1. SS6: Designing and Managing Service Processes
1.1. Redesigning Service Processes
1.1.1. Why Redesign
1.1.1.1. Revitalizes process
1.1.1.2. Changes in external environment
1.1.1.3. Rusting occurs internally
1.1.1.4. Redesign aims to
1.1.1.4.1. Reduced number of service failures
1.1.1.4.2. Reduced cycle time
1.1.1.4.3. Enhanced productivity
1.1.1.4.4. Increased customer satisfaction
1.1.2. Process Redesign
1.1.2.1. Approaches & Potential Benefits
1.1.2.1.1. Eliminating non value-adding steps
1.1.2.1.2. Shifting to self service
1.1.2.1.3. Delivering direct service
1.1.2.1.4. Bundling services
1.1.2.1.5. Redesigning physical aspects of service process
1.2. The Customer as Co-Producer
1.2.1. Levels of Customer Participation
1.2.1.1. High
1.2.1.1.1. Customer works actively with provider to co-produce the service
1.2.1.2. Medium
1.2.1.2.1. Customer inputs required to assist provider
1.2.1.3. Low
1.2.1.3.1. Employees and systems do all the work
1.3. Self-Service Technologies
2. SS7: Managing People for Service Advantage
2.1. Service Employees Are Important
2.1.1. Source of Customer Loyalty & Competitive Advantage
2.1.1.1. Customer’s perspective
2.1.1.1.1. encounter with service staff is most important aspect of a service
2.1.1.2. Firm’s perspective
2.1.1.2.1. frontline is an important source of differentiation and competitive advantage
2.1.1.3. Frontline is an important driver of customer loyalty
2.1.2. Frontline in Low-Contact Services
2.2. the Difficulty of Frontline Work
2.2.1. Boundary Spanning Roles
2.2.2. Role Stress in Frontline Employees
2.2.2.1. Organization vs. Client
2.2.2.2. Person vs. Role
2.2.2.3. Client vs. Client
2.3. Cycles: Failure - Mediocrity - Success
2.3.1. Failures
2.3.1.1. The employee cycle of failure
2.3.1.2. The customer cycle of failure
2.3.1.3. Costs of short-sighted policies are ignored
2.3.2. Mediocrity
2.3.3. Success
2.4. Human Resources Management
2.5. Service Leadership and Culture
3. SS1: INTRODUCTION
3.1. Why study Service
3.1.1. Services dominate most economies and are growing rapidly
3.1.1.1. Almost all economies have a substantial service sector
3.1.1.2. 60% of GDP worldwide
3.1.1.3. Provide most new employment
3.1.1.3.1. knowledge-based industries
3.1.1.3.2. more highly compensated
3.1.1.4. Strongest growth area for marketing
3.1.2. Understanding services offers you a personal competitive advantage
3.1.3. Most new jobs are generated by services
3.1.3.1. service jobs can be exported
3.1.4. Powerful forces are transforming service markets
3.1.4.1. Government Policies
3.1.4.2. Social changes
3.1.4.3. Business trends
3.1.4.4. Advances in IT
3.1.4.5. Internationalization
3.1.5. Forces that reshape
3.2. What are Service
3.2.1. The historical view
3.2.1.1. perishable
3.2.1.1.1. immaterial & cannot be separated
3.2.2. A fresh perspective
3.2.2.1. Benefits without Ownership
3.2.2.1.1. Rental of goods
3.2.3. Five broad categories
3.2.3.1. Rented goods services
3.2.3.2. Defined space and place rentals
3.2.3.3. Labor and expertise rentals
3.2.3.4. Access to shared physical environments
3.2.3.5. Access to and usage of systems and networks
3.2.4. Definition of Services
3.2.4.1. Services
3.2.4.1.1. economic activities
3.2.4.1.2. time-based performances
3.2.4.2. In exchange for their money, time, and effort, service customers expect to obtain value
3.2.4.2.1. access to
3.2.4.2.2. do not take ownership
3.2.4.3. Service Products vs. Customer Service & After-Sales Service
3.2.4.3.1. A firm’s market offerings
3.2.4.3.2. Need to distinguish
3.2.4.3.3. Manufacturing firms are reformulating and enhancing existing added-value services
3.2.4.4. 4 Categories of Services
3.2.4.4.1. People Processing
3.2.4.4.2. Possession Processing
3.2.4.4.3. Mental Stimulus Processing
3.2.4.4.4. Information Processing
3.3. MKT challenges posed by Service
3.3.1. Marketing management tasks
3.3.1.1. differ from those in the manufacturing sector
3.3.2. Eight common differences
3.4. Extended Marketing Mix Required
3.4.1. 7Ps
3.4.1.1. Product - Place and Time - Price -Promotion and Education - Process / Productivity - Physical Environment - People
3.4.2. Process / Productivity
3.4.2.1. Operational inputs and outputs can vary widely
3.4.2.2. Demand and capacity need to be balanced
3.4.3. Physical Environment
3.4.3.1. Crafting a physical environment is key when a service business requires customers to enter the service factory
3.4.3.2. People' interactions are the very levers of value creation in a service encounter
3.4.4. People
3.4.4.1. Loyal, skilled, motivated employees who can also work independantly or together in teams represent a key competitive advantage
3.5. Integration with Other Management Functions
3.5.1. Three management functions play central and interrelated roles in meeting needs of service customers
3.5.1.1. Operations Management
3.5.1.2. Marketing Management
3.5.1.3. Human Resources Management
3.6. Developing Effective Strategies
4. SS2: CB in a Services Context Summary: P76
4.1. The Three-Stage Model of Service Consumption
4.1.1. Pre-purchase Stage
4.1.1.1. Need Arousal
4.1.1.2. Information Search
4.1.1.3. Evaluating Alternatives –Service Attributes
4.1.1.3.1. Search attributes
4.1.1.3.2. Experience attributes
4.1.1.3.3. Credence attributes
4.1.1.4. How Product Attributes Affect Ease of Evaluation
4.1.1.5. Perceived Risks of Purchasing and Using Services
4.1.1.5.1. Functional - Financial- Temporal - Physical - Psychological- Social - Sensory
4.1.1.6. How Might Consumers Handle Perceived Risk
4.1.1.6.1. Strategic Responses to Managing Customer Perceptions of Risk
4.1.1.7. Understanding Customers’ Service Expectations
4.1.1.7.1. Factors Influencing Customer Expectations
4.1.1.8. Purchase Decision
4.1.2. Service Encounter Stage
4.1.2.1. Definition
4.1.2.1.1. a period of time during which a customer interacts directly with the service provider
4.1.2.2. Models and frameworks
4.1.2.2.1. “Moments of Truth”
4.1.2.2.2. High/low contact model
4.1.2.2.3. Servuction model
4.1.2.2.4. Theater metaphor
4.1.2.2.5. Implications of Customer Participation in Service Delivery
4.1.3. Post-encounter Stage
4.1.3.1. Customer Satisfaction with Service Experience
4.1.3.1.1. Satisfaction judgments are based on this comparison
4.1.3.1.2. Customer Delight: Going Beyond Satisfaction
5. SS3: Core and Supplementary Elements
5.1. Planning and Creating Services
5.1.1. Service products consist of
5.1.1.1. Core Product
5.1.1.1.1. central component
5.1.1.2. Supplementary Services
5.1.1.2.1. facilitating its use
5.1.1.2.2. enhancing its value and appeal
5.1.1.3. Delivery Processes
5.1.1.3.1. deliver both the core product and each of the supplementary services
5.1.2. Designing a Service Concept
5.1.2.1. must address the following issues
5.1.2.1.1. How the different service components are delivered
5.1.2.1.2. The nature of the customer’s role
5.1.2.1.3. How long delivery lasts
5.1.2.1.4. The recommended level and style of service
5.1.3. Documenting Delivery Sequence Over Time
5.1.3.1. Must address sequence in which customers will use
5.1.3.2. Determine approximate length of time
5.1.3.3. Information should reflect good understanding of customers
5.1.3.3.1. needs - habits - expectations
5.2. The Flower of Service
5.2.1. Facilitating
5.2.1.1. either needed for service delivery, or help in the use of the core product
5.2.1.1.1. Information
5.2.1.1.2. Order-Taking
5.2.1.1.3. Billing
5.2.1.1.4. Payment
5.2.2. Enhancing
5.2.2.1. add extra value for the customer
5.2.2.1.1. Consultation
5.2.2.1.2. Hospitality
5.2.2.1.3. Safekeeping
5.2.2.1.4. Exceptions
5.3. New Service Development
5.3.1. Success Factors
5.3.1.1. Market synergy
5.3.1.2. Organizational factors
6. SS4: Setting Prices and Implementing Revenue Management
6.1. Effective Pricing is Central to Financial Success
6.1.1. Strategy Different and Difficult?
6.1.1.1. Harder to calculate financial costs than a manufactured good
6.1.1.2. Variability of inputs and outputs
6.1.1.3. Importance of time factor
6.1.1.4. Customer think: difficult to understand, risky, and sometimes even unethical
6.2. Pricing Strategy
6.2.1. The Pricing Tripod
6.2.1.1. Cost-plus based Strategy
6.2.1.2. Competitor based Strategy
6.2.1.2.1. Price competition increases due to
6.2.1.2.2. Price competition can decrease
6.2.1.3. Customer based Strategy
6.2.1.3.1. Understanding Net Value
6.2.1.3.2. Strategies for Enhancing Net Value
6.3. Revenue Management
6.3.1. Maximizing Revenue from Available Capacity at a Given Time
6.3.1.1. Most effective in the following conditions
6.3.1.1.1. High fixed cost structure
6.3.1.1.2. Relatively fixed capacity
6.3.1.1.3. Perishable inventory
6.3.1.1.4. Variable and uncertain demand
6.3.1.1.5. Varying customer price sensitivity
6.3.1.2. Revenue management (RM) is price customization
6.3.1.2.1. Charge different value segments different prices for same product based on price sensitivity
6.3.1.3. uses mathematical models to examine historical data
6.3.1.4. Rate fences deter customers WTP more from trading down to lower prices
6.3.1.4.1. Physical (Product-Related) Fences
6.3.1.4.2. Non Physical Fences
6.4. Ethical Concerns
6.4.1. Ethical Concerns
6.4.1.1. Many services have complex pricing schedules
6.4.1.2. Unfairness and misrepresentation in price promotions
6.4.1.3. Too many rules and regulations
6.4.2. Designing Fairness
7. SS5: Balancing Demand and Productive Capacity Summary P29
7.1. Fluctuations in Demand
7.1.1. Defining Productive Capacity
7.1.1.1. several forms in services
7.1.1.1.1. Physical facilities
7.1.1.1.2. Physical equipment
7.1.1.1.3. Labor
7.1.1.1.4. Infrastructure
7.1.1.2. Financial success
7.1.1.2.1. ability to use productive capacity as efficiently and profitably as possible
7.1.2. From Excess Demand to Excess Capacity
7.1.2.1. Excess demand
7.1.2.2. Demand exceeds optimum capacity
7.1.2.3. Optimum capacity
7.1.2.4. Excess capacity
7.1.3. Addressing Problem of Fluctuating Demand
7.1.3.1. Adjust level of capacity to meet demand
7.1.3.2. Manage level of demand
7.2. Managing Capacity
7.2.1. Enables more people to be served at same level of capacity
7.2.2. Stretch and shrink
7.2.3. Adjusting capacity to match demand
7.3. Analyze Patterns of Demand
7.3.1. Varies by Market Segment
7.3.2. Predictable Demand Patterns and Their Underlying Causes
7.4. Managing Demand
7.4.1. Level of Managing Demand
7.4.1.1. Take no action
7.4.1.2. Interventionist approach
7.4.1.3. Inventorying demand until capacity becomes available
7.4.2. Marketing Mix Elements to Shape Demand Patterns
7.4.2.1. Use price and other nonmonetary costs
7.4.2.2. Change product elements
7.4.2.3. Modify place and time of delivery
7.4.2.4. Promotion and Education
7.5. Inventory Demand
7.5.1. Through Waiting Lines and Queuing Systems
7.5.1.1. Waiting Is a Universal Phenomenon
7.5.1.2. Why Do Waiting Lines Occur
7.5.1.3. Managing Waiting Lines
7.5.1.4. Queuing Systems can be Tailored
7.5.1.4.1. Urgency of job
7.5.1.4.2. Duration of service transaction
7.5.1.4.3. Payment of premium price
7.5.1.4.4. Importance of customer
7.6. Customer Perceptions of Waiting Time
7.6.1. Ten Propositions on Psychology of Waiting Lines
7.7. Inventory Demand
7.7.1. Through Reservation Systems
7.7.1.1. Benefits of Reservations
7.7.1.1.1. Saves customers from having to wait in line
7.7.1.1.2. Helps to control and manage the demand
7.7.1.1.3. Pre-sells the service/can be used to prepare and educate the customer for the service encounter
7.7.1.1.4. Data captured
7.7.1.2. Characteristics of Well-Designed Reservations System
7.7.1.3. Reservations Strategies Should Focus on Yield
7.7.1.3.1. Yield analysis helps managers recognize opportunity cost
7.7.1.3.2. Decisions need to be based on good information
7.7.1.4. Creating Alternative Use For Otherwise Wasted Capacity
7.7.1.4.1. Use capacity for service differentiation
7.7.1.4.2. Reward your best customers and build loyalty
7.7.1.4.3. Customer and channel development
7.7.1.4.4. Reward employees