[In-Depth Review] In the ESG Era, AS as a Core Element for Corporate Survival and Growth

Kim Ik-seong, Advisor of the Korea Distribution Science Association & Professor at Dongduk Women’s University

The business environment can only develop if it can create and secure social shared value alongside the emergence of ESG (Environmental, Social, and Governance). Among the important core competitive factors, one is after-sales service. After-sales service needs to be broadly interpreted as a strategic category that goes beyond simply addressing operational failures or repairs occurring after product sales, to proactively preventing customer complaints and difficulties that may arise post-sale. Recently, new technologies and transaction methods have continuously appeared in the market under the name of innovation. Various and continuous products such as fractional investment platforms, used car sales, and membership-based proxy management businesses have emerged. Conflicting opinions have arisen from the perspectives of innovation, regulation, and consumer protection. These new products involve complex technologies and methodologies, and the relevant government departments responsible for managing them lack both specialized personnel and budgets.

From this perspective, companies themselves must practice ESG management to avoid harming customers, society, and the environment, and to recreate social shared value. After-sales service holds the magic to enhance the solidarity between companies and customers and to turn customers into loyal patrons. Consumer dissatisfaction is more pronounced with high-priced product purchases and service investments. The shorter the time between the purchase point and the occurrence of a problem, the greater the customer’s distrust of the company becomes. Recently, customers who have purchased high-priced financial products such as insurance or pensions often receive pension or insurance payments below expectations for various reasons. Golf or condo memberships are also utilized at the discretion of proxy management companies, affecting members’ property rights.

With the increase in remote work due to COVID-19 and the revival of investment sentiment, interior design companies’ sales have surged. Consequently, skilled technicians are in short supply, and poor-quality construction has become rampant. Companies handle customer complaints through call centers, but it takes at least a week or more to receive actual repairs. The response from the government departments managing these companies is even more frustrating. Customers first encounter recorded messages stating that applications can be made via phone or internet. Even after finally explaining the situation to the responsible official, the typical response is that the law is as it is or to try filing a formal lawsuit. Although everyone promotes ESG management and control measures, there is even suspicion that the attention to after-sales service is insufficient to resolve on-site complaints. What are the alternatives to overcome this? First, companies must recognize after-sales service as a core competitive factor for survival and growth strategies. They need to conduct research and development on why and where defects in their products occur.

Management through relevant statistics or artificial intelligence is necessary. Innovative products and services cannot be anticipated in terms of their functions and problems by general customers in advance. Consumers’ problems and suffering cause social distrust, which ultimately increases social costs for the public. Attempts at research and development on after-sales service are a crucial competitive strategy that improves the quality of corporate services, reduces post-sale cost burdens, and maintains and expands customers. At the same time, it is necessary to consider solutions through collaboration with other specialized companies. For small and medium-sized enterprises, joint utilization and government support are options. The collaborative partner system is a beneficial supply chain system in terms of job creation and social shared value. In particular, it is worth considering whether after-sales service call centers should utilize AI-equipped robot counselors for efficiency.

Support from the government and the National Assembly is also needed to expand after-sales service functions. Problems arising after legislation can be improved through enforcement decrees and the like. This legislative philosophy and management system will become an opportunity to enhance the future competitiveness of our companies. As ESG management is becoming a social issue, it is hoped that awareness of after-sales service will be recognized as a practical management item by companies, the government, the National Assembly, consumer organizations, universities, and all stakeholders.

This content was produced with the assistance of AI translation services.