Case | HBS Case Collection | February 2013 (Revised March 2013)

Agero: Enhancing Capabilities for Customers

by Robert Simons and Natalie Kindred

Abstract

This case illustrates the importance of choosing a primary customer as the basis for organization design. Cross Country Group managers adjusted resource allocation, organization design and performance measures over time to transform Cross Country Group from an opportunistic family business into a sophisticated industry leader. Cross Country (renamed Agero in 2011) operated call centers that coordinated with thousands of small, independent towing companies—Cross Country's "service provider network"—to deliver roadside assistance services, such as vehicle towing and tire changes, to motorists covered by automakers' warranties and insurers' policies.

The case describes Cross Country's evolution from 1972 to 2012 in three phases. This allows students to, at various stages, grapple with defining Cross Country's business (what business is it, and should it be, in?) and its primary customer (vehicle makers and insurers? motorists? service providers?). The answers to these questions have important implications for organization design.

From 1972 to 1998, founder Sidney Wolk built the business through personal relationships with clients. A passionate entrepreneur, his approach to growth—secure customers first, figure out how to make money later—was remarkably successful, if sometimes chaotic. Facing an increasingly commoditized marketplace, in 1998 Wolk hired professional managers who implemented formal performance management systems and invested in sophisticated data analytics. From 1998 to 2007 (phase two), these investments allowed Cross Country to quantify service providers' impact on motorist satisfaction, monitor service providers' performance, and introduce programs to strengthen top-performing service providers' loyalty to Cross Country. Concurrently, the company undertook a two-step organization redesign to focus more resources on service providers (the new primary customer?), improve market-focused innovation and increase client satisfaction. In phase three, from 2008 to 2012, Cross Country entered the high-tech telematics/connected-vehicle business, invested in additional innovations to strengthen its service provider network, and rebranded itself as "Agero." Wolk and his team believed Cross Country had "more driver information than any other company." The case ends with key decisions for the future.

Keywords: entrepreneurial management; entrepreneurial gap; entrepreneurship; auto industry; Insurance; performance management; performance measurement; performance measures; Performance Pressure; Decisions; Family Business; Resource Allocation; Organizational Design; Customer Focus and Relationships; Performance Evaluation; Growth and Development Strategy; Service Industry;

Citation:

Simons, Robert, and Natalie Kindred. "Agero: Enhancing Capabilities for Customers." Harvard Business School Case 113-001, February 2013. (Revised March 2013.)