3. George Day observes:
―The diversity of ways a business can achieve a
competitive advantage quickly defeats any
generalization or facile prescriptions....First and
foremost, a business must set itself apart from its
competition. To be successful, it must identify and
promote itself as the best provider of attributes that are
important to target customers.‖
4. To position itself in the market any organization, company or
firm needs to have focus.
In marketing terms, focus means providing a relatively
narrow product mix for a particular market segment –a
group of buyers who share common characteristics, needs,
purchasing behaviour, or consumption patterns.
5. The extent of service company’s focus can be described along
two dimensions:
Market Focus : A market focus company concentrate on a
narrow market segment but offer a wide range of services.
Service Focus: Service focused firms offer a narrow range
of services to a fairly broad market.
6. BREADTH OF SERVICE OFFERINGS
Narrow Wide
Many
NUMBER OF
MARKETS
SERVED
Few
7. Benefits from the Fully Focused
In this few customers are served by the narrow service
segment.
Provide protection to the firm against would be competitors
and allow firm to charge premium.
Example
Small courier service firm sever only one or two big clients,
provide services based on their requirements.
8. Benefits from Service Focused
In this segment narrow product line is served to many
customers.
Example
Reliance CDMA services launched in year 2002
9. Benefits from Market Focused
It offers the potential of selling multiple services to a single
purchase.
Example:
Tour organizing firms like SOTC. They take care of their
clients travelling ,lodging and food during the entire trip.
10. Major Service Innovations: New core products for previously undefined
markets for example Fedex’s introduction to overnight express service in
1971.
Major Process Innovations: Using new processes to deliver existing products
with added benefits. Example University of Phoenix give lectures either
online or in rented facility.
Product Line Extensions: Addition to current product lines. Example Selling of
Insurance Product by banks.
Process-line Extensions: Alternative delivery procedures
Supplementary Service Innovations: Additions of new or improved facilitating
or enhancing elements
Service Improvements: Modest changes in the performance of current products
Style Changes: Visible changes in service design or scripts
11. Service processes affect customers and also cost, speed, and
productivity
Reengineering – analyzing and redesigning processes to achieve
faster and better performance
Examination of processes can lead to creation of alternative
delivery methods:
◦ Add or eliminate supplementary services
◦ Re-sequence delivery of service elements
◦ Offer self-service options
12. Goods and services may become competitive substitutes if they
offer the same key benefits
Provides an alternative to owning the physical good that can attain
the desired outcome
Any new good may create need for after-sales services now and
be a source of future revenue stream
13. Own a Physical Good Rent Use of Physical Good
Perform Work
Oneself
Drive Own Car Rent a Car and Drive it
Use Own Computer Rent Use of Computer
Hire Someone
to Do Work
Hire a Chauffeur to Drive Hire a Taxi or Limousine
Hire a Typist to Type Send Work out to a
Secretarial Service
14. Services are not immune to high failure rates that plague new
manufactured products
In developing new services:
◦ core product is often of secondary importance, many
innovations are in supplementary services or service delivery
◦ ability to maintain quality of the total service offering is key
◦ accompanying marketing support activities are vital
◦ market knowledge is of utmost importance
15. Market synergy
◦ Good fit between new product and firm’s image
◦ Advantage in meeting customers’ needs
◦ Strong support from firm during and after launch
◦ Understands customer purchase decision behavior
Organizational factors
◦ Strong inter-functional cooperation and coordination
◦ Internal marketing to educate staff on new product and its
importance
16. Market research factors
◦ Scientific studies
conducted early in
development process
◦ Product concept well
defined before undertaking
field studies
18. SERVICE BLUEPRINT
A tool for simultaneously depicting the service process, the points
of customer contact, and the evidence of service from the
customer’s point of view.
Process
Points of contact
Service
Blueprint
Evidence
19. DEVELOPING A BLUEPRINT
Developing a Blueprint
•Identify key activities in creating and delivering service
•Define “big picture” before “drilling down” to obtain a higher level of
detail
A key characteristic of service blueprinting is that it distinguishes between
what customers experience “front-stage”
the activities of employees and support processes “back-stage”,
Between these two lies the line of visibility.
21. KEY COMPONENTS OF A SERVICE BLUEPRINT
Define standards for Specify physical Identify principal
front stage activities evidence customer actions
Objectives:
Identify fail
points &
risks of
excessive Front stage actions
waits Line of visibility by frontline Line of interaction
personnel
Set service
standards
Fail-proof
process
Backstage actions Support processes
Support processes
by customer contact involving other
involving IT
personnel personnel
23. BLUEPRINTING THE RESTAURANT
EXPERIENCE: A THREE-ACT PERFORMANCE
•Act 1: Prologue and Introductory Scenes
•Act 2: Delivery of Core Product
Cocktails, seating, order food and wine, wine service
Potential fail points: Menu information complete? Menu intelligible?
Everything on the menu actually available?
Mistakes in transmitting information a common cause of quality failure
Customers may not only evaluate quality of food and drink, but how promptly
it is served or serving staff attitudes
•Act 3: The Drama Concludes
Remaining actions should move quickly and smoothly, with no surprises at the
end
Customer expectations: accurate, intelligible and prompt bill, payment handled
politely, guest are thanked for their patronage
24. BLUEPRINT FOR EXPRESS MAIL DELIVERY SERVICE
Truck Truck
Packaging Packaging
EVIDENCE
CUSTOMER PHYSICAL
Forms Forms
Hand-held Hand-held
Computer Computer
Uniform Uniform
Customer Customer Receive
Calls Gives Package Package
(On Stage)
Line of interaction
Driver Deliver
Picks Up Package
CONTACT PERSON
Package
Line of visibility
Back Stage)
Customer
Service
Order
Line of internal interaction
Dispatch Airport Fly to
SUPPORT PROCESS
Driver Receives Sort Fly to Unload & Load On
& Loads Center Destinatio Sort Truck
n
Sort Load on
Packages Airplane
25. ADVANTAGES OF BLUEPRINTING
Advantages of Blueprinting
•Distinguish between “front stage” and “backstage”
•Clarify interactions and support by backstage activities and systems
•Identify potential fail points; take preventive measures; prepare
contingency
•Pinpoint stages where customers commonly have to wait
•Identify fail points
•Analysis of reasons for failure reveals opportunities for failure-proofing
to reduce/eliminate future errors
•Need fail-safe methods for both employees and customers
26. REDESIGNING SERVICE PROCESSES
―Institutions are like steel beams—they
tend to rust. What was once smooth and
shiny and nice
tends to become rusty.‖
Mitchell T. Rabkin, MD,
Former President of
Boston’s Beth Israel
Hospital
27. WHY REDESIGN?
Revitalizes process that has become outdated
•Changes in external environment make existing practices obsolete
and require redesign of underlying processes
Rusting occurs internally
•Natural deterioration of internal processes; creeping bureaucracy;
evolution of spurious, unofficial standards
Symptoms:
Extensive information exchange
Data that is not useful
High ratio of checking control activities to value-adding
activities
28. WHY REDESIGN?
Redesign aims to achieve these performance measures:
Reduced number of service failures
Reduced cycle time from customer initiation of a
service process to its completion
Enhanced productivity
Increased customer satisfaction
29. 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
• Increase in productivity and service quality
Shifting To Self- • Lower costs and perhaps prices
service • Enhance technology reputation
• Differentiates company
• Improve convenience for customers
Delivering Direct • Productivity can be improved by eliminating
Service expensive retail locations
• Increase customer base
30. PROCESS REDESIGN: APPROACHES AND
POTENTIAL BENEFITS
• Involves grouping multiple services into one
offer, focusing on a well-defined customer
Bundling group
• A better fit to the needs of target segment
Services • Increase productivity with customized service
• Increase per capita service use
• Focus on tangible elements of service
process (facilities and equipment)
Redesigning • Increase convenience
Physical Aspects • Enhance satisfaction and productivity of
Of Service Process frontline staff
• Cultivate interest in customers
31. Q1.Identify some real-world examples of branding in financial services,
such as specific type of retail bank account or insurance policies, and
define their characteristics. How meaningful are these brands likely to be to
customers?
Q2.Prepare a blueprint of the service with which you are familiar. Upon
completion consider
(a) what are the indicators of quality from the customer perspective
considering the line of visibility
(b) whether all steps in the process are necessary
(c) the location of the potential fail points and how could they be designed
our of the process or what service recovery procedure could be used.
(d) what are the potential measures of process performance
(e) the extent to standardization is possible and advisable throughout the
process
