loyalty in public sector: a practical...

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LOYALTY IN PUBLIC SECTOR: A PRACTICAL APPLICATION WITH SUBWAY USERS IN BRASÍLIA-DF MILTON JONAS MONTEIRO (UnB-PPGT) [email protected] Martha M V O C Rodrigues (UnB-ADM) [email protected] Marcos Thadeu Queiroz Magalhães (UnB-PPGT) [email protected] Evaldo Cesar Cavalcante Rodrigues (UnB-PPGT) [email protected] ADRIANA GIMÉNEZ DA SILVA (UnB-ADM) [email protected] Since it is more expensive to conquer new customers than to retain the actual ones, one of the most significant challenges of companies in a dynamic market with strong competition is to achieve customer loyalty. Therefore, public or privatee companies do not worry only about conquering new customers, but to make them loyal to the product, in order to promote their continuous needs satisfaction and to overcome their expectations. This paper have discussed about the existence of loyalty in the public sector, focusing the service rendered in the transportation branch, specifically in the subway system in Distrito Federal. The methodology was based on exploratory and descriptive researches, which involved the search for information in previous papers and in a field research, which was concentrated in the subway users that were in the subway Central Station in Plano Piloto - Brasília - DF. The field research was done through a questionnaire with 13 questions considered important and appropriate to the data collection about the object studied. The users or customers of the DF Metropolitan Company are the universe of the research. Among the main analyzed aspects there are: which are the reasons that lead these users to use the subway in comparison to other modals (individual transportation and bus); the existence of satisfaction and its level; if they are loyal to the subway, and; what can be improved in the service rendered to reach better satisfaction levels and consequently the customer loyalty. The research results were mostly positive and demonstrated that in general there is satisfaction, however, this is not enough to characterize loyalty in the use of the subway as a single and frequent transportation mean. Nevertheless, the customers pointed out some restrictions in the subway system and also indicated some adjustments or improvement that can be made. XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October 2010.

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LOYALTY IN PUBLIC SECTOR: A

PRACTICAL APPLICATION WITH

SUBWAY USERS IN BRASÍLIA-DF

MILTON JONAS MONTEIRO (UnB-PPGT)

[email protected]

Martha M V O C Rodrigues (UnB-ADM)

[email protected]

Marcos Thadeu Queiroz Magalhães (UnB-PPGT)

[email protected]

Evaldo Cesar Cavalcante Rodrigues (UnB-PPGT)

[email protected]

ADRIANA GIMÉNEZ DA SILVA (UnB-ADM)

[email protected]

Since it is more expensive to conquer new customers than to retain the

actual ones, one of the most significant challenges of companies in a

dynamic market with strong competition is to achieve customer loyalty.

Therefore, public or privatee companies do not worry only about

conquering new customers, but to make them loyal to the product, in

order to promote their continuous needs satisfaction and to overcome

their expectations. This paper have discussed about the existence of

loyalty in the public sector, focusing the service rendered in the

transportation branch, specifically in the subway system in Distrito

Federal. The methodology was based on exploratory and descriptive

researches, which involved the search for information in previous

papers and in a field research, which was concentrated in the subway

users that were in the subway Central Station in Plano Piloto - Brasília

- DF. The field research was done through a questionnaire with 13

questions considered important and appropriate to the data collection

about the object studied. The users or customers of the DF

Metropolitan Company are the universe of the research. Among the

main analyzed aspects there are: which are the reasons that lead these

users to use the subway in comparison to other modals (individual

transportation and bus); the existence of satisfaction and its level; if

they are loyal to the subway, and; what can be improved in the service

rendered to reach better satisfaction levels and consequently the

customer loyalty. The research results were mostly positive and

demonstrated that in general there is satisfaction, however, this is not

enough to characterize loyalty in the use of the subway as a single and

frequent transportation mean. Nevertheless, the customers pointed out

some restrictions in the subway system and also indicated some

adjustments or improvement that can be made.

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

2

Palavras-chaves: Marketing; Loyalty; Public Sector; Subway.

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

3

1. Introduction

There was a time when companies used to guide their efforts mostly to collect new customers.

Now, several factors involve the organizations in an environment with strong competition

created by the globalization. The customers are well informed, with a wide list of preferences,

and are more and more exigent each day, without hesitating to change to other company if

they are not satisfied. In the situation where the companies are involved, the customer

relationship has a vital importance, considering that the results of the relationships together

with the development of the company will determine future purchases. That is why to treat

well the customers is so important, as well as looking for strategies to create and offer them

values in a way to conquer their loyalty. Loyalty is one of the most powerful weapons for the

companies in the globalization era, and it is a solution for the public sector when acting within

the relationship with the society.

This paper is about the loyalty, with emphasis in the conditions and characteristics of the

subway transportation system in Brasília, in a way to establish a theoretical correlation

between the loyalty in the public and private sector so that the answer to the following

question can be answered: how far the concept of achieving the customer loyalty can be

applied in the public sector, especially in the transportation branch (subway)? The aim is to

check the applicability of this concept in a branch of the non-private sector as the public

transportation in which a priori does not experiment the reality presented in the literature, and

also to verify the existence of customer loyalty in the medium class users of the subway

transportation system in Brasília.

2. Relationship Marketing

“One of the most popular definitions of the term marketing is that it is above all to conquer

and retain customers” (LEVITT, 1983 apud ALMEIDA, 2001). It means that one of the

several concerns in the companies, considering the strong competition and globalization, is to

develop and maintain long relationships with its customers.

The marketing definition is turning toward the focus of customers‟ satisfaction and the

maintenance of a good relationship with them, which shows the importance of the terms

relationship and loyalty. Kotler & Keller (2006) define that marketing management is like the

Art and Science of choosing target markets and also collecting, retaining and achieving

customers‟ loyalty through creating and delivering a higher value to them. The emphasis is

clearer when it is mentioned that the aim of marketing is to know and understand the

customer so deeply as the product or service offered, at the same time that the product or

service offered should also be adequate thus it can sell by its own. Therefore, it is possible to

verify that relationship management and customer loyalty are key parts in the marketing

concept. Applying these definitions to the public sector it was possible to perceive that,

especially in the transportation sector, they are far beyond reality. For now, by not considering

this applicability inadequacy, it is possible to conclude that these types of knowledge can still

be incorporated by the duality State-Society. Although, it is beneath the definition presented,

the relationship in the subway transportation system cannot be denied, since there is a service

to be offered and people that use it.

Among the marketing approaches there is the holistic marketing, which goes beyond

traditional application of marketing concepts and is defined by Kotler & Keller (2006) as the

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

4

development, project and implementation of marketing programs, processes and activities,

that can recognize their effects wideness and interdependencies. Holistic Marketing also

recognizes that „everything matters‟ with marketing - and that a broad integrated perspective

is often necessary. This approach is formed by four pillars: internal marketing, integrated

marketing, social responsibility marketing and relationship marketing.

In relation to relationship marketing, Kotler & Keller (2006) understand that it aims to build

long-term relationships with mutual benefits to the key-parties: customers, suppliers,

distributors and other stakeholders, in a way to conquer and retain their business. Vavra

(1993) understands that the aim of relationship marketing is the customers retention, based on

the premise that to the company, the only way to have a long-term profitable survival is the

marketing focused on the customer, considering that each business starts and ends with the

customer, and the company with the majority of customers wins. Las Casas (2006) defines

relationship marketing or after-marketing as all the marketing activities oriented to retain the

customer in post-sale situations. Following the idea of keeping in touch with the customer in

the post-sale it has emerged the need of collecting information from these customers in order

to provide them higher satisfaction. That shows the importance of the CRM (Customer

Relationship Management) in the relationship marketing.

Regarding the term CRM, according to Kotler & Keller (2006), it is the careful management

of detailed information about each customer and all the „contact spots‟ with him, in order to

maximize his loyalty. Stone et al. (2001) highlight the importance of the CRM as an element

to achieve the customer loyalty, emphasizing that the customer loyalty does not origin just

from the sale strategies, because to create efficient restraint strategies it is necessary to know

well the customer behavior and needs. The companies which developed a CRM strategy have

been conquering new customers and retaining the actual ones, by delivering more value,

offering products, services and requests considering their expectations and desires

(BRETZKE, 2000).

Analyzing by the technological side, Bretzke (2000) considers that due to the competition in

real time it is necessary to equip the company with means that can allow them to know and

interact more productively with the customers. And, these means when interconnected

originated the CRM, which is defined as an ensemble of concepts, constructions and tools,

composed by strategy, process, software and hardware. Therefore it must be highlighted that

Bretzke (2000) defined as the main point of CRM the fact that the customers will take their

decisions based on their relationship with suppliers, and that they wish recognition, value,

quality and respect in exchange of their preference.

In the subway transportation system, it can be seen efforts like educational campaigns,

research surveys made to assist the improvement of the service, and even the existence of

communication channels, such as: website; a call center; suggestions box, and; useful

telephones for users. It is important to highlight once more that applying these marketing

concepts aforementioned in the public sector is extremely difficult. Before opening the next

subject, which it will be value construction, satisfaction and customer loyalty, it is important

to quickly comment about an essential element in both private and public sector: service.

Sack et al. (2008) stand that products and services are the first things the customers see in a

company. Then, the aim of creating products and services is to satisfy the consumers,

fulfilling their needs and expectations, which reaffirm the statement that a project of products

and services starts and ends with the customers.

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

5

It is intended to demonstrate that besides the conditions of the public transportation, the users

of this service can and must be called customers, which is not applied to the customer loyalty

term and practice, since as it is shown in this paper has an insignificant application in the

public sector.

The affirmation above in regard to the inexistence of the public dichotomy „customer-user‟ is

based on legitimating the public service rendered, which Slack et al. (2008) call as essential

elements that all of kinds of service must have: a concept, which is an ensemble of benefits

expected by the customer; a product pack, which is the ensemble of components that provides

the benefits defined in the concept, and; a process, which defines the relation among the

components of products and services. These characteristics and the elements in a service

rendered are demanded by both the private customer and the users the public transportation

system, the public customer. Thus, it is the way how the public customer should be treated,

considering that their exigencies regarding a good service rendered is no longer different than

the ones from the private sector. Then, when the customers buy a product or a service, they

are buying an ensemble of benefits in order to fulfill their needs and expectations.

3. Construction of value, satisfaction and customer loyalty

The companies are facing a competition level never seen before. The sale-oriented era is over,

giving place to the orientation focused on customers. Kotler & Keller (2006) consider that the

marketing essence of a well-succeeded marketing orientation is the strong relationship with

the customers. But, what does it mean exactly? Which are the essential elements to achieve

the strong relationship with the customer? Novis & Armstrong (2002) also present an analysis

of the customer knowledge in relation to its way of sharing, which provides important

information to reach the best way of managing it. Based on the statement of Kotler & Keller

(2006) that the probability of satisfaction and purchase repetition depends if the offer fulfills

the costumer value expectation, it is possible to conclude that the focus of the companies is

the „triple-alliance‟: value, satisfaction and loyalty.

According to Las Casas (2006), the value is not only the product or service price, but the

fundamental aspects prized by the customers, not only in relation to the product, but also in

relation to the whole process. In this paper, the definition of value is considered as the

ensemble of benefits that can be offered by the subway to its users. In this case, the process of

creating and delivering value is done through the interaction with its users in order to obtain

an adequate knowledge to the production and delivery of the service rendered. It is important

to exist in the value delivery the interaction with the customers, so that it can be possible to

adjust and improve some items, considering that besides customers they are co-creators of the

value that is offered by the company. Thus, the chances of answering the value requirements

settled by the customers can be raised.

This concern can be expressed in one word: satisfaction. The probability of satisfaction and

repetition of the purchase depends if the offer is answering to the customer expectation of

value. “And, satisfaction is the feeling of pleasure or disappointment that results from the

comparison between the performance (or result) of a product or service and the buyer

expectation” (KOTLER & KELLER, 2006). In such case this relation can be expressed by the

equation: “User‟s Satisfaction (S) = Perception(P) / Expectation (E)” (ALMEIDA, 2001).

The term expectation is what the user can expect from the service rendered, in this paper it

would be the service rendered by Metropolitan Company, and it should be aligned to the

definition of value. Perception is how the user actually perceives the service. And, satisfaction

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

6

is the relation between perception and expectation. Hence, from the equation it is possible to

establish that: P<E; P=E and P>E (ALMEIDA, 2001). In all three situations, the loyalty will

occur when the performance goes beyond expectations. Kotler & Keller (2006) affirm that the

relation between satisfaction and loyalty of a customer is not proportional, considering that

they can be highly satisfied for different reasons. This topic will not be discussed in this

paper, so it will be considered that the basis of the loyalty is the satisfaction, despite its level

of existence.

According to Kishel (1993) there are four elements that contribute to the customer satisfaction

level: the product or service (including fundamental factors such as goals, quality design,

style, durability, color, materials and costs); the environment (regarding the society, economy,

politics and juridical strengths); promotion and sale methods (here there is the creation of the

expectations) and post-sale (the activities that occur after the sales). Las Casas (2006)

emphasizes the importance of the satisfaction by mentioning that when a company or brand

has a satisfied and loyal customer, he becomes an intangible asset to the company, because a

satisfied customer will tell at least to other five people about his satisfaction, creating an

efficient multiplier effect.

Oliver (apud KOTLER & KELLER, 2006) defines loyalty as a repeatedly deep commitment

of buying or ordering a certain product or service in the future, despite of situational

influences and marketing efforts capable of causing changes in the customer behaviors. It is

important to mention that the customer decision to be loyal to a company or even stop buying

from it is a result of several small contacts with it, which are responsible for constructing the

relationship. Las Casas (2006) defends this idea, and presents that the definition of loyalty

requires the creation of a constant value, and for that, creates a goal to organize a company

and a pattern to evaluate the level of these goals.

By delivering a higher value level to the customer, he will be satisfied, and this is the path to

loyalty. Stone et al. (2001) defend some items that create loyalty, which are: satisfaction in

relation to the brand and to the category of the offered products; experience and satisfaction

with the service; alignment of offer and specific customer need; participation in the

order/delivery process; efficient relationship management, and; information exchange.

After that, it is possible to conclude that loyalty is not for all customers. By analyzing a

company based on customer loyalty the first step is to find the best customers which are

customers that can create a constant flow of financial resources and at the same time can be

profitable in the future; “customers that can be loyal and remain loyal” (REICHHELD, 2000).

Regarding the loyalty level, “it is important to have as indicators: the purchase frequency, the

average of the amount purchased and the participation of the purchase in the product

category” (REICHHELD, 2000). It is also important to remember that satisfaction is not a

synonym of loyalty, that is, the loyalty is a process that needs constant feeding. The loyal

customer is the one who makes regular and repeatedly purchases; purchases several products

and services from different lines; “suggests the products and services to other people and is

exempt from the competition attempts” (GRIFFIN, 1998). Stone et al. (2001) also emphasize

that a loyal customer is the one who repeat the purchase and also suggest the products and

services of the company to his friends, besides of paying less attention to other brands.

Therefore, based on the theoretical discussion presented, it was aimed to show that the

company, in the case of this paper, the Distrito Federal Metropolitan Company, needs to keep

a good relationship with its users, and for that, it is essential to maintain marketing strategies

which consider specific actions for each kind of the subway public (including staff), larger

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

7

external publicity, and improvement in the communication channels. By knowing the users‟

needs it is possible to conquer their loyalty through creation and delivery of high values, and

even to overcome their expectations, what clarify the applicability of the term „triple-

alliance‟: value, satisfaction and loyalty.

4. Methodology and research techniques

This paper is an exploratory research, which is based on bibliographic studies, internet

researches, books, scientific articles, documental data, and the opinion research applied by the

Subway Ombudsman – DF, done in the end of the year of 2007.

The descriptive research used technical procedures for the data collection, based on a field

research, considering that, 100 questionnaires were answered in the subway Central Station at

Plano Piloto, Brasília-DF by subway users on May, 19th

, 2009, from 6.00 to 8.30pm. The

following elements were analyzed: satisfaction, loyalty and comparison to other means of

transportation based on the direct observation done in some visits to the stations.

According to Medeiros (2006) the deductive approach method was applied, since it is possible

to start from general statements to get to a particular conclusion. The quantitative method was

also used, since it emphasizes the usage of standardized data, allowing the researcher to make

comparison, summaries and general statements.

The subway, among the means of transportation, have important aspects as speed, security,

and comfort in relation to buses, which are the main mass transportation mean in Brazil and

Distrito Federal. At this point, it is important to consider that a certain level of satisfaction is

not going to lead to loyalty. Considering this statement, it was used the method diagram

below (Figure 1) to restrict the users universe to the ones included in the medium class.

Figure 1 – Method Diagram

The macro universe considered is the users that take the subway during the day. The

Companhia Metropolitana do Distrito Federal-Metrô-DF (Distrito Federal Metropolitan

Company) receives per day 160 thousand users from 6.00 am to 11.30 pm (during 17 hours

and a half). Considering this universe, the calculus for the representative sample, with 95%

confidence interval and 5% margin error, resulted in 399 users. From the bigger sample of

399 users, only 30% would be ideal to represent the target public of the research. As the data

collection would be done in 2 hours in a rush hour, it would come to 46 users. The data from

the study of the Subway Ombudsman concluded that 30.77% of the subway users have a

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

8

family income from R$ 1,900.01 to R$ 3,800.00, and considering that according to the

Getúlio Vargas Foundation (FGV) the medium class has a family income from R$ 1,064.00 to

R$ 4.591,00, the 30.77% would be considered as medium class, what explains the definition

of a 30% sample. However, considering that in the rush hour people flow is much bigger than

in other periods of the day, it was decided to increase the number of the sample to 100 users.

The basis for the study is the opinion research from the Subway Ombudsman and the field

research based on questionnaires answered by several users. For the conclusion they were

analyzed the main elements of this paper: satisfaction, loyalty and comparison to other means

of transportation.

5. Public and Subway Transportation

Regarding transportation, the developing countries, in particular Brazil, share similar

conditions, with low service levels in the public transportation; unequal accessibility

distribution; high traffic accidents levels; traffic jams; overcrowding; lack of a predictable

serving; environmental pollution, and; invasion of the habitation spaces and collective living

because of traffic inadequacy.

According to Vasconcellos (2000), the bus transportation system is the most used mean of

transportation by the Brazilian population. The fact is that it has reached its operational limit,

which summed with the increase of the number of users, create the necessity of a

transportation system with larger capacity and also that can promote traffic flow in areas with

big population concentration with the capability of serving the continuous demand increase.

Specifically in the Brazilian case, Vasconcellos (2000) considers that the economic class in

the country has appeared after the World War II and the economic miracle. This fact together

with the urban space restructuration and the insufficiency of the public transportation means

made the car become the only transportation mean capable of guaranteeing an efficiency level

in comparison to public transportation. Thus, due to the environment settled, the easiness of

using the individual transportation and low level of the public transportation, the medium

class does not see an alternative unless buying and using a vehicle.

The conclusion is that there is an interest conflict, which can explain the public transportation

system situation, because there is an attempt to keep the subsidies in a minimum level (in the

case of the public operation) or to keep the profitability in the maximum level (in the case of

the private operation). Both attempts conflict directly with the users interests, once they end

up forcing the reduction of the service offer and quality level. “So that, a vicious circle is

created, feeding the struggle among conflicting interests” (VASCONCELLOS, 2000).

Within this context, there is the subway system of the country with some of these conditions,

but, at the same time, presenting itself as a solution to some of these problems. In the 70s new

train transportation system was created in Brazil. The subways were installed and started

working in 1973 in São Paulo and in 1979 in Rio de Janeiro. After 21 years, they were built in

metropolitan regions of Belo Horizonte, Recife, Porto Alegre (Rio Grande do Sul), and

Pernambuco. And in the past few years they were built in Brasília, Fortaleza and Salvador.

According to the Distrito Federal Metropolitan Company – Metrô DF website, the subway

system construction project in Brasília was started in 1991. “At first, the subway was planned

to operate in a 41km line, with nearly 10km underground and 28 passenger stations. The

project foresaw a main line connecting Plano Piloto to Ceilândia and Samamabia, which are

surrounding cities” (METRÔ-DF, 2010).

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

9

In January 1997, “it has started the Experimental Travel Programme, which aimed to present

the new transportation system to the Brasília population. And, just in 2001 the subway started

to operate officially” (METRÔ-DF, 2010).

The subway in Brasília, beyond the increase of the number of stations, with the increase of the

number of users (nowadays 160 thousand a day) has faced the need to expand the number of

trains. So, in order to enhance the service, the Company is working on the purchase of 12 new

trains, with 4 cars each. Nowadays they have 20 trains (19 available and 1 spare for

maintenance and parts utilization), 24 operating stations and, 5 stations under construction, all

in 42.38km. The system works with 4m35s to 21m breaks between trains, according to time,

day and line. “The intention is that with the purchase of new trains the minimum break will

diminish to 3 minutes” (METRÔ-DF, 2010). One characteristic that stand out from the

subway transportation system in relation to the bus is the travel speed. The subway travel time

is rigid, and has slight variation in regular and rush hours. In relation to safety, the subway

system counts on a higher number of traffic electronic control devices while the bus system

uses an outdated traffic control technology and also have to share the streets with other

vehicles. “That is why the subway is considered one of the safest transportation means,

considering that when accidents occur they are usually in small proportion”

(VASCONCELLOS, 2000).

According to Vasconcellos (2000) the main reason to the use of individual transportation and

informal transportation is the lack of collective transportation offer that could fulfill the

population needs, what causes more inefficiency, high fuel consumption level, and higher

pollution level. Towards pollution, doubtlessly the one created by the subway transportation

system is considered to have a low impact in relation to other motorized means of

transportation, because it uses traction based on electrical energy and does not expel gases

into the atmosphere. And also the visual and sound pollution created by the subway system

are in small scale, mainly because the lines or parts of it are underground. Hence it follows

that the subway transportation system not only has superior operational capacity in relation to

the bus system, but also can be considered more comfortable, trustworthy, fast, efficient, with

low pollution levels and large capacity to transport the population. Thus, it is shown as the

most appropriate transportation mean to serve a high demand and more and more demanding

customers.

6. Collected data analysis on the subway system

The analysis on the data collected in the interview with the subway users in Brasília, showed

that 91% of the interviewed people has family income above R$ 1,000.00, being classified as

medium class, which is the target class on this study. Regarding the economic condition, 70%

of the interviewed people have a vehicle at home. At first, one of the concerns in this research

was to observe the availability of other transportation means, so it would be possible to make

a comparison among the transportation modals. By talking about loyalty, one of the basic

conditions is that the customer could have choice options. If the percentage of families that

have individual transportation were not considered as significant, it can be presented the fact

that 66% of the interviewed users actually use another transportation modal: 39% a vehicle,

and; 61% bus, and 67% do use bus regularly, as it can be observed in the Figure 2 below. A

priori, it demonstrates the fragility when talking about subway fidelity.

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

10

Figure 2 – Transportation Mean Used and the Regularity of Bus Use

In relation to the purpose on using the subway, 77% of the interviewed users said that it is

because of work; 14% to go to school or University; 7% for leisure; and 2% for other reasons.

In the question about why using the subway instead of car or bus (comparative modals),

considering the reason answered in the question about the subway purpose (if it was for work,

study, leisure or others), 44% of the interviewed people answered that it is to avoid traffic

jams; 30% because of the speed to arrive at the desired place; 14% pointed out the fuel

economy; and 9% said it was because of the quality of the service rendered.

On the other hand, there is a key element regarding loyalty, which is how long the customer

remains in the company. In this case, 63% answered that they use the subway five times a

week, which matches with the subway use purpose pointed out in the previous question,

where 77% answered „work‟. 27% use the subway for over a year; 25% have been using it for

two years; 13% for 3 years; 9% for five years; and 9% for more than 5 years. Here, the use

average is about two and a half years, but, it is not possible to consider this number to

characterize the customer loyalty, because it does not represent a compromise that will lead to

customer loyalty, since it can be easily justified by the purpose of use presented.

By asking about how the users get to the subways stations, it was observed that 61% walk;

23% go by car; and 13% by bus. It is important to highlight here that 70% of the interviewed

users have at home another comparative modal (the car), and from those who said that use

other transportation mean instead of the subway for the same purpose, 61% use bus and 31%

car. This last percentage almost matches with those who go to the station by car (23%),

showing that actually there are users that leave their cars in the subway station in order to use

the subway, since as it was shown in the past paragraphs, they use the subway instead of other

modals because they want to have fuel economy, to arrive where they want rapidly, and of

course to avoid traffic jams.

In relation to satisfaction, 66% affirmed that they are satisfied with the service rendered, and

by comparing modals, the subway satisfaction average is 7.10, while the bus satisfaction

average is 3.41 (using 1.48 and 1.88 standard deviation respectively). Thus, it is noticed the

high difference in the satisfaction level when comparing subway and bus, which is certainly

the reflex of the quality of the services rendered.

By evaluating some aspects of the subway system in Brasília (Table 1), only the capacity was

negatively evaluated (summing the „bad‟ and „terrible‟ percentages it is more than 50%).

However, 64% consider the travel time as „good‟; 56% the security level as „good‟; 45% and

32% the waiting time for the train as „regular‟ and „good‟; the access to information only 5%

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

11

(summed percentages) was considered „terrible‟ and „bad‟. And in a general evaluation of the

service rendered, 59% evaluated it as „good‟; 28% as „regular‟; 10% as „excellent‟ and only

3% as „bad‟.

Evaluation elements Excellent Good Regular Bad Terrible Does not

know

Capacity 2% 18% 26% 18% 36% -

Information 8% 49% 33% 3% 2% 5%

Travel time 13% 64% 21% 1% 1% -

System security 13% 56% 23% 8% - -

Waiting time for the train 5% 32% 45% 12% 6% -

Table 1 – Satisfaction Level

7. Final Considerations

Considering the affirmation of Slack et al. (2008) that any service must have a definition

(ensemble of benefits expected that the customer is buying) and that according to Kotler &

Keller (2006) the satisfaction and purchase repetition depend on fulfilling the customer value

expectation, so that, it can be understood that the loyalty concept requires a constant value

creation, and by delivering a high value, the customer will be satisfied, which will be leading

to loyalty. Part of this condition was positively evaluated in the subway use.

The value creation through the conditions presented by the subway in the majority of the

system elements (security, travel time, waiting time for the train, information, easiness on

embarking and disembarking) were well evaluated, except in the case of capacity. In the

general evaluation of the service rendered, 59% was evaluated as „good‟, 28% as „regular‟

and 10% „excellent‟ (Figure 3). 66% of the interviewed people said to be satisfied with the

service rendered, and the subway satisfaction average is 7.10 while the bus satisfaction

average is 3.41. Then, it is cleared confirmed the initial expectation and it can be concluded

that there is satisfaction by the users of the system, which is one of the steps for the customer

loyalty. However, it is not much to remember that satisfaction is not a synonym of loyalty.

Figure 3 – General Evaluation of the Service Rendered

Even though there are medium class people that use the subway instead of their particular

transportation, that cannot be considered as loyalty. It is not possible to say that there is a

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

12

loyal use of this transportation mean, considering that 61% of the interviewed users use bus

for the same purpose and 67% use it regularly. This statement is also confirmed by some of

the reasons why they use the subway instead of the car, such as: avoiding traffic jams, getting

to the desired place rapidly and fuel economy.

In the comparison of travel time between bus and subway, it was shown that the bus can take

more than the double time to get to the same place, what demonstrate that the subway use is

justified by better conditions in the service rendered by the subway and its advantages.

All the observed elements proportion, obviously, a better service rendered by the subway in

relation to buses and cars. That means that people use the subway, but in such way, because

their own reasons, that does not lead it to loyalty. Hence, the subway transportation system,

not only has superior operational capacity in relation to the bus system, but also can be

considered more comfortable, trustworthy, fast, efficient, with low pollution level and large

capacity to transport the population. And also the travel time is rigid, with slight variation in

regular and rush hours. However, by analyzing the literature, the context about loyalty is the

strong competition, which does not exist in the environment of the subway transportation

system in Brasília, where the comparison to other transportation modals, mainly the service

rendered by the bus transportation service is quite different from the one rendered by the

subway. So, this is beneath the loyalty concept, in the sense of being a compromise of buying

or indicating repeatedly a service or product in the future (OLIVER apud KOTLER &

KELLER, 2006).

Another aspect of loyalty that can be brought into discussion in the public sector is the

premise that it is not for all kind of customers. This would be inadequate in the public sector,

because the citizens are supposed to have the same value, what can justify the difficulty of the

State in reaching this relationship level. Following the same thought, it is possible to notice

that there are not enough loyalty programmes and channels to get closer to the customer,

because the ones that exists are not that efficient so that can create good relationship among

the parties involved.

One of the indicators pointed to measure the loyalty is the purchase frequency, which in this

case is the transportation use. The frequency of the subway use is not justified by the highly

commitment to the service rendered, but by the conditions of the use purpose of the system.

So, the regular use of other public transportation modal affects the loyalty existence in the

subway use.

The subway marketing should also be commented. It was possible to notice that the subway

users and the population in general are not aware of the subway benefits, mainly if compared

to other modals benefits. The marketing in the sector barely exists, exactly the same thing that

occurs in other branches in the public sector. There are also few communication and

information means that are able to create a closer contact among the company and the users.

Although 66% of the interviewed users answered that they are satisfied with the service

rendered and 59% and 28% answered that the general evaluation of the service rendered was

„good‟ and „regular‟, respectively, there were made some critics, which has to be improved

and implemented. According to the users, the following topics should be

improved/implemented: to diminish the time between the trains; to improve the number of

trains and cars; to create new stations; to increase the number of subway lines (this was the

most highlighted topics by the users); to low the ticket price; to enlarge the operation hours at

the weekends; to improve the lighting in some stations; to promote monitoring on the law that

XVI INTERNATIONAL CONFERENCE ON INDUSTRIAL ENGINEERING AND OPERATIONS MANAGEMENT

Challenges and Maturity of Production Engineering: competitiveness of enterprises, working conditions, environment. São Carlos, SP, Brazil, 12 to 15 October – 2010.

13

reserve seats to elders, pregnant women and disable people, and; larger integration among the

subways and other public transportation means.

Then, it is recommend the use of marketing tools to promote periodic researches in different

public branches, trying to establish the measurement of the evolution of the image, demand

and satisfaction in relation to the services rendered. These researches could also be used to

define strategies; to create channels that could optimize communication; to search for service

diversification, by offering complementary services that fulfills the customer need and

expectations; etc. So, it is possible to conclude that not always the satisfaction leads do

loyalty. Although there is a satisfactory level in relation to the services rendered by the

subway in Brasília, this was not enough to characterize the loyalty existence, mainly due to

the reason why the users use the subway, the conditions presented by each modal to which it

was compared, and the lack of direct competition.

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