Microsoft Word 22170023 Nguyen Thi My Linh Final Master thesis V1 (1) UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business NGUYEN THI MY LINH POOR COOPERATION BETWEEN AFTER SALES[.]
UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business NGUYEN THI MY LINH POOR COOPERATION BETWEEN AFTER SALES TEAM AT PRESTIGE SPORTS CARS CO., LTD MASTER OF BUSINESS ADMINISTRATION Ho Chi Minh City – Year 2019 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business NGUYEN THI MY LINH POOR COOPERATION BETWEEN AFTER SALES TEAM AT PRESTIGE SPORTS CARS CO., LTD MASTER OF BUSINESS ADMINISTRATION SUPERVISOR: DR DOAN ANH TUAN Ho Chi Minh City – Year 2019 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com TABLE OF CONTENT Executive summary Company introduction 1.1 Industry overview 1.2 Company Overview 1.3 After sales department (AFS) 1.3.1 After Sales chart 1.3.2 After Sales Service scope Company’s symptoms 2.1 Low profit margin of AFS department in 2018 Problem identification 12 3.1 Problem context 12 3.2 Problem finding process: 12 3.3 Potential problem: 13 3.3.1 Effect by Decree 116 from government 13 3.3.2 High workload 14 3.3.3 Poor cooperation between AFS’s team 17 3.4 Validating problem 24 3.5 The main problem: Poor corporation between AFS team 27 Cause and updated caused-effect map 28 4.1 Potential causes 28 4.1.1 Unbalance benefits and compensation 30 4.1.2 Poor communication 30 4.1.3 Personality differences 31 4.2 Validating causes 32 Alternative solution 34 Action plan 38 Supporting information 44 Interview guide 59 References 74 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Executive summary Prestige Sports Cars Co., Ltd is the official distributor of Porsche in Vietnam (Porsche Vietnam) Porsche is one of the leading sport car brands in the world with powerful engine, high performance, attractive vehicle such as the legendary 911, 718 Boxster, 718 Cayman, Panamera, Cayenne, Macan In Vietnam, Porsche is still taking a small market share in car industry Porsche is famous brand in luxury cars industry with quality products as well as warranty and maintenance service Therefore, in addition to selling cars, after-sales service is also given top priority for all official distributor in the world Base on the management report in 2018, the result of business had been decreased compare with 2017 By using different literature reviews and in-depth interviews among employees in different departments: Sales, After Sales, Finance, Human Resources, Porsche Vietnam had two main symptoms in After Sales department which lower in After Sales profit margin and high turnover rate of technician These aspects contribute to clarify the answer of the queries: what the main problem is, what the potential problem is, why it is the main problem, how important and how it effect to profit margin and After Sales employees in general and technicians in particularly The number of vehicles reduced corresponds to a 4-year maintenance package reduction, which is included when selling a new car Besides, technical staffs leaved their job frequently which also greatly affects the quality of service and sales of the company.The cause of the decline in profit margin and high turnover rate of technicians are estimated to be impacted by three reasons: reduction of sales, increase in cost of goods sold and job dissatisfaction This research will be a supportive analysis for After Sales Director to find the key problem, the main causes and conduct best solution to increase profit margin as well as reduce the turnover rate of technicians Improvement of cooperation and teamwork is the necessary method to reach business target as well as achieve personal goals LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Company introduction 1.1 Industry overview The automobile industry in Vietnam is divided into main categories: imported cars (CBU - Completely Built-Up) and domestically produced cars (including CKD - Completely Knocked Down and SKD: Semi-Knocked Down) Porsche is one of the luxury car brands imported from Germany In 2018, it was a difficult year for imported cars with influence of The Decree No 116/2017 / ND-CP taking effect from January 1, 2018 The Decree No 116/2017/ ND-CP stipulated conditions for production, assembly, import of automobiles, and standardized requirement of warranty and maintenance services for all enterprises Accompanied by Circular 03 of the Ministry of Transport, import activities of automobile manufacturers in Vietnam have encountered barriers and affect the business in general The Decree is considered as a technical barrier to "curb" the prospect of imported CBU vehicles, especially automobiles from Southeast Asian countries, massively entering Vietnam since 2018 In addition to selling cars, the enterprises need to invest on workshop with full machine and tool, have strong human resources to build up brand name and provide excellent service in the market It is one of the strategies of any automotive builder In Vietnam, the reputable automakers as BMW, Lexus, Audi, Mercedes-Benz also often focus on after-sales service, which is an inevitable trend to retain a loyal customer base and to maintain its reputation 1.2 Company Overview Prestige Sports Car Company Limited is the official distributor of Porsche in Vietnam with two centers in Ho Chi Minh City and Hanoi With comprehensive infrastructure and equipment and professional staff, two centers provide services according to standard Sales, Porsche special of Porsche globally Services tequipment, Porsche Fashion include Sales, After Collection (Porsche driver's Selection) and other services LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Porsche brings to the Vietnam market the sporty cars with optimal personalization This is also a factor that makes Porsche sports car brand unique The Porsche models introduced in Vietnam include: the legendary 911, the "roadster" 718, the Gran Turismo Panamera, the SUV Cayenne and the mid-size SUV Macan Porsche is a brand created to conquer sports car enthusiasts Porsche Vietnam has grown steadily since 2007 with canters being considered one of the standards of the automotive industry Porsche is a brand created to win sports car enthusiasts Porsche Vietnam has grown steadily since 2007 with center rated as one of the benchmarks of the automobile industry Porsche Vietnam is proud of perfect service package providing under the leadership of knowledgeable, experienced and skillful leaders and professional staffs Organization chart of Porsche Vietnam General Director Finance Director Sales Director Finance HR Admin IT Finance staffs HR staffs Admin staffs IT staffs 1.3 Sales staffs Marketing Director Marketing Staffs Logistics After Sales Director After Sales Manager Technical Manager After sales department (AFS) Following to Gaiardelli, Nicola and Lucrezia (1), nowadays After Sales service activities are acknowledge as a relevant source of revenue, profit, competitive advantage Therefore, top management should focus on the definition of a structured business performance measurement system for the after-sales business Porsche Vietnam has already provided good service to take care of customers’ car according to Porsche standards: service job, service of car interior and exterior will LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com be provided professionally with 24/7 emergency service only for Porsche car owners Porsche Vietnam provides 24/7 hotlines to customers when the cars are in emergencies In the event of a vehicle malfunctioning during the warranty period, the vehicle will be transported free from the accident location to the Porsche Service Centre for processing and will be returned after inspection look up 1.3.1 After Sales chart After Sales Director After Sales Manager Technical Manager Foreman Service Advisor Service Executive/ Admin Warranty Admin Parts Department Technicians Team Car care Team *Note: - After Sales Director: Managing all activities in After Sales Department - After Sales Manager: Managing all activities in After Sales Department relate to Service - Technical Manager: Monitoring and handling of all technical problem case, technical diagnostic support and general technical support, special tool and workshop equipment orders and administration, PIWIS Tester support and updates - After sales admin: Supporting to AFS director and AFS manager in AFS activities, taking responsibility for synthesizing all feedback from customers - Foreman: Organizing workshop (workflow, job assignment (incl car care), etc.), workshop equipment maintenance supervision LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com - Technician: Taking responsibility for • Repairing & maintaining Porsche cars in accordance with manufacturer’s procedures & diagnostic guidelines • Diagnosing vehicle with advanced special equipment • Interpreting of diagnostic logs and fault finding for comprehensive vehicle system networks • Assurance of highest repair quality standards • Storing and maintaining tools using for repair - Car care: Taking responsibility for polishing and beautifying the car before delivering to the customer - Service Advisor: taking responsibility for: • Receiving phone, setting up auto repair appointment for customers • Contacting customers and listen to customers' opinions and requests about their cars • Taking full note of the customers’ comments • Transferring requests and customer comments for technicians to diagnose diseases • Uploading the list of repairs, parts, working hours, to quote and convince customers • Processing to deliver the car to the workshop to repair • Taking final inspection and delivery of vehicles to customers • Selling the equipment - Service Executive: Taking responsibility to diagnose errors of new vehicles, receiving feedback from customer - Warranty Admin: Taking responsibility for the work related to reimbursing warranty task - Parts department: Ordering and managing spare parts to technical staff as their demand, following up with shipment information and support logistics staff in part importation LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 1.3.2 After Sales Service scope Repairing cars Providing warranty jobs for customers according to Porsche's regulations Providing - year maintenance package for new car (4 - year maintenance packages is offered for each vehicle after activating new car warranty and counted as the revenue of AFS department at that time.) Selling spare parts to customers Checking the cars before delivering to the customer Supplying car care and cosmetic services Company’s symptoms According to Ropega (2) , in order to help businesses reduce the number of risks and avoid business failures, it is necessary to analysis and understand the symptoms of a business When business symptoms are recognized, it will help board of management make decisions to develop the business Following the management report in 2017 and 2018, the symptoms of Porsche Vietnam had revealed as low profit margin and high turnover rate of technician 2.1 Low profit margin of AFS department in 2018 The gross profit margin = (Sale revenue – Cost of Goods Sold) / Sale revenue After Sales Monthly Profit Margin 70% Profit margin (%) 60% 50% 40% 30% 20% 10% 0% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Y2017 54% 48% 52% 48% 56% 51% 59% 50% 49% 49% 47% 51% Y2018 50% 49% 50% 42% 48% 40% 45% 48% 46% 45% 44% 47% LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Figure 1: AFS’s profit margin from 2017 to 2018 Base on Figure 1, in 2018, After Sales monthly profit margin was declined comparing to 2017 The lowest reduction was March with 2%, the highest was Augy with 14% The main reasons of declining profit margin of AFS were decrease in revenue Following to Rigopoulou (3) the after sales services effects on customers' satisfaction as well as on their behavior intentions or repurchase intention, AFS’s revenue include 4-years maintenance package which already sell to customers at the same time with new car sold, warranty service, AFS internal service (include as disposal job, internal job, gifts to customers, etc.) The revenue of AFS did not meet the AFS’s target in 2018 The main service which made AFS’s profit margin decreased include disposal job, service job with gross margin < 25% due to discount for customers, parts stock aging and years maintenance package LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com ... 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