Customer Demand Classification for Automobile Service Based on Analytical Kano Model

Transcription

1 Customer Demand Classification for Automobile Service Based on Analytical Kano Model Yongjun Yang, Zhenxiang Zeng, Jingjuan Xu School of Economics and Management, Hebei University of Technology, , Tianjin China Lixiao Geng* School of Economics and Management, Hebei University of Technology, , Tianjin China *Corresponding author( Abstract In order to discover the differentiations of customer service demands via classifications this paper presents an analytical Kano Model for Automobile service. First, we build an analytical process for the Kano Model to be used in the classification of customer demand elements. Then we study the demand differentiations among the automobile service customers via questionnaire survey. We get the classifications by dividing them into basic demand service group and senior demand service group. The model presented in this paper can be used to the personalization to meet customer demand and to achieve market customization services, which is not only for automotive service but also but also can also be extended to other service areas. The results of the study hopefully provide a method and theoretical contribution for customer classification in service market. Key words: Analytical Kano Model, Personalized Service, Classification of Customer Demand 1. INTRODUCTION With the rapid development of the automobile industry in China, the car ownership in China keeps increasing year by year, and auto service industry market is more competitive than ever. Meanwhile, the consumption vision in the mobile consumption is gradually becoming mature, and the customer service demands is becoming more comprehensive and personalized. The diversity of customer service demands brought increasing customer defection of the conventional auto 4S stores, thus caused impediment to the development of the 4S stores. Drawing lessons from the idea of mass customization in manufacturing, providing the customers with personalized services can greatly satisfy the personalized demands of the customers under the premise of certain cost and limited resources. In the personalized customized services, the customers are mainly subdivided into groups of different service demands, and they are provided with diversified and comprehensive services, that can not only improve the customer satisfaction, but also promote service ability of the auto service providers, thus promoting the sustainable development of automobile service enterprises. Application of KANO model in quality evaluation of digital library service by Cecilia Garibay.et al. (2010). Wu H.H.et al.(2010) put forward the idea of combining Kano model with IPA to categorize the characteristics of products and services. Lai H.J. et al. (2011) combines the Kano model and the single factor analysis of variance to subdivide the market, in order to determine the key attributes of different market service quality evaluation. From literatures research we found that rare researchers concerned the customer classification based on the service demands, therefore, this paper analyzes the classification of customer service based on Analytical Kano model, in order to discover the differentiations of customer service demands via classifications, and then provide better personalized service for the auto customers. 2. KANO MODEL AND LITERATURE REVIEW 2.1. Basic Principle of Kano Model Noriaki Kano developed the Kano Model in the 1980s, and he concluded that there was a nonlinear relationship between customer satisfaction and products (Kano N et al, 1984). According to that non-linear relationship, Kano Model classified customer demands preferences into five categories: Attractive quality feature(a), One-dimensional quality feature(o), Must-be quality feature(m), Indifferent quality feature(i)and Reverse quality feature(r)attractive quality feature. Attractive quality feature: it has some kind of surprised or amazed features. One-dimensional quality feature: it is shown in the Kano picture that there is a linear relationship with positive slope between customer satisfaction and customer demands, which means the more demands are met, the more the customer satisfaction. Therefore, this feature is extremely important to the enterprise development. 59

2 Must-be quality feature: customers generally think that they would be satisfied only if the must-be features were achieved, otherwise, customers should be unsatisfied. Indifferent quality feature: it has no impact on customer satisfaction. Reverse quality feature: Customers normally dislike this feature as when it happened, customers satisfaction decreased Basic tools for Kano Model Basically, the main tools of Kano Model include Kano questionnaire, Kano demands classification and Kano survey table. (1). Kano questionnaire In order to classify different customers, we had both functional and dysfunctional questions when designing the questionnaire, serving as a feedback whether the customers have needs for each feature. We set 5 levels for the optional answers, Like, Must be, Neutral, Live with and Dislike (See Table 1). Table 1. Kano Questionnaire Like Must be Neutral Live with Dislike Functional questions With qualified service Dysfunctional questions Not with qualified service (2). Kano classification demand table We can get response from customers through Table 1, then classify them according to Kano classification table, shown as Table 2. We got the demands feature as O on the occasion that customers answered Like for functional questions and Dislike for dysfunctional questions. Table 2. Kano classification table Does not have this service attribute Has this service attribute Like Must be Neutral Live with Dislike Like Q R R R R Must be A I I I R Neutral A I I I R Live with A I I I R Dislike O M M M Q Note: A stands for Attractive quality feature; O stands for One-dimensional quality feature; M stands for Must-be quality feature; I stands for Indifferent quality feature; R stands for Reverse quality feature; Q stands for answers that have question. (3). Kano Survey Table We obtained related data from both Table 1 and Table, and then we calculated the frequency of all the features, finally we got Kano survey table. However, in the actual process of classification, we confirmed the results predominantly based on the frequency of A, O, M, I Literatures Review Kano model received intensive concerns immediately after it was developed, especially plenty of researches concerning various applications and improvements appeared in the practice field. One of the prevailing research focuses is the application area of the model. Due to the strong maneuverability of its application, and its ability of identifying customer demands from different types, Kano model is more expansively applied, and also, offers some guidance to the management and development in related fields. Most researches on Kano model application focus on the combination with other methods. There were studies on how Kano model improves the importance of customer demands, and how it was applied in specified areas. Additionally, Kano model is applied to provide instructions for benefits of strategic thinking, commercial planning, products development and service quality improvement in different industries. As service quality was also an important part to meet the customer satisfaction, this paper gave an overview from the following two aspects, service quality assessment and customer demands. Cecilia Garibay. et al. (2010) proposed to combine Kano model with QFD and apply them to service quality evaluation in digital library, in order to find the key points to improve the service quality and then take measures to realize the improvements. Wu H.H.et al.(2010) put forward the idea of combining Kano model with IPA (Importance-Performance Analysis), so that to classify the quality of the product or service characteristics, and identify the key factors of the successful enterprise, thus formulate effective management strategies to improve the service quality of enterprises. 60

3 Lai H.J. et al. (2011) combined Kano model with ANOVA, and then applied it to segment the market in order to identify the key attributes of service quality evaluation from different markets, and thereby help enterprises to evaluate the service quality, also explain the whole analytical process with a detailed case. Kano model was applied in the field of medical industry by Wang Shuyi.et al. (2005). Accordingly, Kano questionnaire was designed to collect the opinions of service quality from the patients, then the research identified the different types of patients and demands, and thus made sure that the patients could get satisfied service, and finally, can improve the satisfaction of patients for medical services. Shi Honguo.et al. (2009) integrated Kano model with the SERVQUAL scale and used them for service quality evaluation in the library. They identified 5 different features of library service quality, and on that basis, coefficient of "customer satisfaction" were adopted to study to what extent the effect of the service quality increase the satisfaction or release the dissatisfaction, so that to find out the breakthrough point to improve the library service quality. Qiao Xincai et al. (2014) research on customer demands classification in terms of Oriented Strand Board (OSB) based on the questionnaire survey and the affinity diagram analysis. Kano classification matrix is introduced to classified the customer demands. Then the index of customer demands attraction is calculated by means of assigning quantitatively to the quality requirements. And consequently, they built knowledge base of the customer demands information. To sum up, the study of Kano model is well developed in the field of service quality evaluation and customer demand, however, the traditional Kano model has its limitations in practical applications. For example, as a qualitative analysis model, it is difficult to identify clearly the customer satisfaction of some certain demand, and the features can neither accurately be determined in right order. Therefore, this paper applies the analytical Kano model to solve the above problems. 3. KANO MODEL ANALYSIS OF CUSTOMER CLASSIFICATION IN AUTOMOBILE SERVICE Matzler.et al. (1998) assigned the Kano model, which helps to provide quantitative evaluation of customer satisfaction to the service or product performance, as shown in Table 3. It shows the satisfaction scale that customers exert on the service or product attributes of both functional and dysfunctional questions. Table 3. Satisfaction scale of functional and dysfunctional questions Like Must be Neutral Live with Dislike Provide Product/Service attributes Not available Based on Yang s(2005) research, during the questionnaire designing, the perception of importance for service or products was concerned, as shown in Table 4. For the convenience of calculation, we selected each middle value as a representative value from the important scale numbers, such as the in the option of Extrmely important, we take 0.9 as a representative value which is between 0.8 and 1. Table 4. Scale of Importance Degree Extremely important Very important important Some important Unimportant 0.8~1 0.6~ ~ ~0.4 0~ Customer Demand Analysis Process Model Based on Analytical Kano Model From the perspective of customers, we designed the decision process graph model of automobile service chain, as shown in fig. 1. Through the process of determination of the object, car service attribute identification, customer demand classification and customer utility model extraction, the quality of service can be enhanced. (1) The choice of the research object These research objects mainly refer to the customer groups that need the above-mentioned services. The study object is chosen mainly according to the purpose of the design of the paper, as well as the value of business services and many other factors. Therefore, during the choosing process of the research objects of the questionnaire, we should make sure that these objects have adopted the services or have been exposed to these services. (2) Identification of Automobile Service Attributes In the process of the automobile service attributes identification, it s necessary to re-examine the whole car service chain process based on customer research, such as insurance business, maintenance business, second-hand car business and so on, so as to obtain the above service elements. In the analysis, we can use the route-result chain method, which is mainly applied to describe the impact of individual values on their behaviors and attitudes(yang,2005). However, the customers consumption is a process of changes in inner demand, so there is a necessary connection between the consumer behavior and the value system (RO KEACH M.1973). Thus, each different concept of car service, should correspond to a service attribute, function and 61

4 characteristic. Through the understanding of customers, we identify the different elements of the car service chain process, and form a variety of attributes. (3) Customer demand classification When the analytical Kano questionnaire is designed, before the official survey of the questionnaire, we should analyze the design options, statements, etc., to determine whether it is easy to be understood, and ultimately can form a complete questionnaire. What s more, we identify the car service attributes according to the results table of the analytical Kano, and classify these service attributes. Customer demand classification process Usage instructions Gather information about car services Identify customer service requirements elements Design the Kano questionnaire No Preliminary customer survey questionnaire is clear or not Yes Questionnaire survey and collection Analysis of customer demand classification results Analytical Kano model Analytical Kano Questionnaire Results analysis table Customer utility mode extraction Importance index Figure 1. Customer demand classification process model (4) Customer utility mode extraction After classifying the customer demands, we can quickly classify each service attribute and obtain the expected utility model of each customer segment by calculating the satisfaction and importance of the analytical Kano model. In order to determine the priority of the service attributes of the automobile chain, we can use the analytical Kano decision index to calculate the size of each service element. Enterprises can set up a set of different weight of the automobile service attributes according to the obtained customer utility model, so as to continuously improve the customer's satisfaction and the retention rate of the customers Analytical Kano Indicators Design for Automotive Service Customer Demand F: a service or product attribute set, F={f i,i=1,2,i}, f i : the number i attribute of the service or product, J: the number of customers that have been visited. Therefore, according to the questionnaire, we can achieve the evaluation of each attribute of the product or service. = (,, ) (1) Among them, x ij : the evaluation of customer j on the dysfunctional question about product or service attribute f i, y ij : the evaluation of customer j on the functional question about product or service attribute f i, w ij : the evaluation of customer j on the significance about product or service attribute f i. 62

5 The average satisfaction level of the dysfunctional question is defined as Xi, and the average satisfaction level of the functional question is defined as Yi. So we got: =, = (2) The abscissa of (Xi,Yi) represents the customer's unsatisfied level of service or product attributes and the vertical axis represents the satisfaction level, most of these values fall within the range of 0 to 1. If a negative value appears, we can determine this as a problematic answer or as a reverse quality feature. In the actual decision-making process, some problems should not be considered in. And when the reverse quality feature exists, it can greatly reduce the customer's satisfaction, and should not be considered either. Based on the related problems of Kano model, this paper designed the initial analysis of the service demand elements. Through the consulting and a small range of tests by the relevant scholars and experts in the field of automotive services, the expression of some items in the questionnaire has been further improved, and the final preset questionnaire was determined, as shown in Table 5. Table 5. Analysis table of automobile service demand features Service demand number Service requirements features f1 The traffic convenience of the service network sites \ 4S stores f2 The information sharing degree among the 4S stores f3 The environments of the Service network sites f4 Timeliness of reminder services about regular maintenance and other services f5 The convenience of telephone and online booking f6 The time of waiting for the service f7 The transparency of service process and prices f8 The convenience of service feedback f9 The convenience of financial services f10 The convenience of insurance purchases f11 The convenience of insurance claims f12 The rationality of insurance price f13 The convenience of car rental process f14 The number of optional types of rented cars f15 Whether provides road rescue in car rental services f16 The file completeness of the used cars f17 The transfer convenience of used cars f18 The authority of used car evaluation and certification f19 The after-sales service quality of used cars The convenience of car modification f20 4. EMPIRICAL RESSEARCH 4.1. The Design and Investigation of Questionnaires According to the above analysis, this paper designed a questionnaire based on the analytical Kano model. The questionnaire is divided into three parts: the basic information statistics about the customers and their cars, the investigation on the demand of services in automobile service chain and the investigation on indicator factor importance. Then we conducted a small sample of the questionnaire survey, and took a small-scale revision of the questionnaire's projects. According to the calculation of SPSS 19.0, the reliability of the questionnaire was and the reliability was higher. Formal research was carried out through two channels. First, on the questionnaire search platform, we collected electronic version of the questionnaire directly. Second, we distributed a paper version questionnaire that can investigate in many 4s stores conveniently. We got a total of 200 copies, including80 copies of paper version and 120 copies of targeted electronic version. Removing the non-standard and incompletely filled questionnaires, we got 178 copies of the final valid questionnaires. The effective questionnaires accounted for 89.2% in the total. After processing the questionnaire data, we introduced the internal consistency reliability coefficient, Cronbach s alpha coefficient, to carry out the reliability test. In this paper, the reliability of the formal questionnaire was shown in Table 6. The Cronbach's alpha coefficient of the service satisfaction questionnaire was 0.769, and the reliability was even better. 63

6 Table 6. Reliability statistics Cronbach s Alpha Based on standardized items Cronbach s Alpha Items number Descriptive Statistical Analysis of The Questionnaires (1) Research data processing According to the research data processing, we divided the age of the investigated objects into three stages: under 35 years, 35 ~ 55 years and over 55 years. The number of people under the age of 35 is 62, accounting for 35%; the number of people aged 35 to 55 years old is 75, accounting for 42%; the number of persons over 55 years of age is 41, accounting for 23%. Car owners in the under 35-year-old group, mostly just graduated from college students or just went to work recently. The proportion of people aged 35 ~ 55 years old is the largest one, whose jobs are relatively stable, and have certain income and savings, so it is the main group of automobile industry in China. People over the age of 55 occupied the smallest proportion. We mainly considered the age as the customer classification standards, analyzed different age groups of different needs of customers and the priority of the needs, and provided customized services for different customers of age groups to meet the different needs of each group. Through this personalized service, we can provide the customers with personalized services and improve customer satisfaction, so as to achieve the effect of customer retention. The gender distribution of the survey data was as following, the number of male was 111, accounting for 62.4% of the total number; the number of female is 67, accounting for 37.6% of the total number. (2) Classification of customer demand factors based on questionnaires In order to classify the demand elements of automotive services, we set the average of the satisfaction 0.5 as a threshold, and summarized as following: for the automotive service demand elements fi, if x i <0.5 and y i <0.5, it means that fi is Indifferent quality feature; If x i 0.5 and y i <0.5, it means that fi is Must-be quality feature; If x i 0.5 and y i 0.5,it means that fi is One-dimensional quality feature; If x i 0.5 and y i 0.5, it means that fi is Attractive quality feature. According to the processing of data, we calculated the customer demand classification, as shown in Table 7 and Figure 2. Table 7. Customer requirements classification results Service demand number X Y Demand classification f O f O f M f M f M f M f M f M f I f I f O f O f O f O f M f M f A f A f A f A 4.3. The Results of Customer Demand Classification From the above results we can conclude that: (1) Must-be quality feature(m) includes the following eight points: the environments of the Service network sites (f 3), timeliness of reminder services about regular maintenance and other services (f 4), the convenience of telephone and online booking(f 5), The time of waiting for the service (f 6), the transparency of service process and prices (f 7), the convenience of service feedback(f 8), whether provides road rescue in car rental services (f 15) and 64

7 The file completeness of the used cars (f 16). If these service elements of 4s auto stores can not be met, customers will have some dissatisfaction with the service of this store. (2) One-dimensional quality feature(o) includes the following six points: the traffic convenience of the service network sites/4s stores (f 1), The information sharing degree among the 4S stores (f 2), the convenience of insurance claims(f 11), the rationality of the insurance price(f 12), the convenience of car rental process (f 13), and the number of optional types of rented cars (f 14). The more perfect of these service functions, the customers will become more satisficed. Figure 2. Classification of automotive service attributes based on Kano Model (3) Indifferent quality feature(i) includes the convenience of financial services (f 9) and the convenience of insurance purchases (f 10). It means that these service elements have less impact on customer satisfaction, besides, customer satisfaction with such service attributes is not high, and customers think these attributes are not important. So, 4s stores have no need to try that much to improve these service attributes. (4) Attractive quality feature(a) includes the following four points: the transfer convenience of used cars (f 17), the authority of used cars evaluation and certification(f 18), the after-sales service quality of used cars (f 19), and the convenience of cars modification(f 20). Customer satisfaction of such service attributes is high, but, customers think these attributes are not important. For example, with the increasing number of social cars ownership and the increasing degree of people s pursuit of cars, a large number of high-quality second-hand cars will enter the automobile trading market, so that to better meet the various needs of people. However, the transfer convenience of used cars, the authority of used cars evaluation and a good after-sales service of used cars will bring a higher degree of satisfaction to the groups. 5. RESEARCH RESULTS DISCUSSION AND MANAGEMENT INSPIRATION In order to exactly locating the customer demands, we divided the customers into three parts: under 35 years old, between 35 and 55 years old and over 55 years old. By calculating customer demand data for each customer group, we can draw the following conclusions: different groups appeared various satisfaction degree on those services elements. These elements include the following eight points: the information sharing degree among the 4S stores (f 2), the convenience of telephone and online booking (f 5), the time of waiting for the service (f 6), the convenience of service feedback(f 8), the convenience of financial services (f9),the convenience of insurance purchases (f 10), the transfer convenience of used cars (f 17), and the convenience of cars modification(f 20). As of the convenience of financial services, the group under 35 years old will consider it as one-dimensional quality feature, meanwhile, years old and over 55 years old customer groups will consider it as indifferent quality feature. In fact, most of the people under the age of 35 are facing mortgage and many other pressures, so these people have a weak financial strength. If the 4s stores can provide them with more reasonable financial services, that will greatly improve their satisfaction from this service. While the other two age groups income is relative large and they always have strong economic strength, so they hold a neutral attitude to whether the 4s stores can provide financial services. Via careful calculation, the classification of three groups is shown in Table 7 to Table 9. 65

8 Table 8. Customer demand classification results (Under 35 years old) A M O Basic service demand group f 2,f 3,f 4,f 5,f 7,f 8,f 15,f 16 f 1,f 6,f 9,f 10,f 11,f 12,f 13,f 14 Advanced service demand group f 17,f 18,f 19,f 20 Table 9. Customer demand classification results(35 to 55 years old) A I M O Basic service demand group f 3,f 4,f 5,f 6,f 7,f 8,f 15,f 16 f 1,f 2,f 11,f 12,f 13,f 14 Advanced service demand group f 17,f 18,f 19,f 20 f 9,f 10 Table 10. Customer demand classification results(over 55 years old) A I M O Basic service demand group f 3,f 4,f 6,f 7,f 15,f 16 f 1,f 2,f 5,f 8,f 11,f 12,f 13,f 17 Advanced service demand group f 18,f 19 f 9,f 10,f 20 Table 11. Customer demand classification(men) A I M O Basic service demand group f 4,f 5,f 6,f 7,f 8,f 15,f 16 f 11,f 12,f 13,f 14 Advanced service demand group f 2,f 17,f 18,f 19,f 20 f 1,f 3,f 9,f 10 Table 12. Customer demand classification(women) A I M O Basic service demand group f 3,f 4,f 5,f 6,f 7,f 8,f 15,f 16 f 1,f 2,f 11,f 12, Advanced service demand group f 9,f 17,f 18,f 19,f 20 f 10,f 13,f CONCLUSION In this paper, Kano model is applied as a tool to study the customer demand elements classification, the analysis process model based on Kano model is established. Through Kano questionnaire we study the problems about the different requirements of customers in auto service. The research shows that 33 to 55 years old group is similar with over 55 years old group in the satisfaction of service elements, this two groups just exist differences in two aspects: the convenience of telephone and online booking and the service feedback. Meanwhile, there are some differences between under 35 years old group and 35 to 55 years old group, these differences refer to the degree of information sharing between 4s car stores, the time of waiting for the service, the convenience of both financial services and insurance purchase, and the convenience of cars modification. But there is a big difference between under 35 years old group and over 55years old group. As to different gender, the most typical difference of satisfaction is about service network environments. Men consider the environments as indifferent quality feature, while women consider the environments as must-be quality feature. This means that the satisfaction with the 4s stores service environments of the network sites have different impact on different gender. Men hold neutral attitude to service network environments. By contrast, women pay more attention to the quality and comfort of service environments, that is, they have higher demand for the service network environments. So, 4s stores can improve their service environments to attract more women customers. According to this paper, car service companies can define the service modules standardly. They should use different service modules combination to meet different customers demands. And then how to improve customers satisfaction is the further research objectives and directions of this paper. ACKNOWLEDGEMENTS The research was supported by Hebei Natural Science Foundation (G ). REFERENCES Cecilia Garibay, Humberto Gutierrez, Arturo Figueroa (2010) Evaluation of a Digital Library by Means of Quality Function Deployment (QFD) and the Kano Model. The Journal of Academic Librarianship, 36(2),pp

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