– Service Design and Variety At The Emirates Commercial Visa Section (Word count: 1997 words) CONTENTS 1. Introduction 3 2. Emirates Commercial Visa Section – The Process 3 3. Typical Problems at the CVS 5 4. The Service Design and improvements 5 5.
Variety Control and Management 8 6. Analysis using the Pareto Management Tool 8 7. Recommendations and Benefits: A Critical Review 12 8. Conclusion 13 9. References 14 10. Appendices: Appendix 1 Glossary of key Terms A 1 Appendix 2 Customer Survey Forms A 2 Appendix 3 The Flow Process Chart A 3 Appendix 4 3 matrix model (QFD) model on Service Design A 4 Appendix 5 The Profession Codes table A 5 Appendix 6 The Station Code List A 6 1.
Introduction: In today’s environment, organizations are viable only if they provide satisfaction to the customer, especially so in the service industry. The need identification, forecasts, analysis, conversion and integration is a continuous process, and it is this complexity that gives rise to a new challenge to the production manager. Increasingly, the process of quality assurance and product design coupled with variety, present unique challenges when applied to services, particularly those termed extended service transactions 8. An airline distinctively falls under this category. Here the single “product” is made of physical goods and services embedded within a series of discrete consumption experiences. The Commercial Visa section being a new department offers potential scope for improvements.
The following scrolls are an attempt to explore how the customer needs link into the service design attributes using the Quality function Deployment (QFD), a popular design methodology. These are coupled with the issues relating to Variety. The report concludes with some recommendations that could help bring about cost reduction, and higher resources utilization. Please refer to Appendix -1 for abbreviations. 2. 0 The Emirates Commercial Visa Section – The Process: The Department specifically facilitates the issuance of electronic visas for the state of Dubai from any of the Emirates Airlines ticketing offices world wide for travel on Emirates Airlines only.
The main objective of the department is to give this value added service to passengers flying on Emirates Airlines, there by bringing in revenue by sale of ticket. The process is described as follows: (Refer Process Flow diagram in Appendix – 3) The passenger approaches the Emirates ticket agent for the visa. The agent notes all the passport details and converts the passengers nationality and profession into codes by searching a list on the reservation system (e. g.
) An U. K. national with profession as computer programmer is entered as nationality code GBR and profession code 1133031 into the system. Once the electronic application is filled, the Reservation system routes the application to the RPS that does the validation and storage of the visa details. Applications are routed to the Commercial Visa Sections’ back Office into 4 different mailboxes. The applications are keyed through a web enabled dedicated link into the DNRD system by the staff at CVS.
The approvals / rejects are received from DNRD by the back office and sent back to the RPS system in a certain format for automatic updating. A subsequent enquiry by the Sales agent will display the visa details of the passenger. The back office also looks after the accounting aspects and tracking the passenger movements for entry and exits from the flown ticket coupons. The front office supports any manual applications received in Dubai and gives them to the back office for action. The service can be classified as being that of high contact, low customisation, high labour intensity, and high interaction. Emirates Ticketing & Sales Office RPS System, Sydney Dubai Immigration System Future Link Sita Airline Network Dedicated link Emirates Reservation System, Dubai Figure 1.
3. 0 Typical Problems at the CVS: The automated issuance of visa started functioning in Mar ’00. The typical problems that have surfaced are: Inconsistent quality of service. Delays in the visas finally reaching the passenger. Delay in filling up the Visa application by the sales agent due to search time on a variety of profession codes. This also results in waiting time for the passenger.
Heavy work burden on the staff at the back office, perhaps leading to dissatisfaction and low morale. 4. 0 The Service Design and Improvements: The service design specifies what the customer is to experience, and these include: (a) The physical item, (b) The sensual benefits where the customer is in continuous demand for high quality and delivery schedules, and (c) The psychological benefits like customisation, perception and individual preferences. An Effective Design Process is characterised by: Matching product / service characteristics with customer needs. Meet customer requirements in simplest, most cost-effective manner. Reduced time to market Although improving the design process depends on a host of subjects like Design teams, Concurrent design, etc.
, the one that probably stands out is the Quality Function Deployment. According to Edvard son, Rust and Oliver, effectively managing service design and quality involves three distinct tasks 8. First is the designing of the service product. Second is the designing of the service environment. The third is the development of a system for delivering the service. Thus a successful service design and development requires a systematic approach that create a well articulated interface between a comprehensive set of customer needs, their translation into various service attributes as part of the service design.
One of the few systematic tools potentially useful for making the above links is QFD. An interviewing method was used to elicit the voice of the customer to get a representation of the customer needs for the adaptation of the service design using the QFD process. Based on the survey results of 10 customers, the 3 best customer needs in the order of ranking are Efficiency in handling, Delivery on time, and Courtesy. (Refer Appendix -2 for the survey results) The 3-matrix QFD approach (Appendix – 4) of service design enables one to focus proactively on customer 6. The matrix 1 consists of the voice of the customer, while the matrix 2 serves as a basis for the design improvement. Matrix-1: The customer needs from the survey are plotted against the Service measures of the department with points of 0, 1, 3, 9 given for each cell depending on the correlation 6.
The points are multiplied with the importance weightage function to yield the absolute importance. This represents the house of quality. The distinction between customer requirements and service measures is that customer needs to express ‘what’ the customer expects, whereas service measures determine ‘how’ those expectations can be met. The absolute importance rating provides a method for determining which service measures have the largest effect on meeting customer requirements. Service Measures (how) Customer Needs (what) Importance weightage Customer satisfaction No. of complaints Repeat Customers Timeliness Efficiency in handling 3 9 9 9 9 Delivery on time 2 0 9 9 9 Courtesy 1 9 3 9 0 Absolute importance 36 48 54 45 Matrix-2: The Service measures and the absolute importance have been carried from matrix-1 to matrix-2 and plotted against the Service Design functions, that are most important to the CVS department.
Service Design (how) Service measures (what) Importance Weightage Professionalism Proper equipment Teamwork Training Customer satisfaction 36 3 0 3 3 No. of complaints 48 9 3 9 9 Repeat Customers 54 3 3 1 0 Timeliness 45 3 9 3 3 Absolute importance 837 711 729 675 Matrix-3: The service design measures and the absolute importance have been carried from matrix-2 to matrix-3 and plotted against the Quality techniques to yield its absolute importance. Quality Techniques (how) Service Design (what) Importance Weightage Preventive maintenance Feedback/Survey Continuous education Professionalism 837 1 9 9 Proper equipment 711 9 3 3 Teamwork 729 3 3 1 Training 675 3 3 1 Absolute importance 11448 13878 11070 Due to the elements of intangibility and heterogeneity it is difficult to quantify standards. 4. 0 Variety Control and Management: Variety is desirable, but as variety increases so do organisational problems, costs and controllability 7. Control of variety is essential and the task of reducing variety with subsequent control of the remaining variety is one of the most fruitful tasks that can be undertaken by any organisation.
Sometimes new methods and procedures are introduced for reasons valid during the time of implementation, but this could have adverse effect on the operation of the service. Although, change is not necessarily progress, it is required that the total effect on the organisation be considered, so as to achieve maximum result with minimum effort. It is often necessary to weigh the competitive advantage against the operational complexity when variety is being offered. Differences could exist in the outputs of the organisations generating the same service, within the same department, and even in the same employee on different occasions. sales unit profits costs No. of products No.
of products No. of products Clearly, unnecessary variation needs to be controlled, but the variety attributed to estimating, and then matching, the customer’s requirements is essential to customer satisfaction and must be designed into the systems. Variety could be managed by 3 approaches: Simplification by the reduction of variety. Standardisation by the control of variety and Specialisation by concentrating effort where special knowledge is available.
The 80/20 principle, picked up be TQM mavens a couple of decades ago has resurfaced as a work-life balancing strategy 4. We generally expect the ratio between the efforts and results to be equivalent, but in fact the degree of imbalance is astounding. The benefits lie in the Design, Operations and the Marketing areas. 5. 0 Analysis using the Pareto Management Tool: Pareto principle, also known as the 80/20 rule, states that a small number of causes are responsible for a large percentage of the effect 3. The principle helps in focussing efforts based on the forecast.
A pareto analysis of the usage of these codes by the stations tabulated below is quite revealing. Table 1 shows the ranking of the usage of these profession codes. Table 2 is an analysis by ranking of the different stations by virtue of their sales. The table also sheds light on the workload of the 3 staffs at the back office and the revenues generated by the different stations. Table 1: Ranking of Profession codes by Usage: (for the quarter Apr ’00 to Jun ’00) (Refer to Appendix – 5 for the meaning of the profession codes) Rank Cum Codes (%) Profession Code No. of times used Cumulative usage Cum Usage (%) 1 0.
27 9800041 3433 3433 29. 86 2 0. 55 9900015 913 4346 37. 80 3 0.
82 9900011 742 5088 44. 26 4 1. 10 4111033 705 5793 50. 39 5 1.
38 111031 247 6040 52. 54 6 1. 65 111027 227 6267 54. 51 7 1. 93 9800031 216 6483 56. 39 8 2.
20 4112043 174 6657 57. 92 9 2. 48 112001 170 6827 59. 39 10 2. 76 1622011 160 6987 60. 78 11 3.
03 2631011 141 7128 62. 00 12 3. 31 2631032 120 7248 63. 05 13 3. 59 5140017 106 7354 63. 97 14 3.
86 3120001 99 7453 64. 83 15 4. 14 9900021 91 7544 65. 62 16 4. 41 4112042 81 7625 66. 33 17 4.
69 213031 79 7704 67. 02 18 4. 96 1133031 78 7782 67. 69 19 5. 24 213021 64 7846 68. 25 20 5.
52 1214061 64 7910 68. 81 21 5. 79 1212015 61 7971 69. 34 22 6.
07 4112041 59 8030 69. 85 23 6. 34 4112091 55 8085 70. 33 24 6. 62 1434041 55 8140 70. 81 25 6.
9 3121055 53 8193 71. 27 26 7. 17 3124013 52 8245 71. 72 27 7. 45 211061 51 8296 72.
17 28 7. 72 411035 48 8344 72. 58 29 8. 00 4111023 47 8391 72. 99 30 8.
28 1322011 46 8437 73. 39… 362 100 11495 100 There were 362 different profession codes that were accessed by agents in the second quarter of 2000. About 8% of the profession codes used (viz.
30 types of profession codes) contribute to 73 percent of applications. Table 2: Station ranking by Value of Sales (Note: Does not take into account the revenue of ticket generated and manual applications at front office. Also does not include visas which are refused, cancelled, rejected etc). Staff 1 handles the administration aspect while staff 2, 3, 4 are involved in processing the applications.
(Refer to Appendix – 6 for the meaning of the station codes) Rank Station Name Staff handling the queue Total Visit Visas Visit Visa Revenue (unit Sale price = 165 Dhm) Total 96 hour visa 96 hour Visa revenue. (unit sale price = 45 Dhm) Total Sales (in Dhm) Cumulative Sales Value (in Dhm) Cum % Sales Value 1 THR 3 971 160215 1 45 160260 160260 10. 79 2 NO 4 928 153120 123 5535 158655 318915 21. 47 3 AMM 4 736 121440 43 1935 123375 442290 29. 77 4 BEY 2 584 96360 0 0 96360 538650 36. 26 5 DAR 3 506 83490 84 3780 87270 625920 42.
14 6 KHI 3 402 66330 48 2160 68490 694410 46. 75 7 CAI 4 289 47685 2 90 47775 742185 49. 96 8 LHE 3 272 44880 19 855 45735 787920 53. 04 9 ROM 3 260 42900 15 675 43575 831495 55. 97 10 KI 2 263 43395 1 45 43440 874935 58.
90 11 IST 4 231 38115 43 1935 40050 914985 61. 60 12 DOH 2 220 36300 0 0 36300 951285 64. 04 13 SAH 2 196 32340 10 450 32790 984075 66. 25 14 AUG 2 184 30360 6 270 30630 1014705 68. 31 15 MBA 4 161 26565 25 1125 27690 1042395 70. 17 16 SHE 2 158 26070 2 90 26160 1068555 71.
93 17 MCT 2 147 24255 0 0 24255 1092810 73. 57 18 JOB 3 144 23760 9 405 24165 1116975 75. 19 19 HKG 3 143 23595 2 90 23685 1140660 76. 79 20 AAN 2 124 20460 0 0 20460 1161120 78.
16 21 SIN 3 121 19965 5 225 20190 1181310 79. 52 22 ZR 3 120 19800 4 180 19980 1201290 80. 87 23 FRA 2 117 19305 12 540 19845 1221135 82. 20 24 NYC 4 80 13200 146 6570 19770 1240905 83. 54 25 BKK 3 98 16170 0 0 16170 1257075 84. 62 26 PAR 2 94 15510 11 495 16005 1273080 85.
70 27 QM 4 91 15015 0 0 15015 1288095 86. 71 28 KLA 2 87 14355 7 315 14670 1302765 87. 70 29 DHA 2 81 13365 0 0 13365 1316130 88. 60 30 TO 3 80 13200 0 0 13200 1329330 89. 49 31 JED 4 72 11880 25 1125 13005 1342335 90. 36 32 ATH 2 68 11220 0 0 11220 1353555 91.
12 33 NIC 4 65 10725 0 0 10725 1364280 91. 84 34 BUH 2 61 10065 1 45 10110 1374390 92. 52 35 MLA 4 56 9240 0 0 9240 1383630 93. 14 36 MEL 2 35 5775 78 3510 9285 1392915 93.
77 37 CMB 3 49 8085 0 0 8085 1401000 94. 31 38 LAX 3 41 6765 18 810 7575 1408575 94. 82 39 DAM 4 24 3960 76 3420 7380 1415955 95. 32 40 ISB 3 37 6105 4 180 6285 1422240 95.
74 41 BEG 4 37 6105 1 45 6150 1428390 96. 16 42 KUL 4 36 5940 0 0 5940 1434330 96. 56 43 BAH 2 33 5445 0 0 5445 1439775 96. 92 44 QTR 3 32 5280 0 0 5280 1445055 97. 28 45 RUH 2 30 4950 2 90 5040 1450095 97. 62 46 PEW 3 30 4950 1 45 4995 1455090 97.
95 47 SKG 4 27 4455 0 0 4455 1459545 98. 25 48 STO 2 25 4125 2 90 4215 1463760 98. 54 49 LON 3 20 3300 13 585 3885 1467645 98. 80 50 JKT 3 16 2640 0 0 2640 1470285 98. 98 51 BAK 2 15 2475 0 0 2475 1472760 99.
14 52 PRG 4 11 1815 13 585 2400 1475160 99. 31 53 TIP 4 12 1980 0 0 1980 1477140 99. 44 54 BRU 3 6 990 11 495 1485 1478625 99. 54 55 DAC 4 7 1155 0 0 1155 1479780 99. 62 56 MN 4 6 990 0 0 990 1480770 99. 68 57 MAN 3 5 825 2 90 915 1481685 99.
74 58 SEL 2 5 825 1 45 870 1482555 99. 80 59 SGN 4 5 825 0 0 825 1483380 99. 86 60 VIE 3 5 825 0 0 825 1484205 99. 91 61 HOU 4 2 330 10 450 780 1484985 99. 97 62 HAN 4 3 495 0 0 495 1485480 100.
00 63 EBB 2 0 0 0 0 0 1485480 100. 00 64 LHR 3 0 0 0 0 0 1485480 100. 00 65 MLE 4 0 0 0 0 0 1485480 100. 00 8764 2871660 876 74970 1485480 1485480 100. 00 22 stations out of 65 stations (33. 8 %) contribute to 80 % of the Sales revenue.
Also, if the work divided for the 3 back office staff is inspected, then: Staff-2: 2660 applications processed = 25. 6% Staff-3: 3594 applications processed = 34. 67% Staff-4: 3386 applications processed = 32. 66% 6. 0 Recommendations and Benefits: A Critical review Broad-based applications of QFD have shown to improve design and development time, and improve communications and cohesion within product development teams.
It follows that the customer needs of this service are efficiency, On-time Delivery, and Courtesy. The service design elements most appropriate for these needs are: Professionalism Teamwork Proper equipment Training O & M’s Garth Hall berg notes “All consumers are not equal”5. De-averaging has dominated marketing for decades. Instead of producing products for an undifferentiated “mass” market, marketers have sought to “segment” by attributes like lifestyles, tweaking both product and service accordingly.
Companies are increasingly wooing their most valuable customers. Repeat customers should be monitored and the service should be linked to other corporate programmes like frequent flyer. This will also lead to a high degree of customisation and deepening of knowledge for the staff. A simplification of profession codes (reduction of unnecessary variety) needs to be implemented.
This could be a small part in the process but producing bulk of the overload. The usage of just profession codes should be restricted to about 30-50. This leads to greater productivity and better utilisation of resources. The searching and maintenance of 500 plus codes incurs operational delays and customer waiting time. From table 2 we can see that 22 stations out of 65 stations (33.
8 %) contribute to 80 % of the Sales revenue. Huge amount of money is spent on the training of the outstation staff, sometimes by calling them to the head office in Dubai. This needs to be revisited based on a cost-benefit analysis. Alternatively, the marketing aspect at these stations needs a closer look. It appears that staff 3 and 4 is overburdened relative to staff 2. This could lead to delays and could affect the delivery schedule of the Visa.
The monitoring of station loads needs to be periodically done. This could also be one reason for the low morale and dissatisfaction. Technology can have a great impact. Design can be slightly changed by use of specialised software that can populate the data, rather than the back office staff having to key-in the data.
This can lead to higher productivity and reduced costs. All of this enables continual improvement in service design and implementation, and leads to truly meeting customer needs on a consistent basis. 8. Conclusion: Customer needs has to be integrated into a service design, environment design and delivery systems in industries with extended service transactions, whether for incrementally improving upon or completely redesigning services. To remain a player in the twenty-first century, organizations will find it necessary to focus on lowering costs by enabling the full potential of technology 1. Unnecessary variety should be controlled at all cost.
Although Emirates Airlines enjoys a virtual monopoly in providing this kind of service, the effect of a significant player entering this market cannot be overlooked. The entry barriers are quite low here. The survival will be based on who can provide better customer service, a significant part of which is linked into the service design and variety. References: 1 Chase, Acquilano and Jacobs, ‘Production and Operations Management’, Eighth Edition, 1998. 2.
Kathleen Hickey, ‘Moving all over’, Traffic World, May 1999. 3. Richard Garodnick, ‘Make better use of the forecasting package using the 80/20 Rule’, Apparel Industry Magazine, Atlanta, Oct 1999. 4. Anne Graham, ‘The vital few, the trivial many’, The Internal Auditor, Dec 1998.
5. Alan Mitchell, ‘High cost of supporting the average customer’, Marketing Week, 1998. 6. Donald S E rmer and Mark K Kiper, ‘Delighting the customer: Quality function deployment for quality service’, Total Quality Management, Jul 1998. 7. Alan Muhlemann, John Oakland & Keith Lockyer, ‘Production and Operations Management’, Sixth Edition, Prentice Hall, 1992.
8. Laureate Dube, Michael D Johnson, Leo Mark Renaghan, ‘Adapting the QFD approach to extended service transactions’, Productions and Operations Management, Fall 1999.