BPMT

Assignment
Case Analysis: Otis Elevator

Compiled By:
Krishna Kumar S

Otis Elevator:

Accelerating Business Transformation with IT

Otis was the largest manufacturer, installer and servicer of elevators, escalators
and moving walkways in the world. With a changing operating landscape, the
focus is on improving logistics and services. The company had a vision to
become the leader in service excellence among all the companies worldwide.
Simply put, the company did not provide just elevators but total solutions to the
customers.
The context of the case lies at the time where in there is a big organization wide
change due to the intervention of IT. The focus of IT was the need to drive down
the operating costs and boost the service image up.
The revenues of Otis as a firm climbed from $6billlion in 2000 to $8 billion by the
end of 2003 with 80% of the same coming from outside the United States.

Early Trysts with IT:

Initially Otis created a centralized customer service system to dispatch service
mechanics. IT worked with a host of functional areas to create the concept of
24*7 service called as OTISLINE customer service center. This improved the
visibility of the elevator service business performance to management and
helped deliver better quality service to the customers. It also provided managers
the information needed to manage service business operations. This
consequently led to restructuring in the firm and eliminated several layers of
management thereby speeding the communication.
The second initiative taken was that of the REM elevator monitoring. The
elevator was microprocessor based and helped to monitor the control system
and log the performance statistics onto a distant computer. This helped the
service mechanics to keep them operating at maximum performance levels and
helped handle problems.
Issue:
The core issue at hand is that despite implementing the e*Logistics ERP system
to integrate the various modules in the organization, there was an unexpected
rise in the number of Otis elevators orders as well as their suite of products.

The e*Logistics program as such had a number of issues associated with it.
Some of the issues are as listed below:

Delivery of the e*Logistics to the desktop

Uncertainty of the emerging technology to simulate applications
Substantial technology and process training was needed for users

However over a period of time, it was realized that there was not a direct
correlation between product quality and the cancellation rate. It was concluded
that the maintenance agreements were cancelled due to the dissatisfaction
with the quality of service and not that of the product.
Proposed Solution:
Phase out the entire deployment of the e*logistics ERP system to the
organization so that users get enough time to adapt the system and are able to
effectively utilize the same and derive more value from them.
Comparison of the Proposed Solution with the already Existing Solution:
We observe that implementation of the ERP system happens suddenly. The core
contribution of any companys success lies with the people, processes and
technology inherent to the organization. Having said this, we notice that the ERP
system which has been deployed has been done in a very sudden manner rather
than deploying the same in a phased out manner. This has resulted in the
people not getting enough time to feel comfortable with the platform for its use.
One of the core issues highlighted was the fact that users did not have enough
time or training to adapt to the new system. Users were expected to adapt to
the system overnight which was not feasible. The proposed solution however
ensures that users gradually become comfortable with the system over a period
of time.
Also we notice that there is no issue with the product as such, but the issue lies
with the service. This service issue has resulted because of the inability of the
users to adapt to the system and the same could be improved once users
themselves are comfortable working with the system so that they could help
serve the customers better.
This would be in line with the companys goal of being well known for providing
top notch services rather than being known for their products as such.