Managing Services Week 2 PDF

Managing Services EL Week - 2 PT N Prof. Jayanta Chatterjee Department of Industrial and Managemen...

Managing Services EL Week - 2 PT N Prof. Jayanta Chatterjee Department of Industrial and Management Engineering Indian Institute of Technology Kanpur Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur  HOTEL SERVICE BLUEPRINT EL PT N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (01) (1)1  COMPETITIVE SERVICE ELEMENTS  Availability (24X7 )  Convenience (Store location)  EL Dependability (On-time flights)  Customization (My bank)   Price Quality PT (Signal for Quality ) (P-E) N  Reputation (Social Media & WOM)  Safety (Also Security)  Speed (Contextual ) Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (1)1 (02)  CUSTOMER VALUE EQUATION  Customer Perception after service consumption  +  Service Delivery Process EL  Price to the customer PT N  +  Non-Monetary and other Cost of acquiring the service Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (1)1 (03)  THE FLOWER OF SERVICE inform payment consult EL Core product! billing PT Food? Order N exceptions hospitality safekeeping Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (04) (1)1  ROLES OF SUPPLEMENTARY SERVICES Facilitating Enhancing Services Services EL Information Consultation PT Order taking Hospitality N Billing Safekeeping Payment Exceptions Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (05) (1)1  THE FLOWER OF SERVICES APPLIED TO HOSPITALITY MANAGEMENT Information -reservation - menu prices Payment Consultation -reminders - Credit card - Customized advice - Check - Menu EL - Cash handling suggestions Core Order taking Billing - Self billing - Mail billing PT Food and beverages - Table reservation - Ordering menu N Exceptions - Complaints Hospitality - Suggestions - Waiting areas - Compensation - Free beverage for Safekeeping - Toilets unsatisfactory service - Coat room - Valet parking Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (06) (1)1 SERVICE ELEMENTS TO SERVICE DIMENSIONS  Services are economic activities offered by one party to another, most commonly employing time based performances to bring about desired results in recipients themselves or in objects that belong to the EL customer. PT  In exchange for their money, time, and effort, service customers expect to obtain value from access to goods, labor, professional skills, facilities, networks, N and systems; but they do not normally take ownership of any of the physical elements involved. (Lovelock, Wirtz and Chatterjee, 2008 and later) Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (07) (1)1  SERVICES DIMENSIONS  Often also summarized as IHIP :  INTANGIBILITY: Can’t touch, feel. No storage or transport. EL  HETEROGENEITY : Experientially unique, unique to each consumer. PT  INSEPARABILITY: you can’t most often separate service and the customer from the service provider. N  PERISHABILITY: Expires beyond a defined period of time. Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (08) (1)1  INTANGIBLE TO TANGIBLE CREATING THE SERVICE VALUE PROPOSITION SERVICES ARE EXPERIENCED over time and that are shaped by various points of contact between the service provider and the EL customer.  Touch points. PT N  Service Flow. Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (09) (1)1  TOUCHPOINTS  Any point of contact between a service provider and their users. EL  Tangible elements of a service Flower– PT  Everything that a person accessing the service sees, hears, interacts with N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (1)1 (10)  MAP THE SERVICE FLOW  A service consists of a series of activities and interactions over time. EL  A service flow diagram describes this process, and needs to be customized. PT  Describes how the touch points come together over a N period of time.  A map showing how customers experience the service at various touch points. Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (11) (1)1  HOTEL SERVICE BLUEPRINT EL PT N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (12) (1)1 APPROACHES FOR ADDRESSING SERVICE INTANGIBILITY  Present vivid information  Use buzz or viral marketing  Leverage social media  Use interactive imagery  Aim messages to  Focus on the tangibles influencers EL  Create advertising that  Use brand icons to make the generates talk because it is humorous, compelling, or service tangible  Use association, physical representation, PT unique  Feature satisfied customers N documentation, and in the communication visualization  Generate word-of-mouth  Feature service employees in through employee communication relationships Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (13) (1)1  USER NEEDS Maslow’s hierarchy of needs? 1. Physiological needs such as food, drink and shelter. EL 2. Safety needs such as security and protection. 3. The love and affection and belongingness needs. 4. PT The esteem needs such as self-respect, self-esteem and the esteem of others. N 5. The need for self-actualization, such as self- development and realization. Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (14) (1)1 PROMOTE CONTRIBUTIONS OF SERVICE PERSONNEL  Frontline personnel are central to service delivery in high-contact services EL  Make the service more tangible and personalized  Show customers work performed behind the PT scenes to ensure good delivery  To enhance trust, highlight expertise and N commitment of employees  Advertisements must be realistic  Messages help set customers’ expectations  Internal Marketing on the content of new service before launch Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (1)1 (15) FACILITATE CUSTOMER INVOLVEMENT IN PRODUCTION  Involve customers in service production; they need training to perform well EL  Show service delivery in action PT  Dentists showing patients videos of procedures before surgery-reduces uncertainty N  Streaming videos on Gym Routines reach active customers Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (16) (1)1  STIMULATE OR DAMPEN DEMAND TO MATCH CAPACITY-ALTERNATE DELIVERY Live service performances are ‘Perishable’  Can’t be stored for resale at a later date EL  Recording Set Top Box- Streaming-Mobile You Tube Examples of demand management strategies: PT  Reducing usage during peak demand periods  Stimulating demand during off-peak period N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (17) (1)1  OVERCOMING PROBLEMS OF INTANGIBILITY  Intangibility creates Challenges:  Abstractness EL - No one-to-one correspondence with physical objects  Non-Search ability PT - Cannot be inspected before purchase N  Mental impalpability - Customers find it hard to grasp benefits of complex, multi-dimensional new offerings-Ultrafast Computed Tomography Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (1)1 (18)  IMAGES EL PT N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (19) (1)1  ADVERTISING STRATEGIES FOR OVERCOMING INTANGIBILITY EL PT N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (20) (1)1 SERVICE ABSTRACTS BROUGHT TO LIFE THROUGH SERVICE DELIVERY CHANNELS Messages reach customers through Service outlets the service delivery environment Services cape: Physical design EL Front-line Shape customer’s perceptions Delivers supplementary services employees Cross-selling of additional services Self-service delivery points PT ATM, vending machines and websites Require clear signage and instructions on how to use the service N Familiarize customers with service product Customer training and teach them how to use it to their best advantage Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (21) (1)1  IMAGES OF SERVICE EL PT N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (22) (1)1  SST EL PT N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (23) (1)1  FLOWCHARTING HELPS TO CLARIFY SERVICE ELEMENTS  Display the nature and sequence of delivering service to customers EL  Shows how nature of customer involvement with service organizations varies by type of service:  People processing PT N  Possession processing  Mental Stimulus processing  Information processing Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (1)1 (24)  FLOWCHARTS FOR MENTAL STIMULUS AND INFORMATION PROCESSING SERVICES EL PT N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (25) (1)1  DEVELOPING A BLUEPRINT  Developing a Blueprint  Identify key activities in creating and delivering service  Define “big picture” before “drilling down” to obtain a EL higher level of detail  Advantages of Blueprinting PT  Distinguish between “frontstage” and “backstage”  Clarify interactions and support by backstage activities N and systems  Identify potential fail points; take preventive measures; prepare contingency  Pinpoint stages where customers commonly have to wait Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (26) (1)1  KEY COMPONENTS OF A SERVICE BLUEPRINT Define standards Specify physical Identify principal for frontstage evidence customer actions activities Objectives: EL Identify fail points & risks of Frontstage excessive waits Set service standards PT Line of visibility actions by frontline personnel Line of interaction N Fail-proof process Support Backstage actions Support processes by customer processes involving other contact personnel involving IT personnel Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (27) (1)1  BLUEPRINTING THE RESTAURANT EXPERIENCE: ACT 1 EL PT N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (28) (1)1  IMPROVING RELIABILITY OF PROCESSES THROUGH FAIL-PROOFING  Identify fail points EL  Analysis of reasons for failure reveals opportunities for failure-proofing to PT reduce/eliminate future errors N  Need fail-safe methods for both employees and customers Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (29) (1)1  SETTING STANDARDS AND TARGETS FOR CUSTOMER SERVICE PROCESSES Service Service Service Performance Process Process Attributes Targets Indicators Standards EL Responsiveness Reliability Processing time to approve 24 hours 80% of all Competence applications in 24 applications Accessibility Courtesy Communication Credibility PT hours N Confidentiality Listening to the Creates a Base to Define Service Define/Process Measure Customer Quality Goals for Departmental customer Satisfaction Staff Service Goals Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (30) (1)1  IITK LIBRARY SERVICE REDESIGN PRIORITY AREAS  Make student/faculty experience superior  One stop where possible  Self-service EL - issues/returns PT - High Level information consultancy skills - automated entry/exit (Process/Technology ?) N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (1)1 (31)  INFORMATION SUPPORT  Overall, creation of stratified information support services EL  General queries to new Customer Desk PT  Subject specific queries referred to Information Assistants, Information Librarians, Research N Support Librarians  Newly designed knowledge services Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (1)1 (32)  EL PT N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (33) (1)1  WHY REDESIGN SERVICES?  Revitalizes outdated processes EL  Rusting occurs internally  Natural deterioration of internal processes; creeping bureaucracy; evolution of spurious, unofficial standards  Symptoms: PT - Extensive information exchange N - Data that is not useful - High ratio of checking control activities to value-adding activities Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (34) (1)1  WHY REDESIGN? Redesign aims to achieve these performance measures: EL  Reduced number of service failures PT  Reduced cycle time from customer initiation of a service process to its completion N  Enhanced productivity  Increased customer satisfaction Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (35) (1)1  PROCESS REDESIGN: APPROACHES AND POTENTIAL BENEFITS Streamline front-end and back-end processes of Eliminating non- services value-adding steps Improve productivity and customer satisfaction EL Increase in productivity and service quality Shifting to self- Lower costs and perhaps prices service PT Enhance technology reputation Differentiates company N Improve convenience for customers Delivering direct Productivity can be improved by eliminating expensive retail locations service Increase customer base Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (36) (1)1  PROCESS REDESIGN: APPROACHES AND POTENTIAL BENEFITS Involves grouping multiple services into one offer, focusing on a well-defined customer group Bundling A better fit to the needs of target segment EL services Increase productivity with customized service Increase per capita service use Redesigning PT Focus on tangible elements of service process (facilities and equipment) N Increase convenience physical aspects of Enhance satisfaction and productivity of service process frontline staff Cultivate interest in customers Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (37) (1)1  LIBRARY SERVICE 2025 AT IITK EL PT N Prof. Jayanta Chatterjee : Dept. Industrial and Management Engineering : IIT Kanpur (38) (1)1