Current Stage of the Company
Hertz Australia, is a car rental company that deploys about 8100 cars in over 220 locations in Australia. The company provides cars for hire for business trips, holidays or local trips under every budget. The company also has a global presence and hence provides its local customers with discounts when they travel to other countries and use the company’s rental services. Hence, to have centralized data and a well-integrated system, the company has made use of the ERP solution (Enterprise Resource Planning) with CRM (Customer Relationship Management) module at its heart along with Finance and Sales.
Concerns and the need for change
Currently Hertz is trying to find ways to reduce their IT costs. On having a closer look at the current setup, it is clear that the ERP which has been an on premise installation has become a costly affair. When ERP is set up on premise, the company owns the computers and servers which are taken under capital expenditure. But later on, there is a consistent need for maintenance which again incurs significant costs (Weng, 2014). Hertz, has to hence find ways to reduce the maintenance cost of the ERP systems.
The second issue is that Hertz needs the CRM module available at all times. The mobility of the module is highly required as the rental services use the same day and night. Having to access computers to set up a service would slow down the process and also restrict the sales team’s access to customer data (Rodriguez, 2016). Hence moving to mobile CRM would be beneficial.
The company would further like to navigate into using the latest trends, especially wearable’s that are powered by IoT technology.
Strategic moves to address the concerns
ERP Setup change to Cloud
The major maintenance costs incurred are from the on premise ERP. However, in the recent years, cloud based ERP’s have become accessible reducing the setup and maintenance cost of the system (Miranda, 2013). The effort of maintenance is also being taken up by the vendors reducing the skills required by the company. The table below lists a comparison between the two
From the above table, it is clear that the movement to cloud is highly recommended for Hertz as long as the vendor is effective with security concerns (Morales, 2015)
Hertz, is an on the move company and hence mobile CRM would be an efficient solution. With the growth in mobile internet usage and the cloud server setups, mobile modules have gained popularity and most of the ERP vendors today are providing the same (Kim, 2014). This can eliminate the use of computers and restrict the same to smartphones and tablets which are considerably cheaper and easily accessible. The internal buy-in of devices is the only hardware cost required (Kim, 2015). If the ERP setup of Hertz moves to cloud based, then mobile CRM would simply become an add-on.
With the advent of wearble’s IoT is significantly gaining popularity. Customer service can be improved through the same (Shimada, 2014). Instead of calling a customer centre through designated number, customers can call from the rented vehicles through voice services, there by globalizing the customer communications.
Below listed are internal and external factors that highly require the strategic plan to be adopted
Internal Change Drivers
- Technological Capacity: Hertz, currently does not have the skills to maintain on premise ERP.
- Financial Management: The above solutions provide considerable cost cuttings and increase in ease of sales
- Employee Morale: Mobile CRM would facilitate the sales team in providing better services.
- Poor Delivery: The time lag and effort of the customer to contact customer service is considerably reduced with vehicle voice services
External Change Drivers
- Competition: With more and more rental services entering the market, it is crucial that services are cheap and swift.
- Technology: It is necessary to be agile and easily adopting to survive in the competitive business and hence the need to embrace technology is crucial and high for future survival
- Customer Satisfaction: Faster solutions are always highly appreciated by customers (Lee, 2015)
Critical Success Factors
Below are the success factors to be considered post implementation
- Increase in number of sales done per day
- Time taken to book a service
- Time taken to reach customer center
- Reduction of cost incurred through cloud ERP systems
- Number of security breaches in cloud ERP
- Increase in revenue vs costs incurred for implementation
Investment in IT has become significantly lower with the increasing mobile services due to the inception of cloud. Several companies around the world are adopting the same to reduce set up and maintenance cost and also make use of the anytime anywhere accessibility. Hertz, would be immensely benefited by migrating to cloud, mobile and IoT services through reduced costs and increased revenues
Kim, C., Lee, I.S., Wang, T. and Mirusmonov, M., 2015. Evaluating effects of mobile CRM on employees’ performance. Industrial Management & Data Systems, 115(4), pp.740-764.
Kim, Y.I., Yang, S.S., Lee, S.S. and Park, S.C., 2014. Design and Implementation of Mobile CRM Utilizing Big Data Analysis Techniques. The Journal of The Institute of Internet, Broadcasting and Communication, 14(6), pp.289-294.
Lee, I. and Lee, K., 2015. The Internet of Things (IoT): Applications, investments, and challenges for enterprises. Business Horizons, 58(4), pp.431-440.
Miranda, S., 2013. ERP in the cloud: CFOs see the value of running enterprise applications as a service. Financial Executive, 29(1), pp.65-67.
Morales, V., Vendrametto, O., dos Santos, S.D., Lessa, V.S. and Sartor, E.A., 2015, September. ERP Evaluation in Cloud Computing Environment. In IFIP International Conference on Advances in Production Management Systems (pp. 78-84). Springer International Publishing.
Rodriguez, M. and Trainor, K., 2016. A conceptual model of the drivers and outcomes of mobile CRM application adoption. Journal of Research in Interactive Marketing, 10(1), pp.67-84.
Shimada, K., 2014, June. Customer value creation in the information explosion era. In VLSI Technology (VLSI-Technology): Digest of Technical Papers, 2014 Symposium on (pp. 1-5). IEEE.
Weng, F. and Hung, M.C., 2014. Competition and challenge on adopting cloud ERP. International Journal of Innovation, Management and Technology, 5(4), p.309.