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UNIVERSITY OF ECONOMICS HO CHI MINH CITY
International School ofBusiness
NGUYEN-DINH THIEN TAM
Student ID: 22150055
HIGH CUSTOMER COMPLAINT RATIO FROM
MEDENT CO., LTD
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Dịch Vụ Hỗ Trợ Viết Thuê Tiểu Luận,Báo Cáo
Khoá Luận, Luận Văn
ZALO/TELEGRAM HỖ TRỢ 0973.287.149
MASTER OF BUSINESS ADMINISTRATION
Ho Chi Minh City – 2022
UNIVERSITY OF ECONOMICS HO CHI MINH CITY
International School ofBusiness
NGUYEN-DINH THIEN TAM
Student ID: 22150055
HIGH CUSTOMER COMPLAINT RATIO FROM
MEDENT CO., LTD
MASTER OF BUSINESS ADMINISTRATION
SUPERVISOR: TRAN HA MINH QUAN
Ho Chi Minh City – 2022
Executive Summary
The dizzying turn of the "digital" revolution in today's life has made intellectual property
more important than ever. The intellectual property, which is often considered the most
important asset in all organizations, needs to be well identified and studied. In addition,
in this digital age, adaptation is being viewed as a strong competitive advantage.
In the current economic context of Vietnam and especially in commercial enterprises.
Organizations need to ensure they operate in a way that can help them meet and grow
sustainably by addressing these two issues.
The purpose of this thesis is to explore the causes of high customer complaint ratio
through the current problems with customer at Medent Co., Ltd (in short, it would be
called Medent in this thesis).
The findings of the study revealed the awkwardness and embarrassment of catching up
with the changes of the times as well as the rapid change of customer demand in which
the "information" factor is extremely important. Not only do you have to provide them
enough "information", but also provide solutions that will enable them to apply into their
work.
The findings are discussed in details in the research along with some recommendations
for the company and management board to solve the problem of the actual needs of
customers, towards sustainable development and reduce customer complaint ratio in
Medent Co., Ltd.
Acknowledgements
I would like to acknowledge all who supported me during my studies without whom I
wouldn't be where I am today.
I would especially like to thank my supervisor – Professor Tran Ha Minh Quan for all
his advice and guidance, without his help this could not have been possible.
I also would like to show my gratitude to my colleagues at work and classmates at ISB
for their continuous support. I also send my sincere thankfulness to my parents and
friends for their support and encouragement.
TABLE OF CONTENTS
EXECUTIVE SUMMARY
ACKNOWLEDGEMENTS
LIST OF FIGURES
LIST OF TABLES
1. INTRODUCTION.............................................................................................................01
1.1 The company background..........................................................................................01
1.2 Company structure and mission................................................................................01
2. PROBLEM CONTEXT...................................................................................................03
3. PROBLEM IDENTIFICATION ...................................................................................05
3.1 Cause –and –effect map .............................................................................................05
3.2 Literature review.........................................................................................................07
3.3 Final Cause –and –effect map...................................................................................21
4. CAUSE VALIDATION ...................................................................................................23
5. ALTERNATIVE SOLUTIONS.....................................................................................24
5.1 The first alternative solution: Establishment of a "multi-function" R&D
center...................................................................................................................................24
5.2 The second alternative solution: conduct collaborative research programs with
medical universities and dental associations ................................................................26
6. ORGANIZATION OF ACTIONS.................................................................................29
7. CONCLUSION..................................................................................................................34
8. SUPPORTING INFORMATION..................................................................................35
REFERENCES ........................................................................................................................43
LIST OF FIGURES
Figure 1. Medent organizational structure
Figure 2. Increasing ratio of customer complaint (compare with previous quarter)
Figure 3. Increasing ratio of customer complaint in the last three year
Figure 4. The satisfied ratio with the services and products of Medent - 2018 data
Figure 5. The Gap Model
Figure 6. Initial Cause Effect Map
Figure 7. Final Cause Effect Map
LIST OF TABLES
Table 1: Fixed cost of building center
Table 2: Fixed cost of Team training & recruiting
Table 3: The cost of projects in 2017
Table 4: Action plan
1
1. INTRODUCTION
1.1 The company background
Company name: Medent Co., Ltd
Established year: 1994
Industry: Dental supplies and services.
CEO: Dr. Huỳnh Thanh Đạm
Medent Co., Ltd is one of the largest providers of dental care products and services to
office-based dental and dental practitioners in Viet Nam. Medent is a subsidiary
company of the Medent Group; the largest group provides dental care products in
Vietnam.
The company also serves dental laboratories, government and institutional health care
clinics, and other alternate care sites in the field of dentistry. A company with more
than 23 years of development history and serves thousands of clients in the dental
industry throughout Vietnam.
1.2 Company structure and mission
Regarding the structure, there are multiple services and products that the company
provides. Moreover, it also includes value-added solutions in order for operative
practices and high-quality care to be achieved. Medent oriented to operate through a
centralized and automated distribution network, with a selection of rich and diverse
product portfolio from over 10 global brands from reputable multinational corporations
in the dental industry. Plus, special assistance and various advanced technical aids are
also available to customers in need, as claimed by the company. Specifically, these
consist of financial aids, software and utilities that are specialized in internet trading.
Headquartered in Tan Binh District, HCMC. The company's sales reached a record 200
billion VND in 2016 (Medent Group sales revenue 2016 is 900 billion VND in 2016).
For more information, visit the Medent website at http://medent.vn.
2
Figure 1. Medent organizational structure
(Source: Medent Human Resource Department)
BOD
CEO
Supervisory Board Board of Assistant
6 Director of 6
subsidiary company
of Medent Group
Medent Co., Ltd
Managing Director
VP
Supporting Group
VP
Operational Group
VP
Business Group
Marketing Manager
Technical Services
Manager
Dental Equipment
Sales Manager
Administrat
HR &
ion
Manager
Ware house &
Logistic Manager
Dental Surgical
Sales Manager
Customer Relation
Manager
Finnance &
Accounting
Manager
Dental Labo Sales
Manager
R&D Manager
Import-Export
Manager
DentalImplant
Sales Manager
IT & System
Management
Manager
Purchasing
Manager
3
2. PROBLEM CONTEXT
High ratio of customer complaint
Symptom: High ratio of customer complaint.
We have had data from Customer Services Department that they have received an
increasing number of complains as follows:
On average, from July 2017 to July 2018, the number of complaints increased 3.8% in
average each quarter in a year when compared with the average number of previous
year, we calculated by taking the total number of complaints of each quarter of this
period from Q3 2017 to Q2 2018, add up their sum and then divide by 4, then use this
result to compare with the average of the previous year, thereby calculating the average
percentage above. In addition, we also compared the growth rate of complaints in the
quarters corresponding to the previous years, namely Q3 2017 compared to Q3 2016.
On the other hand, we also compared this average of this year compared to the previous
two years.
The issues mentioned above will be explained in the following two charts:
4
Figure 2. Increasing ratio of customer complaint (compared with the
corresponding quarters in the previous year)
(Source: Medent Customer Relation Department)
While in the past two years, the number of complaints only increase 0.7% in 2016 and
0.9% in 2017.
Increasing ratio of customer complaint (compare
with previous quarter)
Increasing ratio of customer complaint (compare with the corresponding
quarters in the previous year)
Q3 2017 Q4 2017 Q1 2018 Q2 2018 AVG RATIO
4.4%
2.7%
3.3%
4.4%
3.8%
5
Figure 3. Increasing ratio of customer complaint in the last three year
(Source: Medent Customer Relation Department)
Recognizing the importance of the matter, Medent has conducted a survey on customer
satisfaction with the simple Yes / No question:
Are you satisfied with the services and products which Medent is offering?
As a result, 42% of customers were not satisfied with the company's current products
and services. Medent has done the research with 100 customers (in more than 5000 of
their customers in Viet Nam). Their method is to take randomly on the company's
customer list.
Increasing ratio of customer complaint in the last
three year
Increasing ratio of customer complaint in the last three year
2016 2017 2018
0.7%
0.9%
3.8%
6
Satisfied
58%
Unsatisfied
42%
Unsatisfied Satisfied
Figure 4. The satisfied ratio with the services and products of Medent - 2018 data
(Source: Medent Customer Relation Department)
3. PROBLEM IDENTIFICATION
3.1 Cause –and –effect map
After the study above, Medent has realized this is an unusual indicator, but it is very
difficult to conduct an investigation on large samples with specific subjects like
dentists is very difficult, after discussing with the board of directors, everyone has
come up with a preferred solution: conducting a follow-up research by doing 7 in-depth
interviews with 7 different dentists in HCMC and Hanoi.
The interview results indicate that there are three main causes for the high ratio of
customer complaint.
The satisfied ratio with the services and products which
Medent is offering
7
Products provided do not meet the expectations of
customers
Customer service is not good High ratio of customer complaint
Installation and delivery are not good
INITIAL CAUSE & EFFECT MAP
Figure 6. Initial Cause Effect Map
To build the first proposal, I choose the first cause as a potential central problem. The
reason why I remove the others includes two reasons:
Firstly, I start conducting theoretical searches and find out that service and its quality
has become an fascinating phenomenon in the fields of research, operation
management (OR) and service marketing management (SMM) (Nejadjavad &
Gilaninia(2)). The term “service” can be defined in numerous ways. Although the term
has been presented differently through the definition of numerous researchers, it still
ends up in the same field which depends heavily on the satisfaction of customers. In
accordance with American Society for Marketing (2008), a service is known as a
specific product that can be sold or trade. Reversely, as Kotler(3) stated, the same term
is seen as the outcome from the interaction between the supplier and the customer.
There exist a great number of service types in the literature, one of which is
8
supplementary service. It is the extra help that customers receive after attaining their
desired items or products. As Goyal stated, two types of services are presented. The
first one is core service, indicating the desired results that are equal to the price a
customer has to pay for a product. If a refrigerator is bought, for instance, the user will
expect it to be able to freeze food and keep them fresh. The second type of service is,
according to Lovelock and Wirtz(4), is supplementary service, aiming at improving and
assisting the core service. Following this specific model, a company should offer core
service and supplementary service to its clients. With the former, the main interests
and benefits requested by customers are attained. The supplementary services are
bound to enhance such items. According to Lovelock et al.(9), The Flower of Service is
created to explain the two types of supplementary services supporting the core product.
They are facilitating supplementary services and enhancing supplementary services
(2009). I found out that the problem Medent was facing was information and
consultation.
Secondly, when I read again the results of the interview, I discovered that despite many
causes for customer complaints, one of the most important causes we need to pay
attention is the change in nature of the products which the company provides. They
changed from pure tangible products (dental devices) to intellectual products (solutions
for dentistry, we can see through the interview content, including the client side,
namely dentists and the company side, namely sales, marketing and customer service
which we collected during the next interview.
Dr. Hùng– Director of Dr. Hung Dental Hospital shared that:
The majority of Medent's complaints come from the company's services. You
see, as you have recently converted from selling products to selling solutions that I
have not seen thisin practice. You areonly bringing valuestocustomers sporadically
because you lack a lot of core values.
The reason, simply because you do not understand correctly and specifically what you
need to do. For example, when you combine multiple treatment technologies together,
that does not mean "one plus one equal two" that you are changing the behavior and
9
treatment method of the doctor, you need to help them. Do it in a practical way, not
just on theory. In addition, delivery services as well as operating instructions are not
really good. But this is understandable, as I mentioned above, there are things you do
not know. Thus, how can you guide and organize well?
At her point of view, Dr. Hoà – Director of Dr. Hoà Clinic shared that:
Your service is not bad, but the service attitude and the way you organize your
work should be reviewed.
You know, sometimes you cannot do well, but attitude is very important to save the
problem, and about the organization, I'm a doctor, I do not know very well but I feel
recently, your company seems to be "exhausted" and I see that your products in
particular and the market in general are increasingly "more difficult to use", which
may some important reasons that cause the problems.
Dr. Điềm – Director of Sagodent Dental Training Center shared that:
The way your company works is just right for the old days, now it is different
trend. Therefore, complaining is correct.
You understand, I take a lot of time to be able to learn in detail the dental solution to
apply to the patient and then I have to practice a lot. You know that medical solution
is a smooth combination of practice and theory. For me, it is very difficult, you even
want to deliver integrated solution, I think this is very difficult for you at this time.
As Lovelock et al.(9) stated, information plays a crucial part in facilitating the core
products, as it is essential in performing service delivery. It requires sufficient
information in order for customers to attain full value from their purchased products,
especially new customers and prospects. Moreover, they may request specific
information regarding the location to buy a product (or details of the procedure to order
it online), service hours, usage instructions and prices. Based on the result of the
qualitative research, usage instruction is one of the main reason for the change. On the
other hand, according to Naipaul and Parsa(10) , by sticking to the needs of customers
in different situations, it is possible to improve the value of consultation and services;
for example, training and consulting based on specific professions or the usage of a
10
particular product. Lovelock et al.(9) also suggested that it is an improved form of
supplementary service that characterizes consultation, which consists of multiple
dialogs to target clients’ exact requests before leading to a conclusion. In other words,
consultation is a work where a knowledgeable personnel from a service company gives
considerable suggestions regarding the field being inquired; for instance, a man might
ask a bodybuilder for advices on how to gain muscle.
In addition, we also conducted a further review of the theory - model to be able to
provide a view at a different angle, developed by Zeithaml, Berry and Parasuraman(15),
the gap model included give gaps; later, there were six after Lovelock et al.(9) improved
it:
Gap 1: The Knowledge Gap.
Gap 2: The Policy Gap.
Gap 3: The Delivery Gap.
Gap 4: The Communications Gap.
Gap 5: The Perceptions Gap.
Gap 6: The Service Quality Gap.
In which, gap 1 and 5 are two direct and specific gaps in case of Medent. The
Knowledge Gap is the missing information that cause the reduction in satisfaction
regarding fulfilling customers’ expectations while the Perceptions Gap indicates the
imbalance of what the clients feel about the products they receive and what are given
in reality, as customers are unable to evaluate the actual quality of the products. Thus,
we can conclude that information and consultation, which results in a series of
associated consequences for which the other causes are the result of this change.
However, we need to conduct further investigation to be able to identify this problem.
3.2 Literature review
Undoubtedly, numerous scholars and researchers have focused on the concept of
service and service quality through the last few years of the 20th century till the present
11
time. According to Lewis and Mitchell(1), what are truly essential and significant are
the concept that the customers receive and its value plays an important role in
determining how pleased the customers will be. As a marker of customer satisfaction
and organizational performance, the significance of service quality is not only widely
recognized but it has also prompted a noteworthy research push concentrating on
various ventures inside the service sector. In fact, various researchers assess a portion
of the exploration that identifies with characterizing and measuring service quality;
furthermore, they also conduct numerous proposals as to how estimation instruments,
for example, SERVQUAL (service quality) may be progressed.
At this moment, it is a fact that we are living in the time of a great transition when the
economy revolves around services and assistance. Not being parts of the economy, it
is the core of significant worth creation in economy that different services are
considered. In order to compete in a highly vying environment, different corporations
that specialized in services must seek and possess distinctive and efficient methods so
as to achieve the best performance. Thus, holding a thorough understanding of the
administrating process will give them an advantage, together with the general attributes
of their quality as well as the desires of the customer (client). Due to its elusiveness, in
accordance with Nejadjavad and Gilaninia(2), the ratings of customers for services that
do not engage in trading are often quite severe.
3.2.1. Service Marketing and Management
Obviously, service and its quality has become an fascinating phenomenon in the fields
of research, operation management (OR) and service marketing management (SMM)
(Nejadjavad & Gilaninia(2)). In the current business and plan instruction, service
quality is taking its place as one of the significant subjects. It is in management and
marketing literature that the causes for service quality can be found. As a result of high
competitiveness and rapid growth in services, researchers have experienced more
pressure from the field of managing Western Businesses. Although service marketing
specialists delivered the term service quality, there exists an increase in interests as it
receives more attention from how it will be designed. Multiple distinctions can be seen,
despite the reality that the business starts to revolve around the same field and operate
12
in the same manner when dealing with service quality. It is from single orders into
multidisciplinary Service Science that the dialog appears to converging. This is what
triggers the process of creating transitory motion of definitions, methodologies and
dialects. Certainly, such a process will not stop and there will be a rise in exhaustive
vocabulary regarding service quality as well as its marketing and management
strategies.
3.2.2. Service definition
The term “service” can be defined in numerous ways. Although the term has been
presented differently through the definition of numerous researchers, it still ends up in
the same field which depends heavily on the satisfaction of customers. In accordance
with American Society for Marketing (2008), a service is known as a specific product
that can be sold or trade. Reversely, as Kotler(3) stated, the same term is seen as the
outcome from the interaction between the supplier and the customer. On the other
hand, Gummesson claimed that service is none other than the characteristic that could
satisfy the customer’s needs. Through all the distinctive definitions of service, it is
clear that the term is obligated to the satisfaction of customers as well as their
expectations. Clearly, the primary purpose of service is to obtain customers’
satisfaction through the most efficient course of actions, which will also lead to an
improved level of market share and competitive advantage.
3.2.3. Flower of service
There exist a great number of service types in the literature, one of which is
supplementary service. It is the extra help that customers receive after attaining their
desired items or products. As Goyal stated, two types of services are presented. The
first one is core service, indicating the desired results that are equal to the price a
customer has to pay for a product. If a refrigerator is bought, for instance, the user will
expect it to be able to freeze food and keep them fresh. The second type of service is,
according to Lovelock and Wirtz(4), is supplementary service, aiming at improving and
assisting the core service.
13
The goals of service providers are delivering a delightful experience to their customers
so as to stimulate further purchases and gain creditability. For such a purpose to be
achieved, core services always come with secondary aids. It is in such a manner that
customers’ satisfaction is enhanced, which leads to the success of a service company.
It is none other than the flower of service model in which they are collectively captured.
Following this specific model, a company should offer core service and supplementary
service to its clients. With the former, the main interests and benefits requested by
customers are attained. The supplementary services are bound to enhance such items.
As they play a significant role of improving customers’ products, the provider can
impose a greater cost on such services. Such is a way that the two types of service are
operated (Storey & Easingwood(5); Lovelock(6); Bitner, Brown & Meuter(7)). In such a
context, there are two kinds of supplementary services, including enhancing
supplementary services and facilitating supplementary services (Lovelock, Patterson
& Paul(8)). Regardless of theirs functions, the followings are always included in
enhancing supplementary services: safekeeping, hospitality, consultation and
expectations.
Reversely, payment, billing, order-taking, and information are provided by facilitating
supplementary services. It is through facilitating the use of core product and enhancing
service delivery that these elements operate (Lovelock, Patterson & Paul(8)). By adding
value to the service, they also help the company to differentiate from competitors
(Lovelock, Patterson & Paul(8)). Although the core service is undifferentiated,
discriminating provided products are possible to achieve, as they are tested in a
competitive market. Lastly, the act of clarifying service/product elements are assisted
by service delivery which facilitate the delivery of the supplementary and core
product/service. By utilizing it, distinguishing between supplementary products and
the service product will be feasible. In addition, it also assists the process of
anticipating the customers’ experience in using the service.
14
According to Lovelock et al.(9), The Flower of Service is created to explain the two
types of supplementary services supporting the core product. They are facilitating
supplementary services and enhancing supplementary services (2009).
Flower of Service Application in Healthcare Systems
According to Naipaul &Parsa(10), it is feasible to apply studies demonstrated the flower
in numerous firms, such as tourism sector; retailers, and financial sector (Colgate &
15
Alexander(11)); banks’ credit card services (Goyal(12)); performing arts (Hume(13)). In
the work of Naipaul and Parsa(10), the applicability of supplementary services model in
the tourism sector was examined. However, Naipaul and Parsa(10) focused on only one
cluster rather than all of them. Additionally, in the work of Goyal(12), the administration
of 13 supplementary services regarding the banks’ credit card sector are examined. It
is still uncertain as to how the author classify these supplementary services.
Interestingly, the applicability of the flower of service within the healthcare sector is
not examined in the aforementioned studies. However, it is possible to apply this model
in the healthcare sector. Within the context of the flower of service, for example, it is
feasible to categorize services provided in the hospitals into core and supplementary
services. Diagnostic and treatment services offered by doctors may be included in core
services. On the other hand, in hospitals, supplementary services may include the
followings: Billing and Insurance Services; Facility & Maintenance; Food &
Beverage; House Keeping Services; Dietary Services; Operations & Administration
and Nursing Services. Through the aforementioned services, the products provided in
hospitals are improved and presented to the customers in accordance with their
willingness to pay. Hospitals can earn premiums through these supplementary services.
It is alongside core medical services that these services are offered.
3.2.4. Supplementary services
In the introduction, the dissimilarity between core and supplementary services was
provided. As the flower of services model suggests, supplementary services are
classified into two: facilitating supplementary services and enhancing supplementary
services. The former includes information, order-taking, billing, and payment, which
are necessary for the process of supporting the core product (Lovelock et al.(9)). The
latter consists of consultation, hospitality, safekeeping as well as expectations. It is
these elements that form the uniqueness and competitive advantage of the service
(Lovelock et al.(9)). As the model displays, the petals of the flower surrounds the core
product, which is the way that the services may appear (Lovelock et al.(9)).
Grasping the significance of secondary services, Levitt(14) believed that these elements
play a key role in determining whether a company will fail or succeed in a competitive
16
environment. Secondary services are surely the main factors that could allow a
company to increase their charges and perform effectively. In spite of grasping such a
knowledge, there remains a great gap in this research as it cannot suggest the
mechanism capable of helping companies improve their main products. Fortunately, to
solve such a matter, a specific model developed by Lovelock(6) offers great guidance
that are suitable to improve customer value. It suggests that supplementary services
should be employed to support the core products. Such services are categorized into
two: supporting and facilitating services. With the former, a company can distinguish
its products from potential competitors. As these services increase the appeal and value
of the core products, the final output is enhanced, making it a great choice compared
with other competitors. These core products could be in the fields of atmosphere,
accessibility, customer participation and interaction with the organization’s services
(Kotler, Bowen &Makens(3)). As for the latter, they are products or services facilitating
the use of the core services and enhancing their appeal and value to enable the company
to charge a premium price. With the act of supporting the core products, they should
be available for the client to use the core service/product (Kotler, Bowen & Makens(3)).
By driving further into Lovelock’s model, it is possible to see that supplementary
services are classified into eight clusters: payment, consultation, safekeeping,
information, billing, order-taking, exceptions and hospitality (Lovelock(6)). Through
the utilization of this model, the augmented and core services in a service organization
can be analyzed by using a structured approach.
3.2.5. Information
As Lovelock et al.(9) stated, information plays a crucial part in facilitating the core
products, as it is essential in performing service delivery. What makes it so significant
is that information leads customers to a better understanding of the service through
guidelines and insights into the current situation of the market. With the absence of
information, it is no doubt that many potential clients will change their mind before
purchasing a product. They could also request essential information regarding their
desired products or services such as prices, instructions on usage, conditions of sale,
confirmation of reservations, notification of changes and specific warnings and
17
reminders. It requires sufficient information in order for customers to attain full value
from their purchased products, especially new customers and prospects. Moreover,
they may request specific information regarding the location to buy a product (or
details of the procedure to order it online), service hours, usage instructions and prices.
Others include conditions of sale, confirmation of reservations, notification of changes
and specific warnings and reminders. Last but not least, documents related to
reservations, account activities and lists of available products can also be required.
It is important for service firms to provide their information in the most precise and
timely manner, for the fact that getting potential customers irritated is definitely not an
desirable option. There are numerous ways of informing customers about their
requested knowledge, some of which are using front-line employees (who may not be
well informed enough to please customers), printed materials and instruction books. It
is also appropriate to use advanced media such as videos, hard disks, phone messages
or websites - the most popular form of marketing in recent years. With the help of the
Internet, service firms can show their detailed schedules regarding specific
transportation and accommodation plans, with other useful information like nearby
stores and diners with prices and descriptions included. In the cases of numerous
logistics companies, they also implement a special function allowing shippers to follow
the progress of their goods that has already been coded separately.
3.2.6. Order Taking
It is possible that customers wish to attain secure commitment to delivery and keep
track of what are available. It is essential to get the procedure done smoothly. In order
to provide the best experience, companies should focus on making their order taking
progress fast and accurate. This will leave a great impression on their customers, as
waiting is something they never wish to undergo (Lovelock, Patterson & Paul(8)). In
the process of serving a potential customer, companies earn the opportunity to collect
essential information, helping them decide whether or not a customer is qualified to
enroll based on the knowledge acquired. In other cases, clients are requested to submit
an application for consideration. Various order-taking practices are in the forms of
reservations or prearranged meetings that allows customers to enjoy a particular
18
service at a given date, namely, a flight, an accommodation or a restaurant table. Some
examples of elements are order entry, applications, check-in and reservations, vehicle
or equipment rental, memberships in programs/clubs, order entry, prerequisite based
services (college enrollment, financial credit), telephone/mail/web order reservations,
seats/rooms/tables, and professional appointments and on-site order fulfillment.
3.2.7. Consultation
An enhancing supplementary service is what greatly defines consultation. It helps
boost the process of service delivery by contributing improved quality and appeal.
Personal counseling and customized advice may be included in these services, which
required that the company has actual knowledge and professional skills. According to
Naipaul and Parsa(10) , by sticking to the needs of customers in different situations, it
is possible to improve the value of consultation and services; for example, training and
consulting based on specific professions or the usage of a particular product. Lovelock
et al.(9) also suggested that it is an improved form of supplementary service that
characterizes consultation, which consists of multiple dialogs to target clients’ exact
requests before leading to a conclusion. In other words, consultation is a work where
a knowledgeable personnel from a service company gives considerable suggestions
regarding the field being inquired; for instance, a man might ask a bodybuilder for
advices on how to gain muscle. Thus, in order to give the right consultation, it is
necessary to understand thoroughly the current situation of a customer before
proposing an appropriate solution. Extra information from the customers will also
contribute greatly to the process, especially when it can be obtained without too much
effort.
A more delicate form of consultation involves counseling. It is the act of getting
customers to have a greater knowledge of their current situations in order that they
could draw their own conclusions. Such an act will perform effectively when applied
in health care services. Although it is a useful approach, difficulties are also presented
when it comes to help customers get a hold of their state and follow a healthier living
style. In numerous diet centers, counseling is utilized to assist clients in their progress
of losing fat and keeping in shape.
19
Lastly, corporate clients are also presented with different consultation regarding
professional services in terms of industrial and business solutions. The process is also
logically arranged, from the inspecting state to the final phrase where the best solution
will be delivered. Thus, it is more likely that the finest result will be achieved this way.
In the hope of raising their sale, some companies do not charge such a service;
nevertheless, customers have to pay for such aids when they come in separate package.
3.2.8. Hospitality
It is necessary for the business to treat customers investing effort and time to visit and
use its services with hospitality. This characteristic is an enhancing supplementary
service. It adds value to the firm’s products and services and makes them more
appealing to clients, which enhances service delivery. Services related to hospitality
need to reflect pleasure when greeting old clients when they come back and meeting
new ones. These services should be designed to welcome new customers. Companies
should ensure that their employees treat clients with courtesy, which shows how well-
managed they are. Clients should have the option to conduct telephone interactions as
well as to face-to-face encounters when it is necessary. It is from the service site and
the offer of transport that hospitality begins. Moreover, it also includes offering
refreshments, creating comfortable waiting areas, cleaning toilets, and making
customers feel welcomed. In accordance with Lovelock, Patterson, &Paul(8), other
elements that can improve the level of hospitality include offering drinks (food and
beverages), security, greeting, toilets and washrooms, and waiting facilities and
amenities, weather protection, seating, lounges, waiting areas, security, transport, and
entertainment, newspapers and magazine. Through its core service or product, the
quality of the hospitality services of a company may decrease or increase the customer
satisfaction. In people-processing services involving people leaving the service
facility, the same thing also applies.
3.2.9. Safe Keeping
It is a fact that customers visiting a service site will want to be assisted with personal
possessions. These customers may cease to come if the company does not provide
safekeeping services such as convenient and safe car packaging. Safekeeping includes
20
the act of keeping records for the clients safely, private and confidential. Sharing the
same similarity with hospitality, safekeeping is also an enhancing supplementary
service. It improves service delivery making products more appealing to clients
through by adding value to them. Safe keeping also enhances customer trust in the
company and its staff. The company is required to take care of client’s personal
possessions (Lovelock, Patterson, &Paul(8)). The list of safekeeping services includes
caring for goods rented or purchased by clients, looking after customers’ possessions
to caring for goods rented or purchased by clients. Regarding caring for customers’
possessions, it may include baggage handling, child care, parking for vehicles, pet care,
storage space, security personnel (security staff), safe deposit boxes and coat rooms.
To achieve caring for goods rented or purchased by customers, the following services
should be provided: repair and renovation, preventive maintenance, transportation and
delivery, packaging, installation, pickup and inspection and diagnosis. According to
Naipaul and Parsa(10), other services may include provision of coatrooms, leaning and
inspection.
3.2.10. Exceptions
Exceptions refer to non-routine supplementary services that are not included in the
normal service delivery. Naipaul and Parsa(10) claimed that well-defined procedures
enable employees to respond effectively and promptly. Whenever things seem not to
work according to the plan, customers expect responsiveness and appreciate when
being allowed to make special requests in many cases. According to Lovelock,
Patterson, & Paul(8) , some examples of elements are restitution, compliments or
complaints, special request in advance, problem solving, handling difficulties from
products usage, helping clients suffering from accident or medical surgery, solving
problems from failures of services or fixing clients’ devices without charges.
Customers who want to depart from the company’s normal operating procedures may
give special requests. According to Goyal(12), it is possible for them to make advance
requests that concern personal needs such as dietary requirements, personal
disabilities, childcare, or religious observances. Furthermore, problem-solving
situations may arise from the failure of normal product performance or service
21
delivery. There exist various causes that can result in such cases; for instance,
equipment failure, delays, accidents or clients experiencing challenges with the use of
the service or product. It requires require well-defined procedures to handle
suggestions, compliments or complaints. The company should also know that the
process of offering suggestions for improvement, express dissatisfaction, or pass
compliments to service providers should be easy for customers. For serious
performance failures, restitution should be delivered to customers. According to
Hume(13), they may take the form of legal settlements, offers for free service or respires
under warranty.
3.2.11. Billing
Significantly, bills should be clear and intelligible to customers. Some examples of
elements related to bills are as follows: machine display of required amount, periodic
statement of the activity of the account, self-billing (computed by clients) and invoices
for individual transactions (Hume(13)). Billing is a common supplementary service that
are applied in almost all services, especially for paid services. Incomplete, illegible or
inaccurate bill may lead to the disappointment of customers. These failures may
worsen the situation for clients who are experiencing dissatisfaction with the service.
As Hume(13) stated, billing procedures may include machine-displayed price, verbal
statements or monthly statements of fees and account activity, as well as handwritten
invoices. With recent technological advances, it is feasible for companies to adopt
computerized billing. These computerized forms of billing, however, can also cause
service failures and lead to overbilling the customer. Customers often expect clear and
informative bills which are easy and possible for them to understand how the totals are
computed. Customers will not be impressed with confusing and unexpected charges,
illegible handwriting and fuzzy printing (Naipaul & Parsa(10)). It may be inappropriate
to use laser printers that lack the capability to typefaces and switch fonts because they
may produce illegible statements. Thus, companies should concentrate on designing
user-friendly bills based the customers’ preferences. It is billing information that can
help a company to offer an added value to customers.
3.2.12. Payment
22
To deliver services successfully, it is important to conduct the process of payment or
invoicing, which is a kind of facilitating services. It is a fact that customers want to
know what they pay for, how to pay and when they need to pay. With clear, accurate
and on-time invoice, all of this could be facilitated. With simple and convenient
transaction, customers will be more willing to pay. Some examples of elements, in
accordance with Lovelock, Patterson, & Paul(8), include the followings: automation
deduction, using cards online, electronic funds transfer, cash or token into machine,
automated deduction from vouchers.
In particular situations, specific courses of actions regarding payment will be required.
When making purchases, customers often expect convenient payment. There are
multiple ways to facilitate customers bill paying, including: self-service payment
system, hand-to-hand transfer of checks and cash, debit and credit card payment,
prepaid tickets, coupons, vouchers or tokes. Customers are requested to performs
actions such as inserting cards, coins or notes in some automatic services.
Nevertheless, the breakdown of machines can lead to the failure of the system. Thus,
some payments are made directly through transfer of checks and cash. However, the
most established form of payment is using debit cards and credit cards.
3.2.13. Service Quality
In order to perform services and improve their quality, it is significant to grasp their
operative mechanism. This will allow companies to detect problems and fix them
accordingly. As Lovelock et al.(9) stated, regarding service quality, there exist four
distinctive aspects:
1. Customers have to obtain continuous experience in order to be able to perceive
quality, due to its abstract nature.
2. Manufacturing practices are mainly regarded as the primary approach, which
examine services when it is being operated. Its purpose is to achieve principles that
could increase quality with the least cost.
23
3. Services taken its primary concerns in customers mostly focus on the needs and
demands that each person possesses, referring to the fact that quality depends on the
users.
4. Regarding the value of the service and its price, it is crucial to consider the trade-off
each customer has to face.
According to Lovelock et al.(9), as the importance of service quality lies both in its
aspects and dimensions, Zeithaml, Berry and Parasuraman(15) have successfully
categorized the dimensions of service quality into five perspectives.
• Tangibles (appearance of physical elements)
• Responsiveness (promptness and helpfulness)
• Reliability (dependable and accurate performance)
• Assurance (credibility, competence, courtesy and security)
• Empathy (good communications, customer understanding and easy access)
The most essential part of this model is “the zone of tolerance”, which indicates the
expectations each customer may maintain. At one end lies the desired level while
adequate service level is bound at the other (Parasuraman and Berry(15)). Both represent
the limit of customer satisfaction. In accordance with Oliver and Rust(16), service
quality may be illustrated through the SERVQUAL instrument, indicating a response
to the level of service satisfaction. In other words, what pleases customers are none
other than the high value of services at the lowest cost possible.
In the following chapter, customers’ expectations and the distinctive gaps will be
examined, giving an insight into how the process of service delivery takes place in its
multiple variations.
3.2.14. The Gap Model
It is significant to grasp the gap model in order to understand service quality.
Developed by Zeithaml, Berry and Parasuraman(15), the gap model included give gaps;
later, there were six after Lovelock et al.(9) improved it. This explains thoroughly how
24
customers meet their expectations and how they are delivered. Through the gap model,
it is possible for companies to analyze and find out what problems they are facing in
order to draw out a suitable solution.
Gap 1: The Knowledge Gap. The missing information that cause the reduction in
satisfaction regarding fulfilling customers’ expectations.
Gap 2: The Policy Gap. The conflict in the progress of delivering services and the
rules they are based on.
Gap 3: The Delivery Gap. The difference involving service standards and performance
of the service company.
Gap 4: The Communications Gap. The variation of what is marketed in public and the
actual products delivered to clients. As Lovelock et al.(9) stated, two other sub-gaps
form the communication gap. First, it is the internal communications gap, representing
the difference of the actual products a company advertises and what it could possibly
offer to its customers. Second, it is the overpromise gap. Regarding this gap, it is
possible that the sale team of a company is evaluated based on its sale performance,
which is the reason why they overpromise more than what can be offered. Last but not
least, there exists an interpretation gap. This refers to the variation in services that are
actually provided and what customers expect to receive from the company’s
advertisements.
Gap 5: The Perceptions Gap. This indicates the imbalance of what the clients feel
about the products they receive and what are given in reality, as customers are unable
to evaluate the actual quality of the products.
Gap 6: The Service Quality Gap. What the final gap refers to could be an imbalance
between the perception of the real products delivered and the expectations of clients
from the company.
25
3.3 Final Cause –and –effect map
In order to verify and clarify the problem, I continued to interview the sales manager,
customer service manager and marketing manager of Medent. The interview results
show that the "frontline" such as sales and marketing as well as back office
departments, in particular customer services, are embarrassed by this tremendous
change. They all have trouble with the so-called "solution" of the board of
Management Perceptions of
Consumer Expectations
Gap 1
Gap 2
Gap 6
Gap 5
Gap 3
Translation of Perceptions
into Service Quality Specs.
Service Firm
Gap 4
External
Communications
to Consumers
Service Delivery
Perceived Service
Consumer
Expected Service
Past Experience
Personal Needs
Word of Mouth
communication
26
management. The first thing they encounter is how to have the new solution and who
will do the work.
Ms. Nguyễn Thị Đoan Trang – Medent Customer Relation Manager shared that:
Do you remember when you asked me aboutour new orientation to switch from
selling a product to a solution? The problem is simply the switch from selling pure
products to selling a more comprehensive service package to customers, that is the
solution. What I see is that our business team still do theoretical solutions. In short,
they arestill saying that they provide the solution, but when I talk to customers, Iknow
they have not reached the bottom of the problem so their solution is very lack of
application.
At his point of view, Mr. Nguyễn Hữu Phúc – Medent Marketing Manager shared that:
I just find it simply the distance between the will and the reality. Business
solution, it sounds easy, but for me the solution is a form of wisdom, it is very difficult
when we do not know where to start, even "some teams "do not have enough expertise,
I wonder how they deployed?
Because before the change took place, the research, selection and commercialization
of products are the role of business team (sales team). However, the products become
more and more complex, so the level of specialization is also increasing, especially in
combination treatment. Clearly, sales teams do not have enough expertise to be able
to handle this. And of course, other teams like marketing, customer services are
strongly influenced by this, because if they do not understand the product themselves,
how can they deploy these products to customers.
Mr. Cao Thanh Toàn – Medent Sales Manager shared that:
The reason, simply because We are still in the "half-vague" state, or in other
words, I can understand and visualize what the board wants to do, but the actual
deployment brings a lot of difficulties to our team.
27
Why is this happening? Remember that our products and technology are
becoming increasingly complex day by day, let alone their combined solutions, we are
just a business team, my business is not research applied technology in medicine.
4. CAUSE VALIDATION
In order to verify and clarify the problem, after reading theories, I continued to
interview the sales manager, customer service manager and marketing manager of
Medent. The interview results show that the "frontline" such as sales and marketing as
well as back office departments, in particular customer services, are embarrassed by
this tremendous change. They all have trouble with the so-called "solution" of the
board of management. The first thing they encounter is how to have the new solution
and who will do the work.
Because before the change took place, the research, selection and commercialization
of products are the role of business team (sales team). However, the products become
more and more complex, so the level of specialization is also increasing, especially in
combination treatment. Clearly, sales teams do not have enough expertise to be able to
handle this. And of course, other teams like marketing, customer services are strongly
influenced by this, because if they do not understand the product themselves, how can
they deploy these products to customers.
Based on the initial cause and effect map and the final in-depth interview from 3
respondents represent for three main teams (see Interview guides) and theories
informed, it can be seen that the main causes leading to high ratio of customer
complaint are due to errors or omissions in the two issues of information and
consultant. However, in these two factors, information has the most impact high ratio
of customer complaint at Medent because according to Lovelock et al.(9), consultant is
a kind of knowledge service. From there, we can see that knowledge of the product or,
more specifically, customers need relevant information is the foundation for providing
customer service. It is important for Medent to have action plans to solve this problem
immediately.
28
Final Cause –and –effect map
Errors or omissions in
the two issues of
information and
consultant
Products
provided do
not meet the
expectations of
customers
Customer
service is not
good
High ratio of
customer
complaint
Installation and
delivery are not
good
Figure 7. Final Cause Effect Map
5. ALTERNATIVE SOLUTIONS
As above analysis, it can be seen that the main cause of the high ratio of customer
complaint at Medent is errors or omissions in the issues of information. Therefore, this
chapter would focus on giving solutions to solve this cause. Below would be some
alternative solutions applied for errors or omissions in the issues of information.
5.1 The first alternative solution: Establishment of a "multi-function" R&D
center
According to The Flower of Service concept by Lovelock et al.(9), customer needs may
include directions to the physical location where the product is sold (or details of how
to order it by telephone or Web site), service hours, prices, and usage instructions.
Further information, sometimes required by law, could include conditions of sale and
use, warnings, reminders, and notification of changes.
The medical equipment industry in general and dental equipment in particular can be
categorized into two main categories: simple product group and high technology
product group. The problems encountered in this thesis are caused by the high-tech
Errors or
omissions in
the issues of
information
29
product group because of the complexity in their medical applications. Although this
is an intellectual matter, it is also a product. Since this is no longer a matter of knowing
and distributing products, it has come to the problem of "production" and to "produce"
the product we need to have an R&D department. My solution is to set up a showroom
as a R&D center. Because it will very costly to build a R&D center, we have to
purchase lots of equipment so it can be combined to reduce costs as well as increase
business efficiency. Then we need to organize a team of the center with the expertise
and knowledge to carry out the assigned tasks.
Benefits:
There is a place where customers can visit, experience not only the product but
also the new business philosophy of the company anymore.
Has enough facilities as well as tools to research and produce high-applicability
solutions.
Have a department with full expertise to carry out the assigned tasks.
R&D center is a good base for implementing extended solution issues.
Cost:
The fixed cost for establishment a R&D center is VND 10,500,000,000 base on the
report from Financial Department. If we count the additional expenses and the
contingency allowance 10%, we have the total estimating cost is VND 11,550,000,000.
30
Table 1: Fixed cost of building center
# Description Estimating cost (VND)
1 CBCT system 2,000,000,000
2
Intra-oral camera, other scanning systems and
software
1,500,000,000
3 Sterilizer systems 1,200,000,000
4 Milling & sintering systems 3,000,000,000
5
Others (Other systems and cost of design,
construction, etc.)
1,100,000,000
Total 8,800,000,000
Table 2: Fixed cost of Team training & recruiting
# Description Estimating cost (VND)
1
Recruiting R&D Manager and staff,
Manager will manage and training team
270,000,000
2
Catering -meals, lunches, tea and coffee
breaks
10,000,000
3 Training documents and equipment 15,000,000
4 Allowance for organization board 20,000,000
5
Additional cost (electricity, telephone, note
papers, clip board, pens, evaluation form)
5,000,000
Total 320,000,000
Variable cost: This includes the cost of paying a team of three staffs VND 720,000,000
per year (Excluding C&B) and the cost of leasing a house VND 660,000,000 per year.
5.2 The second alternative solution: conduct collaborative research programs
with medical universities and dental associations.
31
In a different perspective, research through sponsorship, collaboration with universities
and associations can be viewed as an "out-source" activity. This is also a type of
traditional research that many companies in the industry have been doing.
Benefits:
Cost savings compare with set up a R&D center.
Universities and associations are the gathering place for many professionals and
researchers with good expertise and prestige in the industry
In comparison with the research center, their final results have high clinical value
and can be reported.
Create more sources of customer input for the business of the company.
Cost:
The cost of this form varies greatly by a variety of factors such as it depends on the
number of projects and topics available to the university or association, the depth and
breadth of the research, etc. However, in general, the cost of these projects can be
controlled and calculated by planning and setting specific targets for annual research
projects based on the board's requirements and also actual market data. But in general,
the cost would be much lower than the first solution. We can take the example of 2016:
32
Table 3: The cost of projects in 2017
# Description Estimating cost (VND)
1
Cerec - Smile design project (Phd. Dr. Lâm
Đại Phong,
University of Medicine and Pharmacy, Ho
Chi Minh City)
65,000,000
2
Cerec & CBCT integrated project (Phd. Dr.
Lâm Đại Phong,
University of Medicine and Pharmacy, Ho
Chi Minh City and Dr. Tran Thanh Phong
Implant specialist of Nobel Viet Nam,
Keiyen Clinic)
50,000,000
3
Cerec Implant project (Dr. Tran Thanh
Phong Implant specialist of Nobel Viet Nam,
Keiyen Clinic)
155,000,000
4 Allowance for organization board 25,000,000
5
Additional cost (electricity, telephone, note
papers, clip board, pens, evaluation form, et
al)
5,000,000
Total
300,000,000
To sum up, set up a R&D center and training team, providing best practices and tools
to improve internal strength of the team while bringing stability to the company, which
is the basis for the company can develop sustainably and can improve the high ratio of
customer complaint in Medent. After considering their benefits and costs, although the
cost is quite high, it could be seen that establishment of a "multi-function"R&D center
should be prioritized to apply because of some below points of view:
Firstly, having a team with enough expertise is necessary for the company at this time
and training is one of the best methods to changing one's awareness and knowledge.
33
Through knowledge and skills gaining in classes as well as on the job, researchers can
recognize what is important, what kind of mistakes are usually made, etc. in the dental
industry. According to Abuharris and Atiya Thabet(17) , it is necessary to note that
training can have an impact on all the members of a company although it can be a tool
to motivate changes. It is possible to benefit everyone if training is conducted
accurately; otherwise, negative influences are also presented. Some examples are
credibility loss, disagreement and decreased productivity.
Secondly, a modern, diversity research facility is essential to enhance the customer
experience, because you cannot let customers make important decisions through oral
counseling.
Thirdly, R&D center is a good base for implementing extended solution issues. As a
matter of fact, you can use it as a powerful tool to support the negotiation and
implementation of the activities of the second solution: conduct collaborative research
programs with medical universities and dental associations. Thus, the solution to set
up a R&D center could be prioritized to implement in Medent. It is both a long-term
strategy and a convincing basis for the determination to do exactly what the company
says to customers. Moreover, if you do not have an internal team, for example, you
choose the second solution, your job will become very unstable because you have to
depend largely on the doctor while their time budget is very limited and the status of
research in the medical sector in Vietnam is still very much limitations such as the
facilities, infrastructure for research is weak, lack of funding, ground level of research,
etc.
Finally, on the other hand, I think we should deploy both solutions parallelly, because
building a research center will take a considerable amount of time, while your company
still needs some new solutions from research to launch it to the market.
6. ORGANIZATION OF ACTIONS
In Medent, errors or omissions in the issues of information is the urgent problem that
needs to be solved immediately. After comparing costs with long term benefits and
base on the research results, the actions that Medent needs to take are:
34
Initiate the construction of the research center as well as beginning recruitment
and training before the research center completes three months
Recruiting a R&D manager who has enough experience to set up a R&D center
Conducted in parallel with the above two work is the implementation of
collaborative research programs as soon as possible.
Table 4 as below is an action plan timeline which take 06 months from June 2018 to
December 2018 and will be reviewed at the end of the year 2019.
33
ACTION PLAN 2018
Month 6 7 8 9 10 11 12
Activities Objectives Responsibility
Initiate the
construction of the
research center as well
as beginning
recruitment and
training before the
research center
completes three
months
Purchase equipment and build a
showroom
Have facilities t to
carry out
independent and
cooperative
activities
BOD, Technical team and
independent
company (out source)
PIC: Dr. Dam (CEO), Mr.
Hoang (Chief Engineer)
Recruiting, training & planning Get staff to manage
and deploy word
HR recruit; HR and R&D
manager training for staff;
BOD and R&D manager
planning for research
activities
PIC: Ms. Ha Vy (HRM),
Dr. Dam (CEO), Dr. Tam
(R&D Manager)
Cerec – Smile design project (Phd.
Dr. Lâm Đại Phong, University of
Medicine and Pharmacy)
Research responds
to new trends
BOD, R&D Manager and
sales manager
PIC: Mr. Cao Thanh Toan
(SM), Dr. Dam (CEO),
Dr. Tam (R&D Manager)
24
The implementation of
collaborative research
programs
Cerec & CBCT integrated project
(Phd, Dr. Lâm Đại Phong, University
of Medicine and Pharmacy, Ho Chi
Minh City and Dr. Tran Thanh Phong
Implant specialist of Nobel Viet Nam,
Keiyen Clinic)
Study on accuracy
to confirm
competitive
advantage
BOD, R&D Manager and
sales manager
PIC: Mr. Cao Thanh Toan
(SM), Dr. Dam (CEO),
Dr. Tam (R&D Manager)
Cerec Implant project (Dr. Tran
Thanh Phong Implant specialist of
Nobel Viet Nam, Keiyen Clinic)
Study on accuracy
to confirm
competitive
advantage
BOD, R&D Manager and
sales manager
PIC: Mr. Cao Thanh Toan
(SM), Dr. Dam (CEO),
Dr. Tam (R&D Manager)
34
7. CONCLUSION
In such a developing country as Vietnam, the production of modern medical equipment
in general and dental equipment in particular with products of good quality and meet the
demand of doctors is not possible at the present time. Most of Vietnam's business
enterprises in this industry, except for simple equipment that can be produced, still have
to choose a commercial approach. However, this option leads to a risk of lack of
competition and the potential for loss of distribution rights.
Indeed, in recent years with the rapid development of science and technology. The
"digital" revolution has changed our lives as fast as ever. Back in the dental industry,
the development of science and technology in the "digital era" has pushed commercial
businesses into the difficult situation: to change to keep up with technology or to die.
Because of a very simple reason, but not simple to implement: the change in the actual
needs of customers, customers now no longer choose and buy products simply, they
have begun to require businesses to provide solutions which come with new
technologies.
Therefore, the need to develop a new approach to help our commercial enterprises
survive in this era is to turn them into consultancy and solution providers. This study
has clarified some points as below:
Firstly, the needs of customers, actually have been changing. Comes with these new
products and technologies are the information factor, businesses need to provide enough
information in the form of solutions to enable them to deploy new technology products.
Secondly, building R&D unit with me is just a name. The essence of the problem to be
solved here is: there must be a functional division to take charge of, or otherwise capture
the change caused by technology and research to apply and transfer it to customers to
create real value and meet their new demand.
Thirdly, building competitive advantages and especially sustainable competitive
advantage by the "From root to tip" method is imperative. In the absence of sufficient
capacity to manufacture high-tech equipment, the added value and solutions come from
35
the "gray matter" of the enterprise or, in other words, the production of intellectual
product is a worthy consideration approach.
8. SUPPORTING INFORMATION
Two types of data were collected in this thesis. Firstly, secondary data was collected
from some reliable sources such as the report of Customer Services Department -
Medent, relevant online literatures, management books and other journals, researches,
etc. which strengthen the theory and conclusions when compared to what the
interviewees mentioned and the real status in Medent recently. Secondly, primary data
is collected through conducting a qualitative research. The main method for collecting
qualitative data is in-depth interviews. These respondents are categorized in two main
groups as follows:
First group: Doctors who are clients of Medent
Second group: Managers/supervisors/workers who are currently working for Medent
The purpose of the interview is to collect general data and opinions of interviewees
about the high complaint ratio of customer with Medent products and services as well
as its causes and their suggested solutions. All questions that respondents in each group
have been asked as follows:
36
INTERVIEW GUIDE
Research objectives: To explore and understand the reason why Medent received a
high rate of complaints.
Duration: 10-20 minutes per interviewee.
THE FIRST QUALITATIVE RESEARCH
Detail interviewees information
Name Gender Business Location
Dr Hùng Male Dr.Hùng Dental Clinic 244A Cống Quỳnh Dist 1, HCMC
Dr Huy Male Dr Beam Dental Clinic
400CD Lê Hồng Phong, Dist 10,
HCMC
Dr Hưng Male
56 Trúc Khê Dental
Clinic
56 Trúc Khê, Dist Đống Đa, HN
Dr Phú Male Việt Úc Dental Clinic 12 Điện Biên Phủ HN
Dr Điềm Male Sagodent Dental 12-14 Phước Hưng, Dist 5, HCMC
Dr Hoà Female DDS Dental Clinic
42 Cửa Đông, Hoàn Kiếm Dist,
HN
Dr Đạm Male Medent Group CEO
37 Bàu Cát 3, Tân Bình Dist,
HCMC
Detail interview content:
Interview Guide
Name: _
Sex: Male Female
Business:
37
Location:
1. After the previous quantitative study, the company received a high rate of
complaints. In your opinion, where does this come from?
Probe & Prompt
1. Could you please explain deeper/clearer?
2. Could you please give us some reasons why you think it's the most important?
Name Probe & Prompt Answer
Dr.
Hùng
1. Could you
please explain
deeper/clearer?
2. Could you
please give us
some reasons that
you think it's the
most important?
The majority of Medent's complaints come from
the company's services.
You see, as you have recently converted from
selling products to selling solutions that I have
not seen this in practice. You are only bringing
values to customers sporadically because you
lack a lot of core values.
The reason, simply because you do not
understand correctly and specifically what you
need to do. For example, when you combine
multiple treatment technologies together, that
does not mean "one plus one equal two" that you
are changing the behavior and treatment method
of the doctor, you need to help them. Do it in a
practical way, not just on theory. In addition,
delivery services as well as operating
instructions are not really good. But this is
understandable, as I mentioned above, there are
things you do not know. Thus, how can you
guide and organize well?
Dr. Huy Medent's complaints come from company
38
mindset in general and staff in particular.
Do you remember when you asked me that you
want to switch from selling a product to a
solution? We have talked about customer centric
orientation, the problem is simply the switch
from selling pure products to selling a more
comprehensive service package to customers,
that is the solution. What I see is that you still do
theoretical solutions, I do not know what you
think, but I see you are away from the core
values of the industry, that is medical expertise.
In addition, delivery services as well as staff
attitude are not professional enough. I say this
because you are targeting high-end customers,
you understand?
Dr.
Hưng
Medent's services, in general, are "standard" but
there are many shortcomings. Thus, leading to
customer complaints.
I appreciate Medent, you are very prestigious,
very enthusiastic and honest. To me, that is what
has been and is helping Medent grow and
survive to this day. However, those are not
enough, I think you lack two things that are
thoughtful and detailed. Be more thoughtful and
detailed. And one more things, more practical.
Dr. Phú The way Medent works, I feel pretty good, you
only need to care more.
I say more attention, which means that you need
39
to pay attention to small points but lead to
dissatisfaction. You know, sometimes you are
doing something good but just for a point, you
get “minus points” from customers. For
example, your delivery time and your
operational instruction course quality. I don’t
know why it was used to good in the past, but
now, it changed.
Dr.
Điềm
The way your company works is just right for
the old days, now it is different trend. Therefore,
complaining is correct.
You understand, I take a lot of time to be able to
learn in detail the dental solution to apply to the
patient and then I have to practice a lot. You
know that medical solution is a smooth
combination of practice and theory. For me, it is
very difficult, you even want to deliver
integrated solution, I think this is very difficult
for you at this time.
Dr. Hoà Your service is not bad, but the service attitude
and the way you organize your work should be
reviewed.
You know, sometimes you cannot do well, but
attitude is very important to save the problem,
and about the organization, I'm a doctor, I do not
know very well but I feel recently, your
company seems to be "exhausted" and I see that
your products in particular and the market in
general are increasingly "more difficult to use",
40
which may some important reasons that cause
the problems.
Dr. Đạm Medent's complaints come from the many
different aspects.
From distribution services, installation services
to operational instruction services, etc.
I think a problem has many causes, but I myself
find that Medent is lacking in knowledge of the
solution, which is not easy to solve because we
have done our best, maybe I have to think about
changing the way to do it.
THE SECOND QUALITATIVE RESEARCH
Detail interviewees information:
Name Gender Position
Mr. Toàn Male Medent Sales manager
Ms. Đoan Trang Female Medent Customer services manager
Mr. Phúc Male Medent Marketing manager
Detail interview content:
Interview Guide
Name:
Sex: Male Female
Business:
41
Location:
1. After reading the previous quantitative & quantitative study, your company is
having problems with customers that many years ago did not meet. In your opinion,
where does this come from?
Probe & Prompt
1. Could you please explain deeper/clearer?
2. Could you please give us some reasons why you think it's the most important?
Name Probe & Prompt Answer
Mr.
Toàn
1. Could you please
explain
deeper/clearer?
2. Could you please
give us some
reasons that you
think it's the most
important?
The majority of Medent's complaints come from
the company's consultant services.
You see, as you have recently converted from
selling products to selling solutions. However,
we only can bring values to customers
sporadically because we don't know exactly
what to do.
The reason, simply because We are still in the
"half-vague" state, or in other words, I can
understand and visualize what the board wants to
do, but the actual deployment brings a lot of
difficulties to our team.
Why is this happening? Remember that our
products and technology are becoming
increasingly complex day by day, let alone their
combined solutions, we are just a business team,
my business is not research applied technology
in medicine.
Ms. Recently, I felt Medent was in a state of
42
Đoan
Trang
confusion and this became clearer after I saw the
results of the report.
Do you remember when you asked me about our
new orientation to switch from selling a product
to a solution? The problem is simply the switch
from selling pure products to selling a more
comprehensive service package to customers,
that is the solution. What I see is that our
business team still do theoretical solutions,
In short, they are still saying that they provide
the solution, but when I talk to customers, I know
they have not reached the bottom of the problem
so their solution is very lack of application.
Mr.
Phúc
I just find it simply the distance between the will
and the reality. Business solution, it sounds easy,
but for me the solution is a form of wisdom, it is
very difficult when we do not know where to
start, even "some teams "do not have enough
expertise, I wonder how they deployed?
To put it simply, my team is needed to do lots of
marketing activities to deliver the solution to our
clients. However, even me had not figured it out,
it was very hard for my team.
43
REFERENCES
1. Lewis BR, Mitchell VW. Defining and measuring the quality of customer
service. Marketing intelligence & planning. 1990;8(6):11-7.
2. Nejadjavad M, Gilaninia S. The Role of Service Quality in Organizations.
Kuwait Chapter of the Arabian Journal of Business and Management Review.
2016;5(7):19.
3. Kotler P, Bowen JT, Makens JC. Marketing for hospitality and tourism: Prentice
Hall; 2009.
4. Wirtz J, Lovelock C. Services marketing: World Scientific Publishing Company;
2016.
5. Storey C, Easingwood CJ. The augmented service offering: a conceptualization
and study of its impact on new service success. Journal of Product Innovation
Management: AN INTERNATIONAL PUBLICATION OF THE PRODUCT
DEVELOPMENT & MANAGEMENT ASSOCIATION. 1998;15(4):335-51.
6. Lovelock CH. Cultivating the flower of service: new ways of looking at core and
supplementary services. Marketing, operations, and human Resources: Insights into
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7. Bitner MJ, Brown SW, Meuter ML. Technology infusion in service encounters.
Journal of the Academy of marketing Science. 2000;28(1):138-49.
8. Lovelock C, Patterson P. Services marketing: Pearson Australia; 2015.
9. Lovelock CH, Wirtz J, Chew P. Essentials of services marketing. 2009.
10. Naipaul S, Parsa H. Supplementary services as a differentiation strategy: an
empirical investigation of lovelock's model in tourism. Journal of Quality Assurance in
Hospitality & Tourism. 2000;1(1):67-80.
11. Colgate M, Alexander N. Benefits and barriers of product augmentation: retailers
and financial services. Journal of Marketing Management. 2002;18(1-2):105-23.
12. Goyal A. Role of supplementary services in the purchase of credit card services
in India. Asia Pacific Journal of Marketing and Logistics. 2004;16(4):36-51.
13. Hume M. Understanding core and peripheral service quality in customer
repurchase of the performing arts. Managing Service Quality: An International Journal.
2008;18(4):349-69.
14. Levitt T. Marketing success through differentiation-of anything: Graduate
School of Business Administration, Harvard University; 1980.
15. Zeithaml VA, Parasuraman A, Berry LL, Berry LL. Delivering quality service:
Balancing customer perceptions and expectations: Simon and Schuster; 1990.
16. Oliver RL, Rust RT. Service quality: New directions in theory and practice: Sage;
1994.
17. Abuharris AT. The role of cross-training in reducing the level of labor turnover
applied study on some hotels in Tripoli-Libya. Romanian Economic and Business
Review. 2013:225.
44

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Luận Văn High Customer Complaint Ratio From Medent Co Ltd

  • 1. UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School ofBusiness NGUYEN-DINH THIEN TAM Student ID: 22150055 HIGH CUSTOMER COMPLAINT RATIO FROM MEDENT CO., LTD Tham khảo thêm tài liệu tại Baocaothuctap.net Dịch Vụ Hỗ Trợ Viết Thuê Tiểu Luận,Báo Cáo Khoá Luận, Luận Văn ZALO/TELEGRAM HỖ TRỢ 0973.287.149 MASTER OF BUSINESS ADMINISTRATION Ho Chi Minh City – 2022
  • 2. UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School ofBusiness NGUYEN-DINH THIEN TAM Student ID: 22150055 HIGH CUSTOMER COMPLAINT RATIO FROM MEDENT CO., LTD MASTER OF BUSINESS ADMINISTRATION SUPERVISOR: TRAN HA MINH QUAN Ho Chi Minh City – 2022
  • 3. Executive Summary The dizzying turn of the "digital" revolution in today's life has made intellectual property more important than ever. The intellectual property, which is often considered the most important asset in all organizations, needs to be well identified and studied. In addition, in this digital age, adaptation is being viewed as a strong competitive advantage. In the current economic context of Vietnam and especially in commercial enterprises. Organizations need to ensure they operate in a way that can help them meet and grow sustainably by addressing these two issues. The purpose of this thesis is to explore the causes of high customer complaint ratio through the current problems with customer at Medent Co., Ltd (in short, it would be called Medent in this thesis). The findings of the study revealed the awkwardness and embarrassment of catching up with the changes of the times as well as the rapid change of customer demand in which the "information" factor is extremely important. Not only do you have to provide them enough "information", but also provide solutions that will enable them to apply into their work. The findings are discussed in details in the research along with some recommendations for the company and management board to solve the problem of the actual needs of customers, towards sustainable development and reduce customer complaint ratio in Medent Co., Ltd.
  • 4. Acknowledgements I would like to acknowledge all who supported me during my studies without whom I wouldn't be where I am today. I would especially like to thank my supervisor – Professor Tran Ha Minh Quan for all his advice and guidance, without his help this could not have been possible. I also would like to show my gratitude to my colleagues at work and classmates at ISB for their continuous support. I also send my sincere thankfulness to my parents and friends for their support and encouragement.
  • 5. TABLE OF CONTENTS EXECUTIVE SUMMARY ACKNOWLEDGEMENTS LIST OF FIGURES LIST OF TABLES 1. INTRODUCTION.............................................................................................................01 1.1 The company background..........................................................................................01 1.2 Company structure and mission................................................................................01 2. PROBLEM CONTEXT...................................................................................................03 3. PROBLEM IDENTIFICATION ...................................................................................05 3.1 Cause –and –effect map .............................................................................................05 3.2 Literature review.........................................................................................................07 3.3 Final Cause –and –effect map...................................................................................21 4. CAUSE VALIDATION ...................................................................................................23 5. ALTERNATIVE SOLUTIONS.....................................................................................24 5.1 The first alternative solution: Establishment of a "multi-function" R&D center...................................................................................................................................24 5.2 The second alternative solution: conduct collaborative research programs with medical universities and dental associations ................................................................26 6. ORGANIZATION OF ACTIONS.................................................................................29 7. CONCLUSION..................................................................................................................34 8. SUPPORTING INFORMATION..................................................................................35 REFERENCES ........................................................................................................................43
  • 6. LIST OF FIGURES Figure 1. Medent organizational structure Figure 2. Increasing ratio of customer complaint (compare with previous quarter) Figure 3. Increasing ratio of customer complaint in the last three year Figure 4. The satisfied ratio with the services and products of Medent - 2018 data Figure 5. The Gap Model Figure 6. Initial Cause Effect Map Figure 7. Final Cause Effect Map
  • 7. LIST OF TABLES Table 1: Fixed cost of building center Table 2: Fixed cost of Team training & recruiting Table 3: The cost of projects in 2017 Table 4: Action plan
  • 8. 1 1. INTRODUCTION 1.1 The company background Company name: Medent Co., Ltd Established year: 1994 Industry: Dental supplies and services. CEO: Dr. Huỳnh Thanh Đạm Medent Co., Ltd is one of the largest providers of dental care products and services to office-based dental and dental practitioners in Viet Nam. Medent is a subsidiary company of the Medent Group; the largest group provides dental care products in Vietnam. The company also serves dental laboratories, government and institutional health care clinics, and other alternate care sites in the field of dentistry. A company with more than 23 years of development history and serves thousands of clients in the dental industry throughout Vietnam. 1.2 Company structure and mission Regarding the structure, there are multiple services and products that the company provides. Moreover, it also includes value-added solutions in order for operative practices and high-quality care to be achieved. Medent oriented to operate through a centralized and automated distribution network, with a selection of rich and diverse product portfolio from over 10 global brands from reputable multinational corporations in the dental industry. Plus, special assistance and various advanced technical aids are also available to customers in need, as claimed by the company. Specifically, these consist of financial aids, software and utilities that are specialized in internet trading. Headquartered in Tan Binh District, HCMC. The company's sales reached a record 200 billion VND in 2016 (Medent Group sales revenue 2016 is 900 billion VND in 2016). For more information, visit the Medent website at http://medent.vn.
  • 9. 2 Figure 1. Medent organizational structure (Source: Medent Human Resource Department) BOD CEO Supervisory Board Board of Assistant 6 Director of 6 subsidiary company of Medent Group Medent Co., Ltd Managing Director VP Supporting Group VP Operational Group VP Business Group Marketing Manager Technical Services Manager Dental Equipment Sales Manager Administrat HR & ion Manager Ware house & Logistic Manager Dental Surgical Sales Manager Customer Relation Manager Finnance & Accounting Manager Dental Labo Sales Manager R&D Manager Import-Export Manager DentalImplant Sales Manager IT & System Management Manager Purchasing Manager
  • 10. 3 2. PROBLEM CONTEXT High ratio of customer complaint Symptom: High ratio of customer complaint. We have had data from Customer Services Department that they have received an increasing number of complains as follows: On average, from July 2017 to July 2018, the number of complaints increased 3.8% in average each quarter in a year when compared with the average number of previous year, we calculated by taking the total number of complaints of each quarter of this period from Q3 2017 to Q2 2018, add up their sum and then divide by 4, then use this result to compare with the average of the previous year, thereby calculating the average percentage above. In addition, we also compared the growth rate of complaints in the quarters corresponding to the previous years, namely Q3 2017 compared to Q3 2016. On the other hand, we also compared this average of this year compared to the previous two years. The issues mentioned above will be explained in the following two charts:
  • 11. 4 Figure 2. Increasing ratio of customer complaint (compared with the corresponding quarters in the previous year) (Source: Medent Customer Relation Department) While in the past two years, the number of complaints only increase 0.7% in 2016 and 0.9% in 2017. Increasing ratio of customer complaint (compare with previous quarter) Increasing ratio of customer complaint (compare with the corresponding quarters in the previous year) Q3 2017 Q4 2017 Q1 2018 Q2 2018 AVG RATIO 4.4% 2.7% 3.3% 4.4% 3.8%
  • 12. 5 Figure 3. Increasing ratio of customer complaint in the last three year (Source: Medent Customer Relation Department) Recognizing the importance of the matter, Medent has conducted a survey on customer satisfaction with the simple Yes / No question: Are you satisfied with the services and products which Medent is offering? As a result, 42% of customers were not satisfied with the company's current products and services. Medent has done the research with 100 customers (in more than 5000 of their customers in Viet Nam). Their method is to take randomly on the company's customer list. Increasing ratio of customer complaint in the last three year Increasing ratio of customer complaint in the last three year 2016 2017 2018 0.7% 0.9% 3.8%
  • 13. 6 Satisfied 58% Unsatisfied 42% Unsatisfied Satisfied Figure 4. The satisfied ratio with the services and products of Medent - 2018 data (Source: Medent Customer Relation Department) 3. PROBLEM IDENTIFICATION 3.1 Cause –and –effect map After the study above, Medent has realized this is an unusual indicator, but it is very difficult to conduct an investigation on large samples with specific subjects like dentists is very difficult, after discussing with the board of directors, everyone has come up with a preferred solution: conducting a follow-up research by doing 7 in-depth interviews with 7 different dentists in HCMC and Hanoi. The interview results indicate that there are three main causes for the high ratio of customer complaint. The satisfied ratio with the services and products which Medent is offering
  • 14. 7 Products provided do not meet the expectations of customers Customer service is not good High ratio of customer complaint Installation and delivery are not good INITIAL CAUSE & EFFECT MAP Figure 6. Initial Cause Effect Map To build the first proposal, I choose the first cause as a potential central problem. The reason why I remove the others includes two reasons: Firstly, I start conducting theoretical searches and find out that service and its quality has become an fascinating phenomenon in the fields of research, operation management (OR) and service marketing management (SMM) (Nejadjavad & Gilaninia(2)). The term “service” can be defined in numerous ways. Although the term has been presented differently through the definition of numerous researchers, it still ends up in the same field which depends heavily on the satisfaction of customers. In accordance with American Society for Marketing (2008), a service is known as a specific product that can be sold or trade. Reversely, as Kotler(3) stated, the same term is seen as the outcome from the interaction between the supplier and the customer. There exist a great number of service types in the literature, one of which is
  • 15. 8 supplementary service. It is the extra help that customers receive after attaining their desired items or products. As Goyal stated, two types of services are presented. The first one is core service, indicating the desired results that are equal to the price a customer has to pay for a product. If a refrigerator is bought, for instance, the user will expect it to be able to freeze food and keep them fresh. The second type of service is, according to Lovelock and Wirtz(4), is supplementary service, aiming at improving and assisting the core service. Following this specific model, a company should offer core service and supplementary service to its clients. With the former, the main interests and benefits requested by customers are attained. The supplementary services are bound to enhance such items. According to Lovelock et al.(9), The Flower of Service is created to explain the two types of supplementary services supporting the core product. They are facilitating supplementary services and enhancing supplementary services (2009). I found out that the problem Medent was facing was information and consultation. Secondly, when I read again the results of the interview, I discovered that despite many causes for customer complaints, one of the most important causes we need to pay attention is the change in nature of the products which the company provides. They changed from pure tangible products (dental devices) to intellectual products (solutions for dentistry, we can see through the interview content, including the client side, namely dentists and the company side, namely sales, marketing and customer service which we collected during the next interview. Dr. Hùng– Director of Dr. Hung Dental Hospital shared that: The majority of Medent's complaints come from the company's services. You see, as you have recently converted from selling products to selling solutions that I have not seen thisin practice. You areonly bringing valuestocustomers sporadically because you lack a lot of core values. The reason, simply because you do not understand correctly and specifically what you need to do. For example, when you combine multiple treatment technologies together, that does not mean "one plus one equal two" that you are changing the behavior and
  • 16. 9 treatment method of the doctor, you need to help them. Do it in a practical way, not just on theory. In addition, delivery services as well as operating instructions are not really good. But this is understandable, as I mentioned above, there are things you do not know. Thus, how can you guide and organize well? At her point of view, Dr. Hoà – Director of Dr. Hoà Clinic shared that: Your service is not bad, but the service attitude and the way you organize your work should be reviewed. You know, sometimes you cannot do well, but attitude is very important to save the problem, and about the organization, I'm a doctor, I do not know very well but I feel recently, your company seems to be "exhausted" and I see that your products in particular and the market in general are increasingly "more difficult to use", which may some important reasons that cause the problems. Dr. Điềm – Director of Sagodent Dental Training Center shared that: The way your company works is just right for the old days, now it is different trend. Therefore, complaining is correct. You understand, I take a lot of time to be able to learn in detail the dental solution to apply to the patient and then I have to practice a lot. You know that medical solution is a smooth combination of practice and theory. For me, it is very difficult, you even want to deliver integrated solution, I think this is very difficult for you at this time. As Lovelock et al.(9) stated, information plays a crucial part in facilitating the core products, as it is essential in performing service delivery. It requires sufficient information in order for customers to attain full value from their purchased products, especially new customers and prospects. Moreover, they may request specific information regarding the location to buy a product (or details of the procedure to order it online), service hours, usage instructions and prices. Based on the result of the qualitative research, usage instruction is one of the main reason for the change. On the other hand, according to Naipaul and Parsa(10) , by sticking to the needs of customers in different situations, it is possible to improve the value of consultation and services; for example, training and consulting based on specific professions or the usage of a
  • 17. 10 particular product. Lovelock et al.(9) also suggested that it is an improved form of supplementary service that characterizes consultation, which consists of multiple dialogs to target clients’ exact requests before leading to a conclusion. In other words, consultation is a work where a knowledgeable personnel from a service company gives considerable suggestions regarding the field being inquired; for instance, a man might ask a bodybuilder for advices on how to gain muscle. In addition, we also conducted a further review of the theory - model to be able to provide a view at a different angle, developed by Zeithaml, Berry and Parasuraman(15), the gap model included give gaps; later, there were six after Lovelock et al.(9) improved it: Gap 1: The Knowledge Gap. Gap 2: The Policy Gap. Gap 3: The Delivery Gap. Gap 4: The Communications Gap. Gap 5: The Perceptions Gap. Gap 6: The Service Quality Gap. In which, gap 1 and 5 are two direct and specific gaps in case of Medent. The Knowledge Gap is the missing information that cause the reduction in satisfaction regarding fulfilling customers’ expectations while the Perceptions Gap indicates the imbalance of what the clients feel about the products they receive and what are given in reality, as customers are unable to evaluate the actual quality of the products. Thus, we can conclude that information and consultation, which results in a series of associated consequences for which the other causes are the result of this change. However, we need to conduct further investigation to be able to identify this problem. 3.2 Literature review Undoubtedly, numerous scholars and researchers have focused on the concept of service and service quality through the last few years of the 20th century till the present
  • 18. 11 time. According to Lewis and Mitchell(1), what are truly essential and significant are the concept that the customers receive and its value plays an important role in determining how pleased the customers will be. As a marker of customer satisfaction and organizational performance, the significance of service quality is not only widely recognized but it has also prompted a noteworthy research push concentrating on various ventures inside the service sector. In fact, various researchers assess a portion of the exploration that identifies with characterizing and measuring service quality; furthermore, they also conduct numerous proposals as to how estimation instruments, for example, SERVQUAL (service quality) may be progressed. At this moment, it is a fact that we are living in the time of a great transition when the economy revolves around services and assistance. Not being parts of the economy, it is the core of significant worth creation in economy that different services are considered. In order to compete in a highly vying environment, different corporations that specialized in services must seek and possess distinctive and efficient methods so as to achieve the best performance. Thus, holding a thorough understanding of the administrating process will give them an advantage, together with the general attributes of their quality as well as the desires of the customer (client). Due to its elusiveness, in accordance with Nejadjavad and Gilaninia(2), the ratings of customers for services that do not engage in trading are often quite severe. 3.2.1. Service Marketing and Management Obviously, service and its quality has become an fascinating phenomenon in the fields of research, operation management (OR) and service marketing management (SMM) (Nejadjavad & Gilaninia(2)). In the current business and plan instruction, service quality is taking its place as one of the significant subjects. It is in management and marketing literature that the causes for service quality can be found. As a result of high competitiveness and rapid growth in services, researchers have experienced more pressure from the field of managing Western Businesses. Although service marketing specialists delivered the term service quality, there exists an increase in interests as it receives more attention from how it will be designed. Multiple distinctions can be seen, despite the reality that the business starts to revolve around the same field and operate
  • 19. 12 in the same manner when dealing with service quality. It is from single orders into multidisciplinary Service Science that the dialog appears to converging. This is what triggers the process of creating transitory motion of definitions, methodologies and dialects. Certainly, such a process will not stop and there will be a rise in exhaustive vocabulary regarding service quality as well as its marketing and management strategies. 3.2.2. Service definition The term “service” can be defined in numerous ways. Although the term has been presented differently through the definition of numerous researchers, it still ends up in the same field which depends heavily on the satisfaction of customers. In accordance with American Society for Marketing (2008), a service is known as a specific product that can be sold or trade. Reversely, as Kotler(3) stated, the same term is seen as the outcome from the interaction between the supplier and the customer. On the other hand, Gummesson claimed that service is none other than the characteristic that could satisfy the customer’s needs. Through all the distinctive definitions of service, it is clear that the term is obligated to the satisfaction of customers as well as their expectations. Clearly, the primary purpose of service is to obtain customers’ satisfaction through the most efficient course of actions, which will also lead to an improved level of market share and competitive advantage. 3.2.3. Flower of service There exist a great number of service types in the literature, one of which is supplementary service. It is the extra help that customers receive after attaining their desired items or products. As Goyal stated, two types of services are presented. The first one is core service, indicating the desired results that are equal to the price a customer has to pay for a product. If a refrigerator is bought, for instance, the user will expect it to be able to freeze food and keep them fresh. The second type of service is, according to Lovelock and Wirtz(4), is supplementary service, aiming at improving and assisting the core service.
  • 20. 13 The goals of service providers are delivering a delightful experience to their customers so as to stimulate further purchases and gain creditability. For such a purpose to be achieved, core services always come with secondary aids. It is in such a manner that customers’ satisfaction is enhanced, which leads to the success of a service company. It is none other than the flower of service model in which they are collectively captured. Following this specific model, a company should offer core service and supplementary service to its clients. With the former, the main interests and benefits requested by customers are attained. The supplementary services are bound to enhance such items. As they play a significant role of improving customers’ products, the provider can impose a greater cost on such services. Such is a way that the two types of service are operated (Storey & Easingwood(5); Lovelock(6); Bitner, Brown & Meuter(7)). In such a context, there are two kinds of supplementary services, including enhancing supplementary services and facilitating supplementary services (Lovelock, Patterson & Paul(8)). Regardless of theirs functions, the followings are always included in enhancing supplementary services: safekeeping, hospitality, consultation and expectations. Reversely, payment, billing, order-taking, and information are provided by facilitating supplementary services. It is through facilitating the use of core product and enhancing service delivery that these elements operate (Lovelock, Patterson & Paul(8)). By adding value to the service, they also help the company to differentiate from competitors (Lovelock, Patterson & Paul(8)). Although the core service is undifferentiated, discriminating provided products are possible to achieve, as they are tested in a competitive market. Lastly, the act of clarifying service/product elements are assisted by service delivery which facilitate the delivery of the supplementary and core product/service. By utilizing it, distinguishing between supplementary products and the service product will be feasible. In addition, it also assists the process of anticipating the customers’ experience in using the service.
  • 21. 14 According to Lovelock et al.(9), The Flower of Service is created to explain the two types of supplementary services supporting the core product. They are facilitating supplementary services and enhancing supplementary services (2009). Flower of Service Application in Healthcare Systems According to Naipaul &Parsa(10), it is feasible to apply studies demonstrated the flower in numerous firms, such as tourism sector; retailers, and financial sector (Colgate &
  • 22. 15 Alexander(11)); banks’ credit card services (Goyal(12)); performing arts (Hume(13)). In the work of Naipaul and Parsa(10), the applicability of supplementary services model in the tourism sector was examined. However, Naipaul and Parsa(10) focused on only one cluster rather than all of them. Additionally, in the work of Goyal(12), the administration of 13 supplementary services regarding the banks’ credit card sector are examined. It is still uncertain as to how the author classify these supplementary services. Interestingly, the applicability of the flower of service within the healthcare sector is not examined in the aforementioned studies. However, it is possible to apply this model in the healthcare sector. Within the context of the flower of service, for example, it is feasible to categorize services provided in the hospitals into core and supplementary services. Diagnostic and treatment services offered by doctors may be included in core services. On the other hand, in hospitals, supplementary services may include the followings: Billing and Insurance Services; Facility & Maintenance; Food & Beverage; House Keeping Services; Dietary Services; Operations & Administration and Nursing Services. Through the aforementioned services, the products provided in hospitals are improved and presented to the customers in accordance with their willingness to pay. Hospitals can earn premiums through these supplementary services. It is alongside core medical services that these services are offered. 3.2.4. Supplementary services In the introduction, the dissimilarity between core and supplementary services was provided. As the flower of services model suggests, supplementary services are classified into two: facilitating supplementary services and enhancing supplementary services. The former includes information, order-taking, billing, and payment, which are necessary for the process of supporting the core product (Lovelock et al.(9)). The latter consists of consultation, hospitality, safekeeping as well as expectations. It is these elements that form the uniqueness and competitive advantage of the service (Lovelock et al.(9)). As the model displays, the petals of the flower surrounds the core product, which is the way that the services may appear (Lovelock et al.(9)). Grasping the significance of secondary services, Levitt(14) believed that these elements play a key role in determining whether a company will fail or succeed in a competitive
  • 23. 16 environment. Secondary services are surely the main factors that could allow a company to increase their charges and perform effectively. In spite of grasping such a knowledge, there remains a great gap in this research as it cannot suggest the mechanism capable of helping companies improve their main products. Fortunately, to solve such a matter, a specific model developed by Lovelock(6) offers great guidance that are suitable to improve customer value. It suggests that supplementary services should be employed to support the core products. Such services are categorized into two: supporting and facilitating services. With the former, a company can distinguish its products from potential competitors. As these services increase the appeal and value of the core products, the final output is enhanced, making it a great choice compared with other competitors. These core products could be in the fields of atmosphere, accessibility, customer participation and interaction with the organization’s services (Kotler, Bowen &Makens(3)). As for the latter, they are products or services facilitating the use of the core services and enhancing their appeal and value to enable the company to charge a premium price. With the act of supporting the core products, they should be available for the client to use the core service/product (Kotler, Bowen & Makens(3)). By driving further into Lovelock’s model, it is possible to see that supplementary services are classified into eight clusters: payment, consultation, safekeeping, information, billing, order-taking, exceptions and hospitality (Lovelock(6)). Through the utilization of this model, the augmented and core services in a service organization can be analyzed by using a structured approach. 3.2.5. Information As Lovelock et al.(9) stated, information plays a crucial part in facilitating the core products, as it is essential in performing service delivery. What makes it so significant is that information leads customers to a better understanding of the service through guidelines and insights into the current situation of the market. With the absence of information, it is no doubt that many potential clients will change their mind before purchasing a product. They could also request essential information regarding their desired products or services such as prices, instructions on usage, conditions of sale, confirmation of reservations, notification of changes and specific warnings and
  • 24. 17 reminders. It requires sufficient information in order for customers to attain full value from their purchased products, especially new customers and prospects. Moreover, they may request specific information regarding the location to buy a product (or details of the procedure to order it online), service hours, usage instructions and prices. Others include conditions of sale, confirmation of reservations, notification of changes and specific warnings and reminders. Last but not least, documents related to reservations, account activities and lists of available products can also be required. It is important for service firms to provide their information in the most precise and timely manner, for the fact that getting potential customers irritated is definitely not an desirable option. There are numerous ways of informing customers about their requested knowledge, some of which are using front-line employees (who may not be well informed enough to please customers), printed materials and instruction books. It is also appropriate to use advanced media such as videos, hard disks, phone messages or websites - the most popular form of marketing in recent years. With the help of the Internet, service firms can show their detailed schedules regarding specific transportation and accommodation plans, with other useful information like nearby stores and diners with prices and descriptions included. In the cases of numerous logistics companies, they also implement a special function allowing shippers to follow the progress of their goods that has already been coded separately. 3.2.6. Order Taking It is possible that customers wish to attain secure commitment to delivery and keep track of what are available. It is essential to get the procedure done smoothly. In order to provide the best experience, companies should focus on making their order taking progress fast and accurate. This will leave a great impression on their customers, as waiting is something they never wish to undergo (Lovelock, Patterson & Paul(8)). In the process of serving a potential customer, companies earn the opportunity to collect essential information, helping them decide whether or not a customer is qualified to enroll based on the knowledge acquired. In other cases, clients are requested to submit an application for consideration. Various order-taking practices are in the forms of reservations or prearranged meetings that allows customers to enjoy a particular
  • 25. 18 service at a given date, namely, a flight, an accommodation or a restaurant table. Some examples of elements are order entry, applications, check-in and reservations, vehicle or equipment rental, memberships in programs/clubs, order entry, prerequisite based services (college enrollment, financial credit), telephone/mail/web order reservations, seats/rooms/tables, and professional appointments and on-site order fulfillment. 3.2.7. Consultation An enhancing supplementary service is what greatly defines consultation. It helps boost the process of service delivery by contributing improved quality and appeal. Personal counseling and customized advice may be included in these services, which required that the company has actual knowledge and professional skills. According to Naipaul and Parsa(10) , by sticking to the needs of customers in different situations, it is possible to improve the value of consultation and services; for example, training and consulting based on specific professions or the usage of a particular product. Lovelock et al.(9) also suggested that it is an improved form of supplementary service that characterizes consultation, which consists of multiple dialogs to target clients’ exact requests before leading to a conclusion. In other words, consultation is a work where a knowledgeable personnel from a service company gives considerable suggestions regarding the field being inquired; for instance, a man might ask a bodybuilder for advices on how to gain muscle. Thus, in order to give the right consultation, it is necessary to understand thoroughly the current situation of a customer before proposing an appropriate solution. Extra information from the customers will also contribute greatly to the process, especially when it can be obtained without too much effort. A more delicate form of consultation involves counseling. It is the act of getting customers to have a greater knowledge of their current situations in order that they could draw their own conclusions. Such an act will perform effectively when applied in health care services. Although it is a useful approach, difficulties are also presented when it comes to help customers get a hold of their state and follow a healthier living style. In numerous diet centers, counseling is utilized to assist clients in their progress of losing fat and keeping in shape.
  • 26. 19 Lastly, corporate clients are also presented with different consultation regarding professional services in terms of industrial and business solutions. The process is also logically arranged, from the inspecting state to the final phrase where the best solution will be delivered. Thus, it is more likely that the finest result will be achieved this way. In the hope of raising their sale, some companies do not charge such a service; nevertheless, customers have to pay for such aids when they come in separate package. 3.2.8. Hospitality It is necessary for the business to treat customers investing effort and time to visit and use its services with hospitality. This characteristic is an enhancing supplementary service. It adds value to the firm’s products and services and makes them more appealing to clients, which enhances service delivery. Services related to hospitality need to reflect pleasure when greeting old clients when they come back and meeting new ones. These services should be designed to welcome new customers. Companies should ensure that their employees treat clients with courtesy, which shows how well- managed they are. Clients should have the option to conduct telephone interactions as well as to face-to-face encounters when it is necessary. It is from the service site and the offer of transport that hospitality begins. Moreover, it also includes offering refreshments, creating comfortable waiting areas, cleaning toilets, and making customers feel welcomed. In accordance with Lovelock, Patterson, &Paul(8), other elements that can improve the level of hospitality include offering drinks (food and beverages), security, greeting, toilets and washrooms, and waiting facilities and amenities, weather protection, seating, lounges, waiting areas, security, transport, and entertainment, newspapers and magazine. Through its core service or product, the quality of the hospitality services of a company may decrease or increase the customer satisfaction. In people-processing services involving people leaving the service facility, the same thing also applies. 3.2.9. Safe Keeping It is a fact that customers visiting a service site will want to be assisted with personal possessions. These customers may cease to come if the company does not provide safekeeping services such as convenient and safe car packaging. Safekeeping includes
  • 27. 20 the act of keeping records for the clients safely, private and confidential. Sharing the same similarity with hospitality, safekeeping is also an enhancing supplementary service. It improves service delivery making products more appealing to clients through by adding value to them. Safe keeping also enhances customer trust in the company and its staff. The company is required to take care of client’s personal possessions (Lovelock, Patterson, &Paul(8)). The list of safekeeping services includes caring for goods rented or purchased by clients, looking after customers’ possessions to caring for goods rented or purchased by clients. Regarding caring for customers’ possessions, it may include baggage handling, child care, parking for vehicles, pet care, storage space, security personnel (security staff), safe deposit boxes and coat rooms. To achieve caring for goods rented or purchased by customers, the following services should be provided: repair and renovation, preventive maintenance, transportation and delivery, packaging, installation, pickup and inspection and diagnosis. According to Naipaul and Parsa(10), other services may include provision of coatrooms, leaning and inspection. 3.2.10. Exceptions Exceptions refer to non-routine supplementary services that are not included in the normal service delivery. Naipaul and Parsa(10) claimed that well-defined procedures enable employees to respond effectively and promptly. Whenever things seem not to work according to the plan, customers expect responsiveness and appreciate when being allowed to make special requests in many cases. According to Lovelock, Patterson, & Paul(8) , some examples of elements are restitution, compliments or complaints, special request in advance, problem solving, handling difficulties from products usage, helping clients suffering from accident or medical surgery, solving problems from failures of services or fixing clients’ devices without charges. Customers who want to depart from the company’s normal operating procedures may give special requests. According to Goyal(12), it is possible for them to make advance requests that concern personal needs such as dietary requirements, personal disabilities, childcare, or religious observances. Furthermore, problem-solving situations may arise from the failure of normal product performance or service
  • 28. 21 delivery. There exist various causes that can result in such cases; for instance, equipment failure, delays, accidents or clients experiencing challenges with the use of the service or product. It requires require well-defined procedures to handle suggestions, compliments or complaints. The company should also know that the process of offering suggestions for improvement, express dissatisfaction, or pass compliments to service providers should be easy for customers. For serious performance failures, restitution should be delivered to customers. According to Hume(13), they may take the form of legal settlements, offers for free service or respires under warranty. 3.2.11. Billing Significantly, bills should be clear and intelligible to customers. Some examples of elements related to bills are as follows: machine display of required amount, periodic statement of the activity of the account, self-billing (computed by clients) and invoices for individual transactions (Hume(13)). Billing is a common supplementary service that are applied in almost all services, especially for paid services. Incomplete, illegible or inaccurate bill may lead to the disappointment of customers. These failures may worsen the situation for clients who are experiencing dissatisfaction with the service. As Hume(13) stated, billing procedures may include machine-displayed price, verbal statements or monthly statements of fees and account activity, as well as handwritten invoices. With recent technological advances, it is feasible for companies to adopt computerized billing. These computerized forms of billing, however, can also cause service failures and lead to overbilling the customer. Customers often expect clear and informative bills which are easy and possible for them to understand how the totals are computed. Customers will not be impressed with confusing and unexpected charges, illegible handwriting and fuzzy printing (Naipaul & Parsa(10)). It may be inappropriate to use laser printers that lack the capability to typefaces and switch fonts because they may produce illegible statements. Thus, companies should concentrate on designing user-friendly bills based the customers’ preferences. It is billing information that can help a company to offer an added value to customers. 3.2.12. Payment
  • 29. 22 To deliver services successfully, it is important to conduct the process of payment or invoicing, which is a kind of facilitating services. It is a fact that customers want to know what they pay for, how to pay and when they need to pay. With clear, accurate and on-time invoice, all of this could be facilitated. With simple and convenient transaction, customers will be more willing to pay. Some examples of elements, in accordance with Lovelock, Patterson, & Paul(8), include the followings: automation deduction, using cards online, electronic funds transfer, cash or token into machine, automated deduction from vouchers. In particular situations, specific courses of actions regarding payment will be required. When making purchases, customers often expect convenient payment. There are multiple ways to facilitate customers bill paying, including: self-service payment system, hand-to-hand transfer of checks and cash, debit and credit card payment, prepaid tickets, coupons, vouchers or tokes. Customers are requested to performs actions such as inserting cards, coins or notes in some automatic services. Nevertheless, the breakdown of machines can lead to the failure of the system. Thus, some payments are made directly through transfer of checks and cash. However, the most established form of payment is using debit cards and credit cards. 3.2.13. Service Quality In order to perform services and improve their quality, it is significant to grasp their operative mechanism. This will allow companies to detect problems and fix them accordingly. As Lovelock et al.(9) stated, regarding service quality, there exist four distinctive aspects: 1. Customers have to obtain continuous experience in order to be able to perceive quality, due to its abstract nature. 2. Manufacturing practices are mainly regarded as the primary approach, which examine services when it is being operated. Its purpose is to achieve principles that could increase quality with the least cost.
  • 30. 23 3. Services taken its primary concerns in customers mostly focus on the needs and demands that each person possesses, referring to the fact that quality depends on the users. 4. Regarding the value of the service and its price, it is crucial to consider the trade-off each customer has to face. According to Lovelock et al.(9), as the importance of service quality lies both in its aspects and dimensions, Zeithaml, Berry and Parasuraman(15) have successfully categorized the dimensions of service quality into five perspectives. • Tangibles (appearance of physical elements) • Responsiveness (promptness and helpfulness) • Reliability (dependable and accurate performance) • Assurance (credibility, competence, courtesy and security) • Empathy (good communications, customer understanding and easy access) The most essential part of this model is “the zone of tolerance”, which indicates the expectations each customer may maintain. At one end lies the desired level while adequate service level is bound at the other (Parasuraman and Berry(15)). Both represent the limit of customer satisfaction. In accordance with Oliver and Rust(16), service quality may be illustrated through the SERVQUAL instrument, indicating a response to the level of service satisfaction. In other words, what pleases customers are none other than the high value of services at the lowest cost possible. In the following chapter, customers’ expectations and the distinctive gaps will be examined, giving an insight into how the process of service delivery takes place in its multiple variations. 3.2.14. The Gap Model It is significant to grasp the gap model in order to understand service quality. Developed by Zeithaml, Berry and Parasuraman(15), the gap model included give gaps; later, there were six after Lovelock et al.(9) improved it. This explains thoroughly how
  • 31. 24 customers meet their expectations and how they are delivered. Through the gap model, it is possible for companies to analyze and find out what problems they are facing in order to draw out a suitable solution. Gap 1: The Knowledge Gap. The missing information that cause the reduction in satisfaction regarding fulfilling customers’ expectations. Gap 2: The Policy Gap. The conflict in the progress of delivering services and the rules they are based on. Gap 3: The Delivery Gap. The difference involving service standards and performance of the service company. Gap 4: The Communications Gap. The variation of what is marketed in public and the actual products delivered to clients. As Lovelock et al.(9) stated, two other sub-gaps form the communication gap. First, it is the internal communications gap, representing the difference of the actual products a company advertises and what it could possibly offer to its customers. Second, it is the overpromise gap. Regarding this gap, it is possible that the sale team of a company is evaluated based on its sale performance, which is the reason why they overpromise more than what can be offered. Last but not least, there exists an interpretation gap. This refers to the variation in services that are actually provided and what customers expect to receive from the company’s advertisements. Gap 5: The Perceptions Gap. This indicates the imbalance of what the clients feel about the products they receive and what are given in reality, as customers are unable to evaluate the actual quality of the products. Gap 6: The Service Quality Gap. What the final gap refers to could be an imbalance between the perception of the real products delivered and the expectations of clients from the company.
  • 32. 25 3.3 Final Cause –and –effect map In order to verify and clarify the problem, I continued to interview the sales manager, customer service manager and marketing manager of Medent. The interview results show that the "frontline" such as sales and marketing as well as back office departments, in particular customer services, are embarrassed by this tremendous change. They all have trouble with the so-called "solution" of the board of Management Perceptions of Consumer Expectations Gap 1 Gap 2 Gap 6 Gap 5 Gap 3 Translation of Perceptions into Service Quality Specs. Service Firm Gap 4 External Communications to Consumers Service Delivery Perceived Service Consumer Expected Service Past Experience Personal Needs Word of Mouth communication
  • 33. 26 management. The first thing they encounter is how to have the new solution and who will do the work. Ms. Nguyễn Thị Đoan Trang – Medent Customer Relation Manager shared that: Do you remember when you asked me aboutour new orientation to switch from selling a product to a solution? The problem is simply the switch from selling pure products to selling a more comprehensive service package to customers, that is the solution. What I see is that our business team still do theoretical solutions. In short, they arestill saying that they provide the solution, but when I talk to customers, Iknow they have not reached the bottom of the problem so their solution is very lack of application. At his point of view, Mr. Nguyễn Hữu Phúc – Medent Marketing Manager shared that: I just find it simply the distance between the will and the reality. Business solution, it sounds easy, but for me the solution is a form of wisdom, it is very difficult when we do not know where to start, even "some teams "do not have enough expertise, I wonder how they deployed? Because before the change took place, the research, selection and commercialization of products are the role of business team (sales team). However, the products become more and more complex, so the level of specialization is also increasing, especially in combination treatment. Clearly, sales teams do not have enough expertise to be able to handle this. And of course, other teams like marketing, customer services are strongly influenced by this, because if they do not understand the product themselves, how can they deploy these products to customers. Mr. Cao Thanh Toàn – Medent Sales Manager shared that: The reason, simply because We are still in the "half-vague" state, or in other words, I can understand and visualize what the board wants to do, but the actual deployment brings a lot of difficulties to our team.
  • 34. 27 Why is this happening? Remember that our products and technology are becoming increasingly complex day by day, let alone their combined solutions, we are just a business team, my business is not research applied technology in medicine. 4. CAUSE VALIDATION In order to verify and clarify the problem, after reading theories, I continued to interview the sales manager, customer service manager and marketing manager of Medent. The interview results show that the "frontline" such as sales and marketing as well as back office departments, in particular customer services, are embarrassed by this tremendous change. They all have trouble with the so-called "solution" of the board of management. The first thing they encounter is how to have the new solution and who will do the work. Because before the change took place, the research, selection and commercialization of products are the role of business team (sales team). However, the products become more and more complex, so the level of specialization is also increasing, especially in combination treatment. Clearly, sales teams do not have enough expertise to be able to handle this. And of course, other teams like marketing, customer services are strongly influenced by this, because if they do not understand the product themselves, how can they deploy these products to customers. Based on the initial cause and effect map and the final in-depth interview from 3 respondents represent for three main teams (see Interview guides) and theories informed, it can be seen that the main causes leading to high ratio of customer complaint are due to errors or omissions in the two issues of information and consultant. However, in these two factors, information has the most impact high ratio of customer complaint at Medent because according to Lovelock et al.(9), consultant is a kind of knowledge service. From there, we can see that knowledge of the product or, more specifically, customers need relevant information is the foundation for providing customer service. It is important for Medent to have action plans to solve this problem immediately.
  • 35. 28 Final Cause –and –effect map Errors or omissions in the two issues of information and consultant Products provided do not meet the expectations of customers Customer service is not good High ratio of customer complaint Installation and delivery are not good Figure 7. Final Cause Effect Map 5. ALTERNATIVE SOLUTIONS As above analysis, it can be seen that the main cause of the high ratio of customer complaint at Medent is errors or omissions in the issues of information. Therefore, this chapter would focus on giving solutions to solve this cause. Below would be some alternative solutions applied for errors or omissions in the issues of information. 5.1 The first alternative solution: Establishment of a "multi-function" R&D center According to The Flower of Service concept by Lovelock et al.(9), customer needs may include directions to the physical location where the product is sold (or details of how to order it by telephone or Web site), service hours, prices, and usage instructions. Further information, sometimes required by law, could include conditions of sale and use, warnings, reminders, and notification of changes. The medical equipment industry in general and dental equipment in particular can be categorized into two main categories: simple product group and high technology product group. The problems encountered in this thesis are caused by the high-tech Errors or omissions in the issues of information
  • 36. 29 product group because of the complexity in their medical applications. Although this is an intellectual matter, it is also a product. Since this is no longer a matter of knowing and distributing products, it has come to the problem of "production" and to "produce" the product we need to have an R&D department. My solution is to set up a showroom as a R&D center. Because it will very costly to build a R&D center, we have to purchase lots of equipment so it can be combined to reduce costs as well as increase business efficiency. Then we need to organize a team of the center with the expertise and knowledge to carry out the assigned tasks. Benefits: There is a place where customers can visit, experience not only the product but also the new business philosophy of the company anymore. Has enough facilities as well as tools to research and produce high-applicability solutions. Have a department with full expertise to carry out the assigned tasks. R&D center is a good base for implementing extended solution issues. Cost: The fixed cost for establishment a R&D center is VND 10,500,000,000 base on the report from Financial Department. If we count the additional expenses and the contingency allowance 10%, we have the total estimating cost is VND 11,550,000,000.
  • 37. 30 Table 1: Fixed cost of building center # Description Estimating cost (VND) 1 CBCT system 2,000,000,000 2 Intra-oral camera, other scanning systems and software 1,500,000,000 3 Sterilizer systems 1,200,000,000 4 Milling & sintering systems 3,000,000,000 5 Others (Other systems and cost of design, construction, etc.) 1,100,000,000 Total 8,800,000,000 Table 2: Fixed cost of Team training & recruiting # Description Estimating cost (VND) 1 Recruiting R&D Manager and staff, Manager will manage and training team 270,000,000 2 Catering -meals, lunches, tea and coffee breaks 10,000,000 3 Training documents and equipment 15,000,000 4 Allowance for organization board 20,000,000 5 Additional cost (electricity, telephone, note papers, clip board, pens, evaluation form) 5,000,000 Total 320,000,000 Variable cost: This includes the cost of paying a team of three staffs VND 720,000,000 per year (Excluding C&B) and the cost of leasing a house VND 660,000,000 per year. 5.2 The second alternative solution: conduct collaborative research programs with medical universities and dental associations.
  • 38. 31 In a different perspective, research through sponsorship, collaboration with universities and associations can be viewed as an "out-source" activity. This is also a type of traditional research that many companies in the industry have been doing. Benefits: Cost savings compare with set up a R&D center. Universities and associations are the gathering place for many professionals and researchers with good expertise and prestige in the industry In comparison with the research center, their final results have high clinical value and can be reported. Create more sources of customer input for the business of the company. Cost: The cost of this form varies greatly by a variety of factors such as it depends on the number of projects and topics available to the university or association, the depth and breadth of the research, etc. However, in general, the cost of these projects can be controlled and calculated by planning and setting specific targets for annual research projects based on the board's requirements and also actual market data. But in general, the cost would be much lower than the first solution. We can take the example of 2016:
  • 39. 32 Table 3: The cost of projects in 2017 # Description Estimating cost (VND) 1 Cerec - Smile design project (Phd. Dr. Lâm Đại Phong, University of Medicine and Pharmacy, Ho Chi Minh City) 65,000,000 2 Cerec & CBCT integrated project (Phd. Dr. Lâm Đại Phong, University of Medicine and Pharmacy, Ho Chi Minh City and Dr. Tran Thanh Phong Implant specialist of Nobel Viet Nam, Keiyen Clinic) 50,000,000 3 Cerec Implant project (Dr. Tran Thanh Phong Implant specialist of Nobel Viet Nam, Keiyen Clinic) 155,000,000 4 Allowance for organization board 25,000,000 5 Additional cost (electricity, telephone, note papers, clip board, pens, evaluation form, et al) 5,000,000 Total 300,000,000 To sum up, set up a R&D center and training team, providing best practices and tools to improve internal strength of the team while bringing stability to the company, which is the basis for the company can develop sustainably and can improve the high ratio of customer complaint in Medent. After considering their benefits and costs, although the cost is quite high, it could be seen that establishment of a "multi-function"R&D center should be prioritized to apply because of some below points of view: Firstly, having a team with enough expertise is necessary for the company at this time and training is one of the best methods to changing one's awareness and knowledge.
  • 40. 33 Through knowledge and skills gaining in classes as well as on the job, researchers can recognize what is important, what kind of mistakes are usually made, etc. in the dental industry. According to Abuharris and Atiya Thabet(17) , it is necessary to note that training can have an impact on all the members of a company although it can be a tool to motivate changes. It is possible to benefit everyone if training is conducted accurately; otherwise, negative influences are also presented. Some examples are credibility loss, disagreement and decreased productivity. Secondly, a modern, diversity research facility is essential to enhance the customer experience, because you cannot let customers make important decisions through oral counseling. Thirdly, R&D center is a good base for implementing extended solution issues. As a matter of fact, you can use it as a powerful tool to support the negotiation and implementation of the activities of the second solution: conduct collaborative research programs with medical universities and dental associations. Thus, the solution to set up a R&D center could be prioritized to implement in Medent. It is both a long-term strategy and a convincing basis for the determination to do exactly what the company says to customers. Moreover, if you do not have an internal team, for example, you choose the second solution, your job will become very unstable because you have to depend largely on the doctor while their time budget is very limited and the status of research in the medical sector in Vietnam is still very much limitations such as the facilities, infrastructure for research is weak, lack of funding, ground level of research, etc. Finally, on the other hand, I think we should deploy both solutions parallelly, because building a research center will take a considerable amount of time, while your company still needs some new solutions from research to launch it to the market. 6. ORGANIZATION OF ACTIONS In Medent, errors or omissions in the issues of information is the urgent problem that needs to be solved immediately. After comparing costs with long term benefits and base on the research results, the actions that Medent needs to take are:
  • 41. 34 Initiate the construction of the research center as well as beginning recruitment and training before the research center completes three months Recruiting a R&D manager who has enough experience to set up a R&D center Conducted in parallel with the above two work is the implementation of collaborative research programs as soon as possible. Table 4 as below is an action plan timeline which take 06 months from June 2018 to December 2018 and will be reviewed at the end of the year 2019.
  • 42. 33 ACTION PLAN 2018 Month 6 7 8 9 10 11 12 Activities Objectives Responsibility Initiate the construction of the research center as well as beginning recruitment and training before the research center completes three months Purchase equipment and build a showroom Have facilities t to carry out independent and cooperative activities BOD, Technical team and independent company (out source) PIC: Dr. Dam (CEO), Mr. Hoang (Chief Engineer) Recruiting, training & planning Get staff to manage and deploy word HR recruit; HR and R&D manager training for staff; BOD and R&D manager planning for research activities PIC: Ms. Ha Vy (HRM), Dr. Dam (CEO), Dr. Tam (R&D Manager) Cerec – Smile design project (Phd. Dr. Lâm Đại Phong, University of Medicine and Pharmacy) Research responds to new trends BOD, R&D Manager and sales manager PIC: Mr. Cao Thanh Toan (SM), Dr. Dam (CEO), Dr. Tam (R&D Manager)
  • 43. 24 The implementation of collaborative research programs Cerec & CBCT integrated project (Phd, Dr. Lâm Đại Phong, University of Medicine and Pharmacy, Ho Chi Minh City and Dr. Tran Thanh Phong Implant specialist of Nobel Viet Nam, Keiyen Clinic) Study on accuracy to confirm competitive advantage BOD, R&D Manager and sales manager PIC: Mr. Cao Thanh Toan (SM), Dr. Dam (CEO), Dr. Tam (R&D Manager) Cerec Implant project (Dr. Tran Thanh Phong Implant specialist of Nobel Viet Nam, Keiyen Clinic) Study on accuracy to confirm competitive advantage BOD, R&D Manager and sales manager PIC: Mr. Cao Thanh Toan (SM), Dr. Dam (CEO), Dr. Tam (R&D Manager)
  • 44. 34 7. CONCLUSION In such a developing country as Vietnam, the production of modern medical equipment in general and dental equipment in particular with products of good quality and meet the demand of doctors is not possible at the present time. Most of Vietnam's business enterprises in this industry, except for simple equipment that can be produced, still have to choose a commercial approach. However, this option leads to a risk of lack of competition and the potential for loss of distribution rights. Indeed, in recent years with the rapid development of science and technology. The "digital" revolution has changed our lives as fast as ever. Back in the dental industry, the development of science and technology in the "digital era" has pushed commercial businesses into the difficult situation: to change to keep up with technology or to die. Because of a very simple reason, but not simple to implement: the change in the actual needs of customers, customers now no longer choose and buy products simply, they have begun to require businesses to provide solutions which come with new technologies. Therefore, the need to develop a new approach to help our commercial enterprises survive in this era is to turn them into consultancy and solution providers. This study has clarified some points as below: Firstly, the needs of customers, actually have been changing. Comes with these new products and technologies are the information factor, businesses need to provide enough information in the form of solutions to enable them to deploy new technology products. Secondly, building R&D unit with me is just a name. The essence of the problem to be solved here is: there must be a functional division to take charge of, or otherwise capture the change caused by technology and research to apply and transfer it to customers to create real value and meet their new demand. Thirdly, building competitive advantages and especially sustainable competitive advantage by the "From root to tip" method is imperative. In the absence of sufficient capacity to manufacture high-tech equipment, the added value and solutions come from
  • 45. 35 the "gray matter" of the enterprise or, in other words, the production of intellectual product is a worthy consideration approach. 8. SUPPORTING INFORMATION Two types of data were collected in this thesis. Firstly, secondary data was collected from some reliable sources such as the report of Customer Services Department - Medent, relevant online literatures, management books and other journals, researches, etc. which strengthen the theory and conclusions when compared to what the interviewees mentioned and the real status in Medent recently. Secondly, primary data is collected through conducting a qualitative research. The main method for collecting qualitative data is in-depth interviews. These respondents are categorized in two main groups as follows: First group: Doctors who are clients of Medent Second group: Managers/supervisors/workers who are currently working for Medent The purpose of the interview is to collect general data and opinions of interviewees about the high complaint ratio of customer with Medent products and services as well as its causes and their suggested solutions. All questions that respondents in each group have been asked as follows:
  • 46. 36 INTERVIEW GUIDE Research objectives: To explore and understand the reason why Medent received a high rate of complaints. Duration: 10-20 minutes per interviewee. THE FIRST QUALITATIVE RESEARCH Detail interviewees information Name Gender Business Location Dr Hùng Male Dr.Hùng Dental Clinic 244A Cống Quỳnh Dist 1, HCMC Dr Huy Male Dr Beam Dental Clinic 400CD Lê Hồng Phong, Dist 10, HCMC Dr Hưng Male 56 Trúc Khê Dental Clinic 56 Trúc Khê, Dist Đống Đa, HN Dr Phú Male Việt Úc Dental Clinic 12 Điện Biên Phủ HN Dr Điềm Male Sagodent Dental 12-14 Phước Hưng, Dist 5, HCMC Dr Hoà Female DDS Dental Clinic 42 Cửa Đông, Hoàn Kiếm Dist, HN Dr Đạm Male Medent Group CEO 37 Bàu Cát 3, Tân Bình Dist, HCMC Detail interview content: Interview Guide Name: _ Sex: Male Female Business:
  • 47. 37 Location: 1. After the previous quantitative study, the company received a high rate of complaints. In your opinion, where does this come from? Probe & Prompt 1. Could you please explain deeper/clearer? 2. Could you please give us some reasons why you think it's the most important? Name Probe & Prompt Answer Dr. Hùng 1. Could you please explain deeper/clearer? 2. Could you please give us some reasons that you think it's the most important? The majority of Medent's complaints come from the company's services. You see, as you have recently converted from selling products to selling solutions that I have not seen this in practice. You are only bringing values to customers sporadically because you lack a lot of core values. The reason, simply because you do not understand correctly and specifically what you need to do. For example, when you combine multiple treatment technologies together, that does not mean "one plus one equal two" that you are changing the behavior and treatment method of the doctor, you need to help them. Do it in a practical way, not just on theory. In addition, delivery services as well as operating instructions are not really good. But this is understandable, as I mentioned above, there are things you do not know. Thus, how can you guide and organize well? Dr. Huy Medent's complaints come from company
  • 48. 38 mindset in general and staff in particular. Do you remember when you asked me that you want to switch from selling a product to a solution? We have talked about customer centric orientation, the problem is simply the switch from selling pure products to selling a more comprehensive service package to customers, that is the solution. What I see is that you still do theoretical solutions, I do not know what you think, but I see you are away from the core values of the industry, that is medical expertise. In addition, delivery services as well as staff attitude are not professional enough. I say this because you are targeting high-end customers, you understand? Dr. Hưng Medent's services, in general, are "standard" but there are many shortcomings. Thus, leading to customer complaints. I appreciate Medent, you are very prestigious, very enthusiastic and honest. To me, that is what has been and is helping Medent grow and survive to this day. However, those are not enough, I think you lack two things that are thoughtful and detailed. Be more thoughtful and detailed. And one more things, more practical. Dr. Phú The way Medent works, I feel pretty good, you only need to care more. I say more attention, which means that you need
  • 49. 39 to pay attention to small points but lead to dissatisfaction. You know, sometimes you are doing something good but just for a point, you get “minus points” from customers. For example, your delivery time and your operational instruction course quality. I don’t know why it was used to good in the past, but now, it changed. Dr. Điềm The way your company works is just right for the old days, now it is different trend. Therefore, complaining is correct. You understand, I take a lot of time to be able to learn in detail the dental solution to apply to the patient and then I have to practice a lot. You know that medical solution is a smooth combination of practice and theory. For me, it is very difficult, you even want to deliver integrated solution, I think this is very difficult for you at this time. Dr. Hoà Your service is not bad, but the service attitude and the way you organize your work should be reviewed. You know, sometimes you cannot do well, but attitude is very important to save the problem, and about the organization, I'm a doctor, I do not know very well but I feel recently, your company seems to be "exhausted" and I see that your products in particular and the market in general are increasingly "more difficult to use",
  • 50. 40 which may some important reasons that cause the problems. Dr. Đạm Medent's complaints come from the many different aspects. From distribution services, installation services to operational instruction services, etc. I think a problem has many causes, but I myself find that Medent is lacking in knowledge of the solution, which is not easy to solve because we have done our best, maybe I have to think about changing the way to do it. THE SECOND QUALITATIVE RESEARCH Detail interviewees information: Name Gender Position Mr. Toàn Male Medent Sales manager Ms. Đoan Trang Female Medent Customer services manager Mr. Phúc Male Medent Marketing manager Detail interview content: Interview Guide Name: Sex: Male Female Business:
  • 51. 41 Location: 1. After reading the previous quantitative & quantitative study, your company is having problems with customers that many years ago did not meet. In your opinion, where does this come from? Probe & Prompt 1. Could you please explain deeper/clearer? 2. Could you please give us some reasons why you think it's the most important? Name Probe & Prompt Answer Mr. Toàn 1. Could you please explain deeper/clearer? 2. Could you please give us some reasons that you think it's the most important? The majority of Medent's complaints come from the company's consultant services. You see, as you have recently converted from selling products to selling solutions. However, we only can bring values to customers sporadically because we don't know exactly what to do. The reason, simply because We are still in the "half-vague" state, or in other words, I can understand and visualize what the board wants to do, but the actual deployment brings a lot of difficulties to our team. Why is this happening? Remember that our products and technology are becoming increasingly complex day by day, let alone their combined solutions, we are just a business team, my business is not research applied technology in medicine. Ms. Recently, I felt Medent was in a state of
  • 52. 42 Đoan Trang confusion and this became clearer after I saw the results of the report. Do you remember when you asked me about our new orientation to switch from selling a product to a solution? The problem is simply the switch from selling pure products to selling a more comprehensive service package to customers, that is the solution. What I see is that our business team still do theoretical solutions, In short, they are still saying that they provide the solution, but when I talk to customers, I know they have not reached the bottom of the problem so their solution is very lack of application. Mr. Phúc I just find it simply the distance between the will and the reality. Business solution, it sounds easy, but for me the solution is a form of wisdom, it is very difficult when we do not know where to start, even "some teams "do not have enough expertise, I wonder how they deployed? To put it simply, my team is needed to do lots of marketing activities to deliver the solution to our clients. However, even me had not figured it out, it was very hard for my team.
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