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Enterprise Rent-A-Car: How does a franchise deliver consistent customer service?

12th Jan 2016

Growing a business organically while retaining a strong service culture is tricky. Leading a business down the road of rapid international expansion through franchising and acquisition can place even greater pressures on customer service, as the culture and ethos of the parent company is translated and influenced by existing practices and behaviours.

But one of the great opportunities that partnership brings is to learn from other organisations.

At Enterprise, as in many other companies, we’ve had to question and reinforce our customer service standards through several periods of rapid growth. We've had to constantly review our practices to ensure our culture and values were strong enough to sustain a reputation for excellent customer care.

Back in the 1990s, the pressure was on. Enterprise was growing very rapidly in the US, but at the same time we recognised the need to ensure that alongside a growth in sales and profits, our customer satisfaction scores remained strong.

This is now something of a legendary story in the company. It was our founder, Jack Taylor, who had by then already handed over the day-to-day running of the business to his son, who spotted that sales growth might not go hand in hand with sustained excellent service.

He challenged his senior team to find a way to ensure that service remained strong. He had built the company from one branch in St. Louis on the premise of service first, profits second. Amidst the growth, he wanted to ensure we did not lose our way.

Quality index

The solution was evolved over many years, but at its heart is a homegrown measurement tool originally called the Enterprise Service Quality index, and now called the Service Quality index (SQi), as we have several brands (Enterprise Rent-A-Car, Alamo Rent A Car and National Car Rental) that are all measured by this same yardstick.

Every month, around 200,000 Enterprise Holdings’ customers are contacted and asked to rate the service they received based on a five-point scale from completely dissatisfied (1) to completely satisfied (5). Each branch is provided with the percentage of customers who said they were “completely satisfied” with their rental experience.

This matters to the business because customers who have ticked the top box are three times more likely to recommend us. In the UK, our most recent brand marketing research has shown that more than a quarter of renters who have used us before prefer to use us again – far higher than for any other brand and due in large part to the service experience they receive.

Service at the core

And to make it really matter to our employees, we made it the core of our business: Enterprise corporate employees at branch manager level and above have their SQi scores taken into consideration when it comes to career advancement, which ensures that employees’ success is linked to outstanding customer service and is a central part of Enterprise’s corporate culture.

Merely running a growing, profitable branch or region wasn’t enough. Only those branch managers who proved they are outstanding in customer service were able to move up the organisation. In a fast-growing company where 99% of jobs are filled by internal promotions, it was a very big deal. And it worked.

Fast forward to today - Enterprise is still growing organically and SQi is the foundation of the business, with hundreds of thousands of calls to customers around the world every month.

However, in the past few years we’ve also expanded our network across Europe by partnering with local rental companies in countries like Italy, Denmark and the Netherlands. We’ve also had to work across not just the Enterprise brand, but National and Alamo as well.

As a starting point, we select business partners on the strength of their customer service. This means that when we put our name over their door in each new country we knew that customers would be treated with care and consideration.

But now we’re dealing with different attitudes to service in different countries, plus a new set of employees in our franchise partners: people who weren’t necessarily bought into the culture of SQi that has underpinned Enterprise for more than fifty years.

As we planned our expansion, we knew that transitioning our franchise partners to SQi would be vital. We also knew that it takes time. Fortunately, Enterprise is still family-owned and we don’t have shareholders pushing for short-term outcomes.

Evolving definition

As a result we’re only just introducing SQi measurement to our partners in countries like Turkey, Slovakia and Portugal. We originally signed the franchise agreements with Turkey and Slovakia in 2013 and Portugal in 2012.

Beyond the time and the commitment, we’ve had to understand what service means to different customers. In the UK and markets in North America, we offer end-to-end rental solutions, from car clubs and car sharing to more long-term rental for specialist commercial vehicles. Our customers want to be able to access all of our products from the same account team and this presents a different service challenge.

Plus the definition of what ‘service’ is has changed dramatically. Service is the personal touch that you get in a rental branch, but service can also be the technology that enables a regular traveller to zip through from immigration to behind the wheel in a smooth automated transaction with little or no human contact.

While for a business that requires transportation for business-critical activities – such as delivery – great service is the ability of the rental provider to minimise downtime when vehicles are off-road. All of these and many other requirements are tracked by one simple “completely satisfied” metric.

As a business we’ve always been aware of the impact growth can have on service, we’ve always monitored it and looked for ways around it because we believed so strongly on the link between service and repeat business.

However, if employees are only focused on the bottom line and on growing into new markets and new opportunities, it’s all too easy to lose sight of customers and what they really want.

In many markets global growth is an imperative, driven by customers who want to buy the service they like at home when they travel overseas or for their international subsidiaries. But that expansion has to be tempered with an understanding of what great service actually means to customers. Measurement is the key, because as the cliché says, you can’t manage what you can’t measure. And service has to be managed just like anything else.

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