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Case analysis for Strategic service system design

See attached case study for Strategic service system design

Prepare a brief overview of the case and, more importantly, the issues that it raises. You should come up with your own perspectives on the case.

1. What are the characteristics of the car rental industry? How do these characteristics influence the design of service delivery processes in this industry in general?

2. EasyCar obviously competes on the basis of low price. What does it do in operations to support this strategy?
How would you characterize the level of service quality that easyCar provides?

3. Is EasyCar a viable competitor to taxis, buses, and trains as Stelios claims? How does the design of its operations currently support this form of competition? How not?

4. What are the operational implications of the changes made by in the last year?

5.How significant are the legal challenges that easyCar is facing? What is your assessment of the likelihood that easyCar will be able to realize its goals for 2004?


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Case Analysis Easy Car


This case discusses about and the situation faced by it in the starting of year 2003. EasyCar is the low priced European car rental business. It was established by easyJet innovator Stelios Haji-Ioannou. This case illustrates the present position of the company and its future goals. By the end of fiscal year 2004, the company wants to attain sales of 100 million and profits of 10 million, so that it can position itself for an initial public offering (John & Luis, 2005). For reaching at these goals, the company had undertaken several efforts that include opening of new locations and changes in some of its old policies.

In all these processes and changes attempted by the company, it confronted several issues in the form of legal and operational issues that will be discussed in this paper. All the substantial issues confronted by the company will be discussed here with the help of different subheadings.

Characteristics' of Car Rental Industry

Subsequent are the various characteristics' of car rental industry along with their impact on the design of service delivery process:

? Intangibility: If it is seen in terms of service, the "service" of car rental is intangible but on the basis of the physical temperament, it is not as intangible as various other services are. In this industry, the consumer can observe and feel the vehicle that is rented, which is not possible in other service industries. In this industry the service provided is the physical car. This significantly affects the service delivery process of industry as they have to keep in mind that consumer wants more and more quality and in case of car rental they can easily judge it.
? Perishability: Car rental service is a perishable service as if a car is not rented for some days, it may direct towards high losses. High fixed costs are associated with car rental service and need to be balanced in significant manner. This characteristic has direct impact on the service delivery process of industry as they have to operate with effective strategies related with perishability.
? Heterogeneity: Car rental service is not an especially heterogeneous service in comparison to the other services like a doctor, lawyer and an architect. In this industry, the customers may request altered vehicles or additional services for example child seat and ski rack. They may require vehicles on diverse rental terms like return with empty or full tank and unlimited miles (John & Luis, 2005). All these things need to be concerned while designing service delivery process as otherwise it may direct towards imperfections in service delivery.

In general, service design is usually qualified as having following fundamental constituents:

1. Physical facilities
2. Processes & procedures
3. Employee's behaviours
4. Employee's professional persuasion (A Case Study Analysis on, n.d.).

In concern to service design, car rental service is a relatively tangible, homogenous service with reasonably little levels of customer contact that represents the need to focus industry's service design on the physical facilities, operations and processes. On the basis of these features, it can be said that rental companies should centre their service design on the physical facilities, operations and processes (Clarke & Chen, 2007). Additionally, employees' behaviours are not insignificant as ...

Solution Summary

A case analysis for is examined. The strategic service system design is analyzed.