DAV Case
DAV Case
1. Why is DAV using SPC? What are the primary challenges in applying Statistical Process Control to a service industry compared to manufacturing?
Why SPC:
Though they have been the industrial leaders, DAV has been faced with competition lately. To overcome competition, DAV has set out to improve the quality of service it provides to its customers to set itself apart. It, initially, planned on using SPC for measuring the quality of service provided to the customer. SPC will help DAV find the accuracy of the service provided based on which an improvement program can be designed for the various processes used to provide service to the customers. The Head of Operations also wanted a tool that measured processes rather than the people. This will help protect employees from the wrath of the superiors.
DAV wanted to develop capabilities that helped them serve value to their customers. Also, DAV wanted these capabilities to be spread across the entire organization which will help them to achieve their aim of quality improvement. The case also notes that for the Insurance industry exceeding customer expectations through quality of service provided will help companies to attract new customers apart from maintaining the current ones. It has become an important differentiation tool to set a firm apart from others.
Above were the contributing factors for DAV to go ahead with SPC to measure and improve the quality of processes involved in providing customer service, which in turn will enable them to improve their market share and stay ahead of competition.
Challenges:
SPC is normally used in the manufacturing firms. It is used to measure and analyze the variations in a continuous/consistent process. But in the case of DAV the processes are not consistent when compared with those used in the manufacturing firms.
Some of the characteristics of the factors that are measured in the services industries are listed below:
Intangible – hard to measure
No clear index to
1. Why is DAV using SPC? What are the primary challenges in applying Statistical Process Control to a service industry compared to manufacturing?
Why SPC:
Though they have been the industrial leaders, DAV has been faced with competition lately. To overcome competition, DAV has set out to improve the quality of service it provides to its customers to set itself apart. It, initially, planned on using SPC for measuring the quality of service provided to the customer. SPC will help DAV find the accuracy of the service provided based on which an improvement program can be designed for the various processes used to provide service to the customers. The Head of Operations also wanted a tool that measured processes rather than the people. This will help protect employees from the wrath of the superiors.
DAV wanted to develop capabilities that helped them serve value to their customers. Also, DAV wanted these capabilities to be spread across the entire organization which will help them to achieve their aim of quality improvement. The case also notes that for the Insurance industry exceeding customer expectations through quality of service provided will help companies to attract new customers apart from maintaining the current ones. It has become an important differentiation tool to set a firm apart from others.
Above were the contributing factors for DAV to go ahead with SPC to measure and improve the quality of processes involved in providing customer service, which in turn will enable them to improve their market share and stay ahead of competition.
Challenges:
SPC is normally used in the manufacturing firms. It is used to measure and analyze the variations in a continuous/consistent process. But in the case of DAV the processes are not consistent when compared with those used in the manufacturing firms.
Some of the characteristics of the factors that are measured in the services industries are listed below:
Intangible – hard to measure
No clear index to