Daisy Perry is the repair shop supervisor at one of the largest automotive dealerships in Phoenix, Arizona. Daisy has been working on cars since she was twelve years old, for more than twenty-five years. She began by helping her father repair racecars; he raced cars as a hobby. After her graduation from high school, Daisy attended a technical school to earn her Automotive Service Excellence (ASE) certification.
Early in her career Daisy moved around from auto maker to auto maker to get as much experience as she could. Daisy has worked on all types of cars, from traditional family vans to sporty high-performance cars. Because of her experience at different dealerships, Daisy has an excellent reputation throughout Phoenix, so much so, that some customers actually switched brands when Daisy moved on to another dealership. Daisy was ready to go out on her own and open an all-purpose automotive repair shop.
Opening her own business required a lot of thought. Daisy had many things to consider, for example, layout, location, type of strategy, productivity, capacity, and customer waiting time, to name just a few. Daisy began to jot down some of the things she believed were important to include in her business.
One critical feature of the business is to have ASE-certified mechanics. In addition to the certification, Daisy wanted her mechanics to look professional. They would wear coveralls with her company logo and their name. She planned to give each mechanic five sets of clothing and to provide each a personal locker to keep them in. She would have a laundry service clean them so there would always be a clean set available to start each workday.
Daisy knew that customers like freebies so she planned to offer a free oil change after every fifth one. Although the type of warranty depended on the work completed and the parts provided, at a minimum, Daisy planned to provide a thirty-day warranty on all work. In addition, the invoices would contain itemized charges, with no hidden costs. Prior to any repairs, the customer would receive a quote. If for some reason the repairs were more extensive than originally thought, Daisy would contact the customer and provide a revised quote before the work continued.
The waiting room would have Wi-Fi, sufficient electrical outlets to charge electronic devices, magazines to read, a TV to watch, and drink and snack machines. The waiting room would be in the center of the facility with windows looking out to all the work bays. This allowed the customer to watch the repairs and see the care given to their vehicles. Each work bay would contain state-of-the-art equipment.
One challenge Daisy was concerned about was scheduling. She believed that once she opened the doors many of her current and past customers would bring her their business. Scheduling, if business is strong, will not be an issue. However, if there are periods, whether seasonal or otherwise, where there are too many mechanics on shift, it will be
difficult to manage. ASE-certified mechanics are not interested in part-time work. A forty-hour per week job is expected and easy to find. Using part-time employees as a safety valve to balanced demand and capacity does not seem an option.
As Daisy reviewed her list, she felt that there were still many unanswered questions. However, Daisy felt reasonably confident since she effectively ran the repair shop at the dealership for the last five years. Daisy had many friends in the business and decided to share her list with several of them and get feedback.
Questions
1. Which service strategy is Daisy planning to implement? Provide specifics that support your selection. Do you believe this is the best strategy? Should she consider one of the other two?
2. Daisy’s concern about scheduling during nonpeak periods is a serious problem. She cannot risk alienating her ASE-certified mechanics by cutting their hours because they can easily find other work. Assume the following: after the first year, Daisy determines the nonpeak periods. There are very few times; however, she believes they will be consistent year after year, meaning the same general timeframe. Explain to Daisy what options or initiatives she can use to increase demand since cutting hours is not an option.