USING SERVICES MARKETING TO DEVELOP AND DELIVER

INTEGRATED SOLUTIONS AT CATERPILLAR IN LATIN AMERICA

Case study analysis
IMT Dubai - Semester III - Marketing of Services
Report Submitted by - Group 5
Amod Apastamb SMBA13010
Anuj Taneja SMBA13013
Sarthak Sahni SMBA13049
___________________________________________________________________________

Introduction -
Find out the products customers want. Design and build them.
Keep them Running. Rebuild and recycle. Do it better than anybody else
Company Time Line -
Founded in 1925 as Caterpillar Tractor Company (Cat) by Benjamin Holt and
Daniel Best
Worlds largest manufacturer of Diesel Engines and Heavy Machinery.
1904- Benjamin tested first type tractor.
1925- C.L best tractor co and The holt manufacturing company merged.
1930The east Peoria, Illinois became major plant
1951- The company opened its first overseas office.
1955 Australian subsidiary announced.
1966- sales in USSR resumes after 3 decades.
1976- Piracicaba plant opens in Brazil.
1991-Caterpillar added to Dow Jones industrial average, replacing Navistar
1997-Fortune magazine names caterpillar one of the most admired company
2006-Total sales exceeds 4 billion dollars.
Caterpillar Products -
Skid steer loaders
Back hole loader
Wheeled excavators
Compact wheel loaders
Articulated trucks
Hydraulic excavators
Scrapers
Motor graders
Demolition and waste applications
Wheel dozers
Material handlers

Transformation -


SWOT Analysis
Strengths
Leader in construction equipment and earth moving equipment.

Offers wide range of products used in different industries.
Unmatched distribution channel in industry.

Weaknesses
Poor Segmentation
No after sale service
Less control over distribution
network.
CSA agreement not promoted
properly

Opportunities
Higher construction and mining activity in emerging markets.
Low oil price leads to the reduction of production cost.
Huge untapped After sale market

Threats
Third party service provider providing entire fleet management service emerged.
Komatsu, John Deere and Volvo had established their dealership network in Latin
America.

CSA's
Highly customized and complex content, length, cost
Sold separately either by the machine or by product support sales reps.
CSA customers generated repeat business
1. CSA to Large customers high loyalty
Limited the CSA marketability and dealer operational efficiency.
2. Smaller / simpler contracts PM (Preventive Management)
Technician activities were not build explicitly into contracts.


1. What else do you need to learn in the Listening Gap (Gap 1) about customer needs
and expectations? LACD had general information from the customer value surveys,
but this information did not tell them what service features customers expected in
the CSAs.
What were they and how could they find out? I n particular, how could they find out
what they needed to know to established standards in the Design and Standards Gap (Gap
2)?
1. The CSAs need to be more in number focusing on different aspects like relationship
with customer, branding, convenience, timing, etc.
2. The service literature was not available and serviceman and salesman were not trained
on CSAs.
3. The CSAs varied across dealers and customers which made them non standard
leading to false promises.
4. Improper coordination among dealers led to confusion in delivering CSAs.
5. Due to varied geographies and cultures of customers, CSAs had to be a bit
customized but under certain standards.
6. The timeline of taking the surveys need to be changed to quarterly and after 3 months
of rendering the service.
To close GAP 2, standards set by the company must be based on
customer requirements and expectations rather than just on internal
company goals.
Customer defined standard
Hard standards and Hard measurement
10 minutes response time from concerned Service centre
4 hours for a service person to arrive
Call back to all missed calls
99% calls served
Soft standard and soft measurement
Empathize
Human Voice
Etiquettes
Building a Service Blueprint

What standards and measures should be set in the Design and Standards Gap (Gap 2) to
deliver to customer expectations? How formal should they be?
Standard CSA defined process, terms and conditions. It should be part of
performance evaluation for dealership and its employees.
Focus on speed and response time, create service Blueprint
Very formal since it will give competitive edge

How should LACD create and design the new CSAs? How should they get everyone in
the dealerships to learn about them and get on board to deliver them?

Service/sales expert - KRA
Formal training
Mentoring
Using technology tools like CRM - Standardized and customized reports
Empowering technicians
Internal communication channel like extranet, portals
Fixed targets for team
Dedicated team and equipments

How should the dealerships overcome all the Performance Gap (Gap 3) issues that
they faced in order to insure consistent delivery
More mechanics should be hired.
Proper coordination between all the departments .
There should be MIS implementation for keeping track of which machine reached
service interval.
Performance appraisals - mandatory training of soft skills, variable pays
Customer care centre should be developed on each dealership
Introducing shift system in dealerships during peak months
Focus on monthly package and schemes like additional service etc should be given to
those who are buying this package.
Proper maintenance of records.
Monthly internal audits

What internal and external materials were necessary to communicate the CSAs to
salespeople and customers? What else would be needed?
Service Circulars with the servicemen, dealers, etc.
Service Manuals these contain the complete info about the machine and how to
operate or service it.
Brochures
Training Modules regular training sessions on and off line.
Dedicated self service websites.
Service camps.
Monthly Customer meets.
Internal web portals giving product info.