©1999 Addison Wesley Longman Slide 6.1 Product, Customer, and Competitive Advantage 6.

©1999 Addison Wesley Longman Slide 6.1

Product, Customer,and CompetitiveAdvantage

6


Table 6.1Otis Elevator’s Repair Service



CUSTOMER

Building owners and people who use elevators



PRODUCT

Elevator maintained in good operating condition

Timely elevator repair

History of service for each elevator



BUSINESS PROCESS

Major Steps:

•Receive call about a problem

•Dispatch mechanics

•Perform repair steps

•Track progress until the elevator is fixed

•Update records

Rationale:

•Direct all calls for service to a centralized dispatching office. Use handheld terminals to maintain contact. Maintain records for anticipating and solving future problems.



PARTICIPANTS

Trained operators who answer calls for service

Local mechanics

INFORMATION

Notification of problem

Current status of all calls for service

Maintenance history of each elevator

Qualification and availability of mechanics

TECHNOLOGY

Computer at headquarters

Handheld terminals

Commercial wireless network


Figure 6.1Viewing products as a combination of information, physical, and service components


Figure 6.2Information systems built into automobiles


Figure 6.3Directions for improvement in a traditional résumé processing system


Figure 6.4Opportunities to increase customer benefits across the customer involvement cycle


Table 6.2Common Roles of Information Systems in Improving the Product of a Work System

COSTTypical measures: •Purchase price•Cost of ownership•Amount of time and attention required

Common information system roles: •Reduce internal cost of business process or increase productivity, making it easier to charge or allocate lower prices to customers•Improve product performance in ways that reduce the customer’s internal costs

QUALITYTypical measures:•Defect rate per time interval or per quantity of output•Rate of warranty returns•Perceived quality according to customer

Common roles:•Insure the product is produced more consistently•Make it easier to customize the product for the customer•Build information systems into the product to make it more usable or maintainable


Table 6.2Common Roles of Information Systems in Improving the Product of a Work System

RESPONSIVENESSTypical measures:•Time to respond to customer request•Helpfulness of responseCommon roles:•Improve the speed of response•Systematize communication with customers•Increase flexibility to make it easier to respond to what the customer wants

RELIALBILITYTypical measures:•Average time to failure•Failure rate per time interval•Compliance to customer committment datesCommon roles:•Make the business process more consistent•Make the business process more secure•Build features into the product that make it more reliable on its own right

CONFORMANCE TO STANDARDS AND REGULATIONSTypical measures:•Existence of nonconformance•Rate of complaints about nonconformanceCommon roles:•Clarify the standards and regulations so that it is easier to determine whether they are being adhered to•Systematize work to make the output more consistent


Table 6.3Competitive Approaches in Different Industries

AUTOMOBILE A

•Solid car at reasonable price

•Good for families

•Good service

•Long warranty

AUTOMOBILE B•Flashy foreign car

•Excellent power and handling

•Image associated with youth and wealth

•Reasonably good repair record

•Reputation for having the newest features

HOSPITAL A

•Best service and best doctors

•Excellent food

•High ratio of nurses to patients

•Pleasant rooms

•Long-term success in difficult heart operations

HOSPITAL B•Lowest cost for the patient

•High volume general care

•Few complex cases

•Cooperative with local ambulance companies


Figure 6.5Extended value chain for a manufactured product


Figure 6.6How Otis Elevator improved and expanded its product


Figure 6.7Internal costs versus costs borne by the customer


Figure 6.8Three ways to make reservations


Figure 6.9Advertising on the Web


Table 6.4Supporting the Sales Process for an Industrial Product

DESIGN THE SALES PROGRAM AND SUPPORTING MATERIALS•Provide information and tools for analyzing strengths and weaknesses of past and current sales processes•Customize sales materials for specific groups of customers

IDENTIFY, PRIORITIZE, AND CONTACT PROSPECTS (POTENTIAL CUSTOMERS)•Create lists of prospects from commercially availabile mailing lists or from internal customer lists•Obtain information about individual prospects prior to sales calls

MEET WITH PROSPECTS TO QUALIFY THEIR INTEREST, EXPLAIN THE PRODUCT, AND COUNTER OBJECTIONS•Use communication technology to set up meetings•Use computers to demonstrate product options or stimulate product operation•Use databases to provide information for justifying the purchase or countering objections


Table 6.4Supporting the Sales Process for an Industrial Product

NEGOTIATE PRICING AND DELIVERY OPTIONS•Perform pricing calculations while exploring the customer’s options•Link to corporate databases to find current product availability and delivery options

TAKE THE ORDER•Perform the recordkeeping related to taking the order and conveying it to the delivery department

FOLLOW UP TO MAINTAIN THE CUSTOMER RELATIONSHIP•Maintain customer database•Perform cutomer surveys•Store and analyze warranty and repair data


Figure 6.10Direct customer participation in customizing an information product


Figure 6.11LevilLink services in the retailing cycle


Figure 6.12Handheld terminal used to speed the process of returning rental cars


Figure 6.13Ford’s Service Bay Diagnostic System


Figure 6.14How elements of a business combine to determine competitive outcomes

©1999 Addison Wesley Longman Slide 6.1 Product, Customer, and Competitive Advantage 6.

Documents

addison wesley longman

elevator slide

maintainable slide

customer common roles

service components

customer benefits

product performance

service maintenance