Mary and Mike, two very young baby boomers, have decided to pursue their long time dream of operating an enviro-friendly car shop. Yes, Mary and Mike have opened the lower mainland's first electric car shop. They carry several lines of small electric commuter vehicles and they have had success selling these cars to people who are environmentally conscious and very frugal.Mary and Mike have the Motto, "good to the environment, good to you." Therefore, they emphasize to their staff that they should always strive for customer satisfaction.

Recently, Mary and Mike have experienced some problems. Numerous customers have come to them saying that they are dissatisfied with the products that they have purchased, that the products do not perform as well as the sales representative had told them they would.They have found that the service staff have been doing extensive repairs to the cars, even when there is actually nothing wrong with the cars, and that sales staff are turning over (leaving) very rapidly.

Mary and Mike are very concerned. They have tried to operate their business in a business like fashion emphasizing customer service above all. But they have also rewarded sales people based on a straight commission system with bonuses for continually increasing sales. The lowest performing sales person each month is terminated.

In service, both the service advisors and technicians are rewarded based on commission on up-selling (selling items that are not initially desired) and cost control so they have to be physically working on cars all the time

What is the major issue in this situation?

Apply theory to explain this issue.

Using theory discussed in this course, how would you deal with this issue?