Operations Strategy in the Rental Car Industry
II. Operations
Products (Service)
The company provides a service, mainly vehicle rental, to replace a customer’s damaged or out of service vehicle. This service has been around for awhile, in this case since 1957, and appears to be in the mature phase. A case could be made that in the case of Enterprise, the service of vehicle rental is still in the growth phase since annual revenue, fleet size, employee size, and the number of locations has grown every year since the founding of the company. The company is also still innovating new methods in delivering their service to maximize quality and efficiency. While this may make for good discussion, for the purpose of this analysis, the service of delivering rental vehicles will be considered to be in the mature phase.
Enterprise has a unique mix of products and services that differentiate it among its competitors. Enterprise was the first rental-car company to offer free pick up and drop for its customers. Hertz, Enterprise’s main competitor has only recently started offering pick up services and it is only offered at a few select locations. The idea for this service came from an entry level employee in Orlando, Florida who had only been with the company for a few months. The idea was successfully initiated and became a service differentiator that give Enterprise a competitive advantage for many years. The service became strategically, very important for Enterprise, particualrly since the majority of their customers are insurance replacement renters who need picked up at the shop where they are dropping their car off. This convenience has helped distinguish Enterprise and gain them an overwhelming majority of the insurance replacement market. It is also an example of how Enterprise uses job enrichment in as a part of its operations strategy in the area of work force management. Other disinguishing products/services include free mileage, fleet management, corporate truck rentals,
Service
Products (Service)
The company provides a service, mainly vehicle rental, to replace a customer’s damaged or out of service vehicle. This service has been around for awhile, in this case since 1957, and appears to be in the mature phase. A case could be made that in the case of Enterprise, the service of vehicle rental is still in the growth phase since annual revenue, fleet size, employee size, and the number of locations has grown every year since the founding of the company. The company is also still innovating new methods in delivering their service to maximize quality and efficiency. While this may make for good discussion, for the purpose of this analysis, the service of delivering rental vehicles will be considered to be in the mature phase.
Enterprise has a unique mix of products and services that differentiate it among its competitors. Enterprise was the first rental-car company to offer free pick up and drop for its customers. Hertz, Enterprise’s main competitor has only recently started offering pick up services and it is only offered at a few select locations. The idea for this service came from an entry level employee in Orlando, Florida who had only been with the company for a few months. The idea was successfully initiated and became a service differentiator that give Enterprise a competitive advantage for many years. The service became strategically, very important for Enterprise, particualrly since the majority of their customers are insurance replacement renters who need picked up at the shop where they are dropping their car off. This convenience has helped distinguish Enterprise and gain them an overwhelming majority of the insurance replacement market. It is also an example of how Enterprise uses job enrichment in as a part of its operations strategy in the area of work force management. Other disinguishing products/services include free mileage, fleet management, corporate truck rentals,
Service