Saturday, November 12, 2011
How May I Assist You? An Insight into Customer Service in the Automobile Sector
Sria Majumdar | IIM S
How May I Assist You?
An Insight into Customer Service in the Automobile Sector
From the times when the service provider was the king, to the current scenario where customer care is a vital point of differentiation- customer service has indeed come a long way. While customer service is often, the neglected cousin of sales and marketing in the automobile sector, it can also prove to be the competitive edge in a crowded industry and saturated market.
Most of the research for this article is drawn from my own internship experience with Tata Motors in South Africa, where I was working on a benchmarking project in customer service. In a market which is dominated by brands like Toyota, Mercedes Benz, Volkswagen, Nissan- a relatively new entrant like Tata Motors faces several challenges. One of the prime causes for a drop in market share for Tata Motors has been customer service. Keeping in mind the challenges of working in a foreign country with distributors, and the issues of spare parts- the customer dissatisfaction cannot be ignored when the CSI (Customer Satisfaction Index) study pours in.
In the automobile sector, the customer touch points are primarily the dealers. The customer rarely comes in direct contact with the distributor or the manufacturer. Thus, it becomes very important that a dealership conveys the same brand message that the manufacturer wants the customer to perceive. Dealership standards, regular inspections and monitoring of workshop processes are some measures taken by the manufacturer to ensure that the customer is satisfied with the brand experience. Every manufacturer has certain dealer standards and service standards that must be adhered to by the dealer. These include all aspects of the dealership from corporate identity to warranty to sales standards. Dealer standards are important because they lead to healthy competition among dealerships to excel, provide a benchmark for dealer audits, lead to performance schemes such as awards, monetary rewards for best dealers and ensure that the brand of the manufacturer is upheld in dealerships. However, monitoring can only work thus far. Dealerships must be brand loyal and this can only come when the brand itself creates a niche for itself in the market.
As far as the customer is concerned, according to a survey by A.C. Nielsen and JD Power, the needs of the commercial vehicle customers (in terms of customer service) in South Africa are primarily- quality of servicing, problem solving abilities, attitude of service personnel, responsiveness of service personnel, availability of spare parts, fix problems in the first visit, reasonable charge for service/ repair, price of spare parts, on-time delivery, warranty assistance, explanation of work, basic facilities at dealership, authorization calls and on-site service. While every manufacturer strives to ensure that these facilities are available at the dealerships, convincing the dealerships for the same is often very difficult. To a dealership, more facilities imply more cost, and unless their sales and volumes justify it- they are hesitant to provide extra services. Meanwhile, customers are being pampered by brands that have been well established. For example: at a Toyota dealership, customers are offered free breakfast when they bring their car in for servicing. At Mercedes Benz, the drivers have fully furnished overnight facilities.
In terms of processes, each dealership has a set of workshop processes. These processes are defined by the manufacturer. Brands such as Toyota have transferred the best practices from manufacturing such as 5S, color coding schemes of TPS etc. into the workshops. Typically, the workshop processes are as follows:
1. Bookings: Most manufacturers and dealerships encourage customers to make bookings prior to bringing their vehicle in. This helps the workshop in being prepared for a customer when he/she arrives. However, for commercial vehicles bookings are not taken very seriously. In most cases, the fleet owners have a personal relationship with the service manager or the workshop controller, and the vehicle is sent in without prior booking. Also, in case of trucks, the number of no-shows is very high. This leads to wastage of resources in case the bookings are pre-opened, and the parts are ready for the customer.
2. Reception: The service advisor is the primary customer touch point when the customer arrives at the dealership. The dealership invests in training the service advisors in people skills, as his/her communication skills and knowledge about the vehicles must be flawless. The service advisor notes down the customer complaints, and undertakes a preliminary inspection of the vehicle. Sometimes, time and cost estimates are given to the customer.
3. Work in Progress: The technician inspects the vehicle in detail, and notes down additional problems or jobs to be done. The job card (document where all the repair details are written down) is then taken to the service advisor, who makes the authorization call. Here the customer is given a time and cost estimate, and is asked for approval to proceed with the job. Only post authorization, work on the vehicle begins. However, in the case of a standard service job, this authorization may not be needed.
4. Inspection, Costing and Handover: The technician hands over the completed job card to the service advisor, who then sends the job card for costing. The workshop controller carries out a quality check and then the vehicle is test driven. The customer is called to collect his vehicle, and the vehicle proceeds to the wash bay. During handover, the customer interacts with the service advisor, who takes her/him through the job card and explains the work done and the costs.
5. After Service Feedback: CSI is becoming increasing important in the industry. It is a vital component of dealer audits, and it is the most important measure of customer satisfaction. Each dealer/manufacturer has its unique method of taking customer feedback, and the questionnaire varies from a single question, up to 20 detailed questions.
Like all other industries, customer service is also heavily reliant on information technology. Comprehensive and elaborate CRM software are used by the manufacturer as well as the dealer. While dealer management systems include bookings interface, costing, work assignment etc., the manufacturer generally uses internet based portals for warranty processing, technical bulletins, recall campaign information etc.
However, there are several points of caution in this industry. At the end of the day, the processes and audits can only take the manufacturer thus far and no further. Customer Service in the automobile industry, like all industries comes down to people. During the internship, I had the opportunity to see how a single person can bring customers to the dealership through sheer charisma and relationship building with the customers. Hence, it is of prime importance that the manufacturers choose dealerships carefully, and dealerships in turn, must choose the right service personnel.
Also, CSI may be very subjective. It is difficult for all dealerships of a brand to provide the same level of customer service. Variation in service levels across dealerships reflect very poorly on the manufacturer, but sometimes it is the customer perception that differs. For the same service, one customer may be very satisfied, while another, thoroughly dissatisfied.
As Peter Drucker said, ‘Quality in a service or product is not what you put into it. It is what the client or customer gets out of it.’ And this must be the takeaway for all automobile manufacturers. Extensive research is the need of the hour to find out what the customer really wants. Maybe investing in breakfast for a customer does not make sense. Maybe the overnight facility does not add to customer satisfaction. Maybe all the customer needs is a car which is fixed right, the very first time. It’s time all manufacturers prioritised service needs and catered to them. As someone rightly said, ‘If we don’t take care of our customers, someone else will!’