Harvard Case - Agero: Enhancing Capabilities for Customers
"Agero: Enhancing Capabilities for Customers" Harvard business case study is written by Robert Simons, Natalie Kindred. It deals with the challenges in the field of Service Management. The case study is 22 page(s) long and it was first published on : Feb 21, 2013
At Fern Fort University, we recommend Agero implement a comprehensive strategy focused on enhancing customer experience, leveraging technology, and fostering a culture of service excellence. This strategy should prioritize service innovation, employee empowerment, and data-driven decision making to achieve sustainable growth and competitive advantage in the evolving roadside assistance market.
2. Background
Agero is a leading provider of roadside assistance services, facing increasing competition and evolving customer expectations. The case study highlights Agero's strengths in technology and data analytics but also reveals challenges in service quality, customer satisfaction, and employee engagement. The main protagonists are Agero's leadership team, grappling with the need to adapt and innovate to maintain their market position.
3. Analysis of the Case Study
This case study can be analyzed through the lens of the Service Profit Chain, a framework that emphasizes the interconnectedness of customer loyalty, employee satisfaction, and profitability. Agero's current situation suggests a disconnect between these elements. While Agero excels in technology and data collection, the company struggles to translate these assets into tangible improvements in service quality and customer satisfaction. This disconnect can be attributed to several factors:
- Service Quality Gaps: Agero faces challenges in bridging the gap between customer expectations and perceived service quality. The case study highlights issues with call center wait times, inconsistent service delivery, and lack of transparency in service processes.
- Employee Empowerment: Despite a strong focus on technology, Agero's service delivery relies heavily on human interaction. However, employees lack the autonomy and empowerment to address customer concerns effectively. This leads to frustration and a decline in service quality.
- Customer Experience Management: Agero lacks a holistic approach to customer experience management. While the company collects data, it fails to leverage it effectively to understand customer needs, personalize service interactions, and proactively address potential issues.
- Service Innovation: Agero's focus on technology has led to a lack of innovation in service offerings. The company needs to explore new service models and technologies to cater to evolving customer demands and differentiate itself in the market.
4. Recommendations
To address these challenges, Agero should implement the following recommendations:
1. Enhance Service Quality and Customer Experience:
- Implement a Customer Journey Mapping: Agero should map the entire customer journey, identifying key touchpoints and potential pain points. This will help identify areas for improvement and develop a more customer-centric approach.
- Develop Service Level Agreements (SLAs): Establish clear SLAs for service delivery, including response times, communication protocols, and service resolution timelines. This will ensure consistency and transparency in service delivery.
- Invest in Service Recovery: Implement a robust service recovery process to address service failures promptly and effectively. This includes empowering employees to resolve issues on the spot and offering compensation for inconvenience.
- Leverage Technology for Service Enhancement: Utilize technology to streamline service processes, improve communication, and provide real-time updates to customers. This includes implementing self-service technologies like chatbots and mobile apps.
- Implement Customer Feedback Management: Establish systems for collecting and analyzing customer feedback through surveys, reviews, and social media monitoring. This data can be used to identify areas for improvement and track progress.
2. Empower Employees and Foster a Service Culture:
- Implement Employee Empowerment Programs: Provide employees with the training, tools, and authority to make decisions and resolve customer issues effectively. This includes empowering call center agents to offer discounts or waive fees in certain situations.
- Develop Employee Incentive Programs: Implement performance-based incentives that reward employees for delivering exceptional customer service. This can include bonuses, recognition programs, and opportunities for career advancement.
- Focus on Diversity and Inclusion: Promote a diverse and inclusive work environment that values different perspectives and experiences. This will lead to a more engaged and customer-centric workforce.
3. Drive Service Innovation and Differentiation:
- Explore New Service Models: Agero should consider expanding its service portfolio to include new offerings like on-demand maintenance services, vehicle diagnostics, and personalized insurance packages.
- Leverage Technology for Service Innovation: Explore emerging technologies like artificial intelligence (AI), blockchain, and the Internet of Things (IoT) to create innovative service solutions.
- Develop a Strong Service Brand: Agero should develop a clear and compelling service brand that communicates its value proposition and differentiates it from competitors. This includes emphasizing its commitment to customer satisfaction, service excellence, and innovation.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies and Consistency with Mission: Agero's core competencies in technology and data analytics can be leveraged to enhance service quality and customer experience. This aligns with the company's mission to provide reliable and innovative roadside assistance solutions.
- External Customers and Internal Clients: The recommendations address the needs of both external customers and internal clients (employees). By improving service quality and empowering employees, Agero can create a win-win situation for all stakeholders.
- Competitors: Agero needs to differentiate itself from competitors by offering superior service quality, innovative solutions, and a more personalized customer experience.
- Attractiveness ' Quantitative Measures: Implementing these recommendations will likely lead to increased customer satisfaction, reduced service costs, and improved employee retention, ultimately driving profitability.
6. Conclusion
By implementing these recommendations, Agero can transform its business model to become a customer-centric organization that delivers exceptional service experiences and achieves sustainable growth. This will require a commitment to continuous improvement, data-driven decision making, and a culture of service excellence.
7. Discussion
Alternatives not selected:
- Outsourcing Service Delivery: Outsourcing certain aspects of service delivery could reduce costs but may compromise service quality and customer satisfaction.
- Focusing solely on technology: While technology is important, Agero needs to balance its technological focus with a strong emphasis on human interaction and service quality.
Risks and Key Assumptions:
- Implementation challenges: Implementing these recommendations will require significant investment and organizational change.
- Customer acceptance: Customers may not readily embrace new service models or technologies.
- Competition: Competitors may adopt similar strategies, requiring Agero to continuously innovate and differentiate itself.
8. Next Steps
Agero should implement these recommendations in a phased approach, starting with pilot projects and gradually scaling up based on results. The following timeline outlines key milestones:
- Phase 1 (Year 1): Implement customer journey mapping, develop SLAs, and pilot employee empowerment programs.
- Phase 2 (Year 2): Roll out service recovery process, invest in technology for service enhancement, and launch customer feedback management system.
- Phase 3 (Year 3): Explore new service models, invest in service innovation, and develop a strong service brand.
By taking these steps, Agero can position itself for long-term success in the evolving roadside assistance market.
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Case Description
Cross Country (renamed Agero in 2011) operated call centers that coordinated with thousands of small, independent towing companies-Cross Country's "service provider network"-to deliver roadside assistance services, such as vehicle towing and tire changes, to motorists covered by automakers' warranties and insurers' policies. The case describes Cross Country's evolution from 1972 to 2012 in three phases. This allows students to, at various stages, grapple with defining Cross Country's business (what business is it, and should it be, in?) and its primary customer (vehicle makers and insurers? motorists? service providers?). The answers to these questions have important implications for organization design. During the first phase, from 1972 to 1998, founder Sidney Wolk built the business through personal relationships with clients. A passionate entrepreneur, his approach to growth-secure customers first, figure out how to make money later-was remarkably successful, if sometimes chaotic. Facing an increasingly commoditized marketplace, in 1998 Wolk hired professional managers who implemented formal performance management systems and invested in sophisticated data analytics. From 1998 to 2007 (phase two), these investments allowed Cross Country to quantify service providers' impact on motorist satisfaction, monitor service providers' performance, and introduce programs to strengthen top-performing service providers' loyalty to Cross Country. Concurrently, the company undertook a two-step organization redesign to focus more resources on service providers (the new primary customer?), improve market-focused innovation and increase client satisfaction. In phase three, from 2008 to 2012, Cross Country entered the high-tech telematics/connected-vehicle business, invested in additional innovations to strengthen its service provider network, and rebranded itself as "Agero." Wolk and his team believed Cross Country had "more driver information than any other company."
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