VILLAGE VOLVO

Service Operation Management – Case Analysis

INDIAN INSTITUTE OF MANAGEMENT KOZHIKODE Interactive Distance Learning Programme – Operations Management eEPOM03

(eMEP Alumni to ePGP Second Year)

DESCRIBE VILLAGE VOLVO’S SERVICE PACKAGE Supporting Facility

Location – Location is sub-urban location. When the customers drop the car for service,

getting back to house / office is a problem

Facility Layout – Waiting areas are provided for customers who come for quick services such

as oil change, alignment etc

Interior – Waiting lounge available with all facilities

Architectural appropriateness – New butler building with 4 bays, waiting area and storage

space

Facilitating Goods

Special care for customer’s unique requirements, Variety of services offered around Volvo

Cars

Information

Maintains CCVD through which timely reminders are sent to customers for repairs. Also helps

the mechanic to diagnose the problems in the car better.

Explicit Service

Issues explained to the mechanic, he does a test drive to understand the issue better

Initial estimate and time of completion informed immediately

Any changes informed to the customer pro-actively, alternatively the customer can contact

technician / service manager

Clean car handed over together with explanation of changed parts and documented in CCVD

Implicit Service

22 years of expertise with the Volvo cars and reputation in the market

Before delivery, mechanic does a test drive to verify the issues are resolved

HOW ARE THE DISTINCTIVE CHARACTERISTICS OF A

SERVICE FIRM ILLUSTRATED BY VILLAGE VOLVO?

Customer participation in service process The customer participates in the service process more often.

Initial estimate and delivery tome can be changing and any changes will be notified to customer in advance. Customer can also get in touch with service manager

Simultaneity High customer satisfaction and market leadership

Perishability capacity of Village Volvo, an hour without repair Intangibility:

reputation of Village Volvo

Intangibility Waiting lounge and refreshments, cleaning of car

Heterogeneity Direct contact mainly with service manager so that one voice

goes to customer

CHARACTERIZE VILLAGE VOLVO IN REGARD TO THE NATURE OF SERVICE

ACT, RELATIONSHIP WITH CUSTOMERS, CUSTOMIZATION AND JUDGMENT, THE

NATURE OF DEMAND AND SUPPLY AND THE METHOD OF SERVICE DELIVERY

Nature of service act Tangible Action directed to customer – Waiting lounge and refreshments

Tangible Actions directed at Customer’s Possession – Estimate of service and actual service

Intangible Action directed to customer – Friendliness, communication on changes to the plan and delivery

Intangible Actions directed at Customer’s Possession – Cleaning the interior, CCVD and documentation

Relationship with customers Service is direct relationship with customer and it is a long-term relationship. They

maintain CCVT for future reference and timely reminders to be sent for service and renewal of insurance etc

Customization and judgment The customer participation in the process is high, there are regular contacts made to

customer in between for changes that was not clear at the time of initiating the service. Alternatively customer can contact the service manager for all queries

Nature of demand and supply There is enough demand for cars with warranty completed from the company. The

owners has enough experience in the field and have good reputation in the field

Method of service delivery The rough estimate and time of completion are mentioned at the time car is picked up.

But any changes to the above are notified to customer well in advance. Once the car is ready for delivery the mechanic does a test drive to verify all issues are resolved and parks in the delivery area.

SUMMARY OF CHARACTERISTICS

Nature of Service Act

Direct recipient of the service Things Repair

Nature of the service Act Tangible Act

Relationship with the customer

Type of Relationship Membership

Nature of the service delivery Continued Delivery services

Customization and judgment

Extent to which services are customized High

Extent to which customer contact personal

exercise judgment

High

Nature of demand and supply

Extent of demand fluctuations Narrow

Supply is constrained With/Without delay

HOW COULD VILLAGE VOLVO MANAGE ITS BACK OFFICE

LIKE A FACTORY?

Smooth operation of demand

They have standard service process to resolve most general customer

problems. The service offered is very centric to customers and high level

of attention is given to this. The mechanics do not do any repairs during

7-8 am because this is the time for customer contact. Similarly 5-6 pm

too. The service manager is aware of what is happening for vehicles and

they are in touch with customers for all variations. The mechanics are

also approachable by the customers for any queries. This makes the

whole service process transparent.

Finished Goods

They do a test drive after the service is completed and place it in parking

area. By this they avoid any rework of the vehicle and add to the finished

good inventory.

HOW CAN VILLAGE VOLVO DIFFERENTIATE ITSELF FROM

VOLVO DEALERS?

Customized Service The owners have created a custom car care program which is not

available with local dealer. Customers can drive in during specific days in week for quick checks and oil changes. They also have a option to take prior appointment and drop in. They encourage users to use this for diagnosis and repair. The owners have 22 years of experience with the same cars and they have good reputation which makes this service operation possible.

Out of warranty

They only deal with out of warranty vehicles

Sustainability All the worn out parts are made available to customers verifications and

after that it is recycled with a partner. Other partnership exists for bodyworks alignments etc

Workshops Helps customer to know more about the vehicle and conducts workshops