8/12/2019 SM Process 10

1/25

8/12/2019 SM Process 10

2/25

Process Blueprinting

The process of service delivery can be mapped

with a flow-chart or a service blueprint.

A diagrammatic representation makes it easy to

tell at a glance if any processes are redundant,

overlapping, unnecessary or just right.

Particularly if the typical time needed for each task

on the process map is identified, we can estimate

the time spent by a customer in a particular stage

of service delivery system, and improvements canbe made through Process Re-engineering (also

called BPR)

8/12/2019 SM Process 10

3/25

8/12/2019 SM Process 10

4/25

Alternative Scenario of the

same process

Punch in Details of DD at ATM Collect draft

Fig. 2: Scenario 2 for a Draft Purchase at an ATM

8/12/2019 SM Process 10

5/25

A Major Service Process : Complaints

Management and Service Recovery

Only one out of 20 dissatisfied customers

bothers to complain.

12 positive experiences are required to erase

one negative experience.Around 50% of attempts at service recovery

are botched up, leaving customers even more

dissatisfied.

86 percent of the bad memories quoted by

respondents are more than 5 -year old

experiences.

8/12/2019 SM Process 10

6/25

BPR-Buying of Drafts

The first scenario we saw may still

be the common one at most banks,

but scenario 2 may well becomeroutine in a few years.

Already, you can order drafts over

the net at the banks which offerinternet banking.

8/12/2019 SM Process 10

7/25

Are new processes always

better? The quarterly statement from your bank as

a substitute for the pass book. Is it a good

thing?

Think about its disadvantages as a

customer..

ATM withdrawal problemshow do you

sort it out if you get shortchanged?

8/12/2019 SM Process 10

8/25

Internet-based shopping

Has promised a lot, but failed to live up to

the hype.

Back end (non-ordering) processes were

at fault in many cases

On the other hand, a lot of processes have

been improved due to technology...

8/12/2019 SM Process 10

9/25

Lost airline tickets

Some old processes have actually been

greatly improved upon, as illustrated by

the boxed item (see text) on lost airline

tickets. Earlier, all was lost if you lost yourairline ticket.

Now it need not be so. If you have identity

proof you can travel.

Also get a refund later.

8/12/2019 SM Process 10

10/25

Insurance Co. Processes

In an insurance co., customer acquisition

can be one process, claims settlement a

second major one from the companys

point of view.

Buying an insurance policy is simple but

making a claim can be cumbersome from

a customers point of view.

8/12/2019 SM Process 10

11/25

Contd..

The company can look for the most

efficient and customer-friendly process

that serves the needs of both parties.

For example, unnecessary stages can be

eliminated, or processes can be

shortened, documentation can be

simplified by reducing unnecessaryinformation asked, and so on.

8/12/2019 SM Process 10

12/25

An Example from Indian

Railways Indian Railways has constantly updated its

reservation processes to make them more

customer-friendly and convenient. But its

routine local telephonic enquiry at railwaystations does not work half as efficiently in

most locations.

There is a serious need to re-look at it and re-

engineer it for the benefit of millions who usethe service everyday.

8/12/2019 SM Process 10

13/25

Contd.

Even if one million passengers waste one

hour of their time because the enquiry number

is not functioning to tell them about a late

arrival, it is one million man-hours wastedeveryday- not counting other man hours of the

people who may go to the station to drop or

pick up someone.

Reengineering this process will translate intomajor savings for customers

8/12/2019 SM Process 10

14/25

Single Window Service

Concept Some years ago, Mr. T.N. Seshan, the then

Chief Election Commissioner, had suggesteda single multi-purpose identity card for everyIndian citizen, that could be used for votingtoo. The concept was a sound one.

For example, the driving license, thepassport, the ration card, and the voters cardcan all be easily issued by the local post officeor the local police station, because that iswhere the actual verification happens in anycase.

8/12/2019 SM Process 10

15/25

E-seva of the AP Govt.

A pioneer in the use of the single window

efficient service idea is the e-seva initiative

by the Andhra Pradesh Government.

Many services including bill payments and

applications/renewals of different types are

provided at one location, in a simple and

comfortable environment.

8/12/2019 SM Process 10

16/25

Managing the Waiting

Process Reasons for waits involved in the service

process -

Limited space for customers (Eg. In a

Restaurant) Limited facilities for processing things (eg:Laundromat has 8 machines)

Limited labor. Number of service providers is

less than the demand, though there may beequipment available. For example, check outclerks at a retail store.

8/12/2019 SM Process 10

17/25

Possible Improvements in the Waiting

Process

(handling capacity/demand mismatch)

1. Seating versus Standing

2. Start another line on a particularly crowdedday

3. Giving people something to do (read, watchTV)

4. Providing Information on possible time inline

5. Pre-process (some work can be donebefore reaching a server, like nursepreparing a patient for operation)

8/12/2019 SM Process 10

18/25

Contd.

Other techniques include price variations

for use of lean time capacity (night travel,

phone calls, internet use), reservation or

appointments system (doctors, air travel)

Exercise: Think of a bottleneck you have

experienced as a customer of a service.

How would you suggest the provider dealwith it?

8/12/2019 SM Process 10

19/25

Six Sigma

Six Sigma is a comprehensive and flexible

system for achieving sustaining and maximizing

business success by minimizing defects and

variability in process. At the quality level of Six Sigma, defectives per

million opportunities (DPMO) is 3.4

It is popular in banks, insurance, health care,

education etc.

Th Si Si C t i B ki

8/12/2019 SM Process 10

20/25

The Six Sigma Concept in Banking

Six Sigma is based on statistical analysis of acompanys own data to measure and improve any

process or task.

Many banks in India are now using the concept of

Six Sigma, made famous by Motorola in the U.S.,

to improve process quality in their processes.

Some of the processes that have benefited from

this concept are account opening, certain tasks

inside the bank such as cheque collection, credit

card delivery, cheque book delivery and credit

approval for loans to individuals and corporates.

Some of the goals that can be achieved with Six

Sigma concepts are-cycle time reduction, and

reduction in the number of defects.

8/12/2019 SM Process 10

21/25

ContdSix Sigma

Some of the banks that have either

implemented six sigma concepts for

quality improvement in India or are

in the process of doing so, are

Citibank, ICICI Bank, HDFC Bankand HSBC.

8/12/2019 SM Process 10

22/25

Why customers complain

To appear intelligent or discerning to others

To get control over the provider (according to

the search for control model in consumer

behaviour, a service encounter is a search forcontrol in some sense)

To build a consensus or to validate their

viewpoint

To let off steam, as an emotional release of

stress

y cus omers on

8/12/2019 SM Process 10

23/25

y cus omers oncomplain

They dont know where or how to do it

They dont think itll help

They doubt their own evaluation as being

subjective

They are uncomfortable in complaining face

to face

They feel they lack the technical expertisewhere the credence attributes predominate

(doctors treatment, car repairs)

8/12/2019 SM Process 10

24/25

What can service marketers

do? Give customers a chance to complain or talk

to you

Develop the Capability of Learning From

Complaints Develop Strategies for recurring complaints

Give Guarantees

Respond Fast

8/12/2019 SM Process 10

25/25

Summing Up

The potential for BPR is immense in Indian service

organisations in both the public and private

sectors.

This can save consumers from long-winded

procedures, increasing satisfaction levels and

customer retention.

The service organisation also stands to gain from

reduced costs of operations and a motivated

workforce working to its optimum capacity.

ICICI Bank, according to an estimate by its

management, expects its BPR initiatives to save

upto 20 percent costs in many of its operations.