Service Operation Management

1. By :
Grace Carolina Malau
Onny Oktami Samosir
ZipCar
Service Operation Management
International Management Business
Administration (IMBA)

2. Outline:
Introduction
How Zipcar works
Service Strategic Vision
Factor That Affect Zipcar’s Economic
Performance
Service Blueprint Zipcar

3. INTRODUCT
ION
Founded by
Robin Chase
and Antje
Danielson
Established
in Boston,
Massachusetts
June 2000 First
Zipcars hit the
road around in
Boston.
A ZIPCAR SNAPSHOT:
Nearly one million
members
12,000+ vehicles
worldwide
500+ cities and towns
500+ college and
university campuses
50+ airports
50+ vehicle makes and
models
Zipcar is the world’s
largest car sharing
service, offering self-
service, on-demand cars
by the hour or day.

4. Found
ers
Antje Danielson
1. University Committee on Environment at Harvard University
2. She received her Ph.D. from Freie Universitat Berlin
3. She used to be worked in car sales and three
years as research assistant at the Hahn-Meitner Institute
Robin Chase
1. Major in English, French, and philosophy at
Wellesley College.
2. MBA (applied economics and finance) – MIT’s Loan School
in 1986

5. Background
• Chase and Danielson had conducted some initial research
during 1999.
• Beginning in early 2000, chase had made a series of
presentations potential investors.
• By January 2000 their raised their first $50.000 from Chase’s
Former MIT Classmate investor.
• June 2000 had leased 12 cars and ready to open business in
Boston.
• October 2000 company had 19 vehicles, nearly 250 members

6. http://www.zipcar.com/how

8. Strategic Location
of ZipCars
 Airport & Entertainment Areas
 HDB and housing Estates
 Shopping malls/Furniture malls,
or events areas like expo
 School and College

9. How the System
WorkMembers reserve a car via the website or their mobile phone.
When they get to the car, they wave their membership card
over a sensor on the windshield (the card and sensor
communicate wirelessly), which triggers a wireless query back
to the company’s database to make sure the user is OK to
take the car.
If everything checks out, the car’s doors are unlocked
electronically and the member drives off.RFID technology
1. Its RFID driver authentication and its wireless vehicle-data
monitoring.
2. The cards rely on RFID technology to recognize members
and their reservation times.
3. Data is transmitted between the vehicles and back-end
systems via a Cingular Wireless network.

10. Pricing
Price The Monthly Plan
Monthly
Commitment
$7
Aplication Fee $25
Monday – Thursday
Hourly rates from
Daily rates from
$7.50
$69
Friday – Sunday
Hourly rates from
Daily rates from
$8.50
$77
Price Occasional Driving
Plan
Annual Fee $70
Aplication Fee $25
Monday – Thursday
Hourly rates from
Daily rates from
$7.50
$69
Friday – Sunday
Hourly rates from
Daily rates from
$8.50
$77
• Cancellation Fee : Up to full trip amount
• Late Fee : $50/hr
• No Deposit
• Include Gas, Insurance, 180 free miles

11. Direct
Competitor
Hertz
I-Go
AutoShare
Streetcar Indirect
Competitor
Taxi
Bicycle
Train
Bus
The Competitor

12. Strengths
• Low Price (Rent by the hour, Insurance/ Maintenance/ Gas Included )
• Style of its service (cool car)
• Accessibility and Flexibility
• Technological Sophistication (Wireless & RFID technology)
• Convenient Checkout process
SWOT ANALYSIS

13. Weaknesses
• Seasonal membership
• Lack of personal Interaction
• Low margins dependent on usage/
utilization.

14. Opportunities
• The company has to adopt a market expansion strategy to
sustain itself globally. The target market of zipcar exist in the
high population metropolitan areas. Most recent area where
the company has expanded its growing market is in the
university and local business.
• The recent acquisition with a London based competitor is
streetcar.
• Increase transit Connection

15. Threats
• Increase in leasing Rate
• Increase a fuel cost
• Increase in Parking cost
• Increase in Insurance Cost
• Consumers use of alternative forms of transportation (bike,
bus, etc.)
• People like to drive and don’t want to give up their cars
(America’s driving culture).

16. SERVICE
STRATEGIC VISION
 Service Concept
 Target Market
 Operating Strategy
 Service Delivery System
 Service Winner
 Service Loser

17.  Service Concept
 Low-cost
 Convenience
 Self Service Access
 Reservation 24/7

18. Target Market
Young Professional
Tourist traveling to a
new city
Bussiness Companies
who don’t use cars
that often Tech Savvy
University Student
Who don’t own car in
Urban Areas

19. Operating
Strategy
 Parking
 Rent the car from another company
 Get discount
 Logo Zipcar
 Government

20. PARTNERSHIP

21. Service Delivery
System
 Self-Service delivery system
 All the cars were outfitted with patented wireless
technology.
 ZipCar also created and installed a GPS-enabled
wireless device in each car

22. Service
Winner
 Convenience location
 Self-service
 Low-cost
 Reservation 24/7

23. Service Losers
 We have to pay member fee
 No one-way trips (in the
beginning)
 Regular hourly charge for
earlier check-in.

24. Factors That Affect Zipcar's Economic
Performance

25. Exhibit 8b : September Operating Data
September (exhibit 8b)
 101 new members has registered, the higher increase
during June -August. Increase 71 % its mean ZipCar
Prepare a new car are available, Expanding the parking ,
Provides a fixed Cost for parking.
 The greater percentage of revenue comes from hourly
uses (63,6%) than from daily use (36,4%).
 hourly uses fee more expensive than daily use fee, but
usage from daily use more than hourly uses, so increase
daily use fee for balance a revenue.
 Usage from trips- night & weekend 60 % its higher than
other days.
 This opens up the potential to have an additional higher
pricing tier for night-time and weekend to increase
revenue.

26. Service Blueprint and possible pokayokes that
Zipcar may improve its service quality.

27. Failure Point:
1. Customers might input wrong data
for reservation
2. Staff might input data for
reservation
3. The customers might found the
difficulties while they are looking
for their car
4. Customers might get some
troubles while diving like an
accident, the car was damage, or
stuck on traffic jam
5. Customers might be late or
parking at wrong area when return
the car
Service Blueprint