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BUSINESS MODEL CANVAS OF MOTORCYCLE AFTER-SALES SERVICE MOBILE APPLICATION

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International Journal of Civil Engineering and Technology (IJCIET)

Volume 10, Issue 04, April 2019, pp. 344–352, Article ID: IJCIET_10_04_035

Available online at http://www.iaeme.com/ijmet/issues.asp?JType=IJCIET&VType=10&IType=4

ISSN Print: 0976-6308 and ISSN Online: 0976-6316

© IAEME Publication Scopus Indexed

BUSINESS MODEL CANVAS OF MOTORCYCLE

AFTER-SALES SERVICE MOBILE

APPLICATION

Andika Syafiq Baskara, Emil Robert Kaburuan, Lulu Ardiansyah,

Sfenrianto Sfenrianto, and Tjoa Han Hwa

Information Systems Management Department,

BINUS Graduate Program – Master of Information Systems Managements

Jakarta, Indonesia 11480.

ABSTRACT

Indonesia is a developing country that has many choices of transportation modes.

The most widely used mode of transportation is a motorcycle. Based on data from

AISI (Indonesian Motorcycle Industry Association) in 2018, total motorcycle production in Indonesia has reached 6,118,637 units. With the high production rate, it indicates the high price of demand from the Indonesian people. Based on these opportunities, new business opportunities for motorbikes are emerging, namely after sales service. Motorcycle consulting services, motorcycle repairs, and spare parts sales examples of business opportunities that arise in the motorcycle sales service business. With the support of information technology that is expected to increase the value of the business. This article will assess the feasibility of a motorcycle after-sales service at one of the motorcycle dealer companies in Indonesia. This article applies a mobile application in form of high-fidelity prototype, a questionnaire based on service quality (SERVQUAL), and business model canvas (BMC) to illustrate the feasibility of a motorcycle after-sales service. Analysis from the questionnaire show that mobile application for motorcycle after sales service meets customer expectations and feasible to be applied. The results of this article are expected to be used as a reference for the motorcycle after-sales service business in Indonesia.

Keywords: Motorcycle After-Sales Service, Business Model Canvas (BMC), Mobile

Application, High-Fidelity Prototype, Service Quality (SERVQUAL) .

Cite this Article: Andika Syafiq Baskara, Emil Robert Kaburuan, Lulu Ardiansyah,

Sfenrianto Sfenrianto and Tjoa Han Hwa, Business Model Canvas of Motorcycle after-Sales Service Mobile Application.

International Journal of Civil Engineering and Technology 10(4), 2019, pp. 344–352. http://www.iaeme.com/IJCIET/issues.asp?JType=IJCIET&VType=10&IType=4

1. INTRODUCTION

Current technological developments and trends require every business to be approved and develop its business. Otherwise, the business will lose the driving market. As a simple http://www.iaeme.com/IJCIET/index.asp 344 editor@iaeme.com

Business Model Canvas of Motorcycle after-Sales Service Mobile Application example of business transportation in Indonesia changed the compilation of Gojek with technological devices that changed the transportation business to be more modern with mobile applications. Gojek through a mobile application offers easy access, mobility, effectiveness, and efficiency in using transportation. This is one example of how this form of adaptation to technology can spur and change the way businesses benefit.

Based on these concrete examples, the adaptation to motorbike after-sales service business is worth making a solution to increase the value of the business and company profits, the business of after-sales motorcycle service is a promising business. Based on data from AISI

(Indonesian Motorcycle Industry Association) in 2018, total motorcycle production in

Indonesia has reached 6,383,108 units [1]. The Astra Group in its annual report reports that the finance from the automotive segment received rose 11% from IDR 95.2 trillion in 2017 to

IDR 106.0 trillion in 2018 due to increased sales. In the two-wheel market, PT Astra Honda

Motor gained a rise sale of 9% to 4.8 million units with a stable market share of 75% in 2018.

The automotive component business managed by PT Astra Otoparts Tbk (AOP) resulted in an increase in net profit by 11% to Rp611 billion in 2018, Supported by Budget Increase, both from the automotive manufacturing market and the replacement parts market (substitute market) [2]. This number can be used as a projection of demand from after-sales services that will be needed by the user. With that much demand, one more selling value is needed that the company offers the customer to be interested in. One way that can be done is by utilizing technology, in this case creating a mobile application that offers easy access, mobility, effectiveness, and efficiency for customers.

One of the services offered is to sell spare parts for motorbikes. Then in 2015, the Obeng application appeared, which stands for an online workshop, an application that has a directory of motorbike and car workshop services throughout Indonesia [3]. This shows the considerable significance for motorbike after-sales service businesses to utilize technology and benefit from the strategy.

Therefore, this article will carry out the process of making a business model of a motorcycle after-sales service business model using the business model canvas (BMC) which provides an overview of the stakeholders involved in implementing a motorcycle after-sales service business. The article took a pilot project at a motorcycle dealer in Jakarta. The results are expected to provide a reference for understanding the business model of after-sales motorcycle services in Indonesia.

2. LITERATURE REVIEW

2.1. Motorcycle After-sales Service Business

After sales service plays a great role in customer satisfaction. Customer satisfaction largely depends on product features, price and aftermarket. Price, mileage, pickup and design have significant effect on customer satisfaction [4]. For durable consumer products, after-sales services play an important role in customers’ purchase decisions. From this customerrelationship view point, after-sales service is regarded as an important factor that has an impact on establishing good relationships with customers. On the other hand, a default and free basic after-sales service, such as a manufacturer’s warranty, also plays an important role in attracting more customer attention in a market with severe brand competition [5]. Offering adequate after-sales service to customers has become a major generator of revenue, profit, and competency in modern industries [6] [7]. At the same time, after-sales services, such as warranties, cost firm a substantial amount of money. Many scholars have explored after-sales service from various viewpoints, such as spare parts supply chain, warranty, customer relationship, and so on [8]. http://www.iaeme.com/IJCIET/index.asp 345 editor@iaeme.com

Andika Syafiq Baskara, Emil Robert Kaburuan, Lulu Ardiansyah, Sfenrianto Sfenrianto and Tjoa Han Hwa

2.2. Business Model Canvas

BMC is the ontology model business [9], describes the characteristics of the business model and enable to explain the entire 'picture' of business model. The focus of this ontology is to have a common language for discussing business models into practice, applicability and usefulness in the context of the business is one of the goals of the business model. Business model is defined as a model that describes rationally how an organization is built, delivered, can deliver results, and obtain value [10].

BMC is a tool that can be used to visualize existing or potential business models on a single page [10]. This tool can be used by individuals and organizations to facilitate the design and redesign of business models because it provides a shared language of business models and clarifies their relationships. The overall building block of BMC in Figure 1 covers nine basic building blocks. Each block visualizes logic for the needs of an organization creating, providing and assessing, complementing the four main areas of business: customers, bargaining value, infrastructure, and financial feasibility.

Figure 1 Business Model Canvas [10]

The need to distinguish between the front (front-back) and the back (back-back) of the processes that exist in the business model innovation [11]. The front side is approved by the customer, while the back side is the supporter and is not directly related to the customer.

Front-end of BMC is customer segmentation (customer segment), value proposition (value proposition), channel (channel), customer relationship (customer relationship), and revenue stream (income stream). Whereas those included in the back-end are the main Resources, main activities, main partners, and cost structures [11].

2.3. Mobile Application

With the estimation of 62.69 million users in 2017, Indonesia has become one of the largest smartphone markets in Asia. With this large number of users, mobile application is an opportunity for many companies. These applications are used to improve operational efficiency, increase competitiveness, and meet new customer demands. Mobile application can have a role to foster collaboration between employees, with other companies as partners, or in the form of social networking with customers [12]. The company wants to develop their brand into a mobile application compared to the web application because of the nature of smartphones that are mobile and close to customers. In Chang's research [13], mobile applications will have an impact on emotional values that are greater than those felt in web applications. http://www.iaeme.com/IJCIET/index.asp 346 editor@iaeme.com

Business Model Canvas of Motorcycle after-Sales Service Mobile Application

2.4. High-Fidelity Prototype

The prototype is a representation of a design made before the final product is completed. An important element of prototyping evaluation is the functionality of the system to be built [14].

With an application development prototype, customers can be tested and get feedback from them with minimal effort.

Fidelity of a prototype refer to level of detail in functionality in a prototype. Low-fidelity prototype is a simple and low technological concept of an idea, the goal is to rapidly turn the ideas into a testable design which can be used in collecting feedback. High-fidelity prototype can be near to the final product in term of functionality and interactivity. The scope of the prototype is not only the user interface (UI) but also includes the user experience (UX), besides that the content of the prototype includes everything that will appear in the final design. This kind of fidelity is effective in communicating the concept to stakeholder and customer. Feedback and information are also communicated effectively [15].

2.4. Service Quality

Service quality within the retail unit is very important to satisfy customers, maintain it, and create loyalty among customers. Service Quality have five dimensions in service quality

(SERVQUAL) [16], described in Table 1.

SERVQUAL measures customer satisfaction in terms of gaps between customer perceptions and their expectations. If their perception (P) exceed expectations (E), customers are satisfied. If their expectations are not met, customers are not satisfied, and when their expectations are in accordance with their perceptions, customers receive what they expect and therefore they are not satisfied or dissatisfied [17].

Table 1 Five dimensions of SERVQUAL [16]

Dimension

Tangibles

Definition

Appearance of physical facilities, equipment, personnel and

Reliability written materials

Ability to perform the promised service dependably and accurately

Responsiveness Willingness to help customers and provide prompt service

Assurance

Employees’ knowledge and courtesy and their ability to inspire

Empathy trust and confidence

Caring, easy access, good /communication, customer understanding, and individualized attention given to customers

3. RESEARCH METHOD

In this article, we made a prototype of a mobile motorcycle application after sales service.

Then we create a questionnaire based on five dimensions of service quality and then interviewed customers about what they were considering after trying the mobile application prototype.

From the results of the questionnaire and interview feedback obtained, we compiled a business model canvas (BMC) to model the flow of information and map important stakeholders.

3.1. Mobile Application Prototype

Making a prototype is done using a high-fidelity prototype technique, where customers can immediately feel the features of what will be on the mobile application. High-fidelity looks like the final result of the software, which means questionnaires and interviews behave naturally during the test. The main component that will be released is the feasibility of the http://www.iaeme.com/IJCIET/index.asp 347 editor@iaeme.com

Andika Syafiq Baskara, Emil Robert Kaburuan, Lulu Ardiansyah, Sfenrianto Sfenrianto and Tjoa Han Hwa motorcycle business model after the sales service and its relevance to the mobile application.

The following is a description of the prototype that has been made:

Figure 2 Login and Homepage

Figure 2 is the login page and homepage of the application. For customers who have entered, you will get a member special promo on the home page.

Figure 3 Main Feature of Mobile Application

Figure 3 is the main menu of services offered by the application. There are 3 menus, among others, spare parts order, order repair service, and consultation. On the spare parts order menu, customers can search and order the desired spare parts. On the repair order service menu, the customer can apply for a motorcycle repair, and the application will provide a customer queue number, and calculate the time the customer must arrive at the workshop.

Consultation menu is a menu with chat features, so customers can chat to find out the solutions made on motorcycle problems.

3.2. Sample and Data Collection

Questionnaires structure are create based on five dimensions on SERVQUAL, and the result will be mapped into customer-needs indicator. Questionnaires and interviews were distributed and conducted to 200 company customers as a sample of data, these results were analyzed to validate the feasibility of motorbikes after the sales service mobile application. Participants are given a link to experience a high-fidelity prototype from a smartphone. Observations were made directly to customers when using the high-fidelity prototype, then after completing the questionnaire, an interview session was conducted to get feedback on motorbikes after the sales service for the mobile business application model. http://www.iaeme.com/IJCIET/index.asp 348 editor@iaeme.com

Business Model Canvas of Motorcycle after-Sales Service Mobile Application

4. RESULT

4.1. Determine Customer Needs

This method identifies the needs of consumers through the result from the questionnaire, observation, and interview with customers. Customer will fill questionnaire before using the prototype as their expectation towards the service, and another questionnaire after using the prototype as their perception. The result of the method is shown in the table 2 below.

Table 2 Customer-Needs Indicator and Response

Dimension Customer-needs indicators

Tangibles

Reliability

The desire to come directly to the workshop and see the process of working the motorbike service

Choose an authorized dealer because it's more trusted;

Responsiveness The ability to do the warranty claim easily;

The need for a call center; the need for technical consultation via apps; The need

Assurance for fast response to motorbike complaints via live chat

Preferred a service is handled by a certified mechanic

Empathy The need for call centers and free consultation via apps

(P) mean

(E) mean

3.56 3.46

4.73 4.47

4.5 2.02

3.94 3.17

4.69 1.18

P-E Gap mean

0.1

0.26

2.48

0.77

3.51

SERVQUAL used to measure the quality of service expected by customers. Table 2 shows the average P, E and P-E scores for each of the five service dimensions - tangibility, reliability, responsiveness, assurance, and empathy. It should be noted that negative gap scores reflect customer dissatisfaction, positive gap scores indicate customer satisfaction, and zero P-E indicates that customers are not satisfied or dissatisfied with the services provided.

Table 2 presents the results of this analysis for the results of the mobile application prototype for each of the five dimensions of service quality. It can be noted from the table that all positive gap scores for questionnaire results show that mobile application for motorcycle after sales service meets customer expectations.

4.2. Develop Business Model Canvas

Figure 4 are the results of the analysis outlined in the Business Model Canvas based on the data held. http://www.iaeme.com/IJCIET/index.asp 349 editor@iaeme.com

Andika Syafiq Baskara, Emil Robert Kaburuan, Lulu Ardiansyah, Sfenrianto Sfenrianto and Tjoa Han Hwa

Figure 4 Motorcycle After Sales Service Business Model Canvas a.

Customer Segments

The new customer segmentation that wants to be obtained is vehicle communities and free customer service, as well as the number of loyal customers and walk-in customers. The traded vehicle community has the right to get their vehicle discount service when using a mobile application. In addition, we can attract the attention of loyal customers, free service customers, and walk-in customers with mobile applications that offer easy access, speed, and ease of transactions. With this new business model, it is expected to increase sales. b.

Customer Relationship

Companies can obtain, maintain and develop customer relationships through outreach

/ social media advertising and personalization applications. With the concept of loyalty, customers get a bonus from every transaction they make on a mobile application. c.

Channels

To increase the number of customers and transactions, the company added a new channel, a mobile application. With the mobile application, customers can more easily make transactions or find information about the goods or services they want to request. For customers who want to see goods directly, they can visit the workshop. d.

Value Propositions

For each customer segment, the company offers several value propositions:

Special spare parts prices, for those who order spare parts through a mobile application.

Home service, and pick-up service that can be ordered through the mobile application, for customers who don't have much time to come to the workshop.

The official workshop for customers who are happier to come directly to buy spare parts or make repairs.

To ensure the convenience of buying spare parts through a mobile application, the company will guarantee the authenticity of the spare parts sent.

Reliable and approved mechanics that will help all vehicles supported by customers. e.

Key Activities

The company's main activities focus on controlling inventory for parts, call centers, service visits, and creating a technological backbone. With the development of http://www.iaeme.com/IJCIET/index.asp 350 editor@iaeme.com

Business Model Canvas of Motorcycle after-Sales Service Mobile Application business and the use of technology, the main activities are added by the existence of creating a technological backbone and service visits. The increase in main activities is a sign of business growth. f.

Key Resources

To support the business being carried out, companies must ensure the availability of excellent resources. There are 4 (four) main things to support the business, namely the workshop as a place visited by customers, technology as one of the basic companies to innovate, mechanics as the core of the after-sales business, as well as tools that support working mechanics. g.

Key Partners

Companies need partners to process company business problems. Suppliers of spare parts, mechanics, dam trainers are provided with additional new partners, namely

IS/IT Vendors to support newly opened channels, namely mobile applications. h.

Revenue Streams

The company gets additional income from the cost of the visit, and pickup fees for services purchased through the mobile application. And the proportion of the increase in the number of spare parts purchased by customers, because the new channel was opened sales. i.

Cost Structure

With the use of technology, the company's cost structure has shifted with the addition of the cost structure in the IT sector. There are 2 (two) new structural costs related to

IT, namely IT investment and IT maintenance

5. CONCLUSION

A total of 6 million motorcycle production in Indonesia means that there is a 6 million after sales service opportunity on motorcycle. Based on the results of the article, and looking at global trends, this article proposes a motorcycle after-sales service business using a mobile application. This research was carried out at a motorcycle dealer company in Jakarta. This pilot project was designed to describe the feasibility of a mobile application of motorcycle after-sales service business in Indonesia.

In this article, the service quality method is used as the basis of the questionnaire, the trial process is carried out directly to the customer. The questionnaire was filled out before as customer expectation data, and after trying high-fidelity prototype from mobile application as data perception. Direct observation is done when the customer tries to prototype a mobile application, interviews are conducted at the end of the session based on the results of observations and questionnaires.

Analysis of the results of the SERVQUAL on prototype test was carried out and all the dimension show positive gap, this show that mobile application for motorcycle after sales service meets customer expectations and feasible to be applied.

This article produces a business model canvas (BMC) to describe the flow of information and allows to identify key stakeholders in formulating plans motorcycle after-sales service business. The results of this article are expected to provide a reference for the growth of motorcycle after-sales service businesses in Indonesia.

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