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06-11-2016
1
Week 3
Vinay Kumar Kalakbandi
Assistant Professor
Operations & Systems Area
09/11/2014 Vinay Kalakbandi 1
Service Operations (SO) Post Graduate Program for Working Executives 2016-17
This week on Service Operations
• Recap
• Service Design fundamentals
• Servicescapes
• Service blueprinting
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Recap
• Service characteristics
• Service classifications
• Service economy
• Strategic Service Vision
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SERVICE SYSTEM DESIGN
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Services comprises of
• Service outcome
• Service experience
• Which is important?
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Service design elements
• Structural – Delivery system, Facility design, Location
• Servicescapes
– Capacity planning • Queuing models
• Managerial – Service quality management
– Managing supply and demand • Yield management, demand steering
– Managing the service encounter • Degree and nature of interaction between customer and server
– Information: and how you use it!
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Service/Product Bundle
Element Core Goods
Example
Core Service
Example
Business Custom clothier Business hotel
Core Business suits Room for the night
Peripheral
Goods
Garment bag Bath robe
Peripheral
Service
Deferred payment
plans
In house restaurant
Variant Coffee lounge Airport shuttle
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The Service Package
• Supporting Facility: The physical resources that must be in place before a service can be sold. Examples are golf course, ski lift, hospital, airplane.
• Facilitating Goods: The material consumed by the buyer or items provided by the consumer. Examples are food items, legal documents, golf clubs, medical history.
• Information: Operations data or information that is provided by the customer to enable efficient and customized service. Examples are patient medical records, seats available on a flight, customer preferences, location of customer to dispatch a taxi.
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The Service Package (cont.)
• Explicit Services: Benefits readily observable by the senses.
The essential or intrinsic features. Examples are quality of meal,
attitude of the waiter, on-time departure.
• Implicit Services: Psychological benefits or extrinsic features
which the consumer may sense only vaguely. Examples are
privacy of loan office, security of a well lighted parking lot.
• Peripheral/Ancillary services and their service
packages!
The Service Package
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Supporting Facility
Facilitating
Goods Information
Explicit Services
Implicit Services
Service
Experience
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Exercise
• Cook it yourself restaurant
• Drive through car wash
• Car Sharing service
• Mobile wedding chapel
• Pet boarding facility
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SERVICESCAPES
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What place is this?
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What place is this?
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Physical evidence
• The environment in which the service is
delivered and where the firm and the customer
interact, and any tangible commodities that
facilitate performance or communication of the
service.
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Elements of Physical Evidence
10-18
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Examples of Physical Evidence from
the Customer’s Point of View
10-19
Examples of Physical Evidence from
the Customer’s Point of View
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Typology of Service Organizations Based on Form
and Use of the Servicescape
10-21
Whom the
servicescape will affect
Flow of the experience
Meaning customers attached to it
Satisfaction
Emotional connections to company
How Does Physical Evidence Affect the
Customer Experience?
10-22
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Roles of the Servicescape
• Important elements used in positioning a service organization.
• Package: ‘wrap’ the service and convey what is ‘inside’ – conveys expectations
– influences perceptions
• Facilitator – facilitates the flow of the service delivery process
• provides information (how am I to act?)
• facilitates the ordering process (how does this work?)
• facilitates service delivery
Eg. International traveler find the a poorly designed airport with few signs, poor ventilation, and few places to sit or eat
• Clue management: the process of clearly identifying and managing all the various clues that customers use to form their impressions and feelings about the company.
10-23
Speedi-Lube Spells Out the Service Offering
10-24
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Roles of the Servicescape (continued)
• Socializer: Helps to convey expected roles, behaviors, and relationships
– facilitates interaction between:
• customers and employees
• customers and fellow customers
• Employees and fellow employees
• Differentiator
– sets provider apart from competition in the mind of the consumer
Socializer:
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Differentiator
Understanding Servicescape
Effects on Behavior
• Stimulus-organism-response theory
– Stimulus = multidimensional environment
– Organism = customers and employees
– Response = behaviors directed at the environment
• Proposition:
Dimensions of the servicescape will affect customers and
employees and they will behave and respond in different ways
depending on their internal reactions to the servciescape.
10-30
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10-31
Responses to the servicescape
Physiological
Affective
Behavior
Cognitive
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Beliefs
Categorizations
Symbolic meaning
Pupil Dilation
Tears, perspiration etc
Arousal
Complexity
Pleasure
Personal control
Natural elements
Approach
Avoidance
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Individual Behaviors in the Servicescape
• Environmental psychologists suggest that people react to
places with two general, and opposite forms of behavior:
– Approach: all positive behaviors that might be
directed to a place
• Desire to stay, explore, work, affiliate
• Shopping enjoyment, spending time and money
– Avoidance: negative behaviors
• Desire not to stay, etc.
10-33
Social Interactions in the Servicescape
• All social interaction is affected by the physical container in which it occurs
– Customer-employee
– Customer-customer
• Scripts (particular progression of events)
• Physical proximity
• Seating arrangements
• Size
• Flexibility
10-34
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Variations in Individual Response
• Personality differences
– Arousal seekers vs. arousal avoiders
Enjoy high levels of stimulation/prefer lower levels of stimulation
– Environmental screeners
Able to experience a high level of stimuli but not be affected by it
• Purpose for being in the servicescape
– Business/pleasure
• Temporary mood state
A person after a day at work/ a person after holiday
10-35
Servicescape dimensions and impact
• Ambient conditions
– Effects on the five senses
– Perfume at mall entrance
– Cookies in the mall
– Oxygen in the casino
– Music played in the supermarket
• Familiarity
• Tempo
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Servicescape dimensions and impact
• Spatial layout and functionality
– The new supermarkets!
– Self service restaurants
• Signs, symbols, and artefacts
– explicit or implicit communication of meaning
– Important in forming first impressions
– Visual metaphor of the organization’s offering
– Way-finding labels: Aiga symbols
– Professor’s office
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Guidelines for Physical Evidence Strategy
• Recognize the strategic impact of physical evidence.
• Blueprint the physical evidence of service.
• Clarify strategic roles of the servicescape.
• Assess and identify physical evidence opportunities.
• Update and modernize the evidence.
• Work cross-functionally
10-38
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Managerial Implications
• Careful and creative management of servicescape necessary – Helps firms achieve both
external marketing goals and internal organizational goals
• Servicescape is a visual metaphor for the organization’s offering
• Servicescape is the packaging of the service
• It facilitates and nurtures a certain type of interaction
• Helps as a key differentiator
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SERVICE BLUEPRINTING
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Service Blueprinting
• A picture or map that accurately portrays the
service system so that the different people
involved in its development can understand and
deal with it objectively regardless of their roles
or their individual point of view.
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Service Blueprint
Physical/Tangible Evidence
Customer Actions
• Line of interaction
Onstage/Visible Contact Employee/Technology Actions
• Line of visibility
Backstage/Invisible Contact Employee Actions
• Line of internal interaction
Support Processes
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Service Blueprint of Luxury Hotel
Steps in designing a blueprint
1. Identify the service to be blueprinted – Basic business concept
– A service within a family of services
– A specific service component
2. Identify the customer segment that receives the service
3. Map the service from the customer’s point of view
4. Draw the lines of interaction and visibility
5. Map the service from the customer contact person’s point of view
6. Draw the line of internal interaction
7. Link customer and contact person activities to needed support functions
8. Add physical evidence
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How will the blueprint help?
• Identifying key processes necessary along with
what needs to be visible to the customer
• Identifying failure points and arranging for
necessary fail safe mechanisms
• Helps choreograph an ideal service encounter
• Aid service improvement efforts
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Blueprinting exercise
• Cook it yourself restaurant
• Drive through car wash
• Car Sharing service
• Paragliding service
• Mobile wedding chapel
• Pet boarding facility
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