Service design methods in small and medium sized enterprises - Case study: Travel Agency

SERVICE DESIGN METHODS IN SMALL AND MEDIUM SIZED ENTERPRISES -‐ CASE STUDY: TRAVEL AGENCY

IDBM PRO 2012 PIIA TIILIKAINEN 27.12.2012

TABLE OF CONTENTS SERVICE DESIGN METHODS IN SMALL AND MEDIUM SIZED ENTERPRISES -‐ CASE STUDY: TRAVEL AGENCY ...................................................................................................................................................... 1 TABLE OF CONTENTS ............................................................................................................................................ 2 1. ABSTRACT .............................................................................................................................................................. 3 2. INTRODUCTION ................................................................................................................................................... 5 2.1 Service design as a function .................................................................................................................... 5 2.2.2 Design methods during the customer insight phase ................................................................ 5 2.2 Research objective .................................................................................................................................... 10

3. ANALYSIS ............................................................................................................................................................. 11 3.1 Introducing the business need ........................................................................................................... 11 3.2 Tourism as a service ................................................................................................................................. 11 3.2.1 Chinese tourists in Finland ........................................................................................................... 11 3.2.2 Characteristics of Chinese Tourists ........................................................................................... 12

3.3 Company profile ......................................................................................................................................... 12 3.4 Service design tasks during the customer insight phase .......................................................... 12 3.5 Ideal service design method – characteristics .............................................................................. 13 3.6 Evaluation of service design methods .............................................................................................. 13 3.7 Role-‐play immersion, observation, shadowing and day in a life ........................................... 14 3.8 Diary methods (video, camera, written) .......................................................................................... 16 3.9 Other methods (Co-‐design, Make Tools, Five Times Why, Affinity Diagrams, Mobile probes) ................................................................................................................................................................... 17

4. SUMMARY ............................................................................................................................................................. 18 APPENDIX 1: SERVICE DESIGN METHODS ANALYSIS TABLE .......................................................... 19 APPENDIX 2: STEFAN MORITZ LIST OF TOOLS AND METHODS DURING SERVICE DESIGN UNDERSTANDING PHASE .................................................................................................................................. 20 BIBLIOGRAPHY ....................................................................................................................................................... 21

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1. ABSTRACT Design has many faces within an organization – a designer can act as a mediator between different business functions in visualizing the company strategy and targets, customer segments, products and services etc. Service design is an interdisciplinary function1, which combines different methods and tools from various disciples such as market research, anthropology, and psychology as well as design management. It is a new way of thinking and an evolving approach but at the core of this discipline is the understanding of customer needs, dreams and wishes.2 This research paper focuses on design management tools and methods, which can be used to gain a better understanding of end-‐user/customer requirements in order to deliver delightful service experiences to meet those requirements. Service design process and tools emphasize strong social skills, empathy toward user/customer, creativity and visual thinking. 3 The link to design thinking comes from an iterative approach, which is similar to an empathic design process, which tries to visualize the future service concepts through prototyping.4 However, as Stickdorn and Schneider point out: “If you would ask ten people what service design is, you would end up with eleven different answers – at least.”5 During my career, I have been developing many services without the theoretical background on service design. In those projects, I have used multiple methods such as focus groups, traditional surveys, customer journey mapping, shadowing, mystery shopping, UX testing with cameras, card sorting etc. and have always found them useful in understanding the customer at hand. Now that I am managing a start up with limited money and resources, I am curious to explore what kind of tools and methods can be applied with relatively low cost. Many design management methods for service design are a luxury of large companies, who have dedicated research budgets to throw into customer research. They can hire specialist companies around the world for the assignment and outsource the work to skilled design management professionals. If you are a small or medium sized company (SME), you may not have enough expertise or money to use dedicated research companies. If your customer base is from a different culture or you don’t have a common language, it may seem impossible to use existing methodology to gain insights. This paper aims to answer the following question: Which design management tools are best suited for a SME to gain a better understanding of end-‐users/customers? As a case example, I am going to use a small travel agency, which provides services for a foreign customer base from a different culture and lacks a common language with its’ customers. I decided to focus on the initial customer insight phase, which is critical in designing a new service. I used Hämäläinen, Vilkka and Miettinen’s framework, which outlined the following methods that can be used during the customer insight phase in service design:

• DESIGN ETHNOGRAPHY: ROLE PLAY IMMERSION • ETHNOGRAPHY: OBSERVATION • ETHNOGRAPHY: SHADOWING • CONTEXT MAPPING: MAKE TOOLS • DESIGN PROBES: DIARY (WRITTEN) • DESIGN PROBES: DIARY (CAMERA) • DESIGN PROBES: DIARY (VIDEO)

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• DESIGN PROBES: MOBILE • FIVE TIMES WHY • DAY IN A LIFE • AFFINITY DIAGRAMS • CO-‐DESIGN METHODS

These methods were analyzed from the target customer segment (Chinese tourist), company (small travel agency), industry application (tourism), tourism product/experience and on analysis effort dimensions based on subjective review. Based on my research, it seems that Role-‐play immersion, Observation; Shadowing and Day in a life method offer most potential for the travel company, when they want to design new travel services or improve existing service. Most importantly, they don’t require a heavy up-‐front investment. These methods can be used, when there is no common language with the customer and they don’t require deep specialist skills in order to use them. Some training will be required. In addition, these methods produce results in an easily ‘digestible’ and reportable format. Their shortcoming is limited geographical scope and dependency on understanding the customer’s language; however, as most communication is anyhow non-‐verbal, observational methods can still be used.

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2. INTRODUCTION

2.1 Service design as a function Service design is an interdisciplinary function, which has similarities with an iterative and empathic design process, where the key aim is to involve the user or customer into the design process. Although there seems to no agreement over the ‘correct’ way of defining service design, there are certain similarities in most definitions. The following phases can be recognized in most service design approaches.

FIGURE 1: SERVICE DESIGN PROCESS PHASES6

During the customer insight phase, the service designer should focus on growing his understanding of user needs in order to come up with development ideas. Understanding is learning about customer’s latent and conscious needs.7 According to Moritz, understanding clients is about understanding their goals, values, needs, behavior, problems, group dynamics, interaction, demographic and psychographic factors.8 Hanington divides the human centered research methods into three categories: traditional (such as customer surveys, focus group interviews), adapted (such as ethnographic research, video ethnography) and innovative (such as co-‐creation workshops, user diaries).9

2.2.2 Design methods during the customer insight phase According to Hämäläinen, Vilkka and Miettinen10 the following approaches can be utilized during the customer insight phase:

1. Design ethnography, where the service designer takes the role of the customer or user in order to gain insights about a product or a service. For example, the designer could take the role of a tourist bus driver in order to capture the real customer journey during a sightseeing tour. The observation process should not be

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intrusive even though it is common to use video cameras to capture information. The designer can also interview the users. The purpose is to understand the motivations of people to use a product or a service.

2. Ethnographic methods have been used in anthropology and they aim to make the culture visible, audible and understandable by giving meaning to the symbols and rituals in a culture.11 Traditionally is has been entirely face to face cultural interaction and data collection but lately, the virtual online world has been studied through ‘netnography’, where the interaction and data collection happens purely online. A mix of both methods can also be used to study cultures and communities.12 Observation is a common ethnographic method. It is easy to imagine an anthropologist in a jungle village, sitting on a stone and taking notes about the behavior and rituals of the villagers. Shadowing is similar to observation but focuses more on user’s interactions and tasks through real time interaction processes. In tourism context, following a tourist group as a member to observe how the group interacts with the guide and other people or what kind of tasks do the tourists perform during a tour are examples of shadowing.

3. Context mapping methods are often used in facilitated workshops, where the users or customers carry out exercises with make tools. For example, they could be asked to make a ‘future airplane’ out of cardboard and other handicraft materials. Through visualization, they express their subconscious and underlying needs.

4. Customer uses design probes to document ‘ day in a life’ type scenarios or other contexts. Design probe methods are based on self-‐observation and documentation. Typical examples are photography diaries, video diaries or written diaries. Mobile probes were introduced by University of Art and Design in Helsinki. Users use a camera phone to send written answers and pictures and the researcher has a browser-‐based application to send questions and probes to users. The responses are recorded in a server. Lately this methodology has veered more towards quantitative research due to the limitations in designing true empathy probes with mobile technology.13 A tourist could be provided with a camera and asked to record ‘most unusual and memorable events’ during this tour in order to find out service differentiation options.

5. Five times why method focuses on finding a root cause to the problem at hand. It is

one of the Six Sigma14 methods and tries to establish a cause and effect relationship underlying a problem.

‘Customers think our prices are too high’ 1. Why? They are saying that competitors are offering the same tour at a lower

price. (First why) 2. Why? Maybe the competitors have been able to negotiate better prices with

hotels and taxis. (Second why) 3. Why? Due to their higher volumes, they are able to get volume discounts. (Third

why) 4. Why? Hotels and taxis prefer to work with travel agencies who bring in most

money. (Fourth why) 5. Why? That’s how they make their profit. (Fifth why)

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It is possible to keep asking more Why’s in order to get to the root cause but a rule of thumb seems to be that 5 Why’s are often sufficient to get to the root cause.

6. Day in a Life method puts the service designer in customer’s shoes and makes

him list and document all user tasks, circumstances and user experiences during a day. This method can be used to discover unusual events or themes in daily routines of people. First step is to decide what is the scope of the study, where do we need more information; is it about roles, interactions or the environment. In tourism, this method could be used for example when observing what alterations are needed to a pre-‐programmed tour by observing when the group does not follow the program and analyzing the context of the deviations.

7. Affinity diagrams help process and categorize information, which has been collected through Affinity notes. It brings out the customer needs, issues and problems. In this method, all ideas and notes are first recorded on Post-‐It notes and then collected on the wall, grouped and categorized. In Six Sigma, this method is called KJ (Kawakita Jiro) Model.

8. Co-‐creation or co-‐design methods such as board games, card games, role-‐plays

or storytelling aim to involve and empower the users into the design process along with other stakeholders in order to provide ideas and solutions for the design of multi-‐channel and complex services. This could provide a nice playground for designing a new travel service just as an example. However, use will be limited in situations, where the user/ customer and the design team do not have a common language.15

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Examples of user diaries: Trambook, an Aalto University project 2012

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In the service concept phase, the purpose is to generate multiple ideas for alternative service implementations. A service can be described through service touch points, customer journey maps or other structural elements needed in service creation.16

Example of a customer journey map from Lego Prototyping makes the idea of a service visual and helps to communicate it to the end user or customer. Different methods have to be applied in service prototyping than product prototyping, where the designer typically builds a replica of the intended product and embeds some real functionality to it. Service prototyping methods are more experimental by nature and often use storytelling as a key method.17

Company Confidential. ©2010 Nokia 1

This is an example of the output after a couple of steps; showing an approach to design a WOW experience for a flight to NYC. Reasons to like this tool: • It’s great to have a formal approach to describing/designing experiences • It starts with the description of a specific customer (in the center) • It recognizes the life cycle of experiences: before, during, and after • It’s easy to use and simple to understand http://experiencematters.wordpress.com/2009/03/03/legos-building-block-for-good-experiences/

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Example of a storytelling service prototype from Lauttasaari bridge18, 2012 During the launch and maintenance phase, service design is not over, though often forgotten. Many companies fall into the traditional ‘customer survey’ cycle, where customers are being questioned at regular intervals to see if they are still ‘happy with our service’. IDEO, one of the world’s most recognized design agencies, think that today companies are valued less for their current offerings than for their ability to innovate and come up with something new.19 User-‐centric service design methods can also be applied after the service is launched to help keep it competitive and to innovate on value adding elements to customers.20 Given the variety of services that exist, service design also has to cope with different situations and contexts. Services live – they cannot be pre-‐produced and stored.21 This is especially true of tourism, where the service is co-‐produced by multiple actors, each having an influence on the overall customer perception of the service.

2.2 Research objective This paper aims to answer the following question: Taking into account the complexity in service design as an interdisciplinary function, tourism as an amalgam of goods, services and people and the business challenges of small to medium sized enterprises in understanding design or having resources or funds to allocate to it – what are feasible methods for a small travel service provider to use for gaining a deeper insight about their customers needs, wants and dreams? Although it would be very tempting to analyze all four, service design phases, I have decided to focus on the initial customer insight phase, which is critical in designing a new service. Travel is a very competed industry with relatively low differentiation and the companies face heavy price competition. Understanding your customers’ hidden needs may offer potential for new innovation and differentiation.

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3. ANALYSIS

3.1 Introducing the business need Many travel and destination service providers are small or medium sized companies. Design is commonly used among large businesses. UK Design Council research into the use of design also revealed that rapidly growing businesses were six times more likely to see design as an integral part of their operations compared to the static businesses.22 Many service design methods are a luxury for a SME, who may lack the expertise, people and money to carry out extensive customer research projects using a specialist research company. Therefore it is important to be able to find ‘good enough’ and more cost-‐effective methods, which are simple to take into use and apply during the key phases of a service design project – when exploring and discovering customer needs, for creating and visualizing new service concepts and reflecting on them for improvement, as well as during the implementation phase, when the ideas are put into action within the organization.

3.2 Tourism as a service “A tourism product is an amalgam of all goods, activities, and services offered to tourists by different sectors of the tourism industry in order to satisfy tourist needs while they are away from home. It includes the journey to and from a destination, transfer from and to an airport, accommodation, transportation while at the destination and everything that a tourist does, sees, and uses on the way to and from the destination, including purchases of food and drinks, souvenirs, entertainment, amusement and a very wide range of other services such as financial, medical, insurance, etc.” 23 The tourism product is not only a collection of tangible (hotel building, bus) or intangible (accommodation service, transportation service) elements but also has psychological experiences from the moment the tourist leaves home to when is arrives back home. All of these experiences are highly subjective and influenced by demographic (e.g. age), socioeconomic (e.g. social class), geographic (place of origin), cultural (e.g. cultural values) and psychological (e.g. needs and motivations) factors. The tourism service also has a human component and the perceptions of this are particularly important. During their travel, tourists come into contact not only with guides but also flight attendants, waitresses in restaurants and local residents, just to mention a few. Therefore the authors Kandampully, Mok and Sparkes suggest that the key components in a tourism product are: access, amenities, accommodation, attractions, activities and people.24

3.2.1 Chinese tourists in Finland

As early as 2012, China is expected to replace Japan as the world’s largest tourism market, with sixty-‐six million Chinese traveling abroad in 2011, a number expected to hit 100 million by 2020, according to the World Tourism Organization. Despite the expected tens of millions expected inbound Chinese tourists in the next few years, most hotels, airlines and retailers do not yet understand how to successfully capture this market. These travelers are affluent; expect customized travel experiences with some of the comforts of home. 25

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In 2010, Finland received 73,000 visitors from China. 42% of the Chinese visitors in Finland were on business trips and 43% on leisure trips. The average stay in Finland lasted 6 nights. 77% of the visitors stayed at a hotel or motel. Chinese visitors spent around EUR 36 million while in Finland in 2010. The average spending was EUR 72 per day and EUR 500 per visit. The amount of travel from China to Finland is expected to increase in the near future due to the rising living standard and disposable income.26

3.2.2 Characteristics of Chinese Tourists Chinese tourists are used as a case example to represent a customer base, which comes from a very different cultural background, has different expectations and needs regarding travel and often do not speak English or Finnish. The first barrier that needs to be overcome is language – preparation needs to go into translating menus, hotel and travel information and basic conversational language for travelers. Some international hotels have introduced touches aimed at Chinese travelers such as stocking instant noodles, Chinese teas and tea kettles in mini-‐bars, offering Chinese TV channels and slippers in guest rooms, and serving congee (hot rice porridge) and dim sum at breakfast.27 One of our clients said that getting serviced by ‘white people’28, automatically implies a better level of service than being chauffeured by a Chinese driver living in Finland. There are many things that are not tangible at a first glance.

3.3 Company profile

The company can be characterized as follows:

-‐ Small company offering travel related services for Chinese tourists -‐ Number of employees < 10 -‐ Has recently entered travel business -‐ Privately funded company -‐ Offers packaged and tailor-‐made travel experiences in Finland and Scandinavia -‐ Aims at medium to high end Chinese customers -‐ Does not employ any design or market research professionals with Chinese

language skills

3.4 Service design tasks during the customer insight phase Although service design aims to put the customer at the center of its process, the process often starts with the company. Since service design is often a co-‐creative process, where multiple company employees and managers need to participate, it is crucial to understand the company’s point of view on a certain problem.29 Using our travel company example; let’s assume that the company thinks it is failing to understand the correct price point of services since they are receiving feedback from some customers that their prices are too high for Chinese people.

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The second task is not finding a solution by ‘lowering the price’ but identifying the real problem. Gaining a clear understanding of the situation from the perspective of current and potential customers is crucial for successful service design. To simplify, it is not about trying to find the solution immediately – it is about finding the problem first! It is about finding the true motivations behind customer behavior by understanding the behavior and mindset of people.30 Using the price point example: there could be multiple reasons behind customer’s price perception e.g. travel offering is described poorly and not reflecting the quality of service, in customer’s culture different things are valued, company is providing too many ‘extras’, which customer does not value… The third task is to visualize the findings and the underlying structure of the previously intangible services. This helps to simplify complex and intangible processes and empowers the designer and team to change those parts of a service, which might not be functioning properly.31 Let’s use a city sightseeing tour as an example. If the service designer can visualize customer’s expectations on what happens on a tour by building a storyboard or a customer journey map, it will be easier to discuss with company management and stakeholders on the differences between customer’s thinking and the company perspective.

3.5 Ideal service design method – characteristics

From the service designer’s perspective, an ideal method would have the following characteristics:

-‐ Suitable to use during customer insight phase in service design (choice of methods) -‐ Does not require common language between service designer and customer as the

company customer base is Chinese and the company does not employ Chinese researchers or designers (table: LANGUAGE DEPENDENT)

-‐ Does not mandate direct interaction between designer and object, as the company in question does not have Chinese speaking employees (table: INTERACTION IS INDIRECT)

-‐ Suitable for researching tourism product dimensions (access, amenities, accommodation, attractions, activities and people) (table: INDUSTRY APPLICATION)

-‐ Captures demographic (e.g. age), socioeconomic (e.g. social class), geographic (place of origin), cultural (e.g. cultural values) and psychological (e.g. needs and motivations) dimensions (table: COLUMNS H-‐L)

-‐ Does not require specialist skills, the researcher can be trained to use the method with relatively low effort (table: SPECIALIST SKILLS NEEDED)

-‐ Produces research insights, which are relatively easy to analyze and report (not requiring complex tools or systems for carrying out the analysis) (table: LOW EFFORT ANALYSIS)

-‐ Is cost effective and does not require major investments (table: LOW COST) Table refers to the Analysis table in Appendix 1.

3.6 Evaluation of service design methods I carried out a subjective evaluation between the following methods and how well they met the criteria described in chapter 3.5:

• DESIGN ETHNOGRAPHY: ROLE PLAY IMMERSION • ETHNOGRAPHY: OBSERVATION

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• ETHNOGRAPHY: SHADOWING • CONTEXT MAPPING: MAKE TOOLS • DESIGN PROBES: DIARY (WRITTEN) • DESIGN PROBES: DIARY (CAMERA) • DESIGN PROBES: DIARY (VIDEO) • DESIGN PROBES: MOBILE • FIVE TIMES WHY • DAY IN A LIFE • AFFINITY DIAGRAMS • CO-‐DESIGN METHODS

Simple green (meets the requirement well), yellow (somewhat meets the requirement) and red (does not meet the requirement) symbols are being used to provide a quick visual overview of the methods. Calculating together the green scores out of the eleven (11) evaluation criteria used did the final scoring. See Appendix 1 for more detail. Based on the subjective evaluation, the methods could be arranged into ‘Best Fit’ order:

1. ROLE -‐PLAY IMMERSION (score: 9/11) 2. OBSERVATION (score: 9/11) 3. SHADOWING (score: 9/11) 4. DAY IN A LIFE (score: 9/11) 5. VIDEO DIARY (score: 7/11) 6. CAMERA DIARY (score: 6/11) 7. WRITTEN DIARY (score: 4/11) 8. FIVE TIMES WHY (score: 4/11) 9. CO-‐DESIGN METHODS (score: 4/11) 10. MOBILE PROBES (score: 3/11) 11. AFFINITY DIAGRAMS (score: 3/11) 12. CONTEXT MAPPING: MAKE TOOLS (score: 2/11)

It is important to keep in mind that ‘Best Fit’ means the best fit for the company and industry type in question and the evaluated methods can be used for other situations and businesses, which may result in a different ranking.

3.7 Role-‐play immersion, observation, shadowing and day in a life At a glance, these methods appear very similar – there is a service designer, who uses the method on his own, without too much interaction with the research objects. Using the travel example, perhaps we can find some differences. Let’s use the following research objective to highlight the similarities and differences: “Study Chinese female visitors in Helsinki to create new shopping related tourist services.” In role-‐play immersion, the service designer could take a role of a shopping assistant, who is helping the visitor by carrying their shopping bags. He would follow her around and study where she goes, who she interacts with, what she buys, how she pays for the goods, what are the ‘unknowns’ and surprises… The designer then uses this information, reflects on it and creates first prototype concepts of the new shopping related travel service.

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A purely observational method could put the designer in a luxury goods store, for example sitting behind the counter, to make observations about Chinese women visiting the store. How are they behaving, what are they wearing, what are they looking at … Based on the observations, service prototypes can be presented for further evaluation. Day in a life method tries to capture the flow of events during a day. In this assignment, the designer would focus on documenting the interactions and events in a journey type description. In this method it is important to also focus on the exceptions. The company may have a pre-‐assumption of the journey such as:

In practice the designer can notice that the real-‐life journey will look very different:

Shadowing is similar to the previous methods. Service designer observes the customer, front-‐line staff or other stakeholders with minimal intrusion. They can employ a range of methods from taking pictures, recording conversations, videotaping etc. Often the purpose is to spot situations where things do not go as planned or where people may say one thing but do another. Taking the Chinese shopper example, the service designer could for example observe the dialogue between shop assistant and client to capture situations, where the client makes a spot purchase of an unexpected item. From the company perspectives these methods are relatively low cost and do not require a lot of investment into technical tools, expensive experts or facilities. Although experts

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develop the methods, with some training most people could start using them to gather customer insights. They can also be well used in travel industry, where there is often a need to observe people during their tour or travel destination, at hotels, restaurants and other attractions. The methods are well suited to observe the interaction between people, which is one of the key psychological dimensions in a travel experience. Ideally, some interaction between the service designer and customer would be possible, e.g. during the role-‐play, the designer could carry out a dialogue with the client. In my opinion, these methods can still work in a situation, where direct conversations are not possible due to language differences. These methods are also suited for capturing information about the cultural, demographic, socioeconomic and psychological dimensions since they are based on close observation. Cultural differences are good to keep in mind, as a smile in Eastern cultures, may not mean the same here. A good service designer would therefore do background research into the cultural differences between himself and the customer in question. The limitations of these methods are language dependency, limited capability to capture geographical factors. Ideally the service designer should be able to follow the discussions and have a dialogue with the person under observation. If there is no common language, this will not be possible. These methods are also geographically limited for a small company, if it does not have money to hire specialist companies abroad or to send their own team to different locations. For large companies, this will not be an issue. If the researcher uses a lot of video material, the analysis can become cumbersome, as video editing is very time consuming. If more lightweight capture mechanisms are used, such as writing notes, taking pictures with a camera or recording sound bites; it will be easier to create a presentation of the results. However, video is a powerful visual tool and if the results need to be communicated to a larger audience, it would justify some investment into video editing and producing a presentation with embedded video material.

3.8 Diary methods (video, camera, written) Diary methods are self-‐reflective and the customer will use the media to document the assignment usually over a longer period. The service designer can send further probes and instructions during the period to gather additional views or to direct the assignment. Tourist groups could be equipped with a digital or video camera and be asked to document their journey or certain parts of it. For example: a Chinese tourist could be asked to document typical ‘Finnish things’, which could give the travel agency new insights on their customer segment. Tour leader could be asked to document questions from the tourist group in a normal diary. Travel agency can use the information to write more descriptive tour brochures. From an SME perspective, these are low cost methods that are relatively simple to use, as most people would know how to write in a diary or take photographs. Video cameras require more technical skills from the users. They are adept for documenting cultural, demographic and psychological factors. The written diary falls short due to its’ language dependency (researcher has to use same language as the object) and it provides limited capability to measure demographic, geographic and socioeconomic factors; written text is a simple medium compared to photographs or video, where contextual information is more rich (visual, audio…)

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People interaction is one of the key factors in travel experience and cannot be captured well in written or camera diary. Video is a good medium for that, even when there is no common language. In general, these methods are effective in overcoming cultural boundaries, as the research materials are highly evocative. The challenge for analysis is the abundance of material: hundreds of photographs or hours of video that is full of visual and audiovisual pieces of information.

3.9 Other methods (Co-‐design, Make Tools, Five Times Why, Affinity Diagrams, Mobile probes) Co-‐design and Make Tools are used often in groups; where service designer, subject matter experts and customers come together for a design assignment. Make Tools are good for building concrete prototypes of new tangible products. In travel, customers can build a prototype of a new hotel or to illustrate a new travel brochure design using Make Tools. Co-‐design is a good method for analyzing and designing processes and complex systems such as a travel reservation system. For a small travel agency, the shortcoming of these methods is that they require direct interaction between customers and the service design team and therefore cannot be used in a situation, where there is no common language. The methods are not low cost since the company has to hire experts to facilitate workshops, hire a facility to hold the workshop and purchase materials for prototype building. Six sigma-‐oriented methods – Five Times Why and Affinity Diagrams – are not optimal for capturing tourism experience dimensions (cultural, demographic…) or people interaction. They are also language dependent. They might be better suited for the service concept or prototyping phases, where the insight information has to be sorted through and analyzed by the company. Mobile probes have a more quantitative application and are not low cost, require specialist skills from the service designer, are dependent on language and an interaction between customer and researcher. Therefore it can’t be considered as a suitable method for a small travel company. On the positive side, some of these methods can produce very visual prototypes or reports at a relatively low cost. For example, if customers co-‐create a travel brochure prototype, it can instantly be used in reporting. Same if they create service mock-‐ups. Five times why and Affinity diagrams are low-‐effort reporting methods, which hardly require any specialist skills or complex tools for creating the report.

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4. SUMMARY This research paper focuses on Service Design methodology and set out to answer the following question: Taking into account the complexity in service design as an interdisciplinary function; tourism as an amalgam of goods, services and people and the business challenges of small to medium sized enterprises in understanding design or having resources or funds to allocate to it – what are the feasible methods for a small travel agency to use for gaining deeper insights about their customers’ needs, wants and dreams? I decided to focus on the initial customer insight phase, which is critical in designing a new service. I used Hämäläinen, Vilkka and Miettinen’s framework, which outlined the following methods that can be used during the customer insight phase in service design:

• DESIGN ETHNOGRAPHY: ROLE PLAY IMMERSION • ETHNOGRAPHY: OBSERVATION • ETHNOGRAPHY: SHADOWING • CONTEXT MAPPING: MAKE TOOLS • DESIGN PROBES: DIARY (WRITTEN) • DESIGN PROBES: DIARY (CAMERA) • DESIGN PROBES: DIARY (VIDEO) • DESIGN PROBES: MOBILE • FIVE TIMES WHY • DAY IN A LIFE • AFFINITY DIAGRAMS • CO-‐DESIGN METHODS

These methods were analyzed from the target customer segment (Chinese tourist), company (small travel agency), industry application (tourism), tourism product/experience and on analysis effort dimensions based on subjective review. Based on my research, it seems that Role-‐play immersion, Observation; Shadowing and Day in a life method offer most potential for the travel company, when they want to design new travel services or improve existing service. Most importantly, they don’t require a heavy up-‐front investment. These methods can be used, when there is no common language with the customer and they don’t require deep specialist skills in order to use them. Some training will be required. In addition, these methods produce results in an easily ‘digestible’ and reportable format. Their shortcoming is limited geographical scope and dependency on understanding the customer’s language; however, as most communication is anyhow non-‐verbal, observational methods can still be used.

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APPENDIX 1: SERVICE DESIGN METHODS ANALYSIS TABLE

HOW TO READ THE TABLE: Method = name of the service design method Variables on top row (low cost, specialist skills needed…) = analysis dimensions based on the travel company requirements Score = number of green symbols out of total 11 dimensions analyzed

Green symbol means that this method meets the requirement well

I Yellow symbol means that this method somewhat meets the requirement, but there are some reservations about using it

✗ Red symbol means that this method does not meet the requirements as specified in this context (travel industry and company specific requirements)

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APPENDIX 2: STEFAN MORITZ LIST OF TOOLS AND METHODS DURING SERVICE DESIGN UNDERSTANDING PHASE Benchmarking Client segmentation Context analysis Contextual interviews Contextual enquiry Critical incident technique Ecology map Ethnography Experience test Expert interviews Focus groups Gap analysis Historical analysis Inconvenience analysis Interviews Market segmentation Mystery shoppers Net scouting Observation Probes Reading Service status Shadowing Thinking aloud Trend scouting User surveys Five Times Why Insight matrix Tested and tried components Inspirational specialists SOURCE: Moritz, Stefan, Service Design – Practical Access to an Evolving Field, London 2005, p 126

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BIBLIOGRAPHY 1 Stickdorn Mark and Schneider Jakob, This is service design thinking, First printing, Amsterdam 2011, p 29 2 Miettinen, Satu (toim.), Palvelumuotoilu – uusia menetelmiä käyttäjätiedon hankintaan ja hyödyntämiseen, 2.painos, Helsinki 2011, p 18 3 Miettinen, Satu (toim.), Palvelumuotoilu – uusia menetelmiä käyttäjätiedon hankintaan ja hyödyntämiseen, 2.painos, Helsinki 2011, p 32 4 Miettinen, Satu (toim.), Palvelumuotoilu – uusia menetelmiä käyttäjätiedon hankintaan ja hyödyntämiseen, 2.painos, Helsinki 2011, p 32 5 Stickdorn Mark and Schneider Jakob, This is service design thinking, First printing, Amsterdam 2011, p 29 6 Miettinen, Satu (toim.), Palvelumuotoilu – uusia menetelmiä käyttäjätiedon hankintaan ja hyödyntämiseen, 2.painos, Helsinki 2011, p 37 7 Miettinen, Satu (toim.), Palvelumuotoilu – uusia menetelmiä käyttäjätiedon hankintaan ja hyödyntämiseen, 2.painos, Helsinki 2011, p 61 8 Moritz, Stefan, Service Design – Practical Access to an Evolving Field, London 2005, p 126 9 Hanington, B (2003), Methods in the Making: A Perspective of the State of Human Research in Design. Design Issues. Volume 19. Number 4. Boston, MA, Autumn 2003 10 Miettinen, Satu (toim.), Palvelumuotoilu – uusia menetelmiä käyttäjätiedon hankintaan ja hyödyntämiseen, 2.painos, Helsinki 2011, 61-‐75 11 Miettinen, Satu (toim.), Palvelumuotoilu – uusia menetelmiä käyttäjätiedon hankintaan ja hyödyntämiseen, 2.painos, Helsinki 2011, pages 61-‐75 12 Kozinets, Robert V., Netnography, doing ethnographic research online, London 2010, page 67 13 Mattelmäki, Tuuli, Design Probes, Publication Series of the University of Arts and Design Helsinki A 69, Vaajakoski, 2006 14 Six Sigma is a business management strategy, which was originally developed by Motorola in 1986. Source: www.wikipedia.org 15 Miettinen, Satu (toim.), Palvelumuotoilu – uusia menetelmiä käyttäjätiedon hankintaan ja hyödyntämiseen, 2.painos, Helsinki 2011, page 77-‐78 16 Stickdorn Mark and Schneider Jakob, This is service design thinking, First printing, Amsterdam 2011, p 130-‐131 17 Miettinen, Satu (toim.), Palvelumuotoilu – uusia menetelmiä käyttäjätiedon hankintaan ja hyödyntämiseen, 2.painos, Helsinki 2011, p 132-‐133 18 Helsinki Tagged project: http://www.helsinkidesignweek.com/other/helsinki-‐tagged 19 Kelley, Tom, The ten faces of innovation, Great Britain 2006, p 4 20 Miettinen, Satu (toim.), Palvelumuotoilu – uusia menetelmiä käyttäjätiedon hankintaan ja hyödyntämiseen, 2.painos, Helsinki 2011, p 38 21 Moritz, Stefan, Service Design – Practical Access to an Evolving Field, London 2005, p 46 22 Design Council (2005), National survey of firms, London 23 Kandampully Jay, Mok Connie & Sparkes Beverly, Service quality management in hospitality, tourism and leisure, New York, 2001, p 8-‐9 24 Kandampully Jay, Mok Connie & Sparkes Beverly, Service quality management in hospitality, tourism and leisure, New York, 2001, p 10 25 Travel Marketers Aren’t Prepared for Flood of Affluent Chinese Tourists, www.adventuretravelnews.com, Sept 30, 2012 26 Rajahaastattelututkimus, osa 24, Matkailunedistämiskeskuksen julkaisuja, MEKA:171 2011

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27 Travel Marketers Aren’t Prepared for Flood of Affluent Chinese Tourists, www.adventuretravelnews.com, Sept 30, 2012 28 Refers to Finnish people in this context, source: Route 88 Oy customer data 29 Stickdorn Mark and Schneider Jakob, This is service design thinking, First printing, Amsterdam 2011, 128-‐129 30 Stickdorn Mark and Schneider Jakob, This is service design thinking, First printing, Amsterdam 2011, 128-‐129 31 Stickdorn Mark and Schneider Jakob, This is service design thinking, First printing, Amsterdam 2011, 129