Harvard Case - Hamburguesas El Corral: Does Delivery Service Matter?
"Hamburguesas El Corral: Does Delivery Service Matter?" Harvard business case study is written by Marcus Thiell, Luz E. Orozco, Daniela Sinisterra. It deals with the challenges in the field of Service Management. The case study is 24 page(s) long and it was first published on : Jan 16, 2017
At Fern Fort University, we recommend that Hamburguesas El Corral implement a strategic delivery service with a focus on service quality, customer experience, and operational efficiency. This will involve a multi-pronged approach encompassing service design, branding, employee empowerment, and technology integration. By strategically leveraging delivery, El Corral can expand its customer base, enhance brand perception, and solidify its position as a leading fast-casual dining experience in Colombia.
2. Background
Hamburguesas El Corral is a successful fast-casual restaurant chain in Colombia, known for its high-quality burgers and consistent customer experience. The case study explores the potential benefits and challenges of introducing a delivery service, considering the competitive landscape and changing consumer preferences. The main protagonists are the El Corral management team, who are grappling with the decision of whether to invest in a delivery service and how to best implement it.
3. Analysis of the Case Study
The case study presents a compelling opportunity for El Corral to capitalize on the growing demand for food delivery services. However, it also highlights potential challenges, such as maintaining service quality, managing costs, and ensuring brand consistency. To analyze the situation, we can utilize the following frameworks:
a) Service Quality and Customer Experience:
- SERVQUAL Model: Applying the SERVQUAL model, El Corral needs to assess its current service quality against customer expectations in the following dimensions: tangibles, reliability, responsiveness, assurance, and empathy. This assessment will help identify areas for improvement and ensure the delivery service meets customer standards.
- Customer Journey Mapping: Mapping the customer journey from ordering to delivery will highlight potential pain points and opportunities for service innovation. This will involve analyzing the customer experience at each touchpoint, including online ordering, order confirmation, preparation, delivery, and post-delivery feedback.
- Service Blueprinting: A service blueprint will visualize the service process, identifying key interactions and potential points of failure. This will help El Corral design a robust delivery system that minimizes errors and maximizes customer satisfaction.
b) Business Model and Competitive Advantage:
- Service-Dominant Logic: Applying the service-dominant logic, El Corral can focus on creating value for customers through the delivery service. This involves understanding customer needs and offering solutions that exceed expectations.
- Competitive Advantage: El Corral needs to differentiate its delivery service from competitors by leveraging its existing strengths, such as brand reputation, product quality, and customer loyalty. This could involve offering unique delivery options, loyalty programs, or partnerships with delivery platforms.
c) Operations and Technology:
- Service Operations Management: El Corral needs to optimize its delivery operations to ensure efficiency, speed, and accuracy. This includes managing service capacity, optimizing delivery routes, and implementing robust order tracking systems.
- Technology-Enabled Services: Integrating technology into the delivery service is crucial for streamlining operations and enhancing the customer experience. This could include online ordering platforms, mobile apps, GPS tracking, and automated order management systems.
d) Employee Empowerment and Motivation:
- Employee Empowerment: Empowering delivery staff to handle customer inquiries and resolve issues on the spot will enhance customer satisfaction and build brand loyalty.
- Employee Incentives: Implementing performance-based incentives for delivery staff can motivate them to provide exceptional service and contribute to the overall success of the delivery program.
4. Recommendations
Based on the analysis, we recommend the following steps for El Corral to implement a successful delivery service:
1. Service Design and Development:
- Define Service Value Proposition: Clearly articulate the value proposition of the delivery service, emphasizing the benefits for customers, such as convenience, speed, and quality.
- Design Service System: Develop a comprehensive service system that includes online ordering, order processing, preparation, delivery, and customer feedback mechanisms.
- Develop Service Standards: Establish clear service standards for delivery time, order accuracy, and customer interactions to ensure consistency and quality.
- Pilot Test: Conduct a pilot test of the delivery service in a limited area to refine processes, gather customer feedback, and identify areas for improvement.
2. Branding and Marketing:
- Brand Extension: Leverage the existing El Corral brand to build awareness and trust for the delivery service.
- Marketing Campaign: Launch a targeted marketing campaign to promote the delivery service, highlighting its unique features and benefits.
- Social Media Engagement: Utilize social media platforms to engage with customers, build brand loyalty, and gather feedback on the delivery service.
3. Employee Empowerment and Motivation:
- Training and Development: Provide comprehensive training to delivery staff on service standards, customer service skills, and safe driving practices.
- Performance Management: Implement a performance management system to monitor delivery staff performance, provide feedback, and recognize outstanding contributions.
- Incentive Programs: Develop incentive programs to motivate delivery staff to provide exceptional service and achieve performance targets.
4. Technology Integration:
- Online Ordering Platform: Develop a user-friendly online ordering platform that allows customers to place orders easily and track their delivery status.
- Mobile App: Develop a mobile app for customers to order, track deliveries, and access loyalty programs.
- GPS Tracking: Implement GPS tracking for delivery vehicles to optimize routes, improve delivery times, and enhance customer communication.
- Order Management System: Implement an order management system to streamline order processing, ensure accuracy, and manage inventory.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies: El Corral's core competencies in food quality, customer service, and brand recognition provide a strong foundation for a successful delivery service.
- External Customers: The recommendations address the needs and expectations of customers seeking convenience and quality food delivery.
- Competitors: The recommendations consider the competitive landscape and aim to differentiate El Corral's delivery service through its unique value proposition and operational efficiency.
- Attractiveness: The recommendations are expected to generate positive returns on investment through increased sales, improved customer satisfaction, and enhanced brand loyalty.
- Assumptions: The recommendations are based on the assumption that the Colombian market is receptive to food delivery services and that El Corral can effectively manage the operational challenges associated with delivery.
6. Conclusion
Implementing a strategic delivery service can be a significant growth opportunity for Hamburguesas El Corral. By focusing on service quality, customer experience, and operational efficiency, El Corral can expand its customer base, enhance brand perception, and solidify its position as a leading fast-casual dining experience in Colombia.
7. Discussion
Alternatives:
- Partnering with a third-party delivery platform: This option would require less investment but would limit control over service quality and branding.
- Focusing solely on in-store dining: This option would maintain El Corral's current business model but would miss out on the growing demand for delivery services.
Risks:
- Maintaining service quality: Ensuring consistent service quality during delivery is crucial to maintaining customer satisfaction.
- Managing costs: Delivery operations can be expensive, requiring careful cost management to ensure profitability.
- Competition: The food delivery market is becoming increasingly competitive, requiring El Corral to differentiate its service and attract customers.
Key Assumptions:
- The Colombian market is receptive to food delivery services.
- El Corral can effectively manage the operational challenges associated with delivery.
- El Corral can maintain its brand reputation and service quality through the delivery service.
8. Next Steps
To implement the recommendations, El Corral should follow these steps:
- Phase 1 (3 months): Conduct a pilot test of the delivery service in a limited area.
- Phase 2 (6 months): Refine the service based on pilot test results and expand the delivery service to additional locations.
- Phase 3 (12 months): Optimize the delivery service, integrate technology, and implement marketing campaigns to drive customer adoption.
By taking a strategic and phased approach, Hamburguesas El Corral can successfully launch a delivery service that enhances its customer experience, expands its reach, and strengthens its position in the Colombian market.
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Case Description
Hamburguesas El Corral is a Colombian hamburger fast food chain founded in 1983. From the beginning, Hamburguesas El Corral was recognized as a traditional Colombian brand, positioning itself with the motto "the original recipe" as a provider with focus on fresh and highest quality products. The case allows students to examine the service encounter design of Hamburguesas El Corral and to compare it with McDonald's, which entered the Colombian market in 1995 and took over market leadership from Hamburguesas El Corral in 2012. The case furthermore tackles the trend towards delivery services in the fast food sector, addressing the specific service encounter design components of this delivery mode as well as its potential benefits and risks within the context of a changing competitive environment. The case finally asks students to analyze potential responses of El Corral's management to regain market share and market leadership, leading to the following question: Should El Corral hold firm to its traditional "no-delivery-service" policy or should it adapt to a major market trend and create a new brand, "El Corral Home", as a 100% home-delivery chain?
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