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Otis Elevator Company: Plans and Developments Case Study

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Updated: Jul 8th, 2020

What types of B-Webs does Otis Elevator represent? Clearly explain and justify your choices

Otis Elevator Company is the world’s leading producer, installer, and servicer of escalators, elevators, and moving walkways. Otis Elevator is a vivid example of such a type of B-web as a value-chain. It is necessary to justify such a choice by describing business operations.

Otis Elevator is involved in two types of operations. According to the case study, the company works for small and big building projects. Small projects may be characterized as product-centric B-web because they function on the basis of make-and-sell logic. Customers who do not require special modifications of elevators or any other products comprise a target audience of small projects. Thus, the architects, contractors, or building owners may choose from the available products. The Process Capital is of primary significance for the success of small projects.

The situation with big projects is different. Clients of big projects require particular design and construction. For example, a particular elevator may be designed for a building that is taller than usual. In 2002, Bousbib realized that the company’s performance in big projects related not only to excellent products but the provision of flawless services for customers. As a result, a fivefold order-to-hand-over business cycle was implemented.

This cycle included five steps. The first step was the Project Proposal. This phase aimed to establish initial relations with the customer. New customers who considered the idea of ordering products of the company could benefit from the so-called prebid checklist. With the help of the e*Logistics program, customers could receive a substantial amount of information about their orders. The next step was Sales Processing. The second step included activities necessary for the proper issuance of documents, booking, validating, and scheduling of the order. The field-installation supervisor played a significant role in this step.

He had to meet the client to clarify contract details and then visit the factory to monitor the readiness to execute the order. The third step in this cycle was Order Fulfillment. This process was realized with the help of regional contract logistics centers (CLC). These centers had to manage supply chains and organize all processes necessary for the successful and timely completion of orders. The fourth phase was the Field Installation. During this stage, the process of elevators or escalators installations had to be monitored. The E*Logistics program facilitated this process substantially. Closing Activities was the last step that presupposed the final billings and checks.

This system of operating of big projects proves that Otis Elevator’s other B-web type is shop-production value-chain based on the sell-and-build logic. It is precisely stated that the first step is selling of proposal to the customer and then comes building or fulfilling of the order.

Based on your B-Web analysis of Otis Elevator in the first question, please select what you believe should be the three top priority IT projects for this company

The type of the value-chain is a significant factor for the identification of the IT projects recommended for this company. The company realized that the rate of dissatisfaction with the quality of service was the primary reason for the cancels of maintenance agreements. This situation demonstrates the need to improve shop-production value-chain. Efficient IT projects should be suggested for the improvement of Relationship Capital.

  1. IT projects for analysts. The improvement of the Relationship Capital presupposes maximum satisfaction of customers’ needs. Before making any decisions, it is crucial to launch a project aimed at gathering analytical data about clients. Analysts should use various services like Oracle, Microsoft Access to understand what is the most disturbing thing in services. Also, inspections and evaluation of reasons for cancelation of the agreement should be conducted;
  2. Databases with all relevant information about clients. The formation of electronic databases is necessary for constant monitoring of service issues. Databases should contain information about previous complaints of customers, the time needed for the solution or repair, and clients’ feedback. Such monitoring will be useful for further evaluation of possible problems and their timely prevention. For example, Otis Elevator may find out after what period of time the subsequent maintenance will be required. Then, the company may contact the client and provide information about desirable maintenance. Such an approach for internal perspective is likely to increase customers’ satisfaction;
  3. Online service for customers. Finally, clients should feel that they may approach the Otis Elevator whenever they need it. It is recommended to launch the system of premium online support to increase customer retention. For example, the company may create an electronic page for the client so that the latter may post questions and feedback. Also, there should be a special button for calling the services in case of an emergency. The clients will appreciate that their time is not wasted. Such online pages should contain all necessary information about orders, pricing, offers, and additional services.
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