High customer complaint ratio from medent co , ltd

UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business NGUYEN-DINH THIEN TAM Student ID: 22150055 HIGH CUSTOMER COMPLAINT RATIO FROM MEDENT CO., LTD MASTER OF BUSINESS ADMINISTRATION Ho Chi Minh City – 2019 UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business NGUYEN-DINH THIEN TAM Student ID: 22150055 HIGH CUSTOMER COMPLAINT RATIO FROM MEDENT CO., LTD MASTER OF BUSINESS ADMINISTRATION SUPERVISOR: TRAN HA MINH QUAN Ho Chi Minh City – 2019 Executive Summary The dizzying turn of the "digital" revolution in today's life has made intellectual property more important than ever The intellectual property, which is often considered the most important asset in all organizations, needs to be well identified and studied In addition, in this digital age, adaptation is being viewed as a strong competitive advantage In the current economic context of Vietnam and especially in commercial enterprises Organizations need to ensure they operate in a way that can help them meet and grow sustainably by addressing these two issues The purpose of this thesis is to explore the causes of high customer complaint ratio through the current problems with customer at Medent Co., Ltd (in short, it would be called Medent in this thesis) The findings of the study revealed the awkwardness and embarrassment of catching up with the changes of the times as well as the rapid change of customer demand in which the "information" factor is extremely important Not only you have to provide them enough "information", but also provide solutions that will enable them to apply into their work The findings are discussed in details in the research along with some recommendations for the company and management board to solve the problem of the actual needs of customers, towards sustainable development and reduce customer complaint ratio in Medent Co., Ltd Acknowledgements I would like to acknowledge all who supported me during my studies without whom I wouldn't be where I am today I would especially like to thank my supervisor – Professor Tran Ha Minh Quan for all his advice and guidance, without his help this could not have been possible I also would like to show my gratitude to my colleagues at work and classmates at ISB for their continuous support I also send my sincere thankfulness to my parents and friends for their support and encouragement TABLE OF CONTENTS EXECUTIVE SUMMARY ACKNOWLEDGEMENTS LIST OF FIGURES LIST OF TABLES INTRODUCTION 01 1.1 The company background 01 1.2 Company structure and mission 01 PROBLEM CONTEXT 03 PROBLEM IDENTIFICATION 05 3.1 Cause –and –effect map 05 3.2 Literature review 07 3.3 Final Cause –and –effect map 21 CAUSE VALIDATION 23 ALTERNATIVE SOLUTIONS 24 5.1 The first alternative solution: Establishment of a "multi-function" R&D center 24 5.2 The second alternative solution: conduct collaborative research programs with medical universities and dental associations 26 ORGANIZATION OF ACTIONS 29 CONCLUSION 34 SUPPORTING INFORMATION 35 REFERENCES 43 LIST OF FIGURES Figure Medent organizational structure Figure Increasing ratio of customer complaint (compare with previous quarter) Figure Increasing ratio of customer complaint in the last three year Figure The satisfied ratio with the services and products of Medent - 2018 data Figure The Gap Model Figure Initial Cause Effect Map Figure Final Cause Effect Map LIST OF TABLES Table 1: Fixed cost of building center Table 2: Fixed cost of Team training & recruiting Table 3: The cost of projects in 2017 Table 4: Action plan 1 INTRODUCTION 1.1 The company background Company name: Medent Co., Ltd Established year: 1994 Industry: Dental supplies and services CEO: Dr Huỳnh Thanh Đạm Medent Co., Ltd is one of the largest providers of dental care products and services to office-based dental and dental practitioners in Viet Nam Medent is a subsidiary company of the Medent Group; the largest group provides dental care products in Vietnam The company also serves dental laboratories, government and institutional health care clinics, and other alternate care sites in the field of dentistry A company with more than 23 years of development history and serves thousands of clients in the dental industry throughout Vietnam 1.2 Company structure and mission Regarding the structure, there are multiple services and products that the company provides Moreover, it also includes value-added solutions in order for operative practices and high-quality care to be achieved Medent oriented to operate through a centralized and automated distribution network, with a selection of rich and diverse product portfolio from over 10 global brands from reputable multinational corporations in the dental industry Plus, special assistance and various advanced technical aids are also available to customers in need, as claimed by the company Specifically, these consist of financial aids, software and utilities that are specialized in internet trading Headquartered in Tan Binh District, HCMC The company's sales reached a record 200 billion VND in 2016 (Medent Group sales revenue 2016 is 900 billion VND in 2016) For more information, visit the Medent website at http://medent.vn BOD CEO Supervisory Board Director of subsidiary company of Medent Group Board of Assistant Medent Co., Ltd Managing Director VP Supporting Group VP Operational Group VP Business Group Marketing Manager Technical Services Manager Dental Equipment Sales Manager HR & Administration Manager Ware house & Logistic Manager Dental Surgical Sales Manager Customer Relation Manager Finnance & Accounting Manager Dental Labo Sales Manager R&D Manager Import-Export Manager Dental Implant Sales Manager IT & System Management Manager Purchasing Manager Figure Medent organizational structure (Source: Medent Human Resource Department) PROBLEM CONTEXT High ratio of customer complaint Symptom: High ratio of customer complaint We have had data from Customer Services Department that they have received an increasing number of complains as follows: On average, from July 2017 to July 2018, the number of complaints increased 3.8% in average each quarter in a year when compared with the average number of previous year, we calculated by taking the total number of complaints of each quarter of this period from Q3 2017 to Q2 2018, add up their sum and then divide by 4, then use this result to compare with the average of the previous year, thereby calculating the average percentage above In addition, we also compared the growth rate of complaints in the quarters corresponding to the previous years, namely Q3 2017 compared to Q3 2016 On the other hand, we also compared this average of this year compared to the previous two years The issues mentioned above will be explained in the following two charts: 33 Through knowledge and skills gaining in classes as well as on the job, researchers can recognize what is important, what kind of mistakes are usually made, etc in the dental industry According to Abuharris and Atiya Thabet(17) , it is necessary to note that training can have an impact on all the members of a company although it can be a tool to motivate changes It is possible to benefit everyone if training is conducted accurately; otherwise, negative influences are also presented Some examples are credibility loss, disagreement and decreased productivity Secondly, a modern, diversity research facility is essential to enhance the customer experience, because you cannot let customers make important decisions through oral counseling Thirdly, R&D center is a good base for implementing extended solution issues As a matter of fact, you can use it as a powerful tool to support the negotiation and implementation of the activities of the second solution: conduct collaborative research programs with medical universities and dental associations Thus, the solution to set up a R&D center could be prioritized to implement in Medent It is both a long-term strategy and a convincing basis for the determination to exactly what the company says to customers Moreover, if you not have an internal team, for example, you choose the second solution, your job will become very unstable because you have to depend largely on the doctor while their time budget is very limited and the status of research in the medical sector in Vietnam is still very much limitations such as the facilities, infrastructure for research is weak, lack of funding, ground level of research, etc Finally, on the other hand, I think we should deploy both solutions parallelly, because building a research center will take a considerable amount of time, while your company still needs some new solutions from research to launch it to the market ORGANIZATION OF ACTIONS In Medent, errors or omissions in the issues of information is the urgent problem that needs to be solved immediately After comparing costs with long term benefits and base on the research results, the actions that Medent needs to take are: 34 Initiate the construction of the research center as well as beginning recruitment and training before the research center completes three months Recruiting a R&D manager who has enough experience to set up a R&D center Conducted in parallel with the above two work is the implementation of collaborative research programs as soon as possible Table as below is an action plan timeline which take 06 months from June 2018 to December 2018 and will be reviewed at the end of the year 2019 33 ACTION PLAN 2018 Activities Initiate the Purchase equipment and build a construction of the showroom research center as well as beginning recruitment and training before the research center Recruiting, training & planning completes three months Month Objectives Have facilities t to carry out independent and cooperative activities Get staff to manage and deploy word Cerec – Smile design project (Phd Dr Lâm Đại Phong, University of Research responds Medicine and Pharmacy) to new trends 10 11 12 Responsibility BOD, Technical team and independent company (out source) PIC: Dr Dam (CEO), Mr Hoang (Chief Engineer) HR recruit; HR and R&D manager training for staff; BOD and R&D manager planning for research activities PIC: Ms Ha Vy (HRM), Dr Dam (CEO), Dr Tam (R&D Manager) BOD, R&D Manager and sales manager PIC: Mr Cao Thanh Toan (SM), Dr Dam (CEO), Dr Tam (R&D Manager) 24 The implementation of Cerec & CBCT integrated project collaborative research (Phd, Dr Lâm Đại Phong, University programs of Medicine and Pharmacy, Ho Chi Minh City and Dr Tran Thanh Phong Implant specialist of Nobel Viet Nam, Keiyen Clinic) Study on accuracy to confirm competitive advantage Cerec Implant project (Dr Tran Study on accuracy Thanh Phong Implant specialist of to confirm Nobel Viet Nam, Keiyen Clinic) competitive advantage BOD, R&D Manager and sales manager PIC: Mr Cao Thanh Toan (SM), Dr Dam (CEO), Dr Tam (R&D Manager) BOD, R&D Manager and sales manager PIC: Mr Cao Thanh Toan (SM), Dr Dam (CEO), Dr Tam (R&D Manager) 34 CONCLUSION In such a developing country as Vietnam, the production of modern medical equipment in general and dental equipment in particular with products of good quality and meet the demand of doctors is not possible at the present time Most of Vietnam's business enterprises in this industry, except for simple equipment that can be produced, still have to choose a commercial approach However, this option leads to a risk of lack of competition and the potential for loss of distribution rights Indeed, in recent years with the rapid development of science and technology The "digital" revolution has changed our lives as fast as ever Back in the dental industry, the development of science and technology in the "digital era" has pushed commercial businesses into the difficult situation: to change to keep up with technology or to die Because of a very simple reason, but not simple to implement: the change in the actual needs of customers, customers now no longer choose and buy products simply, they have begun to require businesses to provide solutions which come with new technologies Therefore, the need to develop a new approach to help our commercial enterprises survive in this era is to turn them into consultancy and solution providers This study has clarified some points as below: Firstly, the needs of customers, actually have been changing Comes with these new products and technologies are the information factor, businesses need to provide enough information in the form of solutions to enable them to deploy new technology products Secondly, building R&D unit with me is just a name The essence of the problem to be solved here is: there must be a functional division to take charge of, or otherwise capture the change caused by technology and research to apply and transfer it to customers to create real value and meet their new demand Thirdly, building competitive advantages and especially sustainable competitive advantage by the "From root to tip" method is imperative In the absence of sufficient capacity to manufacture high-tech equipment, the added value and solutions come from 35 the "gray matter" of the enterprise or, in other words, the production of intellectual product is a worthy consideration approach SUPPORTING INFORMATION Two types of data were collected in this thesis Firstly, secondary data was collected from some reliable sources such as the report of Customer Services Department Medent, relevant online literatures, management books and other journals, researches, etc which strengthen the theory and conclusions when compared to what the interviewees mentioned and the real status in Medent recently Secondly, primary data is collected through conducting a qualitative research The main method for collecting qualitative data is in-depth interviews These respondents are categorized in two main groups as follows: First group: Doctors who are clients of Medent Second group: Managers/supervisors/workers who are currently working for Medent The purpose of the interview is to collect general data and opinions of interviewees about the high complaint ratio of customer with Medent products and services as well as its causes and their suggested solutions All questions that respondents in each group have been asked as follows: 36 INTERVIEW GUIDE Research objectives: To explore and understand the reason why Medent received a high rate of complaints Duration: 10-20 minutes per interviewee THE FIRST QUALITATIVE RESEARCH Detail interviewees information Name Gender Business Location Dr Hùng Male Dr.Hùng Dental Clinic 244A Cống Quỳnh Dist 1, HCMC Dr Huy Male Dr Beam Dental Clinic Dr Hưng Male Dr Phú Male Việt Úc Dental Clinic 12 Điện Biên Phủ HN Dr Điềm Male Sagodent Dental 12-14 Phước Hưng, Dist 5, HCMC Dr Hoà Female DDS Dental Clinic Dr Đạm Male Medent Group CEO 56 Trúc Khê Dental Clinic 400CD Lê Hồng Phong, Dist 10, HCMC 56 Trúc Khê, Dist Đống Đa, HN 42 Cửa Đơng, Hồn Kiếm Dist, HN 37 Bàu Cát 3, Tân Bình Dist, HCMC Detail interview content: Interview Guide Name: Sex: Business: Male Female 37 Location: After the previous quantitative study, the company received a high rate of complaints In your opinion, where does this come from? Probe & Prompt 1.Could you please explain deeper/clearer? Could you please give us some reasons why you think it's the most important? Name Probe & Prompt Dr Could Hùng please Answer you The majority of Medent's complaints come from explain the company's services deeper/clearer? You see, as you have recently converted from Could please give you selling products to selling solutions that I have us not seen this in practice You are only bringing some reasons that values to customers sporadically because you you think it's the lack a lot of core values most important? The reason, simply because you not understand correctly and specifically what you need to For example, when you combine multiple treatment technologies together, that does not mean "one plus one equal two" that you are changing the behavior and treatment method of the doctor, you need to help them Do it in a practical way, not just on theory In addition, delivery services as well as operating instructions are not really good But this is understandable, as I mentioned above, there are things you not know Thus, how can you guide and organize well? Dr Huy Medent's complaints come from company 38 mindset in general and staff in particular Do you remember when you asked me that you want to switch from selling a product to a solution? We have talked about customer centric orientation, the problem is simply the switch from selling pure products to selling a more comprehensive service package to customers, that is the solution What I see is that you still theoretical solutions, I not know what you think, but I see you are away from the core values of the industry, that is medical expertise In addition, delivery services as well as staff attitude are not professional enough I say this because you are targeting high-end customers, you understand? Dr Medent's services, in general, are "standard" but Hưng there are many shortcomings Thus, leading to customer complaints I appreciate Medent, you are very prestigious, very enthusiastic and honest To me, that is what has been and is helping Medent grow and survive to this day However, those are not enough, I think you lack two things that are thoughtful and detailed Be more thoughtful and detailed And one more things, more practical Dr Phú The way Medent works, I feel pretty good, you only need to care more I say more attention, which means that you need 39 to pay attention to small points but lead to dissatisfaction You know, sometimes you are doing something good but just for a point, you get “minus points” from customers For example, your delivery time and your operational instruction course quality I don’t know why it was used to good in the past, but now, it changed Dr The way your company works is just right for Điềm the old days, now it is different trend Therefore, complaining is correct You understand, I take a lot of time to be able to learn in detail the dental solution to apply to the patient and then I have to practice a lot You know that medical solution is a smooth combination of practice and theory For me, it is very difficult, you even want to deliver integrated solution, I think this is very difficult for you at this time Dr Hoà Your service is not bad, but the service attitude and the way you organize your work should be reviewed You know, sometimes you cannot well, but attitude is very important to save the problem, and about the organization, I'm a doctor, I not know very well but I feel recently, your company seems to be "exhausted" and I see that your products in particular and the market in general are increasingly "more difficult to use", 40 which may some important reasons that cause the problems Dr Đạm Medent's complaints come from the many different aspects From distribution services, installation services to operational instruction services, etc I think a problem has many causes, but I myself find that Medent is lacking in knowledge of the solution, which is not easy to solve because we have done our best, maybe I have to think about changing the way to it THE SECOND QUALITATIVE RESEARCH Detail interviewees information: Name Gender Position Mr Toàn Male Medent Sales manager Ms Đoan Trang Female Medent Customer services manager Mr Phúc Male Medent Marketing manager Detail interview content: Interview Guide Name: _ Sex: Business: Male Female 41 Location: After reading the previous quantitative & quantitative study, your company is having problems with customers that many years ago did not meet In your opinion, where does this come from? Probe & Prompt 1.Could you please explain deeper/clearer? 2.Could you please give us some reasons why you think it's the most important? Name Probe & Prompt Answer Mr Could you please The majority of Medent's complaints come from Toàn explain the company's consultant services deeper/clearer? You see, as you have recently converted from Could you please selling products to selling solutions However, give us some we only can bring values to customers reasons that you sporadically because we don't know exactly think it's the most what to important? The reason, simply because We are still in the "half-vague" state, or in other words, I can understand and visualize what the board wants to do, but the actual deployment brings a lot of difficulties to our team Why is this happening? Remember that our products and technology are becoming increasingly complex day by day, let alone their combined solutions, we are just a business team, my business is not research applied technology in medicine Ms Recently, I felt Medent was in a state of 42 Đoan confusion and this became clearer after I saw the Trang results of the report Do you remember when you asked me about our new orientation to switch from selling a product to a solution? The problem is simply the switch from selling pure products to selling a more comprehensive service package to customers, that is the solution What I see is that our business team still theoretical solutions, In short, they are still saying that they provide the solution, but when I talk to customers, I know they have not reached the bottom of the problem so their solution is very lack of application Mr I just find it simply the distance between the will Phúc and the reality Business solution, it sounds easy, but for me the solution is a form of wisdom, it is very difficult when we not know where to start, even "some teams "do not have enough expertise, I wonder how they deployed? To put it simply, my team is needed to lots of marketing activities to deliver the solution to our clients However, even me had not figured it out, it was very hard for my team 43 REFERENCES Lewis BR, Mitchell VW Defining and measuring the quality of customer service Marketing intelligence & planning 1990;8(6):11-7 Nejadjavad M, Gilaninia S The Role of Service Quality in Organizations Kuwait Chapter of the Arabian Journal of Business and Management Review 2016;5(7):19 Kotler P, Bowen JT, Makens JC Marketing for hospitality and tourism: Prentice Hall; 2009 Wirtz J, Lovelock C Services marketing: World Scientific Publishing Company; 2016 Storey C, Easingwood CJ The augmented service offering: a conceptualization and study of its impact on new service success Journal of Product Innovation Management: AN INTERNATIONAL PUBLICATION OF THE PRODUCT DEVELOPMENT & MANAGEMENT ASSOCIATION 1998;15(4):335-51 Lovelock CH Cultivating the flower of service: new ways of looking at core and supplementary services Marketing, operations, and human Resources: Insights into services 1992:296-316 Bitner MJ, Brown SW, Meuter ML Technology infusion in service encounters Journal of the Academy of marketing Science 2000;28(1):138-49 Lovelock C, Patterson P Services marketing: Pearson Australia; 2015 Lovelock CH, Wirtz J, Chew P Essentials of services marketing 2009 10 Naipaul S, Parsa H Supplementary services as a differentiation strategy: an empirical investigation of lovelock's model in tourism Journal of Quality Assurance in Hospitality & Tourism 2000;1(1):67-80 11 Colgate M, Alexander N Benefits and barriers of product augmentation: retailers and financial services Journal of Marketing Management 2002;18(1-2):105-23 12 Goyal A Role of supplementary services in the purchase of credit card services in India Asia Pacific Journal of Marketing and Logistics 2004;16(4):36-51 13 Hume M Understanding core and peripheral service quality in customer repurchase of the performing arts Managing Service Quality: An International Journal 2008;18(4):349-69 14 Levitt T Marketing success through differentiation-of anything: Graduate School of Business Administration, Harvard University; 1980 15 Zeithaml VA, Parasuraman A, Berry LL, Berry LL Delivering quality service: Balancing customer perceptions and expectations: Simon and Schuster; 1990 16 Oliver RL, Rust RT Service quality: New directions in theory and practice: Sage; 1994 17 Abuharris AT The role of cross-training in reducing the level of labor turnover applied study on some hotels in Tripoli-Libya Romanian Economic and Business Review 2013:225 44 ... software 1,5 0 0,0 0 0,0 00 Sterilizer systems 1,2 0 0,0 0 0,0 00 Milling & sintering systems 3,0 0 0,0 0 0,0 00 Others (Other systems and cost of design, construction, etc.) 1,1 0 0,0 0 0,0 00 8,8 0 0,0 0 0,0 00 Total... Figure Medent organizational structure (Source: Medent Human Resource Department) PROBLEM CONTEXT High ratio of customer complaint Symptom: High ratio of customer complaint We have had data from Customer. .. board 2 5,0 0 0,0 00 Additional cost (electricity, telephone, note papers, clip board, pens, evaluation form, et 5,0 0 0,0 00 al) Total 30 0,0 0 0,0 00 To sum up, set up a R&D center and training team, providing