Lunes, Adrian Joseph A.

SEM 2011105934
EMG199R-T
Topic Proposal
Topic:
The importance of satisfying clienteles in a service industry and convert them as loyal clienteles
by application Service Engineering and Management tools.

Introduction:
ABC Company is involved in the repair, installation, cleaning service and preventive
maintenance of HVAC (Heating, Ventilating and Air-conditioning) System in the Philippines. It
handles not only multi-brands but also multi-systems of chillers and air-conditioners.
ABC Company aims to provide its clientele with topnotch services by training and producing an
excellent pool of highly-motivated workforce. The company strives to provide value-added
services and preventive maintenance procedures for HVAC systems hence allowing customers
to reduce their unlikely overhead costs. ABC Company has proven to establish excellent
business partnerships with its customers and with such we commit to continuously improve the
quality of service provided for every customer.
The said company is divided into three sales groups: the Chiller Service Dept., Unitary Products
Group, and the Project Development Group.
In Global Market the HVAC industry is potential increasing according to study, 32% of energy
consumption is the HVAC Industry, which is the largest percentage among all the energy
consumption.

PERCENTAGE OF ENERGY CONSUMPTION

HVAC; 32%

Lightning; 25%Cooking; 2%
Other; 20%

Electronics; 7%

Refrigeration; 4%

Computers ; 4%
Water Heating; 6%

HVAC

Cooking

Refrigeration

Computers

Water Heating

Electronics

Other

Lightning

This industry is a worldwide enterprise, with roles including operation and maintenance, system
design and construction, equipment manufacturing and sales, and in education and research.

Based from the 2013 market segmentation of HVAC, single-family homes, healthcare and
institutional buildings, educational buildings are the top 3 market of HVAC. The recent global
HVAC market report is expected to generate over $68.93 billion at an estimated of 4.34% from
2016 to 2020.

Figure 1.02 Global HVAC Market (IBISWorld, 2013)

One major contributor in ABC Companys profit is the Chiller Services Department; this
department handles the repair services, preventive maintenance and operatorship for different
kind of chillers. Chillers are commonly used in application that need large cooling capacity such
as hypermarket/malls, industrial process, commercial air conditioning such as offices and
factories to make the room well-ventilated. Here in the Philippines, ABC Company is one of the
key players in said industry that provide this kind of services. One of the main reason on how
the Chiller Services Department get its client/s is under a specify brand that sell Chiller products
in the country, the companys department handles the services required like maintenance and
repair of equipment under the warranty of the product. Once the warranty is terminated the
client can decide if they want to keep the said department as their after sale service provider or
not. The competitors are RCAC, JEC, Cofely, Top Source, Macrotech, Delta-T, Phil Energy,
Schindler and FS Cool Aire.

Market Share

Schindler; 1%

Top Source; 4%

RCAC; 29%
Phil Energy; 2%
Macrotech; 3%

ANPI; 47%

JEC; 5%
FS Cool Aire; 1%

Delta - T; 3% Cofely; 5%

Problem Statement:
The Chiller Services Department losses almost 60 percent of target clienteles after the warranty
is terminated for the year 2013 to 2014, resulting to opportunity loss of PHP 36,960,000.00 per
year.

Number of
Chiller
Installed
Number of
Chiller
(Awarded)
Number of
Chillers
(Not
Awarded)
Percentage

2010

2011

2012

2013

2014

45

28

16

13

0
100%

0
100%

0
100%

29
64.44%

15
53.57%

*(Data as of May 2016)

The services price varies to the size of chillers.

Number of not awarded Chillers
Average Income From Preventive
Maintenance per Year
(P120,000/Chiller)
Income from Service Personnel
per Year (720,000/Chiller)
Total Opportunity Loss

2013
29

2014
15

Total

P 3,480,000.00

P 1,800,000.00

P 5,280,000.00

P 20,880,000.00

P 10,800,000.00

P 31,680,000.00
P 36,960,000.00

Objectives:

Assess the current Marketing and Service System of the company for chiller
installation and maintenance.
To determine the factors that affects clients decision to award the preventive
maintenance service.
To develop actions that will ensure customer retention on chiller preventive
maintenance service.

Methodology:
Input

Interview,
Observation and

data Gathering
Voice of the

Customer
Assessing the
current process in
doing the service.

Process

Process Mapping
Value Chain Analysis
Market Analysis
Service Blueprint
Why-Why Diagram
Service Quality

Assessment
Strategy Formulation
Benchmarking

Output

Assessed current Marketing

and Service System of the
company.
Factors that affect clients
decision
to
award
the
preventive
maintenance
service.
Improved Service and Client
Retention.

Process Mapping - Analysis of each process involved in the said department. Mapping the
process can show the bottlenecks and factors regarding the causes of the errors and how to
eliminate or prevent them.
Value Chain Analysis - It helps you identify the ways in which you create value for your
customers, and then helps you think through how you can maximize this value: whether through
superb products, great services, or jobs well done.
Market Analysis - Better understanding and determining the attractiveness of the market.
Service Blueprint - Identifies fail points, that is, weak links of the chain of service activities,
which points can be the target of continuous quality improvement.

Voice of the Customer (VOC) - Capture the feedback of internal or external customers about the
services.

Benchmarking - To determine industry best and best practices and adapt it to the company.
Why-Why Diagram Determining the root cause why the clients changes after-sales provider.