SM

Increase market share by

improving customer satisfaction by
CATERPILLAR

GROUP 6
Harish Deepak (X010/14)
Kirity Kumar (X013/14)
Shiva Shankar Mahto (X028/14)
1

SM

Equipment Market Segment

SM

Market Dynamics

Equipment are used in segments ( Construction, Mining,

Agriculture, Forestry etc.)
Customers buy equipment together with service agreement
Service agreement takes care regarding refurbishment of
equipment and maintaining the uptime and productivity

It also emphasis on having equipment for 100% of the time

Customer pay for CSA and repair services to achieve these goals
Customer who buy complex and sophisticated equipment such as
Longwall, Continuous miners and construction equipment would like
to go ahead with CSA
Customer who buy general equipment would like to carry
maintenance by their own
These customers do not value for uptime and productivity too much
3

SM

Competitions Heating Up

Third Party service Providers, that allowed customers to outsource

their entire fleet management for both CATERPILLAR and NonCATERPILLAR equipment were emerging
These companies operate internationally whereas CATERPILLAR
dealers operate nationally
These incentivize customers to engage with them when they operate
in a larger region
The service offerings and competencies were less sophisticated than
CAT dealers which helped them to establish successful customer
relations in certain segment
Aftermarket suppliers & distributors were selling will fit parts
that though inferior in quality and durability were sold at significantly
lower price points
They offered no services, still managed to held over 30 50% of the
aftermarket segment

SM

Competitions Heating Up

Small local workshops were also offering repair services ranging from
simple repairs to complex ones.
Some of them were earlier established by CAT dealers itself & so enjoy
customer acceptance
Customers also had their own mechanics, which they use them for
both maintenance and repair activities
These mechanics were having difficulty to cope with sophisticated
new equipment where having specialized tools is a must
They limited themselves in servicing older equipment
Organized manufacturers ( John Deere, Komatsu, Volvo etc.)
established their own dealer networks and focus on their products
selling to same customers

SM

Customer Support Agreement

CSAs (CSAs)
are highly customized in content, length and cost --------------

Total Maintenance
Repair contracts
Product support of all their equipment
The agreements were sold separately from machines & were
delivered through Dealers Product Support Organization
CSA has brought several benefits to customers
Regarding risks and costs of unplanned machine downtime
Resulted in higher levels of loyalty
The current degree of customization and complexity limited the
CSA marketability & Dealers Operational Efficiency to serve
growing no. of customers
The smaller and simple contracts called preventive maintenance
agreements (PM CSA) were purchased by many small customers
These PM CSA involved the provision of CATERPILLAR oils and filters
at predetermined service intervals and were delivered through a
dealer field technician
Visual machine inspection, monitoring of the condition of the
machine and feedback discussions with customers were not built into
contracts
They were considered extra services but were not executed
Virtually include any service which customer wanted and that
consistently.
dealers could provide
Some were even unnoticed by business owners.

SM
Jose Pepe Brousset , Marketing & Operations Director
called Division s Dealer Advisory Panel
The company s five year growth targets could not be
met unless the organization moves from a Product
focus to an integrated customer focus
His goal was to develop, deploy and pilot a plan
using the best practices in service to redefine
the CSA (Customer Service Agreement) value
andto
to deliver
grow CSA
30% per
year these agreements was the
proposition
Learning how
service
through
best approach to making both the company and its dealerships ready
for the challenges involved in delivering service
Expected
services

Perceived
Services
Find out what products customers want. Design and build them. Keep
them running. When they wear out, rebuild or recycle. Do it better
than anybody else

SM

A literature search and conversation was initiated among Sales & Service
Personnel & Product Management
Key attributes were identified such as
a. Reliability
Able to do any job needed
M/C ready when promised
Job done right the first time
Effectiveness of technical services
Perform only necessary work
b. Assurance
Able to do any job needed
Service available when needed
Efforts to increase customer efficiency
c. Tangibles
Clean up after service work
Convenient to mine/ workplace
Completeness of documentation
d. Empathy/ Relationship
Courteous and friendly service
e. Responsiveness
On time delivery
Response on customer issues, complaints/Breakdown
Prompt warranty action
Questionnaires were mailed to 634 customers under CSA
284 usable returns (45%) were received

SM
Expected
services

GAP 1

GAP 2

GAP 3

GAP 4

External communications to customer

Perceived

Lack of integrated service mkt communicatio

Inefficient management of customer
expectations
Over promising
Inadequate horizontal communications

Actual Service delivery

Deficiencies in human resource policies

Failure to match supply and demand
Customer not fulfilling roles
Problems with intermediaries and channels

Customer driven service designs and

standards

Poor service design

Absence of customer defined standards
Inappropriate physical evidence and
servicescape
Companys
understanding of customer

expectations

Inadequate research
Lack of upward communication
Insufficient relationship focus
Inadequate service recovery

SM
THE LISTENING GAP (GAP1)
Using existing surveys conducted by Caterpillar called Customer
Value surveys
The team grouped survey items by the service quality dimension
These surveys was mapped on an importance / performance matrix

IMPORTANCE

opportunity o
Responsiveness
o Relationship

Strength

o Reliability
o Assurance

Limited
action

o Tangibles
PERFORMANCE

Maintain
10

SM
Tangibles : Customer performance perception was high but
had relatively low impact on the overall customer loyalty
Empathy/ Relationship/ Reliability & Assurance : They provide
competitive differentiation but none of them were positioned
as a dominant element of the value proposition All of them
show significant potential for improvement
Responsiveness : The most influential factor on customer
loyalty and underperformed as compared to other factors. The
dimension required urgent attention
CONCLUSIONS
Service reliability, Responsiveness and Relationship needed
improvement
Product differentiation and Quality control cannot offset these
issues
Dealer Product support Operations and Marketing capabilities
has an equal importance
Customer Surveys were sporadically conducted & partially
designed for collecting service feedback & relationship
11

SM

With effective communication and gap identification the team learned

the basics
Assessed the state of each service quality gaps for their pilot dealers
They then started broad basing to their other regions and was
successfully implemented

12

SM

KEEP TRYING NEW THINGS AND BE POSITIVE!!!

THANK YOU

13