Customer

Service Delivery

Delivering Customer Delight

Company Overview:
Established in 2009, BERG Global Ltd. has evolved into one of the fastest growing mobile handset companies in India. With a mission of becoming the 1st global consumer brand from India,
BERG Global Ltd. has shown profitability and growing sales since the first year of operations.
The bedrocks of the companys culture are the core values of Integrity, Adaptability and Passion
for Excellence. The Brand operates in the realm of Create Possibilities.
With a wide product portfolio encompassing tablets, feature phones and smart phones, BERG
Global Ltd. offers unique value propositions at multiple price points to suit diverse consumer
categories.
BERG Global Ltd. is the only Indian mobile handset brand in the country to have an in-house
R&D set-up in India and China. It boasts of a robust sales and service network with over 1000
distributors, 90000 retailers and 1400 service centres spread across the country.
Background:
With special emphasis on budget and mid-range devices, Indian handset players have captured significant market share.

Though the figures look promising and lead to promising projections, the after sales service often puts a question mark on sustainability. To an extent, Indian players have successfully been
able to replicate the product features of international players, but the same cant be said for the
after sales service model.
LIVE Business Challenge:
In the district of Aurangabad, BERG started its operations about 12 months back and has a warranty customer base of 300,000 (monthly sale of 25000 units). In general, BERG gets around
4800 service calls per month. By service calls, we mean those customers who visit the service
centres to get their handsets repaired. By service centre, we mean the service franchisee given
to an independent agency as BERG is not providing service through owned service outlets.
By and large, the split between warranty and non-warranty calls is 95:5. On every warranty
call, the service centre makes an average of INR 60. The same amount triples in the case of a
non-warranty call.
As per norms, satisfactory service delivery can be ensured by 1 front desk executive (for data
entry and work order generation) and 1 technician (to carry out repairs) for every 500 calls. The
technician count increases in direct proportion to the number of calls whereas the front desk
can be manned by 2 executives even for a call load of 1500.
As per policy guidelines, BERG tries to restrict the maximum calls at a service centre to 1500/
month. The service centre size ranges from 300- 400 square feet. The real estate rates are INR
50/ square feet and are expected to increase at the rate of 20% per annum. Additional expenses are incurred on IT infrastructure and furniture. Salary of a front desk executive is around INR
8000 while a repair technician is paid 25% higher than a front desk executive. Also one technician can fix a maximum of 30 complaints in a day.
Out of the total complaints received- 40% are software related complaints, 25% are minor repairs like microphone/ receiver, 15% are accessory related complaints like chargers/hands free
and 20% are critical complaints related to Printed Circuit Board/Touch panel/ LCD etc.
As per norms, once a customer approaches the service centre:
1. Call is registered on the customer portal (SAP) and unique complaint number is allotted to
each call. Process takes 15 minutes time.
2. Handset is checked for warranty , physical damage, water damage- Process takes 20 minutes
3. Customer is informed about the probable time of repair and cost if it is not a warranty repair.
4. If repairable on the same day, the customer is asked to wait for some time else the customer
is requested to come back on the expected date of repair.
Software related issues can be resolved immediately (within 30 minutes). Minor complaints
can be resolved in 4-6 hours. 50% of accessory related problems can be solved immediately
while the rest in 24 hours. 60% of critical problems need spare part replacement and therefore
need 2-3 days time while the balance 40% of critical issues are escalated to the repair factory
based at Noida. Average transit time for Repair Factory is 96 hours and Repair Factory turnaround time (RF TAT) is 48 hours. Average time spent on a handset to fix any type of complaint
is 30 minutes apart from the time spent on call logging and physical check-up.

Most of the customer complaints (around 80%) are found to be registered between 1200 hrs
to 1700 hrs.
BERG conducted a customer satisfaction survey and found that its customers are not satisfied
with the service delivery. An internal auditor was then appointed to find out the reasons for
customer dissatisfaction.
In the next 12 months, BERG intends to sell 40000 units/ month in Aurangabad. However, we
are conscious that in order to sustain sales, after sales service has to be revved up.
On the basis of above information determine:
- The number of service centres required for a satisfactory service delivery after 12 months
- What infrastructure is required to serve customers satisfactorily?
- What should be the basis of increasing the number of service centres in future?
- ROI per service centre
- Should BERG opt for OWNED SERVICE OUTLET strategy rather than appointing franchisees
and paying them on per-call basis? State the reasons for your choice with cost/ benefit
analysis.