Using Services Marketing to Develop and Deliver Integrated Solutions at Caterpillar in Latin America

8/17/2019 Using Services Marketing to Develop and Deliver Integrated Solutions at Caterpillar in Latin America

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Case Study Assignment: Using Services Marketing to Develop and deliver Integratedsolutions at Caterpillar

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CASE STUDY ASSIGNMENT

Using Services Marketing to Develop and Deliver

Integrated Solutions at Caterpillar in Latin America

Group !

Harish Deepak

Shiv Shankar Mahto

Kirity Kumar

IIM RACHI

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"#at else do $ou need to learn in t#e Listening Gap %Gap &' a(out

customer needs and e)pectations* LACD #ad general in+ormation

+rom t#e customer value surve$s, (ut t#is in+ormation did not tell

t#em -#at service +eatures customers e)pected in t#e CSAs. "#at-ere t#e$ and #o- could t#e$ /nd out* In particular, #o- could

t#e$ /nd out -#at t#e$ needed to kno- to esta(lis#ed standards in

t#e Design and Standards Gap %Gap !'*

ot kno"ing "hat customers e#pect is one o$ the root causes o$ not

delivering to customer e#pectations% Hence it is really important to learn and

understand customer e#pectations and gap &et"een Company perceptions '

customer e#pectations% (e need to learn a&out the

• )eatures o$ service "hich are important to customers

• (hat level o$ these $eatures customer e#pect

• (hat customers think the company can and should do "hen pro&lems

occur in service delivery

)rom the case* "e came to kno" some o$ general attri&utes o$ CSA and their

respective importance "ith respect to customers+ e#pectations% ,ut it is not

clear

• (hat aspect o$ responsiveness is the customer really looking $or

• Customer may ask $or Caterpillar maintenance person "ithin an hour

&ut does he "illing to pay $or the same

,est practices should al"ays &e adopted and &road &ase throughout any

company% -he case says that there are $e" customers at some dealers* "ho

are truly satis.ed and loyal% -his is the reason that CSA rene"al is much

higher at these customers% Moreover* the dealers have also higher share o$

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"allet in these customers% So instead o$ running the pro0ect at entire

customer &ase it shall &e &etter to run the pro0ect at this selected customers

"ho may represent a particular segment such as construction or may &e

$rom di1erent segment 2such as mining* construction* Agriculture3% -hese

$eatures and e#pectations and service design and standards can &e $ound

out through $ollo"ing:

a% )irst o$ all do a proper segmentation o$ these customer &ase

&% Create dialogue "ith these customers 2segment "ise3 through dinner

meetings or get4together: As people used to share lot o$ in$ormation

during dinner and drinks ta&le

c% ,y organi5ing hotel seminars* meeting at various social gatherings :

Dealer persons* Regional Sales Manager can conduct seminar "here

people $rom dealer together "ith contact points o$ customer shall &einvited to have $ace to $ace interaction "hich later lead to $riendship

and e6cient 7o" o$ in$ormation

d% Developing personal relationship : 8enerally people disclose and

con.de "hen they trust the other person

,ased on .ndings $rom these meetings some &rie$ guidelines such as

$eatures o$ service* standards and service scape e#pectations can &e $ramed

as $ollo"s:

!% 0esponsiveness :

o )ast action on receipt o$ complaint9,reakdo"n Machine

o Immediate availa&ility o$ reuired spare parts ' maintenancepersonnel

o Standards may &e "ithin ; days m9c ready to resume "ork

o Attending o$ pro&lem &y CA- 9 Dealer person "ithin /< hrs

/% 0elia(ilit$:

o Can per$orm right 0o& at the .rst time itsel$

o =#cellent uality o$ >roduct

o -rust"orthy personnel "ho are a&le to do 0o& as reuired

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o Service availa&le "hen needed

;% Assurance:

o M9C ready on time as promised

o >er$orms only necessary "ork

o Correct and genuine parts &eing used during maintenance


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spending pocket% CSA should provide value to customer as "ell as earn

pro.ta&ility $or the company% Hence CA- should o1er di1erent CSA to the

di1erent segments o$ customers% )rom the case "e $ound out:

• =uipment are used in various segments

• Some customers &uy euipment together "ith service agreement

• Service agreement takes care regarding re$ur&ishment o$ euipment

and maintaining the uptime and productivity

• It also emphasis on having euipment $or !B o$ the time

• Customer pay $or CSA and repair services to achieve these goals

• Customer "ho &uy comple# and sophisticated euipment such as ong"all* Continuous miners and construction euipment "ould like to go

ahead "ith CSA

• Customer "ho &uy general euipment "ould like to carry maintenance

&y their o"n

• -hese customers do not value $or uptime and productivity too much

• -here are some customers "ho operate internationally "hereas CA-

has regional dealers* these customers reuire or need a single contactpoint regarding CSAs% Moreover* customer "ant to have a single stop

service agency "hich can service their entire 7eet o$ euipment

"hether &e CA-* Komatsu* @olvo* etc%

• Some customer also &uy "ill .t component on the &asis o$ lo"er cost

and ready to compromise on uality

• Some customers have old and traditional 7eet o$ euipment "hich can

&e serviced through normal and general tools and techniues and

hence go $or local "orkshop

-hese .ve principles need to &e adopted during research o$ service

User- centered : Services should be experienced and designed through the

customer’s eyes

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GENE0ALC2NST0UCTI2N

3alue uptime 4productivit$

-illing to pa$

Sop#isticatede5uipment

Lo- cost segment

2ld 4 traditionale5uipment

Do it ourselves6$ourselves

Generale5uipment


Co-creative: All stakeholders should be included in the service design

process

Sequencing: A service should be visualized as a sequence of interrelated

actions

Evidencing: Intangible services should be visualized in terms of physicalartifacts

Holistic: The entire environment of a service should be considered

Moreover the a&ove in$ormation suggest that research should imply $or

a% (hat are di1erent type o$ customer in general construction industries

&% Ho" can they &e su& segmented $urther &ased on their needs and

reuirements

c% Inv

olve key Front line people catering to larger accounts and customercontact persons in ne service development aligned ith !A" vision#

mission statement and groth plan

i% (hat type o$ service they reuire "ith the product

ii% Do they 0ust reuire service o$ oil and .lter checking at reuired time

interval or detailed service "henever needed

iii% Do they really give importance to uptime and productivity o$ machine

iv% Are they "illing to pay $or the service

d% -hese shall help in framing of Service product portfolio $ organization

structure implementing ne" service development

277E0INGS MA08ETCU00ENT NE" CUST2ME0S


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CUST2ME0S

E9ISTING SE03ICES

MARKET PENETRATION

• Increase share of

allet

MARKET DEVEOPMENT

• !ustomers going to %rd

party service providers

• International !ustomers

ho require single

contact point

irrespective of

geography

NE" SE03ICES

SERVICE DEVEOPMENT

• !ustomers using ill

&t spares $ general

services

• !ustomer going for

local orkshop

• !ustomer ho do not

value uptime $

productivity• !ustomer having lo

budget

• !ustomer having old

$ traditional

equipment

DIVERSI!ICATION

• Start providing

consulting business

• 'rovide guidance ho a

pro(ect can be

developed e)ciently

and quickly

e% ,ased on the a&ove ta&le* research* &rain storming need to &e

conducted to generate a ne idea to cater to the needs o$ all

segments* e#pansion o$ e#isting services "ith modi.cation and

development o$ ne" service model as "ell as pro&a&le "ays to go

diversi.cation

$% ,ased on the same Idea generated* it shall &e regarded a good .t then

service concept need to &e developed considering the point that "hat

concept is and "hat customer need it is .lling through multiple

iterations and discussion% (ith proper concept de.nition* a description

o$ service that represents speci.c characteristics need to &e prepared

g% -hese service concept need to &e discussed "ith pro&a&le customers

and $ront end employees $or their response "ith clear rationale

h% Assuming service concept is &een evaluated &y customers andemployees then "e need to decide regarding economic $easi&ility and

potential pro.t implications% Demand analysis* operation $easi&ility*

revenue pro0ections and cost analyses are assessed at this stage%

Concept need to pass pro.ta&ility and $easi&ility screening

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i% Fnce it passes all these hurdles it is ready $or implementation% o" a

prototype service product needs to &e created and tested $or customer

acceptance% All stakeholders need to &e involved so that the service

concept can &e re.ned to the point at "hich a detailed service

&lueprint illustrating customer e#perience and the implementation

plan $or the service can &e produced

0% o" this tangi&le product can &e test marketed in a limited num&er o$

trading areas to determine marketplace acceptance o$ the product as

"ell as other marketing mi# varia&les such as promotion* pricing and

distri&ution systems%

k% A$ter this commerciali5ation o$ service need to go live and to &e

introduced to the entire marketplace "ith t"o o&0ectives% )irst is to

&uild and maintain acceptance o$ the ne" services among large no% o$

service delivery personnel* "ho shall &e responsi&le $rom no"on"ards% -his task &ecomes easy "hen they have involved one key

service delivery personnel during service design and development

stage% Second is to monitor al aspect o$ service during introduction and

through the complete service cycle%

l% o"* the complete commerciali5ation process need to &e revie"ed

and su&seuently changes need to &e made considering delivery

process* sta6ng and marketing mi# varia&les on the &asis o$ actual

market dynamics

G


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"#at standards and measures s#ould (e set in t#e Design and

Standards Gap %Gap !' to deliver to customer e)pectations* :o-

+ormal s#ould t#e$ (e* :o- s#ould LACD create and design t#e ne-

CSAs* :o- s#ould t#e$ get ever$one in t#e dealers#ips to learna(out t#em and get on (oard to deliver t#em*

-he standards and measures "hich should &e set in the design and

standards 8ap to deliver to customer e#pectations are

Standard CSA de.ned process* terms and conditions% It should &e

part o$ per$ormance evaluation $or dealership and its employees%

)ocus on speed and response time on the &asis o$ customer delights

points collected a$ter research* create service ,lueprint

@ery $ormal since it "ill give competitive edge

-he standards should &e &oth hard and so$t:

Hard Standards such as:

• Attending o$ customer service reuirement "ithin /< hrs

•

Machines should &e ready $or use "ithin ; days ma#

• Responsiveness to complaints call "ithin /< hrs%

• Intimation and con.rmation through email o$ complaint login no to

customer "ithin / hrs% o$ receipt o$ complaint call


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• Delivery

o$

reuired spares "ithin / "orking days at the site

-hese can &e measured through $ollo"ing:

!% S#ip to target : B o$ orders delivered on time "ith complete accuracy

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/% 2n Time /rst time /) : B o$ pro&lems related to maintenance o$

euipment .#ed on the .rst visit &y a service representative arriving

at the time promised

,y $ollo"ing steps "e can get everyone in the dealerships to learn a&out

them and also get on &oard to deliver them :

Service/sales expert - KRA

Formal training

Mentoring

Using technology – tools like CRM - Standardied and c!stomied reports

"mpo#ering technicians

$nternal comm!nication channel like extranet% portals

Fixed targets &or team

'edicated team and e(!ipment

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De.ciencies in humanresources policies

J Shortage o$ trained employee9techniciansJ Attention not given to their interaction or communication skillsJ >er$ormance monitoring o$ technicians varied $rom dealer to dealerJ o $ormal $orum $or communication &9" inter department

personnel

Customer "ho do not$ul.ll roles

J Customer not providing position o$ vehicle during servicere:uirement

J Customer $orget to in$orm dealer a&out machine reaching service

interval

)ailure to match supplyand demand

J ack o$ communication among parts * service and salesdepartment

J ot having relia&le system $or keeping track o$ machines routineinspection

J A&sence o$ e1ective communication &9" customers ' dealersemployee

J Shortage o$ trained employess in peak season and vice versa>ro&lems "ithintermediaries

'channels


:o- s#ould t#e dealers#ips overcome all t#e ;er+ormance Gap %Gap


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"#at internal and e)ternal materials -ere necessar$ to

communicate t#e CSAs to salespeople and customers* "#at else

-ould (e needed*

-he case says that there is a&sence o$ e1ective Sales tools in connection

"ith CSAs% CA- employees are segmented in such a "ay that Sales >ersonnel

does not sell CSAs neither they gain incentive "ith its sales% CSAs are very

customi5ed and their o1ering di1er $rom customer to customer% Hence due to

lack o$ proper kno"ledge o$ CSAs* employees and dealers used to do over

promise or under promise% -he internal and e#ternal materials necessary are

as $ollo"s:

!% Service Circulars "ith the servicemen* dealers* etc%

/% Service Manuals these contain the complete in$o a&out the machineand ho" to operate or service it%

;% ,rochures


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Using Services Marketing to Develop and Deliver Integrated Solutions at Caterpillar in Latin America

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