Service management market positioning rhizu

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2. TopicsMARKETPOSITIONINGBLUEPRINTOF SERVICES 3. George Day observes: The diversity of ways a business can achieve a competitive advantagequickly 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 orfirm needs to have focus.In marketing terms, focus means providing a relativelynarrow product mix for a particular market segment agroup of buyers who share common characteristics, needs,purchasing behaviour, or consumption patterns. 5. The extent of service companys focus can be described alongtwo dimensions:Market Focus : A market focus company concentrate on anarrow market segment but offer a wide range of services.Service Focus: Service focused firms offer a narrow rangeof services to a fairly broad market. 6. BREADTH OF SERVICE OFFERINGS NarrowWideManyNUMBER OFMARKETSSERVEDFew 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.ExampleReliance 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 undefinedmarkets for example Fedexs introduction to overnight express service in1971.Major Process Innovations: Using new processes to deliver existing productswith added benefits. Example University of Phoenix give lectures eitheronline or in rented facility.Product Line Extensions: Addition to current product lines. Example Selling of Insurance Product by banks.Process-line Extensions: Alternative delivery proceduresSupplementary Service Innovations: Additions of new or improved facilitatingor enhancing elementsService Improvements: Modest changes in the performance of current productsStyle Changes: Visible changes in service design or scripts 11. Service processes affect customers and also cost, speed, andproductivity Reengineering analyzing and redesigning processes to achievefaster and better performance Examination of processes can lead to creation of alternativedelivery 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 theyoffer the same key benefits Provides an alternative to owning the physical good that can attainthe desired outcome Any new good may create need for after-sales services now andbe 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 ComputerHire Someoneto 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 newmanufactured products In developing new services: core product is often of secondary importance, manyinnovations 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 firms 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 itsimportance 16. Market research factors Scientific studiesconducted early indevelopment process Product concept welldefined before undertakingfield studies 17. Blueprinting Services to Create Valued Experiences andProductive Operations 18. SERVICE BLUEPRINTA tool for simultaneously depicting the service process, the pointsof customer contact, and the evidence of service from thecustomers point of view.Process Points of contact Service Blueprint Evidence 19. DEVELOPING A BLUEPRINTDeveloping a BlueprintIdentify key activities in creating and delivering serviceDefine big picture before drilling down to obtain a higher level ofdetailA 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. 20. SERVICE BLUEPRINT 21. KEY COMPONENTS OF A SERVICE BLUEPRINT Define standards forSpecify physical Identify principal front stage activities evidencecustomer actionsObjectives:Identify failpoints &risks ofexcessive Front stage actionswaitsLine of visibilityby frontline Line of interactionpersonnelSet servicestandardsFail-proofprocessBackstage actions Support processesSupport processes by customer contact involving other involving ITpersonnel personnel 22. Blueprinting the Restaurant Experience: Act 1 23. BLUEPRINTING THE RESTAURANT EXPERIENCE: A THREE-ACT PERFORMANCEAct 1: Prologue and Introductory ScenesAct 2: Delivery of Core ProductCocktails, seating, order food and wine, wine servicePotential fail points: Menu information complete? Menu intelligible?Everything on the menu actually available?Mistakes in transmitting information a common cause of quality failureCustomers may not only evaluate quality of food and drink, but how promptlyit is served or serving staff attitudesAct 3: The Drama ConcludesRemaining actions should move quickly and smoothly, with no surprises at theendCustomer expectations: accurate, intelligible and prompt bill, payment handledpolitely, guest are thanked for their patronage 24. BLUEPRINT FOR EXPRESS MAIL DELIVERY SERVICETruckTruckPackagingPackaging EVIDENCECUSTOMER PHYSICALFormsFormsHand-heldHand-heldComputer ComputerUniformUniformCustomer Customer ReceiveCallsGives PackagePackage (On Stage)Line of interaction Driver Deliver Picks Up PackageCONTACT PERSON Package Line of visibilityBack Stage)CustomerServiceOrderLine of internal interaction Dispatch Airport Fly to SUPPORT PROCESS Driver ReceivesSortFly toUnload &Load On& Loads CenterDestinatioSortTruckn SortLoad on PackagesAirplane 25. ADVANTAGES OF BLUEPRINTINGAdvantages of BlueprintingDistinguish between front stage and backstageClarify interactions and support by backstage activities and systemsIdentify potential fail points; take preventive measures; preparecontingencyPinpoint stages where customers commonly have to waitIdentify fail pointsAnalysis of reasons for failure reveals opportunities for failure-proofingto reduce/eliminate future errorsNeed fail-safe methods for both employees and customers 26. REDESIGNING SERVICE PROCESSES Institutions are like steel beamsthey tend to rust. What was once smooth and shiny and nicetends to become rusty. Mitchell T. Rabkin, MD,Former President of Bostons Beth IsraelHospital 27. WHY REDESIGN?Revitalizes process that has become outdatedChanges in external environment make existing practices obsolete and require redesign of underlying processesRusting occurs internallyNatural deterioration of internal processes; creeping bureaucracy; evolution of spurious, unofficial standardsSymptoms: 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-servicesvalue-adding Steps Improve productivity and customer satisfaction Increase in productivity and service quality Shifting To Self- Lower costs and perhaps pricesservice Enhance technology reputation Differentiates company Improve convenience for customers Delivering Direct Productivity can be improved by eliminatingServiceexpensive retail locations Increase customer base 30. PROCESS REDESIGN: APPROACHES AND POTENTIAL BENEFITS Involves grouping multiple services into oneoffer, focusing on a well-defined customerBundlinggroup A better fit to the needs of target segmentServices Increase productivity with customized service Increase per capita service use Focus on tangible elements of serviceprocess (facilities and equipment)Redesigning Increase conveniencePhysical 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, anddefine their characteristics. How meaningful are these brands likely to be tocustomers?Q2.Prepare a blueprint of the service with which you are familiar. Uponcompletion consider(a) what are the indicators of quality from the customer perspectiveconsidering 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 designedour 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