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7 P’S OF SERVICE MARKETING
PROCESS
PROCESSES
28/04/2023Faculty of Management Studies, MBA(MS)
3
One of the 7Ps of Service marketing
Services are processes which are marketed Airline markets the process of transportation Restaurant markets process of meal
preparation & presentation
IMPORTANCE OF SERVICE PROCESS
28/04/2023Faculty of Management Studies, MBA(MS)
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Goods - manufacturing takes place in factories in the absence of customers
Process within the factories are in the domain of operations and customer doesn’t come in contact with them
Services - customer is part of processes One bad process leads to bad service experience
Front end process
Back end process
SERVICE PROCESS
28/04/2023Faculty of Management Studies, MBA(MS)
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Service experience - passing through a series of predetermined stages involving activity/interactionAir service - ticket booking ,check-in, security check, boarding, being seated in plane, meal service, collection of luggage etc.
Goods are differentiated on the basis of their attributes.
Service firms use processes to create differentiation in their service products. Air Deccan’s no frill service Jet Airways high class service
28/04/2023Faculty of Management Studies, MBA(MS)
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Visible services - check-in, security check & physical transfer of passengers to the airplane
Invisible services - refreshment procurement process, aircraft preparation service
People processing processes - security check Information processing processes - Ticket booking Material processing - luggage transfer, meal
service
PROCESS ANALYSISUNDERSTANDING SERVICE PROCESS
VARIETY IN PROCESS
28/04/2023Faculty of Management Studies, MBA(MS)
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Specifies whether the process has a standardized or flexible sequence of events
Has implications on cost, complexity and flexibility
Runner Repeaters Strangers
Runner
28/04/2023Faculty of Management Studies, MBA(MS)
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Standardized operation
Found in high volume operations
Lead to tight process control and automation
Allows high efficiency
Mass Service
EXAMPLE OF TRAIN RESERVATION SYSTEM
28/04/2023Faculty of Management Studies, MBA(MS)
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Repeaters
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Complex and occur less frequently
Result of expansion of services
Handles variety
Require process adjustment in an existing runner setup
Service Shop
EXAMPLE OF LUXURY HOTEL
28/04/2023Faculty of Management Studies, MBA(MS)
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Strangers
28/04/2023Faculty of Management Studies, MBA(MS)
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Non-standardized process
Difficult to forecast demand and resource requirements
Occur least frequently
Added during addition of new services
Professional Service
Different process types are appropriate for different Volume-Variety combinations
VolumeLow High
Varie
tyLo
wH
igh
Strangers
Repeaters
Runners
Service process types
28/04/2023Faculty of Management Studies, MBA(MS)
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Deviating from the ‘natural’ diagonal on the product-process matrix has consequences for
cost and flexibility
Professionalservice
ServiceShop
Massservice
None
None
Less process flexibility
than is needed so less cost
More process flexibility
than is needed so high cost
The ‘natural’ line of fit of process to volume/variety characteristics
Service operations process types
VarietyVolume
28/04/2023Faculty of Management Studies, MBA(MS)
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THE SERVICE PROCESS MATRIX
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Low volumeLow
standardization
INCREASING VARIETY
Low volumeMultiple Services
Higher volumeFew major Services
High volumeHigh
standardization
SERVICE CHARACTERISTICS
INCREASING VOLUME
Customer service branch
Investment banking
Bank call centre
Credit card processing
Jumbled flow
(job-shop)
Disconnected line flow(batch)
Connected line flow(mass)
Smooth flow (Continuous)PR
OC
ESS
CH
AR
AC
TER
ISTI
CS
Random flow
(project)
VALUE ADDITION IN PROCESS
28/04/2023Faculty of Management Studies, MBA(MS)
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Identifying which part of the process is most important to customer
Subjective as based on the context of service
Segregation of frontline and backroom process
TASK ALLOCATION
28/04/2023Faculty of Management Studies, MBA(MS)
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Depends on the value focus of the service process
Varies depending on the service concept
SERVICE PROCESS DESIGN
INTEGRATING MARKETING WITH OPERATIONS
INTEGRATING MARKETING WITH OPERATIONS
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Service process needs to be designed with the customers in mind
Along with what is delivered, how it is delivered too has relevance
Poorly designed service may lead to poorly perceived quality
Operations led service design considerations often ignore customers
PROCESS DESIGN IN SERVICES
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Marketing and operations must communicate and collaborate in process design
Operations tend to focus on the needs of the providers
Customer-centric processes create a satisfied customer
A service system uses materials, equipments, people and information
DECISIONS IN SERVICE PROCESS PLANNING
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• Primary Technology• Conversion Process• Specific Equipments• Process Flow• People• Service Location• Facility Layout• Organizational Culture
PROCESS TYPES IN SERVICE OPERATIONS
28/04/2023Faculty of Management Studies, MBA(MS)
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Line or Flow•Operations in pre-determined sequence•Adopted in goods manufacture•Logical sequencing of service activities•Co-ordination between stages is important•Most convenient for a standardized output
Job Shop•Combination of activities and sequence determined by the service desired•Labour intensive process•Flexibility in terms of the variety offered•Appropriate for customized service•Limits the employment of specialists
SERVICE-PROCESS MATRIX
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Services differ with respect to their products and character
Opportunity to transfer managerial know-how and skills between services
Common set of problems demand similar responses
Two dimensional matrix by Roger Schmenner
28/04/2023Faculty of Management Studies, MBA(MS)
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Low High
Service Factory Service Shop Airlines Hospital Trucking Auto repair Hotels Other repair services Resorts/ recreation
Mass Service Professional Service Retailing Physicians Wholesaling Lawyers Schools Accountants Retail banking Architects
Degr
ee o
f Lab
or I
nten
sity
Degree of Interaction and Customization
Low
High
SERVICE-PROCESS MATRIX: CHALLENGES
.
Low Labor Intensity Challenges:
• Capital Decisions • Keeping up with Technology • Managing Demand • Scheduling service delivery
Low Interaction/ Customization Challenges:
• Differentiating in market• Making service “warm”• Managing physical surroundings• Developing operating procedures
High Labor Intensity Challenges:
• Hiring workers• Training workers• Developing methods and
controls• Assuring employee welfare• Controlling distant operations• Starting new units• Managing growth
High Interaction/ Customization
Challenges:
• Managing costs• Maintaining quality• Reacting to
customers in process• Managing people in process• Gaining employee
loyalty
Service FactoryLow labor, low
interaction/customization
Service ShopLow labor, high
Interaction/customization Mass Service
High labor, low interaction/customizatio
n
Professional ServiceHigh labor, high
interaction/customization
28/04/2023Faculty of Management Studies, MBA(MS)26
CASE STUDY: MUMBAI DABBAWALAS
Bombay Dabbalawas: An Overview
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Dabbawalas: An Overview
Standard Operating Procedures
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• Collect, Transport and Distribute• 5000 Dabbawalahs: 30
customers/Dabbawalah• Zoning System approach• Each zone served by a team of 20-25
dabbawala• Team leader, Mukadam• Self administered work units with common
agenda• 3 hierarchies: 5000 workers, 800
mukadams and a small number in Executive committee
The System: Secrets of Success
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Committed Workforce Strong social bond Extensive railway system Coding System
The System: How it operates?
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Dabbas collected
from customer homes, taken to railway station
Dabbas sorted at station
Dabbas loaded
on wooden
trays
Majority of trays destined for the
city area
Dabbas returned
to househol
ds in evening
THANK YOU