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Business Finance
The WIZARD system at Avis
It is possible to rent cars at almost every major airport and city centre in the world, and there is
invariably intense competition to attract and keep customers. Since the hire companies all offer
similar ranges of relatively new vehicles, and the reliability of these cars is taken for granted by
most customers, competition is generally on service and/or price. The most critical service
factor is the availability of the desired category (size and specification) of car, and the speed
with which all the hire contract paperwork can be completed, so that the customer is not
unnecessarily delayed. This depends on the effectiveness of the hire company’s planning and
control system. One of the most important Avis sites in Belgium is the operation at Brussels
National Airport at Zaventem, which deals predominantly with business customers, and hires
out up to 200 cars on a busy day. Avis’s advertisement, targeted at the business market,
emphasizes its ability to process customers quickly and efficiently. The objective is to complete
the transaction in less than two minutes and this is facilitated by Avis’s well-developed
computer system, known as WIZARD, which handles all reservations, preparation of hire
contracts at the service desks, inventory management and invoicing systems. WIZARD is a
globally integrated system, with over 15,000 terminals in Avis branches worldwide, allowing
international reservations to be made with accuracy and certainty, and helping to maximize the
utilization of vehicles throughout the network.
Regular customer surveys and analyses of actual demand patterns are carried out to determine
the customers’ preferences in terms of type and category of vehicles, providing a guide to the
Belgian fleet composition, which is managed from the central ‘clearing house’ at Machelen.
Because each of the Belgian branch offices has access to a pool of cars held at Machelen, their
local buffer stock requirements can be minimized. The requirements for the movement of car
inventory between branches and between countries is centralized in this way, allowing the
branches to concentrate on the task of providing good customer service. Each regular business
customer has a unique reference number in WIZARD, allowing reservations to be made and
rental contracts to be completed quickly, with only three pieces of information: the customer’s
number, the type of car required and the duration of the hire. This type of transaction is usually
completed within two minutes, after which the customer goes directly to the car park and
collects the car.
Questions
- 1 What do you see as the main planning and control tasks of the Wizard system?
2. How would you evaluate the effectiveness of the planning and control activity at Avis?
