I would like to open my discussion with a brief introduction of the organization I work for: Swatchgroup. It is the largest watch manufacture in the world with 22 individual watch brands under group. Each brand operates relatively independently in term of product design, manufactory (Few rely on group resource for mass production, e. g. : Swatch), retailing, sales, marketing and finance. Therefore, I will choose one brand – OMEGA that I have been worked for over 4 years to critically evaluate its operation management strategy.
There are also many crucially important parts of service operation systems in watch manufacture: sales and after sales, business to customer (retailing), business to business (wholesale), suppler chain management and logistics management, etc. I will use after sales – the customer service operation as my objective for analysis. Firstly, to identify at which stage of the Hayes and Wheelwright model the operations of customer service function of OMEGA place, I will lay out its function operation by the four Vs analysis (ref 1) and the process map.
It works as below process in terms of Vs positioning and process: (4Vs) It is obvious that OMEGA, as a prestige watch product, offers its customer relatively reliable, hi-classified, customized and direct operation service. So we arrange “bank counter” service, where our customer can talk to receptionists face to face about their watches’ problem (front line).
After receptionists recognize the demand of the customer, e. g: watch strip shortening or caliber malfunction, the demand will be assessed individually: e.g. : watch strip shortening can be processed in the back stage within 20 min (XXX), while caliber malfunction need to be further diagnose with the problem, sent to local manufactory workshop to be fixed(XXXX). The customer will be informed with the repair period, alternatively with the service receipt, customer is also able to track the after-sell service status by accessing the customer service website, or call the 24hr service line. Luxury goods industry has been recently blooming in the past 5 years in China.
As one of the early entrants, OMEGA has been building up the service operation since the first day. Its outstanding performance is recently awarded by “IT Time” magazine – one of the most outspoken publications in the watch industry for “Best Customer Service”. There is no doubt that the strategy impact of OMEGA’s customer service is “clearly the best in the industry”. However, I am afraid it is not yet placed as an operation advantage at the stage of “redefines industry expectation”.
I will further elaborate the augment in the following discussion: (OMEGA positions in the stage 3 in the Hayes and Wheelwright model, chart source) Internally support to externally support: The customer service is still a supporting function within our organization. It is a simply “after-sales” service, which has a co-ordinated set of manufacturing structural. The function is thought to be a “watch repair & maintenance center” for most of the time to our customers, though it provides the best quality of service in the industry.
It lacks of initiative and proactive, and the operation service will always to be the “warranty service”. So how do we do to upgrade the service support from internal support to external one? Maybe, we can learn one thing or two from the same kind of function focused on “repair & maintenance” in the automobile industry. Volkswagen, with the world-class reputation of reliability, claims “its reputation for reliability is synonymous with the quality of service”(www. volkswagen. co. uk/owners/servicing).
It is obvious that Volkswagen takes service operation as important as its product offerings. It is important for the customers to realize that the service comes active from the moment they purchase the car, not from the moment the car breaks down! Likewise, the service operation for watch industry shouldn’t be only set to be an “after-sales warranty”. We must take a step ahead, offering the service bounded with watch product, so service is one of the reasons the customer chose OMEGA.
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