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Assessing Service Issues

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Assess the service issues present in Going, Inc.'s low statistical rate of on-time service and propose quality and control measures for improvement. Use the following information for your assessment.

Service Division
Mission Statement: Become the most successful provider of airline transport for the business
Marketing Slogan: "High society in the air"
Going, Inc.'s airline service has been losing business in regular service operations for 20
months now and is saddled with low performance in on-time delivery, baggage handling, and
overall customer service. Several outside consultants have viewed these three areas for
short-term fixes that could quickly improve the bottom line, but perhaps even more drastic
steps are needed.
Going, Inc.
On Time 83.91% 71.6%
Air Carrier
Delay 3.71% 9.82%
Delay 0.55% 2.62%
5.01% 5.00%
Delay 0.07% 1.2%
3.50% 3.75%
Cancelled 3.07% 6%
Diverted 0.18% .10%
Operations 100.00% 100%
Going's competitive strategy is now questioned by company executives because many
previous business traveling customers are now seeking a less expensive air travel solution.
Ten areas of operations strategy have been identified for study to gain a competitive
1. Service Design Strategy
a. Going, Inc. mainly serves long routes across the United States and international
routes into Europe and Asia. It is also seeking new South America routes.
b. The company emphasizes in-flight service to its business and first-class
c. The company has been slow to adapt to the Internet, offering only general
information about its airline on the company homepage.
2. Quality Management Strategy
a. The company has been content with average customer satisfaction rankings until
the recent downturn in business.
b. The company concentrates its efforts toward the big budget frequent flyer and
seeks to ensure top quality over other airlines in first and business class service.
Numerous frequent flyer programs and marketing materials are sent to target
3. Process and Capacity Strategy
a. The company owns many different commercial airplanes in its fleet?presently
seven different models from two manufacturers (AirDyno and Cosnot).
b. Full meals are offered on all flights, and in-flight meal customization, designed to
give the meal service a "Going, Inc. flair," is performed on each flight at the flight
attendant stations. This includes folding napkins into the trademark Going, Inc.
symbol, adding a Going, Inc. pen to the tray, and inserting a small Going, Inc.
flag to the flower vase on each tray.
4. Location Strategy
a. Going, Inc. flies to all major cities and every state but rarely more than once per
day (other than hub cities).
b. The company has a major hub in the East (JFK, New York), Central (O'Hare,
Chicago), Mid-West (Denver) and West (LA) regions.
5. Layout Strategy
a. Going, Inc. gates are located at the best locations (closest to the terminal).
b. Going, Inc. boards its planes with first-class passengers and then by first-come,
6. Human Resources, Job Design Strategy
a. The company does not have the best relationship with its unions. Minimal pay
increases and hiring over the last 3 years has created a chasm between the two
parties. Pilots frequently fly right up to their legal limit.
b. Employees have complained about lack of a voice and lack of up-to-date training
c. After each flight, cleaning crews must go through each aisle, flight attendant
station, and lavatory. Due to the number of models in the fleet, the cleaning cycle
time is comparatively slow and contributes heavily to the poor air carrier delay
7. Supply Chain Management
a. Going, Inc. has a very elongated supply chain, serving four major hubs in the US.
b. Going, Inc. has what can be termed has a lukewarm relationship with AirDyno,
one of the company airplane suppliers, due to some past financial issues and a
lack of support on AirDyno's part in supplying replacement parts.
c. The company maintains 4 models from AirDyno and 3 models from Cosnot,
relying on each to supply replacement parts.
8. Inventory Management
a. The company's maintenance department must be exceptionally managed due to
the number of models of planes in its fleet. Maintenance stations are located at
each hub location, with a central larger facility at the airline's Denver hub.
9. Scheduling Strategy
a. Going, Inc. has 225 inland destinations and flies to every state in the US on its
schedule on top of its Europe and Asia routes. For comparison, Southwest
Airlines serves 53 airports in 27 US states.
b. Data demonstrates that Going, Inc. is higher than the industry standard in air
carrier delay and connecting aircraft late arrival.
10. Maintenance and Reliability Strategy
a. Going, Inc. has experienced higher costs in maintenance, repair, and training in
the last 2 years.
b. Going, Inc. airplanes are grounded or in repair and maintenance 18% more than
the industry average.

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Solution Preview

Create a proposal to save the company's airline service business.

They have to reduce the gaps in:
- Weather delay, cancellations
- Overall diversions and other quality levels
- Customer satisfaction levels
- Using ecommerce
- Costs ( As they are suffering from higher costs)
- Human resources

For this I will recommend:
Application of TQM in service industry
Services can not be in an inventory. Services are often unique in everyway. Every person for example may receive a different haircut from the barber shop. In addition, every person may receive different legal advices. These types of services are usually not the same as the rest of the people. This is the reason why it is difficult to standardize. Most services have a high customer interaction. Each interaction will vary depending on the needs and wants of the consumer. Services have inconsistent product definition Moreover; services are knowledge based such as education, medical and legal services. Lastly, services are dispersed because the types of service are brought to the customer such as the home, office or store.
One of the most important elements in creating a successful business is having happy, satisfied customers
that keep coming back. Satisfied customers recommend your product or service to family, friends, and associates. This ca be achieved by the customer driven quality. "Quality" is continually evolving, an emerging consensus includes Continuous Improvement and Learning: Continuous improvement and learning refers to both incremental and "breakthrough" improvement, and applies to both the individual and organizational levels. Improvement and learning can be directed toward better products and services, to better processes, and to being more responsive, adaptive, and efficient. The key Components according to the Juran are:

# Quality Planning: from customer needs to product/service to meet needs.
# Quality Improvement: developing and improving capable processes.
# Quality Control: making the process work in normal operating conditions with minimal ...

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Problem Set

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1. Why was easyGroup successful with easyJet?
2. What is your assessment of easyGroup's diversification strategy?
a. Do you expect easyGroup to be successful in internet cafes? Why or why not?
b. What do you think of the easyCar concept? Will it make money for easyGroup?
3. What is the core competence van easy Group?
4. Should easyGroup enter the UK cinema business?
a. How well do cinemas fit the "easy" formula?
b. In order to answer this question make an analysis of the cinema business in the UK using the 5 Forces Model! Describe easy Cinema as a potential entrant?
c. If you think the UK is attractive, what are the entry barriers? how would you enter this business?
5. What are your recommendations for the easyGroup diversification strategy?

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