Enterprise Rent-A-Car:
Measuring Service Quality
SURVEYING CUSTOMERS
Kelvin Kirkman wheeled his shiny blue BMW couple into his driveway, put the gearshift into park, set the parking brake and got out to check his mail box as he did every day when he returned home. As he flipped through the deluge of catalogs and credit card offers, he noticed a letter from Enterprise Rent-A-Car. He wondered why Enterprise would be writing him.
THE WRECK
Then he remembered. Early that month, Kelvin had been involved in a wreck. A he was driving to work one rainy morning, another car had been unable to stop on the slick pavement and had plowed into his car as he waited at a stoplight. Thankfully, neither he nor the other driver was hurt, but both cars had sustained considerable damage. In fact, he was not able to drive his car.
Kelvin had used his cell phone to call the police, and while he was waiting for the offices to come, he had called his auto insurance agent. The agent had assured Kelvin that his policy included coverage to pay for a rental car while he was having his car repaired. He told Kelvin to have the car towed to a nearby auto repair shop and gave him the telephone number for the
Enterprise Rent-A-Car office that served his area. The agent noted that his company recommended using Enterprise for replacement rentals and that Kelvin’s policy would cover up to $20 per day of the rental fee.
Once Kelvin had checked his car in at the shop and made the necessary arrangements, he telephoned the Enterprise office. Within 10 minutes, an Enterprise employee had driven to the repair shop and picked him up. They drove back to the Enterprise office, where Kelvin completed the paperwork and rented a Ford Taurus. He drove the rental car for 12 days before the repair shop completed work on his car.
“Don’t know why Enterprise would be writing me,” Kelvin thought. “The insurance company paid $20 per day, and I paid the extra because the Taurus cost more than that. Wonder what the problem could be?”
TRACKING SATISFACTION
Kelvin tossed the mail on the passenger’s seat and drove up the driveway. Once inside his house, he opened the Enterprise letter to find that it was a survey to determine how satisfied he was with his rental. The survey itself was only one page long and consisted of 13 questions (See Service
Quality Survey attached).
Enterprise’s executives believe that the company had become the largest rent-a-car company in the United States (in terms of number of cars, rental locations and revenue) because of its laserlike focus on customer satisfaction and because of its concentration on serving the home2 city replacement market. It aimed to serve customers like Kelvin who were involved in wrecks and suddenly found themselves without a car. While the more well known companies like Hertz and Avis battled for business in the cutthroat airport market, Enterprise quietly built its business by cultivating insurance agents and body-shop managers as referral agents so that when one of their clients or customers needed a replacement vehicle , they would recommend Enterprise.
Although such replacement rentals accounted for about 80 percent of the company’s business, it also served the discretionary market (leisure/vacation rentals), and the business market (renting cars to business for their short-term needs). It had also begun to provide on-site and off-site service at some airports.
Throughout its history, Enterprise had followed founder Jack Taylor’s advice. Taylor believed that if the company took care of its customers and employees first, profit would follow. So the company was careful to track customer satisfaction.
About 1 in 20 randomly selected customers received a letter like Kelvin’s. An independent mailed the letter and a postage-paid return envelope to the selected customers. Customers who completed the survey used the envelope to return it to the independent company. That company compiled the results and provided to Enterprise.
CONTINOUS IMPROVEMENT
Meanwhile, back at Enterprise’s St. Louis headquarters, the company’s top managers were interested in taking the next steps in their customer satisfaction program. Enterprise had used the percentage of the customers who were completely satisfied to develop its Enterprise Service
Quality Index (ESQi). It used to survey results to calculate an overall average ESQi score for the company and a score for each individual branch. The company’s branch mangers believed in and supported the process.
However, top management believed that to really “walk the walk” on customer satisfaction, it needed to make the ESQi a key factor in the promotion process. The company wanted to take the
ESQi for the branch or branches a manager supervised into consideration when it evaluated that manager for promotion. Top management believed that such a process would ensure that its managers and all its employees would focus on satisfying Enterprise’s customers.
However, the top managers realized they had two problems in taking the next step. First, they wanted a better survey response rate. Although the company got 25 percent response rate, which was good for this type of survey, it was concerned that it might still be missing important information. Second, it could take up to two months to get results back, and Enterprise believed it needed a process that would get the customer satisfaction information more quickly, at least on a monthly basis, so its branch managers could identify and take action on customer service problems quickly and efficiently.
Enterprise’s managers wondered how they can improve the customer-satisfaction-tracking
process.