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JUNK VAN CASE STUDY

Problem Statement
1-888-Junk-Van operates in the waste collection industry. Waste collection is generally
perceived to be a rough business, characterized by unreliable customer service and a lack
of professionalism. It was also considered to be a commodity service, and so as competitors
increasingly entered the market prices began to fall. Achieving operational efficiencies in this
challenging environment was difficult enough for global companies that benefited from
significant scale economies, but was almost impossible for local companies like the Canadian
based Junk Van run by Marcus Kingo. To reduce high fixed startup costs, Kingo opted to
create a simple virtual business model. As business grew, however, so did operational
complexity, and inefficiently and errors became common place. Drivers relied on instructions
deliveries through an email system, and when this information was incomplete or incorrect,
customers suffered the consequences. Information holding errors were pervasive and the
business was losing customers.
The key problem is to find an affordable IT system that met Kingos operational
requirements and allowed the business to grow. While the system had allowed 1-888-JunkVan to grow initially, information errors and inefficiencies were now negatively impacting
operations and increasing costs. The scope of the problem is that since the business model is a
virtual business model with no brick and mortar store locations, all communication and
information transmission would be electronic meaning if there were communication errors
they would greatly affect the business. Kingo could not afford to keep wasting time putting
out these fires in a very competitive job market.
The case touches of a few of the symptoms which include:

Simple administrative tasks (e.g. contracting helpers, going back to the customer site
to collect money) took up a lot of the drivers time.

Even though some templates existed for drivers to send their information to the data

clerk, they rarely used them, so delivers data consolidation was very time consuming.
Customer service quality was suffering, which damage the companys reputation.
Errors in customer contact information, forgotten emails, manual calculations, and
billing mistakes caused negative customer interactions.

The most serious problem originated with the data clerk who would accidently send the
wrong version of the database to the morning operation, and as a result some jobs were
already booked no longer showed in the database and did not make tier way onto the spread
sheet used by the drivers. Fixing the database was extremely time consuming and meanwhile
no new reservations could be taken as there was only one live copy.
Situation Assessment
The context of the problem is that Junk Van was running an inefficient unsustainable virtual
model given the growth of their business along with the errors of their employees. The
company employed two call centre operations, one data clerk, three drives and helpers, all
under Kingos direct virtual supervision. The mistakes were becoming costly and customer
retention began to slip resulting with customers wanting to switch to another waste removal
provider.
The decision criteria for situation are having a central database for the company, the
system needs to be remotely accessible, and automated emails to customers. The system
needs to be easy to implement and operate for all the employees. It will also need to be
flexible and robust enough to handle revolutionary changes in the marketplace or industry.
List of Plausible Alternative Courses of Action
Kingo's business was too small to justify hiring a dedicated IT worker and since Kingo did
not personally have an IT background, the solution had to be easy to implement and operate.
Ease of use was also critical since his staff did not possess very high IT skills; yet you
have to rely heavily on the system on a daily basis. Vendor support was also essential. Kingo

knew the company needed a central database, and that internal information should no longer
be transmitted by an email. The database should be accessible remotely since everyone would
be working on it simultaneously from different locations. Emails to customers needed to be
sent automatically from the system in order to avoid mistakes and the resulting delays.
There were 5 apparent options for King to evaluate:
1.Microsoft Access Database:
Upgrading from MS-Works to MS-Access could be done within a relatively short
time and on a small budget. Access could be installed locally on multiple computers, or it
could also be installed on a centralized server to access remotely through the internet and a
secure virtual private network (VPN). Local installations in several computers had an
advantage in that Kingo could easily person the installations himself. Licenses were prices at
$179 per computer.
Kingo believed he could find time during evenings or weekends to create the new
database, and that could be ready in a couple of weeks. This option would not allow for
remote access, and so each instance of the database would have to be updated manually
updated every day. Choosing this option would require Kingo to spend a significant amount
of technical information, and he could not rule out the possible need of extra help in order to
get it right.
The number of required user licenses would depend on how many people would be
working on the program concurrently. Kingo would also need to consider the costs of hosting
the shared server, as well as required professional development assistance.

2.Customer Application:

In this alternative Kingo could have someone build a completely customized


application for the business. He received several quotes for a web-based system, which would
meet the requirements of a central database and provide remote access, and the system would
also have some basic functionality included. The initial build time was estimated to be four
weeks, and the upfront price was about $2000. However, this did not provide any changes or
adjustments that might be required. Maintenance was charged at about $60 per hours per
developer, and there was no way to predict how much maintenance would be needed. There
were a few questions related to this alternative.
First, the quotes did not include data migration, so Kingo imagined he would end up
paying some extra money for this service. Second, custom-made software simply could not
be seen beforehand. He could not know whether the needs the expressed to the developer
were understood or whether the software would be easy to use. By that time, a certain amount
of time and money would have already been invested.
3.Google Docs:
Google Docs offed online applications that could be used to create text documents,
spreadsheets, slide-based presentations, and forms. The forms application was of interest as it
could be quickly created and shared with employees. Users could work simultaneously on the
same file in a collaborative system environment. Google Docs was free for up to 10 user
accounts, and for small businesses there was a fee of $5 per user per month. Kingo believed
he could migrate to a Google Docs system in a matter of a couple of weeks. However, with
this option all data would be input into an online spreadsheet, and could not be cross
referenced in the way it usually is in relational databases. Another downside was Google
Docs lack of formal customer support; the only available assistance was through online blogs
and forums.

A common concern of cloud computing was that users did not own the tools and
resources used to store sensitive company data which raised some confidentiality issues, and
made people wonder what would have if Google decided to suspend or even cancel the
service.
4. Platform as a Service:
PaaS was similar to Google Docs in that it was delivered on a cloud computing
infrastructure. PaaS was defined as the provision of computational resources namely
hardware, storage, network capacity and some basic software functionality on demand
through the internet. PaaS differentiated itself through the fact that users could utilize
common applications, as well as build their own unique applications, using a shared
computing platform that was provided and hosted by a third party. Kingo was not sure he
possessed the necessary IT skills to take advantage of the independence Paas seemed to
offer. Another benefit is that the vendors of PaaS offer on-site trials so business owners can
get a hands on idea of how the system would work for their individual business and
implementation, including data migration, would only take about three days.
Service package costs ranged from $300 to $600 per month, depending on how much
storage space and how many user licenses and applications were needed. If customization
was required, more time and money would be needed, as this option was charged extra on an
hourly basis, at about $180. Fortunately long term contracts were not required; he could scale
the service up or down at any point, or cancel the service with one months notice.
5.ERP System:
ERP were built around a central database. They were designed to accessible remotely,
and claimed to integrate business processes by covering every aspect of the business, from
purchasing, sales, and customer service, to finance, human resources, and e-commerce.

Upon doing some research Kingo found that even though these options were meant for small
businesses they were very expensive. The average small firm option is built to have 20-25
users and the cost for licenses would be around $2,500 per user per year.
It was likely that license prices would be higher for company with fewer
users. Another disadvantage for Kingo is that the various packages come with many options
most of would not benefit Kingo's business model. The systems appeared static and focused
mainly on production and finance models, which were not top priorities for his company.
Evaluation of Alternatives
Some key theoretical concepts that should be included in evaluation of the alternatives:
1.

Cost effectiveness- Decide if the strategy is worth the cost to implement

2.

Time implementation- How quick can the strategy be implemented

3.

Ease of use- How easy is the strategy is to use for non-technical people

4.

Adaptable- if the strategy is flexible to meet needs of changes in the business


or market place

5.

Long term solution- If the strategy can be implemented for the long term

6.

Vendor service and reliability- Does the vendor provide quality service and is

the

company reliable with a good track record or with little to no experience.


Recommendation
Based on the needs of Kingo and the potential alternatives, my recommendation is to use two
of the alternatives Google Docs for the immediate future and PaaS over the long term. To
service our immediate IT issues using Google Docs would be to quickest, cost effective, and
requires the shortest learning curve. On Google Drive you can set different user profiles, for
example, one proving full access to files, another for editing forms, and a third limited to
reading information. A key element for customer relations with Junk Van is email
distribution, which can be supported on Google Docs.

For example customers could send an email with a link to a form, which they could then
complete and return online without having any miscommunication of data or payment
information.
Taking into account that it would be one large spreadsheet and could not be cross
referenced, this still could be the first step in the IT solution for Kingo. Despite no formal
customer support, there was still enough information in forums and blogs that could help
Kingo and employees with trouble shooting.
To help with future long term IT needs, it is recommended to use Platform as a
Service. Paas similar to Google Docs in that it was delivered on a cloud-computing
infrastructure. Users cold utilize common applications, as well as build their own unique
applications, using a shared computing platform that was provided and hosted by a third
party. This could allow for Junk Van users to use some of the applications they were using in
Google Docs and create the more robust IT applications it needs for success in the long run.
Kingo discovered there were a few Paas providers operating in North America who provided
different Paas solutions. Being able to customized and tailor your solution with an
infrastructure that uses cloud functionality is a key selling point. Since businesses are
constantly changing, there is a huge benefit to having an IT solution that can be tailored to
ones specific business needs. It is important for Kingo to determine how much of a platform
he wanted to support his business, but Paas would provide him with flexibility by scaling his
service and down at any point and there were no long term contracts. Basic implementation
took only 3 days which would be a nice transition and compliment to using Google Docs.
In the short run, using Google Docs is a good solution to solve some of the
preliminary problems and migrate into using a PaaS solution in the future. By having a duel
solution, Junk Van will be able to satisfy its clients, provide employee collaboration and

accountability, have quality assurance checks, and provide time to discover and determine
what IT solution is best for a long term business objectives of the company.