Application of the CRM concepts in the analysis (Delhi Metro Case)

Read the case attached and refer to case with pictures, if possible.1) What is the company’s CRM strategy? And how are they implementing it?2) Define the customer segments – which is more profitable and why?3) How is the company achieving (or not) customer acquisition, retention, loyalty? What customers are they specifically not targeting and why?4) What is meant by “customer delight” and how is the company achieving it, or not achieving it?5) Is the use of CRM a competitive advantage for the company? How and why? What activities and processes are they putting in place to achieve this? How can they maintain it?There’s not really a page count, just answer the questions to the best of your abilities. 🙂
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W16649
DELHI METRO RAIL CORPORATION (A): DELIVERING CUSTOMER
SATISFACTION
Somnath Chakrabarti and B. S. Kiran wrote this case solely to provide material for class discussion. The authors do not intend to
illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other
identifying information to protect confidentiality.
This publication may not be transmitted, photocopied, digitized, or otherwise reproduced in any form or by any means without the
permission of the copyright holder. Reproduction of this material is not covered under authorization by any reproduction rights
organization. To order copies or request permission to reproduce materials, contact Ivey Publishing, Ivey Business School, Western
University, London, Ontario, Canada, N6G 0N1; (t) 519.661.3208; (e) cases@ivey.ca; www.iveycases.com.
Copyright © 2016, Richard Ivey School of Business Foundation
Version: 2016-10-07
It is punctual and clean and seemed like an oasis. I hope they continue to maintain the standards.
Professor A. Parasuraman,
Distinguished Professor of Services in Marketing, University of Miami
On December 29, 2015, Anuj Dayal, the chief spokesperson for Delhi Metro Rail Corporation Ltd. (DMRC),
was about to brief the media on the preparations made by DMRC to cope with the impending surge in commuter
traffic. The government of the National Capital Territory of Delhi was desperate to manage escalating levels of
air pollution—a level high enough to earn Delhi the World Health Organization’s rebuke as the world’s most
polluted city.1 The government had announced a pilot project of an odd–even vehicle rule to regulate private
transport beginning January 1, 2016. With vehicles limited for use only on alternate days, the Delhi metro would
need to transport a surge in commuter volume. The entire nation was waiting to see if DMRC could cope with
this increase and sustain its commitment to its service philosophy, which was named DLITE, an acronym for the
phrase “Do lasting improvement in travel experience.”2
Dayal had reason to be optimistic about DMRCÂ’s chances of overcoming the odds. DMRC had been rated
second among 18 international metro systems for customer service and was among the best three performers
in the Net Promoter Score category, which was based on the possibility of satisfied customers
recommending the service usage to others.3 For an emergent economy, this recognition was a moment of
rare pride, and particularly so because DMRC was fully owned by the government (a 50:50 joint venture
between the federal government of India and the regional government of Delhi) and operated as a public
sector entity with a regulated fare structure.4
There were also causes for concern. IndiaÂ’s young demographic segment was growing. Being assertive and
vocal, millennials5 demanded augmented services, more amenities, and value-added facilities.6 The
customer expectations were rising, but so were the input costs and losses. Financially, the growth of fare
sales revenue had not kept pace with rising inflation and commuter tariffs had not been changed since 2009,
despite DMRCÂ’s pleas for an increase (see Exhibit 1).
This document is authorized for use only by Vincent Bandi in Managing Customer Experiences – MKT-436 – SFO at Hult International Business School, 2018.
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After serving the National Capital Region (Delhi and its surrounding districts) for more than a decade, the
Delhi metro was valued by its stakeholders and held a strong brand identity and reputation, both
domestically and globally. But operationally and financially, DMRC was being squeezed from all sides and
struggling to produce a consistent “wow” reaction from its customers. Now, with the impending commuter
surge on account of the environmental crisis in Delhi, DMRC was in a hard-pressed situation.
For Dayal, 2016 was set to usher in new challenges. The year would test the resilient service culture of DMRC
and its ability to perform under relentless pressure. He knew that the odd–even scheme would be a litmus test
for DMRC and its mission to delight the customers. At the same time, Dayal was worried about the hold on
fares affecting the companyÂ’s bottom line. Dayal needed to find a way to balance commutersÂ’ expectations
and DMRCÂ’s mission of delighting its customers with an increasingly strained financial situation.
DMRC: CONVERTING MILLSTONES TO MILESTONES, 2002–2015
The Delhi metro was conceived in the late 1990s to serve the urban mobility needs of Delhi, the national
capital of India. The National Capital Territory of Delhi was the worldÂ’s second most populous city with a
population of 25 million.7 Bus transport, three-wheeled vehicles, and private transport were the primary
modes of transport, until DMRC’s mass urban transit services “metrofied” Delhi.
The feasibility of mass transit systems in a hugely congested city like Delhi was doubted by many. Also,
given the poor track record of infrastructure projects in India, the Delhi metro was written off by most
people even before the project took shape. However, DMRC was able to prove most of the detractorsÂ’ fears
unfounded. Under the competent and visionary leadership of its first managing director, Elattuvalapil
Sreedharan, the Delhi metro went on to become a benchmark in project management and operational
efficiency. The Delhi metro now figured in KPMG’s list of 100 infrastructure projects of the world “that
address excellence through scale, feasibility, complexity, innovation, or impact on society.”8
DMRC’s vision was to provide a “commuting experience on the Delhi metro [that was a] customer’s
delight.”9 DMRC was committed to covering the complete area of Delhi and adjoining areas with a metro
network by the year 2021. According to its mission statement,10 DMRC was also aiming to accomplish the
following goals:
?
?
?
Serve customers, including differently-abled commuters, with passion.
Sustain the image of being first in the transportation sector in India, and be among the top three metro
rail systems in Asia with regard to
? safety;
? reliability;
? punctuality;
? quality; and
? customer responsiveness.
Make the Delhi metro self-sustainable.
DMRC began its customer operations in Delhi in December 2002. The entire Phase 1 of metro lines was
completed in 2005, almost three years ahead of schedule. The second phase was completed in 2011. Phases 3
and 4 were scheduled for completion in 2016 and 2021 respectively. The Delhi metro network was 13th largest
in the world, with 142 stations in financial year FY 2014/15. With the completion of Phase 3 in 2016, the
Delhi metro was set to become the seventh city in the world with more than 200 metro stations. While in many
countries, metro systems had multiple operators, the Delhi metro was operated solely by DMRC.
This document is authorized for use only by Vincent Bandi in Managing Customer Experiences – MKT-436 – SFO at Hult International Business School, 2018.
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In 2013, an international journalist noted:
As a rule, nothing in IndiaÂ’s public sector works as intended. But the Delhi metro works: 99.97 per cent
of trains arrive within one minute of schedule. They are clean, cool and safe. At peak hour, they come
every 2 1/2 minutes. It runs at a profit. Every stage has been completed on time, within budget. In India,
in the modern world, that is a miracle.11
Initially, construction and establishing the infrastructure were the biggest challenges; later, serving its
diverse customers and satisfying its multiple stakeholders proved to be bigger challenges for DMRC. But
in a matter of a decade, even amid all its resource constraints and limitations, DMRC managed to alter the
service perceptions and establish a strong emotional connection with its customers by delivering a superior
service experience.
DMRC: DESIGNING SERVICES FOR ALL
The mandate of DMRC was to build, operate, and expand mass transit rail services in a densely populated
city characterized by duality: an amalgamation of old and new, medieval and modern, masses and classes.
In 2001, with a population of around 15.5 million in Delhi NCR and an elected regional government, Delhi
was more of a city-state than just the capital city of the country.12
Like the rest of India, Delhi was experiencing a change in its demographic profile, with a significant population
increase in the 15 to 40 age group. Imbued with this demographic divide, India was projected to have the
youngest working population in the world by 2020. Therefore, DMRCÂ’s service architecture had to be planned
in consideration of contemporary travel needs, emerging trends, and a diverse set of customers.13 At one end of
the spectrum, DMRC had to serve elite commuters who were working in the business hubs of Gurgaon and
Noida, located on the periphery of Delhi. On the other end of the spectrum, DMRC had to serve the needs of a
huge floating population, including migrant labourers who came to Delhi in search of livelihood. DMRCÂ’s
services had to be user-friendly, operationally efficient, affordable, and convenient to attract a majority of those
who would normally opt for private transport, or use another form of public transport.
Most potential users were new to the concept of a high-quality mass transit system like the Delhi metro,
whose many technologies originated outside of India and its culture. This had a significant impact on both
the core and support infrastructures. The service architecture was modified to suit local requirements,
factoring in cultural profiles, modes of dressing, habits, age, and other considerations. The coach design
and fare collection systems were also modified to suit local requirements.
DMRC was sensitive to the special needs of commuters coming from different strata of society. DMRC
became the first mass transit system in the country to conduct accessibility audits in order to provide
differently-abled commuters with a comfortable travel experience. To evoke commuter confidence in the
capabilities of the Delhi metro and to serve a diverse clientele, wheelchairs, and stretchers were made
available at all stations. DMRC also worked with nearby local hospitals to create a treatment process for
commuters requiring medical attention and for handling emergency situations.
DMRC had the vision to customize the equipment and track for the specific wear and tear expected in
DelhiÂ’s continental climate, with its range from subtropical and humid to extreme cold. The objective was
to make the Delhi metro an “all-weather, all-section” prototype where the best technologies and practices
from metro systems around the world would converge and evolve to an international standard.
This document is authorized for use only by Vincent Bandi in Managing Customer Experiences – MKT-436 – SFO at Hult International Business School, 2018.
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EMPLOYEE TRAINING AND SERVICE PHILOSOPHY: SERVICE FOR ALL AND ALL FOR SERVICE
DMRC was aware from the beginning that the quality of service encounters would be a key factor to making
the commuters feel comfortable and confident about using the Delhi metro, especially because some of the
technologies were being implemented for the first time in the country.
An elaborate customer-facing architecture was created by DMRC to serve the customers effectively and with
empathy (see Exhibit 2). In order to serve the diverse needs of commuters, a section of frontline staff was
designated as customer relations assistants (CRAs). They were specifically prepared to handle the special
problems of senior citizens, women, and the differently abled, and were trained in sign language for assisting
hearing and speech impaired commuters. The CRAs were also trained in first aid and disaster management.
Training the frontline staff was essential so that DMRC could be confident of handling any eventualities
triggered by human factors or unforeseen contingencies. Even the staff members of channel partners were trained
in commuter interaction and customer etiquette. The entire customer staff and even managerial staff underwent
training in soft skills, yoga, and stress management to prepare them mentally and physically to endure the
challenges of customer care. Special focus was paid to absorbing the DMRC culture (see Exhibit 3).
In DayalÂ’s words:
The biggest asset of Delhi Metro is its philosophy of customer orientation. Keeping this at the centre,
the other aspects have been structured. Emphasis has been on timely completion of projects to avoid
cost and time overruns. Efficient manpower management and extensive use of technology is encouraged.
In Delhi Metro, people can see better customer orientation. Hence, in DMRC, the focus was on
“Customer Care” and not on “Customer Relation.”
SERVICE PLACE MANAGEMENT: CHALLENGES AND OUTCOMES
Driven by its founding managing directorÂ’s vision, DMRC focused on service and ambience to create a
distinguished service experience. The staff members were trained to educate commuters about observing
and maintaining safety and cleanliness standards. DMRC provided a series of short public awareness films
online for Internet-savvy customers. Disincentives were also built into the system to discourage commuters
from abusing or vandalizing property, or risking other commutersÂ’ safety.
Verbal and visual reinforcements were also used to create awareness of safety issues, etiquette, and the need
for maintaining cleanliness. The neat and clean environment, presence of staff almost around the clock, and
extensive deployment of personnel led to civic engagement to the point of near sanctity. As observed by the
managing director, Mangu Singh, “Cleanliness was the deterrent to those who were littering.”14
SERVING CUSTOMERS DIVERSELY AND SERVING DIVERSE CUSTOMERS
The crux of the service experience offered by DMRC was its reliable, safe, comfortable, and punctual
commute. Its punctuality rate was higher than 99 per cent. As a result, ridership consistently increased over
time (see Exhibit 1). Over the next two to three years, the average daily ridership was slated to increase
from 2.5 million to around 4.0 million. During FY 2015/16, DMRC broke the 3-million mark, when it
carried 3.17 million passengers on a single day on August 28, 2015; the previous record was 2.89 million,
set on September 8, 2014.
This document is authorized for use only by Vincent Bandi in Managing Customer Experiences – MKT-436 – SFO at Hult International Business School, 2018.
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To serve a more technologically enabled society, DMRC scaled and expanded its offerings and servicedelivery mechanisms. Automatic ticket vending machines were installed to reduce queues and eliminate
manual interface. Points-of-sale machines were introduced so commuters could use their debit and credit
cards to purchase metro tokens. The opportunity to recharge contactless smart cards on the Internet and in
mobile applications started in 2013, facilitating fare inquiry and journey management.
Almost half a million women commuters depended on the Delhi metro. To serve their needs, a separate
womenÂ’s coach was introduced on each of the Delhi metroÂ’s trains in 2010. Safety, security, and
convenience led women commuters to prefer the Delhi metro over other forms of transport. DMRC also
launched Know Your Metro programs in 2014 to inform women commuters about facilities available for
them, inside the Delhi metroÂ’s premises and on the trains, for their safety.
CUSTOMER ENGAGEMENT
As ridership increased, DMRC continued to expand and multiply its customer engagement channels. To
evaluate progress in customer care, an elaborate system of multi-channel feedback was introduced.
Customers could give their feedback online, contact a 24/7 helpline, or leave a comment in the complaint
book provided at every station. DMRC designated a public complaint officer within the operations and
maintenance department to handle public complaints. The 24/7 help line also provided commuters with
information about train times, connections, and so on.
CustomersÂ’ input was fed into the training system. Voice and participation forums also helped DMRC to
“commuter-source”15 suggestions and correct its service deficiencies. Over time, toilets and drinking water
facilities were added at the Delhi metro stations. Similarly, a commuterÂ’s suggestion resulted in DMRC
providing demarcation in the stations for six-coach versus eight-coach trains.
Of its own volition, DMRC opened a winter home for the care of senior citizens and a fully furnished
childrenÂ’s home for the welfare of under privileged people. It also organized regular book and painting
shows at selected stations. DMRC even established a dedicated museum—the Metro Museum—to
showcase DMRCÂ’s achievements and accomplishments.
DMRC: A LEARNING ORGANIZATION
DMRC was designed to be a forward-looking and adaptive organization,16 with room for constant improvement
in knowledge and technology. Liberalization enabled DMRCÂ’s leadership and its core team to scout for the best
skills and standards, selecting those that were best suited to the local requirements of Delhi. DMRC learned from
the successes and failures of metros around the world. According to DMRC sources:
Located in one of the most congested cities in the world, the Delhi metro became the focus of attention not
only because it is IndiaÂ’s largest urban intervention in the transportation sector since independence, but also
because it used cutting-edge technology from around the world including Germany, France, Japan, and Korea
to create a system that is one of the most advanced in the world.
This document is authorized for use only by Vincent Bandi in Managing Customer Experiences – MKT-436 – SFO at Hult International Business School, 2018.
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EMPLOYEE ENGAGEMENT
From the start, a decision was made to create a people-friendly organization. Hence, the human resources
department became a vital component of DMRC.
Employees were continuously trained—on the job and at a specially established DMRC training centre—
about the core values of DMRC: integrity, punctuality, cleanliness, and maintaining mental and physical
health. Refresher courses and mentoring techniques were employed to cope with increasing service
pressure. Structured programs were organized for senior management to promote introspection and selfdevelopment, and to foster growth as better employees and citizens. Eventually, DMRCÂ’s training centre
became a mentoring and training institute for other upcoming metros in the country.
DMRC adopted a considerate approach to employeesÂ’ welfare. Over the years, it introduced different benefits
and allowances for employees to keep them motivated. Efforts were made to ensure that employees had a high
quality of life and were able to achieve a work–life balance. Staff welfare schemes were introduced over time,
such as financial support during marriage or marriage of a child, and educational awards for employeesÂ’
children who scored well on board examinations. Such measures helped DMRC to be rated one of the
preferred employers in a 2013 survey by a business magazine (see Exhibit 4).17
DMRC management inculcated a team-oriented spirit among staff. Customer care and DLITE were given
priority. Outstanding employee behaviour such as exemplary contributions of various kinds, catering to the
needs of oneÂ’s duty, helping customers, and returning lost articles, were rewarded with spot awards. The
awardees were profiled in internal newsletters.
The professional work culture and growth opportunities attracted some of the best talent to DMRC. Through
a carefully designed human resources policy, DMRC was able to harness the potential of its diverse team
of civil, electrical, signalling, and telecommunications engineers, and its gene …
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