Assignment

MGT 514

OPERATIONS MANAGEMENT

Student name: Phi Thi Thu Khuyen ID: SABI100409

OPERATION‟S STRATEGY OF

BIG C VIETNAM

TABLE OF CONTENT

EXECUTIVE SUMMARY ..................................................................................................... 3

1.0 INTRODUCTION ............................................................................................................. 4

2.0 COMPANY BACKGROUND .......................................................................................... 5

3.0 BIG C’S STRATEGIES AND COMPETITIVE PRIORITIES .................................... 6

4.0 OPERATIONS STRATEGY ............................................................................................ 6

4.1 FIVE PERFORMANCE OBJECTIVES .......................................................................... 8

4.1.1 Quality ....................................................................................................................... 8

4.1.2 Speed ......................................................................................................................... 9

4.1.3 Dependability........................................................................................................... 10

4.1.4 Flexibility................................................................................................................. 11

4.1.5 Cost .......................................................................................................................... 12

5.0 KEY PERFORMANCE INDICATORS (KPIs) ........................................................... 13

6.0 OPERATIONS PERFORMANCE ANALYSIS ........................................................... 14

6.1 GAP ANALYSIS ........................................................................................................... 14

6.2 PERFORMANCE BENCHMARKING ......................................................................... 16

7.0 CONCLUSION ................................................................................................................ 21

8.0 REFERENCES ................................................................................................................. 22

9.0 APPENDICES .................................................................................................................. 24

9.1 Appendix A – Main Drivers of Customer Loyalty ........................................................ 24

9.2 Appendix B – The Sand Cone Model ............................................................................ 25

EXECUTIVE SUMMARY

The main purpose of this report is to analyse the operations issue in Big C Vietnam

supercenters. Customer satisfaction become its guideline during 14 years of development

with five core values that are customer satisfaction – solidarity – integrity – innovation –

responsibility. Furthermore, Big C‟s competitive priorities are quality, flexibility and cost

which stress on its competitive strength of being a one-stop shopping place that able to meet

customers‟ demands via its product diversity at competitive pricing, customer services and

comfortable shopping environment. The operations strategy is supporting its business

strategy by executing the five operations performance objectives.

The first objective is quality that focuses on the good condition of merchandise, cleanliness

of facilities, appropriateness of shopping environment and good customer services. Big C

puts great efforts to achieve this objective. Second objective is speed which exposes time for

product delivery, total transaction of going to the supermarket, asking for a product or service

and getting it in a satisfactory condition. Third objective is dependability that comprises

operational time, availability and security of parking area, delivery of merchandise and

reliability of pricing.

In addition, the fourth objective is flexibility that includes product flexibility (private label),

flexible payment methods (payment in cash, by credit card or installment service), flexibility

in opening hours (special occasions), volume flexibility (pre-order) and delivery flexibility

(door-to-door, time requested, incentive delivery). The final objective is cost which refers to

operational cost and the price charged to customers from the customers‟ viewpoints.

The five performance objectives are assessed in terms of key performance indicators (KPIs)

and analysed by two models that are gap analysis and performance benchmarking. It indicates

that Big C not only should focus on its competitive priorities but also need to take immediate

action on few fields of the speed and dependability objectives. Moreover, consuming trends

have great impact on companies‟ operations, especially retailers. As a result, Big C should

make essential improvements and enhance its operation efficiency.

1.0 INTRODUCTION

This report shows the operations issue in Big C Vietnam. It contains company background

item emphasizing the company‟s strategies and competitive priorities. There‟s an analysis in

detail for five performance objectives that are quality, speed, dependability, flexibility and

cost. In addition, the report dissects the key performance indicators (KPIs) of the operations

according to two models that are gap analysis and performance benchmarking. The final

section of this report suggets some recommendations and conclusion.

2.0 COMPANY BACKGROUND

Present in Vietnam since 1998, Big C is one of subsidiaries of Casino Group – one of the first

French retail groups with the investment of 350 million USD. This is the achievement of

successful partnership between the Casino Group and Vietnamese partners. With 18

supercenters located in Ho Chi Minh City, Dong Nai, Ha Noi, Hai Phong, Da Nang, Hue,

Vinh, Vinh Phuc, Nam Dinh, Hai Duong and Thanh Hoa, Big C deals in 50,000 items

(including 95% of Vietnamese products), employs more than 7,500 people and accounts for

30,000,000 customers every year. Big C also exportes Vietnamese local products to the

Casino Group stores all over the world.

The brand name Big C implies its two most important elements of the business and strategies

for success. “Big” refers to the large size of our stores and the wide selection of merchandise

the hypermarket offer. “C” refers to its loyal customers, which partly indicates its business

phylosophy that is putting customers first in its development. This is also stated in the

mission “Become the reference and be the best retailer to satisfy our customers”. During

these 14 years of development, Big C always commits to the objective of satisfying

customers. “PRICE, QUALITY, SERVICE” are the watchwords. “CUSTOMER

SATISFACTION – SOLIDARITY – INTEGRITY – INNOVATION – RESPONSIBILITY”

are the 5 core values of Big C, which creates a strong link between the teams themselves and

customers.

Figure 1: Five core values of Big C

Source: Retrieved from Big C Vietnam website (http://www.bigc.vn)

3.0 BIG C’S STRATEGIES AND COMPETITIVE PRIORITIES

Big C offers a clean, comfortable shopping environment with a wide assortment of goods

available at reasonable prices and provides an outstanding customer service in order to ensure

the winning business strategy. Additionally, Big C provides a one-stop shopping experience

to our customers with a wide range of useful services at all stores (About Us: About Big C).

As one of top retailers in Vietnam, Big C is also expanding at a rate of five new stores

annually in the country, consistent with the dual property/ retailing business model that is

developing and enhancing shopping centers within Big C hypermarket to optimize the retail

and rental space allocation, make the stores more attractive and increase rental income

without affecting the retail sales of its stores (2010 Annual Report and Social Responsibility

Performance, 2011). Conforming with Casino group‟s policy of sustainable development, Big

C Vietnam has actively integrated into the socio-economic practices of the country, proactive

lauched social and community oriented activities and made sustainable development one

integral part of its development strategy (Media Center: Big C hypermarket chain 10 years of

development and innovation).

All these indicates that Big C‟s competitive priorities are quality, flexibility and cost.

4.0 OPERATIONS STRATEGY

Big C‟s operations strategy is supporting its business strategy by developing and adopting

diverse initiatives such as restructuring of organisation business units and implementing cost

reduction means. Contributing to improve the company‟s operational efficiency, effective

cost conscious culture is also fostered and enhanced. Besides, Big C always strives develops

and adopts information technology in operations management in order to raise operations

efficiency to meet customer needs best and strengthen competitive position.

The objective of customer satisfaction is considered as the guideline of Big C‟s operation and

the core commitment made by the whole Big C team members. Hence, in Vietnam, Big C

becomes the first hypermarket in building clearance price rules as well as stores and services

commitments to customers and developing five core values which are basic guidelines for

staff complying in the relationship with customers (Help you to spend less: Price

commitment, Our Services: Big C stores and services, About us: Company Value). The major

owner of Big C, Casino group, also helps encourage a culture of optimal managerial

performance by defining six attitudes and behaviours and organizing training sessions in

these behaviours given to all of the Group‟s managers in Vietnam for best practices (2010

Annual Report and Social Responsibility Performance, 2011). In addition, Big C optimize its

business operations through store expansion to have spacious, hygienic, comfortable and

well-arranged hypermarkets and shopping centers with nice décor. Besides, applying good

policy of stocks control help Big C ensure sufficient amount of products to serve customers

(Media Center: Big C hypermarket chain 10 years of development and innovation). These

strategies reinforces Big C‟s business goal that is customer satisfaction.

This indicates that Big C‟s operations contribution is positioned at Stage 2 in Hayes and

Wheelwright‟s model (Figure 2). It could be considered that Big C is as good as its

competitors positioned at Stage 2 and slightly reach Stage 3 that the operations are among

clearly the best in the industry.

Figure 2: Big C’s operations contribution

Source: Adopted from Slack et al. (2007)

4.1 FIVE PERFORMANCE OBJECTIVES

This section describes the five performance objectives that are quality, speed, dependability,

flexibility and cost. After that, the five objectives are analysed by gap analysis and

performance benchmarking in Section 6.0.

4.1.1 Quality

Good quality is the key factor to reach customer satisfaction and reduce cost as it prevents

errors and increases dependability that contributes to more efficient operations (Slack,

Chambers, & Johnston, 2007). Quality in Big C is shown by diverse terms such as good

condition of merchandise, cleanliness of facilities, appropriateness of shopping environment

and good customer services.

Big C‟s reputation has traditionally rested on the quality and freshness of its products. Big C

has been successful in setting up partnerships with local producers, whether they‟re small-

scale growers from Vietnam‟s Da Lat plateau, whose goods are shuttled each day to Hanoi

and Ho Chi Minh City by a dozen or more drivers, or fishermen operating in the Mekong

Delta. Throughout the country, an educational campaign is underway in conjunction with

local authorities to teach potential suppliers about modern distribution methods and to help

them comply with current requirements. These efforts are already producing results, with a

growing number of partnership agreements signed, primarily in the grocery sector (2010

Annual Report and Social Responsibility Performance, 2011).

Its baguettes are the best and least expensive anywhere in Vietnam and three bakers from Big

C Vietnam were selected to represent the country in the Asian finals of the Louis Lesaffre

Bakers Cup. Big C‟s service quality has also just been singled out for praise by Saigon

Marketing, the country‟s top marketing publication (2010 Annual Report and Social

Responsibility Performance, 2011).

The company has developed relations with prestigious manufacturing partners, including

state-owned enterprises, MNC and private businesses, in order to secure the quality of the

products supplied. Big C‟s Training & Meat Producing Center where produces Big C Ham

was granted the Hazard Analysis and Critical Control Point (HACCP) certification in

accordance with the standard HACCP CODEX REV4:2003 which showed the company has

strictly practised Food and Safety regulations.

Big C cooperates with Health centers to have periodical and accidental tests, in order to check

foods quality. Besides, in 2007, the quality control was professionalized with Big C Hygiene

& Quality Department being established to take responsibility of: (1) Ensuring 100% of items

sold at Big C follow the Vietnamese regulations; (2) Controlling suppliers‟ factories with its

partner, a world‟s leading inspection, verification, testing and certification company; (3)

Implementing the hygiene and quality control standard operation procedure; (4) Providing

training program for Big C's staff. Although these efforts are always performed to prevent

poor quality goods from reaching Big C hypermarkets, there are a few limitations in

mechanism to punish strictly suppliers that breach food safety and hygiene regulations as

well as the workload to check out a large number of food leading to food hygiene and safety

scandals affecting Big C‟s reputation recently.

Moreover, Big C commits feedback to customers within maximum 5 days and training staff

for better support to consumers. However, supervising employees that interacts directly with

customers hasn‟t been close leading to customer dissatisfaction and complaints.

4.1.2 Speed

Speed in Big C supermarket means the minimized time for the total transaction of going to

the supermarket, asking for a product or service and getting it in a satisfactory condition.

This objective enhances the value of the product or service to customers and therefore raise

customer satisfaction. It brings other benefits to the operation such as maintaining

dependability as short delivery and lead time made. To speed up the time for the total

transaction, Big C often plans to shedule for sales staff to work overtime or increases the

number of sales staff to advise clients as needed and ensure rapid replenishment, cashiers,

checkout-counters equipped payment by card system to make customer purchases quickly

and conveniently, gift packing employees and delivery staff by 30% on national days,

holidays or during promotion program period when attracts more shoppers coming to Big C

(Big C enhances services before Lunar New Year of Dragon, 2012; Phuoc, 2012).

Nevertheless, it seems that overload causing long queues at checkout counters and parking

areas still occurs on these special occasions and therefore decreases customer satisfaction

(Binh, 2012).

As a big supercenter, Big C forms its Purchasing Center that takes responsibility of general

purchasing planning and developing a supply chain to serve every Big C hypermarket in best

condition. Purchasing Center collects inventory information, the number of current goods

available on shelves, customer shopping needs reported from head counters who are in charge

of particular areas to build procurement plan that makes sure goods available in Big C. To

save cost, items supplied with good price and stable quality from partners, Big C often orders

large and consistent quantity of goods (at least once a week) and uses centralize distribution

center in which it combines facilities delivered by suppliers with other goods and send big

trucks to move them to every Big C hypermarket. Big C is also studying to use train or boat

to move goods from south to north for optimizing the number of delivery and better saving

cost. Regarding immediately available goods guarantee, Big C commits that all products on

its catalogue are always available at stores. In case out of stock (during period of promotion

programs), customers can order with maximum quantity of 5 units/ items and they will

receive within 8 days (except the quantity of item is identified or written "limited quantity"

on the catalogue).

In term of returning/ exchanging items, Big C commits these procedures occur within 72

hours for electronic appliances and 48 hours for other goods.

4.1.3 Dependability

Dependability objective plays an important role to the company as it affects time, cost and

stability. Reliable operations help the company save time and money, and also brings good

quality of the operations. Big C opens its stores at 8am or 8.30am everyday (depending on

each store) as well as publicly posted operational time, available ATM, payment methods,

free bus routines, parking areas and delivery rules of each store on its website. Big C

launches promotion program every 3 weeks with promotion alerts via SMS, email and

uploading promotion catalogues on its website. Besides, the stores have sufficient parking

place and apply swift automatic license plate recognition systems and magnetic parking

tickets in parking area management, which makes customers feel comfortable and secure

when shopping.

In addition, Big C provides rolling baskets with outstanding advantages such as: contain more

goods, use less space, can be pulled or pushed on the ground with one solid pulling handle

along with normal baskets and shopping carts. Big C ensures they are in good condition for

safety and functional purpose. Moreover, clearance price tag rules (yeallow tags for

discounted goods and white tags for normal goods) and price/ barcode correctness are always

guaranteed and strictly executed in each Big C hypermarket. Besides, Big C offers many

convenient services such as free gift wrapping, alteration for altering free the clothes bought

at Big C to the suitable size., free door-to-door and time requested delivery, etc to bring

customer satisfaction.

Nevertheless, there is sometimes long queuing time for payment, unavailable parking area

and out-of-stock items due to a large number of shoppers on special occasions or in the

period of promotion programs. To deal with these problems, Big C extends operational time

to allocate appropriate shopping traffic, opens temporary counters, mobile checkout counters

and supplements more staff for quick replenishment or putting goods again on original

location because some customers causes misplacement of goods.

4.1.4 Flexibility

Flexibility has several distinct meanings but is always associated with an operation‟s ability

to change. For Big C, this objective is shown in the introduction of new lines, a wide range of

goods stocked, the ability to adjust the number of customers served and to get out-of-stock

items. Big C has private labels such as famous in-house bakery bearing the brand “Bakery by

Big C”, other essential goods under the brand “Wow! Attractive price” which is 10 to 70

percents cheaper than leading brands, “Casino” premium food imported from France,

European standard certified ham “Ebon”, French wine leading brand “Sommeliers” (How to

spend less: Our brands). Among them, “Big C” brand which is the newest encompasses 40

products belonging to lines of household, cosmetics and food sold at 10 to 30 percents lower

than leading brands. At present, Big C has nearly 500 items of certain commodities which are

being sold are its private labels. Big C has been cooperating with local producers to develop

various assortment of merchandise bearing its private brands that suit for market needs and

reduce cost (Lien, 2011).

Moreover, Big C offers LOHAS (Lifestyle of Health and Sustainability) carrier bags (the

reused bags) sold at cost price to help customers use lesser carrier bags when they shop and

provides organic items such as Casino BIO products containing at least 97% bio components

for enviroment protection. Big C also offers gift vouchers with different values from

VND50,000 to 1,000,000 to give individual customers and companies a gift choice for their

lovers and staff. In every Big C hypermarket, consumers can even buy top up in various

values of Viettel, Mobiphone, Vinaphone. Furthermore, there is also flexibility in payment

methods. Customers can pay by cash or credit cards such as Visa, Master, Amex, and JCB

Card or use installment service for some typical electronic appliances.

There is a high peak of shopping traffic on special occasions, Lunar new years and the period

of promotion programs. Thus, Big C is flexible in its opening hours which extending the

operation hours to overnight or even 24 hours continiously during 3 consecutive days before

Tet holiday. Additionally, there is volume and delivery flexibility that the company could

adjust its order quantity to meet high demands and attain out-of-stock items as it maintains

long-term partnerships with local suppliers and practises pre-order before especial occasions.

Hence, in summary, flexibility plays an significant role that enables reliable and stable

operations.

4.1.5 Cost

Lowest price or minimum cost is obviously very important criteria to customers‟ perception.

Thus, with the slogan “Big C, Low price for every family” launched since 2007, Big C

positions itself as a low-price retailer and actively applies innovative procurement policy to

obtain varieties of quality vegetables and prepared foods sold at especially attractive prices,

which gives families the chance to attain the least expensive products on the market. For

example, each month the banner spotlights about twenty items that are available at an

unbeatable price (“Golden Days”), while special events direct customers‟ attention to

particular products, as in the twice- annual “Beauty Week” event designed to showcase

beauty products. With its new yellow and red packaging, the WOW brand of budget products

is readily visible on store shelves and is becoming a major asset to the chain. In smaller cities

and villages, Big C is also helping customers take advantage of its low-price policy with

stores on wheels that operate under a large tent.

Moreover, Big C launches attractive promotion programs focusing on necessity products

(every 3 weeks) with discount of 5% to 50% plus interesting prizes. Simultaneously, the

company keeps updated with market development to minimize price adjustment being

detrimental to consumers. The company also offers incentive prices for customers owning

Big C member cards. Besides, the company introduces LOHAS reused carrier bags to reduce

the cost of plastic bags.

Big C applies margin reduction investment in order to offer best price to customers and

maintain cost as the company‟s competitive priorities. Big C provides managerial training

sessions of Casino group, develops its own programs such as “Big C young leaders” as well

as adopts employment policy with notable items such as constantly seeking new talents, good

treatment policy, made-to-request training programs in line with internal and external

training, theory and practice, focusing on hand-over of skills, reasonable assigments based on

individual strengths, appointment policy based on training and internal manpower

mobilization. These help Big C enhance the staff‟s quality and thus reduce staff turnover

costs. There are more than 60% of Big C officers working 4 years over (Media Center: Big C

hypermarket chain 10 years of development and innovation).

Furthermore, the costs of bought in material and services could be maintained low as with

commitment with the suppliers, mutual benefits from long-term partnerships as well as

practising reasonable and resolute neotigation policy (Dieu, 2011; Phuong, 2011). Big C also

practiced cost reduction measures to improve operational efficiency and productivity

activities. For instance, Big C has developed the project "Big C Vietnam to implement energy

saving projects" with a total capital investment of more than VND10 billions. Project

activities include energy audits and saving methods suggestion against loss of energy;

replacing all T8 fluorescent lamps with T5 fluorescent lights to save electricity and

installation of energy supervision and management system at all Big C supermarkets across

the country, setting up additional cold storage tanks to take advantage of off-peak electricity

prices which help save more than VND1.5 billions every year (Greater efficiency of research

and synchronous investment in power-saving solutions, 2011).

5.0 KEY PERFORMANCE INDICATORS (KPIs)

The KPIs for Big C‟s operations are shown in the Figure 3 below.

Figure 3: Key Performance Indicators (KPIs) for Five Performance Objectives

Quality

Customer Satisfaction Score

Level of Customer Complaints

Number of Merchandise‟s Defects

Warranty/ Returning or Exchange Claims

6.0 OPERATIONS PERFORMANCE ANALYSIS

The KPIs have been analysed by two models that are gap analysis and performance

benchmarking.

6.1 GAP ANALYSIS

Flexibility

Range of Products and Services

Payment Methods

Time and Quantity of Order

Dependability

Proportion of Products in Stock

Schedule Adherence

Percentage of Orders Delivered Late

Customer Queuing Time

Speed Order Lead Time

Frequency of Delivery

Cost

Price that Charged to Customer

Labour Productivity

Cost per Operation Hour

ANALYSIS AND EVALUATION:

Big C measurement of the performance objectives are typically done through customer

satisfaction score and level of customer complaints. Big C established customer service

center aiming to attain the customers‟ feedback via face-to-face communication, email,

website, hotline and customer survey forms.

The competitor survey that compare Big C‟s operations with other competitors is also

performed. Generally, this survey measures on the product quality, assortment and

pricing.

Nonetheless, the KPIs measurement of Big C ignores consideration of the arrangement

display and process technology. Arrangement display plays an important role to the

quality of the operations particularly customer satisfaction on the shopping environment.

Besides, process technology crucially contributes to operations performance in

enhancement of product and service quality. Therefore, measurement of these criteria

will provide advantages of potential improvement of the Big C‟s operations.

Figure 4: Gap Analysis of Big C’s Operation’s Performance and Customers’ Needs

*Rating is based on the scales below:

Rating 1 2 3 4 5

Requirements

of the market

Not

Important

Somewhat

Important

Important Very

Important

Extremely

Important

Performance

of the

operations

Not Good Somewhat

Good

Good Very Good Extremely

Good

ANALYSIS AND EVALUATION:

This expresses that customers require quality, cost and flexibility as their most important

criteria (rated at 5). Subsequently, it is followed by dependability and speed. This also

indicates that the five objectives perfomance are significantly requested by the market.

There are gaps between performance of the Big C‟s operations and the market requirements.

Quality and cost are rated as „Very Good‟, which implies that the Big C‟s quality and cost

performance is almost meeting the customer requirements. Depenability and flexibility are

rated as „Good‟; while speed is rated as „Somewhat Good‟. On the whole, there is the

distance between the actual operation of Big C and market demand and thus there is also a

need for improvement.

6.2 PERFORMANCE BENCHMARKING

Figure 5 and 6 shows the performance benchmarking analysis and Nine-point performance

scales are used for appraising the KPIs (Figure 3).

Figure 5: Nine-point Performance Scales

Scales for appraising importance to customers

Rating Description

1 Provides a crucial advantage with customers

2 Provides an important advantage with most customers

3 Provides a useful advantage with most customers

4 Needs to be at least up to good industry standard

5 Needs to be around the median industry standard

6 Needs to be within close range of the rest of the industry

7 Not usually come into customers' consideration, but could

become more important in the future

8 Very rarely come into customers' considerations

9 Never come into consideration by customers and are never likely

to do so

Scales for appraising performance against competitors

Rating Description

1 Consistently considerably better than its nearest competitor

2 Consistently clearly better than its nearest competitor

3 Marginally better than its nearest competitor

4 Often marginally better than most competitors

5 About the same as most competitors

6 Often within striking distance of the main competitors

7 Usually marginally worse than most competitors

8 Usually worse than most competitors

9 Consistently worse than most competitors

KEY: X Importance to Customers Y Performance against Competitors**

** Competitors are typically grouped in the analysis which including Supermarkets that are Metro Cash & Carry Vietnam, Saigon Coopmart.

1 2 3 4 5 6 7 8 9

Quality

A. Customer Satisfaction Score X Y

B. Level of Customer Complaints X Y

C. Number of Merchandise‟s Defects X Y

D. Warranty/ Returning or Exchange Claims X Y

Flexibility

E. Range of Products and Services X Y

F. Payment Methods X Y

G. Time and Quantity of Order X Y

Dependability

H. Proportion of Products in Stock X Y

I. Schedule Adherence X Y

J. Percentage of Orders Delivered Late X Y

K. Customer Queuing Time X Y

Speed

L. Order Lead Time X Y

M. Frequency of Delivery X Y

Cost

N. Price that Charged to Customer X Y

O. Labour Productivity X Y

P. Cost per Operation Hour X Y

Figure 6: Performance Benchmarking

– Rating ‘Importance to Customers’ and ‘Performance against Competitors’ on the Nine-point Scales for Big C

IMPORTANCE / PERFORMANCE SCALES

PERFORMANCE

OBJECTIVES

KEY PERFORMANCE

INDICATORS

C, O,

P

I, J,

L, M

1

2

3 D, E A, B, N

4

5

6

F, G

7

H, K

8

9

9 8 7 6 5 4 3 2 1

Figure 7: The Importance-Performance Matrix for AEON

Less

Important Qualifying

Order

Winning

Importance to Customers Low High

Better

than

Same

as

Worse

than

Bad

Performance

against

Competitors

Good

Excess

Appropriate

Improve

Urgent

Action

Excess

Appropriate

Improve

ANALYSIS AND EVALUATION:

Analysis from Figure 6:

Importance to Customers Performance against Competitors

- Quality and cost objectives are

decisive which provides a crucial and

important advantage from the

customers‟ perspectives.

- Two KPIs of the flexibility objective

are rated as „Provides a useful

advantage‟.

- Dependability and speed objectives

are rated as „Need to be up to good

industry standards‟. This shows that

these objectives are less important in

comparison with the quality and cost

objectives.

- Quality, flexibility and cost

objectives are typically rated as

„Marginally better than its nearest

competitor‟ or at least „About the

same as most competitors‟.

- This shows that Big C performed

these objectives well.

- However, dependability and speed

objectives are performed weakly

compared to others.

Analysis from Figure 7:

Disaggregation of the five performance objectives into competitive factors:

Order Winners

- Quality

- Flexibility

- Cost

Qualifiers - Dependability

- Speed

In addition, the matrix suggests the fields of improvement of the five objectives:

Zone Key Performance Indicators (KPIs)

Appropriate Zone

- Customer Satisfaction Score

- Level of Customer Complaints

- Warranty/ Returning or Exchange Claims

- Range of Products and Services

- Price that Charged to Customer

Improve Zone - Number of Merchandise‟s Defects

- Payment Methods

- Time and Quantity of Order

- Schedule Adherence

- Percentage of Orders Delivered Late

- Order Lead Time

- Frequency of Delivery

- Labour Productivity

- Cost per Operation Hour

Urgent Action Zone - Proportion of Products in Stock

- Customer Queuing Time

RECOMMENDATIONS:

Big C should take immediate action for the KPIs in urgent action zone which are the

dependability and speed objectives. Customer queuing or waiting time demonstrated in

Appendix A is considered as one of the significant drivers of customer loyalty. The figure in

Appendix A also shows that quality and dependability are considerable for customer

satisfaction and loyalty. Consequently, it is important for Big C to enhance its KPIs in the

improve zone.

Operational cost is the most crucial emphasis of every organisations. Cost efficiency could be

undertaken by improving the other four performance objectives as exhibited in Appendix B.

The Sand cone model implies that the emphasis on improving quality first and followed by

dependability, speed, flexibility will improve the costs.

Additionally, record inflation causes Vietnamese consumers to be even more price sensitive

and tend to choose “value for money” goods (especially FMCG) at acceptable price (12 main

consuming trends for the year 2012, 2011; Nielsen Shopper Trends Study, 2011). Nielsen

found that 56 percent of Vietnamese shoppers actively search for promotions while shopping

and 87 percent open to buying promotions (Nielsen Shopper Trends Study, 2011). Moreover,

they trust on product quality of private label and are ready to buy. Hence, Big C need to take

to heart consumer purchasing behaviour and rationalize as well as optimize operations

performance to enhance efficiency along with adopt more innovative promotions, point-of-

sale displays and other tactics to attract and retain shoppers.

7.0 CONCLUSION

In conclusion, Big C‟s competitive priorities are quality, flexibility and cost. These three

objectives are also grouped into order-winner factors highly required by customers. In

addition, Big C‟s operations are appraised by using key performance indicators (KPIs). The

judgement from gap analysis and performance benchmarking implies that Big C should

enhance immediately a few areas of the speed and dependability objectives and improve the

rest of speed, dependability as well as some items of flexibility and quality.

8.0 REFERENCES

1. (2011). 12 main consuming trends for the year 2012. FTA Research & Consultant.

2. (2011). 2010 Annual Report and Social Responsibility Performance. Casino Group.

3. Greater efficiency of research and synchronous investment in power-saving solutions.

(2011). National Energy Efficiency Programme - Ministry of Industry and Trade.

4. (2011). Nielsen Shopper Trends Study. Nielsen Holdings N.V.

5. Big C enhances services before Lunar New Year of Dragon. (2012, January 12). New

Hanoi.

6. About Us: About Big C. (n.d.). Retrieved June 18, 2012, from Big C Vietnam website:

http://www.bigc.vn

7. About us: Company Value. (n.d.). Retrieved June 18, 2012, from Big C Vietnam website:

http://bigc.vn

8. Binh, N. (2012). Midnight shopping for Tet. Tuoi Tre online newspaper.

9. Dieu, N. (2011). Enterprises jointly stabilize prices . Voice of Vietnam online.

10. Ferdows, K., & Meyer, A. D. (1990). Lasting improvements in manufacturing

performance: In search of a new theory. In Journal of Operations Management (Vol. 2,

pp. 168–184). Elsevier B.V.

11. Help you to spend less: Price commitment. (n.d.). Retrieved June 18, 2012, from Big C

Vietnam website: http://bigc.vn

12. How to spend less: Our brands. (n.d.). Retrieved June 18, 2012, from Big C Vietnam

website: http://www.bigc.vn

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9.0 APPENDICES

9.1 Appendix A – Main Drivers of Customer Loyalty

Source: Kumar, Batista, & Maull, 2011

9.2 Appendix B – The Sand Cone Model

Source: Ferdows & Meyer, 1990