dev (2017), outdated sales tactics is
one of the major reasons for loss of clients. In the era of internet, customers are already
informed and knowledgeable about the products and services of a company and thus they do
not like to waste time on lengthy calls from customer service executives. Talking over phone
with a sales representative to get an idea of the services is an outdated sales tactics. At present
the prospects are almost 60 percent through sales cycle, even before talking to any sales
representative. Sales representative at BIC are overburdened with tasks such as emailing,
entering data, prospecting and researching leads, scheduling calls and meetings. They spend a
lot of time on these activities which should have been otherwise used in selling. Spending a
lot of time on unqualified leads as well as prospects is another outdated sales tactics. In order
to qualify a lead, a sales representative has to indulge in hours of conversation resulting in
loss of valuable time that could have otherwise be used in selling. Sales representative use the
same universal pitch which results in loss of clients. Developing a common pitch for all

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customers hep save time but buyers today have different requirements and want that they are
addressed as per their specific needs (Madheswari, Suganthi and Josephine 2016). Sales
representative have to dial the main phone line of the company and depend on switchboard
operators to direct the calls to the prospects which can be called a outdated process. This is a
lengthy process and there are low chances that the sales representative will be able to reach
out to the intended target. The businesses are becoming dynamic in nature and thus they
require new techniques to retain their clients. The old tactics will result in loss and damage
the brand name of the company.
2.2.3 Failed loyalty programmes
As per the research done by Lee and Fay (2017), loyalty programs are of great help in
boosting customer retention. BIC failed in loyalty programs that led to almost 40 percent of
the loss of its clients. Failure of loyalty programs are a result of good strategy and proper
planning. The company is not aware of its client’s requirements and lacks in the ability to
understand how they can attract new and retain the old customers. The loyalty programs fail
due to unappealing rewards, least emotional connection, lack of proper communication and
lack of awareness. Erroneous selection of rewards can also be attributed for failure of loyalty
programs. The terms and associated conditions of the loyalty programs are most of the times
not defined properly and the customer fails to understand how he will be actually benefitted
from the same. Thus chooses to let it go and shifts to other brands and companies. The values
that are being offered through the program are not conveyed well to the customers thus
failing to convince them. Most of the times, the customers are not aware of the loyalty
programs and thus do not feel connected to the same. The company needs to take proper
initiatives to develop the interest of the customers in their services. Failing to communicate
with the potential customers about the loyalty program is another major cause for the failure
of the same. Loyalty programs are not just incentives and benefits as customers look up to

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building a relationship with the company. Studies suggest that communication plays a vital
role in the success of loyalty programs (De Haan, Verhoef and Wiesel 2015). Failing to build
an emotional connection is another major reason for failure of loyalty programs. The
undefined term and conditions of the loyalty programs fail in attracting customers.
2.3 Comparison of the three factors
The three factors that have been mentioned above have vital roles to play in retention
of clients. The fast factor that is customer experience is the most essential one as it is the
experience of the customers that makes them suggest the company to others or defame the
company. A customer who gets disappointed with the customer services offered will never
get back to the company. The customers want that their issues are listened to and the
company accepts and appreciates their feedback and not finding these they chose other
companies. On the other hand, the second factor depends on the frequent update of
technologies so that it can catch its contemporaries in this field. Sticking to the same old sales
tactics will neither attract new customers nor will it help retain the old customers. The sales
representatives are overburdened with work as the company is not updating the sales tactics
which can certainly affect their work leading to loss of clients. Poor customer services
offered can be mitigated by proper training given to the employees while on the other hand
by deploying new technologies the second factor of old sales tactics can be checked (Ascarza
et al. 2018). The last factor that is failed loyalty programs that depend wholly on the
management. This reveals that the loyalty programs have not been discussed well by the
management. The failure of loyalty programs can be attributed to the lack of proper strategies
by the management. It is the responsibility of the management to define the terms and
conditions of the loyalty program and ensure that customers are well aware of the same.

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Thus, from these three factors it can be said that poor customer experience contributes
maximum to the loss of clients of a company.
2.4 Role of communication to retain existing clients of BIC
Customer retention is keeping the customers happy with the product and services
offered to them. Communication is a key to convince clients and proper communication with
the existing customers can help BIC in retaining them. The company needs to communicate
values that mean the customer purchase history must be noted so that in future he does not
have to repeat the order. This small step can make the customer feel that the company give
their order a priority. The existing customers if provided with useful informations about the
products and services will help them keep engaged. Communication skills should be strong
enough to interact with the customers and understand what they expect from the company.
Convincing customers totally depends on the communication skills of the sales
representatives (Preikschas, Cabanelas, Rüdiger and Lampón 2017). Lack of proper
communication skills can create misunderstandings and it can happen that the customer does
not get what the actual benefits of the services are.
Another major factor is being quick at providing response to a customer. Quick
response is considered one of the attributes of effective communication and helps in
enhancing the growth of businesses. Customers want that their issues are resolved as soon as
possible and this is possible with proactiveness and proper communication skills. The
problems of the clients should be responded to on time. Customers expect quick response for
the issues raised by them and this can happen only if representatives can communicate
properly. The way in which a complaint is handled can either lead to loss of client or help in
retaining the client. The customers can be asked for their feedback which will give them a
feeling that the company values their opinion. The existing customers at BIC can be retained
by the help of proper communication.

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As discussed earlier, lack of communication results in failure of loyalty programs as
well thus the employees of the company should be given proper training on how to
communicate with the clients so that they be successful in retaining them (Hill and Alexander
2017). Now-a-days the customers do not want to listen to the prospects rather as they know a
lot they want to be listened to. Thus the customer service representatives must be patient
enough to listen to the queries of the customers and answer them properly instead of sticking
to the common pitch for all. The customers should be updated with the new products and
services of the company and this requires frequent follow ups.
2.5 Impact of bad customer relationship on loss of clients
Bad customer relationship is the major contributor to the loss of clients in a business.
When customers do not get proper services they search for new company and better brands.
This directly can be related to the loss of the clients affecting the growth of the company in
the long run. As per the research done by Wilson, Zeithaml, Bitner and Gremler (2016), bad
customer relationship not only is responsible for loss of clients but also results in spoiling the
image of the company. The reviews of the existing customers are important to get more
clients and if the existing ones have bad experience the company should forget about new
clients. Bad customer experience includes untimely response to the issues raised by clients,
lack of proper communication and incapability of solving the problem (Johnson, Park and
Bartlett 2018). The client gets dissatisfied with the services offered and thus prefers
refraining from buying products or services from the company. They even advice their near
and dear ones to avoid going to that company which can be a major loss for the firm. If the
existing clients are kept satisfied with proper services they can suggest the company to their
close friends and family members that can provide the company with new clients.
On contrary to this bad experience can result in loss of clients as well as be a
hindrance in the marketing of the product and services of the company. Poor services in this