GROUP 1: CATEGORIEIS OF SERVICE MIX ❖ Services may meet a personal need (personal services) or a

A service is any act or performance one party can offer that is essentially business need ( business services)
intagible and does not resut in the ownership of anything. Its production ❖ Service providers differ on their objectives (profit or non-profit) and
may or may not be tied to a physical product. Increasingly, ownership (private or public)
manufacturers, distributors, and retailers are providing value-added
services, or simply excellent customer service, to differentiate Distinctive Characteristics of Services
themselves. Many pure service firms are now using the Internet to reach Four distinctive service characteristics greatly affect the design
customers; some operate purely online. of marketing programs: intagbility, inseparability, variability, and
perishability.
Categories of Service Mix
The service component can be a minor or a major part of the total Intangibility. Services lack physical form; they do not interact with any
offering. We distinguish five categories of offerings: of our senses in a conventional way, they can’t be touched or held.
1. A pure tangible good such as soap, toothpaste, or salt with no
accompanying services. Implications: Ownership cannot be transferred, vlue derives from
consumption or experience, quality is difficult to evaluate prior to
2. A tangible good with accompanying services, like a car, computer, consumption or purchase.
or cell phone, with a warranty or specialized customer service contract.
Typically, the more technologically advanced the product, the greater the Inseparability. Production and consumption cannot be separated
need for high-quality supporting services. (compared with goods where production and consumption are entirely
discrete processes). Whereas goods, are manufactured, then
3. A hybrid offering, like a restaurant meal, of equal parts goods and inventoried, then distributed, and later consumed, services are typically
services. People patronize restaurants for both the food and its produced and consumed simultaneously. The provider is part of the
preparation. service.

4. A major service with accompanying minor goods and services, Implications: Services are typically high contact systems and are
like air travel with supporting goods such as snacks and drinks. This labour-intensive; fewer opportunities to transact business arm’s length,
offering requires a capital-intensive good—an airplane—for its fewer opportunities to substitute capital for labour; subject to human
realization, but the primary item is a service. error.

5. A pure service, primarily an intangible service, such as babysitting, Variability. (Also known as Heterogeneity). Services involve processes
psychotherapy, or massage. delivered by service personnel and subject to human variation,
The range of service offerings make it difficult to generalize without a few customers often seek highly customized solutions, services are
further distinctions. inherently variable in quality and substance. Because the quality of
services depends on who provides them, when and where, and to whom,
❖ Services are equipment-based or people-based. services are highly variable
❖ Services companies can choose among different processes to
deliver their service. Implications: Service quality is difficult to manage; fewer
❖ Some services need the client’s presence. opportunities to standardize service delivery.
Here are three steps service firms can take to increase quality control. • Complementary services can provide alternatives to waiting
customers, such as cocktail lounges in restaurants and automated
1. Invest in good hiring and training procedures. Recruiting the right teller machines in banks
employees and giving them excellent training are crucial, whether they • Reservation systems are a way to manage the demand level. Airlines,
are highly skilled professionals or low-skilled workers. Better-trained hotels, and physicians employ them extensively.
people exhibit six characteristics that improve service quality:
competence, courtesy, credibility, reliability, responsiveness, and
communication skill. On the supply side:
• Part-time employees can serve peak demand. Colleges add part-time
2. Standardize the service-performance process throughout the teachers when enrollment goes up; stores hire extra clerks during
organization. A service blueprint can map out the service process, the holiday periods.
points of customer contact, and the evidence of service from the • Peak-time efficiency routines can allow employees to perform only
customer’s point of view. Bervice blueprints can be helpful in identifying essential tasks during peak periods. Paramedics assist physicians
potential “pain points” for customers, developing new services, during busy periods.
supporting a zero-defects culture, and devising service recovery • Increased consumer participation frees service providers’ time.
strategies. Consumers fill out their own medical records or bag their own
3. Monitor customer satisfaction. Employ suggestion and complaint groceries.
systems, customer surveys, and third-party comparison shopping. • Shared services can improve offerings. Several hospitals can share
Customer needs may vary in different areas, allowing firms to develop medical-equipment purchases.
region-specific customer satisfaction programs. Firms can also develop • Facilities for future expansion can be a good investment. An
customer information databases and systems for more personalized amusement park might buy surrounding land for later development.
service, especially online.

Perishability. Service performances are ephemeral; unlike physical

goods, services cannot be stored or inventoried, so their perishability can
be a problem when demand fluctuates.

Implications: Demand is subject to wide fluctuations, no inventory

to serve as a buffer between supply and demand, unused capacity
cannot be reserved; high opportunity cost of idle capacity.

Several strategies can produce a better match between service demand

and supply.

On the demand (customer) side:

• Differential pricing will shift some demand from peak to off-peak
periods. Examples include low matinee movie prices and weekend
discounts for car rentals.
• Nonpeak demand can be cultivated. McDonald’s pushes breakfast
service, and hotels promote minivacation weekends.
GROUP 2: DEVELOPING SERVICE PRODUCTS: CORE AND SUPPLEMENTARY Enhancing Supplementary Services
ELEMENTS These add extra value for the customers.

Service performances are experienced rather than owned. Even when there are physical elements to which 1. Consultation. Consists of advice from a knowledgeable service person in
the customer takes a title of ownership a significant portion of the price paid by customers is for the value response to the request: “What do you suggest?”. Effective consultation requires
added by the service elements, including expert labor and the use of specialized equipment. A service an understanding of each customer’s current situation before suggesting a suitable
product comprises of all the elements of the service performance, both physical and intangible, that create course of action.
value for customers. 2. Hospitality. Hospitality-related services should ideally reflect pleasure at meeting
new customers and getting old one when they return. Well-managed businesses
try to ensure that their employees treat customers as guests. Courtesy and
DESIGNING THE SERVICE CONCEPT consideration for customers’ needs apply to both face-to-face encounters and
telephone interactions.
Core Product. The core product is “what” the customer is fundamentally buying. The core product is the 3. Safekeeping. When customers are visiting a service site, they often want
central component that supplies the principal, problem-solving benefits customer seek. assistance with their personal possessions. In fact, unless certain safekeeping
services are provided, some customers may not visit at all.
Supplementary Services. Delivery of the core product usually is accompanied by a variety of other service-
4. Exceptions. Involve supplementary services that fall outside the routine of normal
related activities referred to collectively as supplementary services. These services augment the core
service delivery. Astute businesses anticipate such exceptions and develop
product, facilitating its use and enhancing its value and appeal to the customer’s overall experience.
contingency plans and guidelines in advance, Well-defined procedures make it
Delivery Processes. These are the processes used to deliver both the core product and each of the easier for employees to respond promptly and effectively.
supplementary services.
Special Request- A customer may request services that require a departure
Documenting the Delivery Sequence over Time. It is the sequence in which customers will use each of the from normal operating procedures. Common requests relate to personal needs,
core and supplementary services and the approximate length of time required in each instance. including care of children, dietary requirements, medical needs, religious observance,
and personal disabilities.
THE FLOWER OF SERVICE
Problem Solving- Sometimes, normal service delivery (or product
The eight clusters are displayed as petals surrounding the center of a flower—called the Flower of Service. performance) fails to run smoothly due to accidents, delay, equipment failure, or difficulty
The petals are arranged in a clockwise sequence, following how they are likely to be encountered by faced by a customer while using a product.
customers (although this sequence may vary). The flower analogy can help us understand the need for
consistent performance on all supplementary elements, so that a weakness in one element doesn’t spoil Handling of complaints/suggestions/compliments- Th is activity requires well-
the overall impression. defined procedures. It should be easy for customers to express dissatisfaction, offer
suggestions for improvement, or pass on compliments. Likewise, service providers
Facilitating Supplementary Services. These are required for either service delivery and/or aids in the use should be able to make an appropriate response quickly.
of the core products.
Restitution- Many customers expect to be compensated for serious
1. Information. To obtain full value from any good or service, customers need relevant information. performance failures. Compensation may take the form of repairs under warranty, legal
Companies should make sure the information they provide is both timely and accurate. If not, it is settlements, refunds, an off er of free service, or any other form of payment-in-kind.
likely to make customers feel irritated or cause them inconvenience.
Managerial Implications
2. Order-taking. Once customers are ready to buy, a key supplementary element comes into play—
accepting applications, orders and reservations. The process of order-taking should be polite, fast, - Most supplementary services do (or should) represent responses to customer needs.
and accurate so that customers do not waste time and endure unnecessary mental or physical effort.

3. Billing. Billing is common to almost all services (unless the service is provided free of charge). - Any badly handled element may negatively affect customers' perception of service
Inaccurate, illegible, or incomplete bills risk disappointing customers who may, up to that point, have quality.
been quite satisfied with their experience. Billing should also be timely, because it encourages people
to make faster payment.
- Not every core product is surrounded by supplementary elements from all eight
4. Payment. In most cases, a bill requires the customer to take action on payment (and such action petals of the Flower of Service.
may be very slow in coming!). A variety of payment options exist, but customers expect them to be
easy to use and convenient. Exceptions include bank statements and other direct debit payment
services, which shows the charges to be deducted from a customer’s account. - A company's market positioning strategy helps to determine which supplementary
services should be included.
 Brand meaning—what comes to the customer’s mind when a brand is mentioned.
- The flower of service serves as a checklist in the search for new ways to augment
existing core products and to design new offerings.
Brand equity—the degree of marketing advantage that a brand has over its competitors.

- All of the elements in each petal should receive the care and attention needed to New Service Development
meet defined service standard.
A Hierarchy of New Service Categories
Branding Service Products and Experiences
Style Changes. Represent the simplest type of innovation. Typically involving no
Branding can be employed at both the corporate and product levels by almost any changes in either process or performance. They are often highly visible, create
service business. In a well-managed firm, corporate brand is not easily recognized but excitement, and may serve to motivate employees.
also has meaning for customers as it stands for a particular way of doing business.
Applying brand names to individual products enables the firm to communicate to the Service Improvements. Most common type of innvoation. Involves modest changes in
target market the distinctive experience and benefits associated with a specific service the performances of current products, including improvements to either the core product
concept. or to existing supplementary services. Unique improvement that can enhance
customer’s experience.
Branding Strategies for Services
Supplementary Service Innovations. Take the form of adding new facilitating or
Branded House. Used to describe a company, that applies its brand name to multiple enhancing service elements to an existing core service or of significantly improving an
offerings in often unrelated fields. The danger of such strategy is that the brand gets existing supplementary service.
overstretched and weakend.
Process Line Extensions. These are less innovative but often represent distinctive
Sub-Brands. The corporate or the master brand is the main reference point, but each new ways of delivering existing products. The intention is either to offer a different and
product has a disctinctive name as well. more convenient experience for existing customers, or to attract new customers who
find the traditional approach unappealing.
Endorsed Brands. The product brand dominates but the corporate name is still
featured. Hotel companies use this approach. Each brand must promise a distinctive Product Line Extensions. These are additions to company’s current product lines.
value proposition targeted at a different customer segment. Loyalty programs are often These new services may be targeted at existing customers to serve a broader variety of
used to encourage this. needs, or designed to attratc new customers with different needs (or both).

House of Brands. Home to numerous brands, each independent of one antoher, and Major Process Innovations. Consist and involve of the use of new processes to deliver
each with its own audience, marketing, look and feel. existing core product with additional benefits.

Major Service Innovations. These are new core products for markets that have not
been previously defined. They usually include new service characteristics as well as
Building Brand Equity. To build a strong brand, we need to understand what radical new processes.
contributes to brand equity. Brand equity is the value premium that comes with a brand.
It is the additional amount that customers are willing to pay for a branded service over a Reengineering Service Processes. Reengineering involves analyzing and
similar service that has no brand. redesigning processes to achieve faster and better performance. Examination of
processes may also lead to alternative delivery methods. Examination of procesess may
Company’s presented brand—mainly through advertising, service facilities, and also lead to creation of alternative delivery methods that are radically different as to
personnel. constitute entireley new service concepts.

External brand communications—from word-of-mouth and publicity. These are outside Physical Goods as a Source of New Service Ideas. Any new physical product has
of the firm’s control. the potentital to create a need for related possession-processing services.

Customer experience with the company—what the customer goes through when hey
patronize the company.

Brand awareness—the ability to recognize and recall a brand when provided with a cue.
GROUP 3: CONSUMER BEHAVIOR IN A SERVICES CONTEXT 5. Service Expectations
Expectations are formed during the search and decision-making process, and they are heavily shaped by
information search and evaluation of alternatives. If you do not have any previous experience with the
service, you may base your pre-purchase expectations on online searches and reviews, word of mouth,
3 Stage Model of Service Consumption news stories, or a firm’s own marketing effort.
1. Pre-Purchase Stage
2. Service Encounter Stage a) Desired Service - This is a “wished for” level of service—a combination of what customers
believe can and should be delivered in the context of their personal needs. Desired service
3. Post-Encounter Stage can also be influenced by explicit and implicit promises made by service providers, word of
mouth, and past experiences.
b) Adequate Service - This is the minimum level of service customers will accept without being
A. Pre-Purchase Stage dissatisfied.
c) Predicted Service - This is the level of service that customers actually expect to receive.
1. Need Awareness Predicted service can also be affected by service provider promises, word of mouth, and past
The decision to buy or use a service is triggered by a person’s underlying need or need arousal. experiences. Directly affects how customers define “adequate service” on that occasion. If
Needs may be triggered by: good service is predicted, the adequate level will be higher than if poorer service is predicted.
a) Unconscious Minds - personal identity and aspirations d) Zone of Tolerance - Even the performance of the same service employee is likely to vary from
b) Physical Conditions - hunger and pain time to time. The extent to which customers are willing to accept this variation is called the
c) External Sources - social media, marketing activities such as advertising zone of tolerance.

2. Information Search 6. Purchase Decision

Once a need has been recognized, customers are motivated to search for solutions to satisfy the need. After consumers have evaluated possible alternatives by comparing the performances of competing
Several alternatives may come to mind, and these form the evoked set. The evoked set can be derived service offerings, assessing the perceived risk associated with each offering, and developing their desired,
from past experience or external sources such as social media, online reviews and searches, advertising, adequate, and predicted service-level expectations, they are ready to select the option they like best.
retail displays, news stories, and recommendations from service personnel, friends, and family.

3. Evaluation of Alternatives B. THE SERVICE ENCOUNTER STAGE

Once the consideration set and key attributes are understood, the consumer typically makes a purchase
decision. The service encounter stage involves the direct interaction of the customer with the service firm.

Service Attributes 1. Service Encounters Are “Moments of Truth”

Customers need to compare and evaluate the different service offering when faced with several
alternatives. Richard Normann borrowed the “moment of truth” metaphor from bullfighting to show the importance of
• Search At tributes - tangible characteristics customers can evaluate before purchase. contact points with customers:
• Experience Attributes - those that cannot be evaluated before purchase. Customers must
“experience” the service before they can assess attributes such as reliability, ease of use, and “[W]e could say that the perceived quality is realized at the moment of truth, when the service provider and
customer support. the service customer confront one another in the arena. At that moment they are very much on their own. .
• Credence Attributes - characteristics that customers find hard to evaluate even after . . It is the skill, the motivation, and the tools employed by the firm’s representative and the expectations
consumption. Here, the customer is forced to believe or trust that certain tasks have been and behavior of the client which together will create the service delivery process.”
performed at the promised level of quality.
In bullfighting, the life of either the bull or the matador (or possibly both) is at stake. The message in a
4. Perceived Risk service context is that at the moment of truth, the relationship between the customer and the firm is at
Perceived risk is usually greater for services that are high in experience and credence attributes, and first- stake.
time users are likely to face greater uncertainty. Know the perceived risks customers face in purchasing
services and the strategies firms can use to reduce consumer risk perceptions. It is likely that you were 2. Service Encounters Range from High Contact to Low Contact Services
worried about the possibility of not making the best choice. The worse the possible consequences and
the more likely they are to occur, the higher the perception of risk. It involves different levels of contact with the service operation. Some of these encounters can be very brief
and may consist of a few steps, such as when a customer calls a customer contact center or uses a service
• Functional - unsatisfactory performance outcomes app. Others may extend over a longer time frame and involve multiple interactions of varying degrees of
• Financial - monetary loss, unexpected costs complexity. For example, a visit to a theme park may last all day.
• Temporal - wasting time, consequences of delays
• Physical - personal injury or damage to possessions • High-contact Services
• Psychological - personal fears and emotions Using a high-contact service means that there is direct contact between customers and the firm
• Social - how others think and react throughout the service delivery process. The marketing challenge is to make the experience
• Sensory - unwanted effects on any of the five senses appealing for customers both in terms of the physical environment and their interactions with
 service personnel. During the service delivery process, customers are usually exposed to many Role and Script Theories
physical cues about the organization, such as the exterior and interior of its buildings, equipment
and furnishings, appearance and behavior of service personnel, and even other customers. The actors in a theater need to be familiar with the script and the roles they are playing. Similarly, in service
• Low-contact Services encounters, knowledge of role and script theories can help organizations to better understand, design, and
At the opposite end of the spectrum, low-contact services involve little, if any, physical contact manage both employee and customer behaviors during service encounters.
between customers and service providers. Instead, contact takes place at arm’s length through
• Role Theory
electronic or physical distribution channels. For example, customers conduct their insurance and
Stephen Grove and Ray Fisk define a role as “a set of behavior patterns learned through
banking transactions by mail, telephone, and Internet. They may also buy a variety of
experience and communication, to be performed by an individual in a certain social interaction
information based services online rather than from brick-and-mortar stores.
in order to attain maximum effectiveness in goal accomplishment.” Roles have also been defined
The Servuction System as combinations of social cues or expectations that guide behavior in a specific setting or context.
The satisfaction and productivity of both parties depend on the extent to which each person acts
French researchers Pierre Eiglier and Eric Langeard were the first to conceptualize the service business as a out his or her prescribed role during a service encounter (also called “role congruency”).
system that integrated marketing, operations, and customers. They coined the term servuction system • Script Theory
(combining the terms service and production) to describe the part of the service organization’s physical Like a movie script, a service script specifies the sequences of behavior that employees and
environment that is visible to and experienced by customers. customers are expected to learn and follow during service delivery. While employees receive
formal training, customers learn scripts through experience, communication with others, and
The servuction model shows all the interactions that make up a typical customer experience in a high- designed communications and education. Any deviations from this known script may frustrate
contact service. Customers interact with the service environment, service employees, and even other both customers and employees.
customers who are present during the service encounter. Each type of interaction can create value (e.g., a
pleasant environment, friendly and competent employees, and other customers who are interesting to Role and Script Theory Complement Each Other
observe) or destroy value (e.g., another customer blocking your view in a movie theater).
Think of the roles played by the professor and the students in the classes that you’ve attended. Typically,
The servuction system consists of a technical core and the service delivery system: the role of the professor is to deliver a well-structured and interesting lecture that focuses on key topics
and engages the students in discussion. The role of the student is to come to class prepared and on time,
• Technical core- where inputs are processed and the elements of the service product are created. listen attentively, participate in discussions, and not disrupt the class.
This technical core is typically back-stage and invisible to the customer (e.g., think of the kitchen
in a restaurant). What goes on backstage is usually not of interest to customers unless it directly By contrast, the opening portion of the script for a lecture describes specific actions to be taken by each
affects front stage activities. For example, if a kitchen reads orders wrongly, diners will be upset. party. For instance, students should arrive at the lecture hall before the class starts, select a seat, sit down,
• Service delivery system—where the final “assembly” takes place and the product is delivered to and open their laptops. The professor then enters, puts notes on the table, turns on the notebook and LCD
the customer. This subsystem includes the visible part of the service operations system. Using projector, greets the students, makes preliminary announcements, and starts the class on time. As you can
the theater analogy, the visible front office is like a live theater where the service experience is see, the frameworks offered by the two theories are complementary and describe the appropriate behavior
during the encounter from two different perspectives.
staged for the customer.
Perceived Control Theory
The proportion of the overall service operation that is visible to customers varies according to the level of
customer contact. For high-contact services which directly involve the customer, the visible component of The Perceived Control Theory holds that customers have a need for control during the service encounter.
the entire service operations tends to be substantial. In contrast, low-contact services usually have most of The higher the level of perceived control during a service situation, the higher will be their level of
the service operations system backstage. satisfaction. The perception of control can be behavioral, decisional, or cognitive.

Theater as Metaphor for Service Delivery: An Integrative Perspective • Behavioral control allows the customer to change the service situation by asking the firm to
customize its typical offerings.
Service delivery consists of a series of events that customers experience as a performance. The theater is a
• Decisional control means that the customer can choose between two or more standardized
good metaphor for understanding the creation of service experiences through the servuction system,
options without changing either.
especially for high-contact service providers.
• Cognitive control is exercised when the customer understands why something is happening
• Service facilities (e.g., the flight will be delayed because there is a technical problem with the aircraft) and knows
Imagine service facilities as containing the stage on which the drama unfolds. what will happen next (also called predictive control; e.g., knowledge of how long the delay will
• Personnel be). We are often mollified when the service provider keeps us informed about the situation.
The front stage personnel are like the members of a cast, playing roles as actors in a drama, and
supported by a backstage production team.

The theater metaphor also includes the roles of the players on stage and the scripts they have to follow.
C. POST-ENCOUNTER STAGE • Empathy (easy access, good communications, and customer understanding)
3) Measuring Service Quality
The last stage of service consumption is the post-encounter stage, which involves consumers’ attitudinal
and behavioral responses to the service experience. These include customer satisfaction, service quality To measure service quality, Valarie A. Zeithaml and her colleagues developed a survey instrument called
perceptions, repeat purchase, and customer loyalty. SERVQUAL. It is based on the premise that customers evaluate a firm’s service quality by comparing their
perceptions of its service with their own expectations. SERVQUAL is seen as a generic measurement tool
1) Customer Satisfaction that can be applied across a broad spectrum of service industries. When perceived performance ratings are
lower than expectations, the service quality is poor. The reverse indicates good quality.
In the post-encounter stage, customers evaluate the service performance they have experienced and
compare it with their prior expectations. 4) Customer Loyalty

The Expectancy-Disconfirmation Model of Satisfaction Loyalty is a customer’s willingness to continue patronizing a firm over the long term, preferably on an
exclusive basis, and recommend the firm’s products to friends and associates. Loyalty is an important
Satisfaction is a judgment that follows a series of consumer product interactions. During the decision- outcome of customer satisfaction.
making process, customers assess attributes and risks related to a service offering. They also develop
expectations about how the service they choose will perform. The zone of tolerance can be narrow and firm Customers are not inherently loyal to any one firm! Rather, firms need to give their customers a reason to
if the expectations are related to attributes that are important in the decision-making process. buy from them and then stay with them. Delivering great service experiences that satisfy customers and
build their service quality perceptions is the first and probably the most important step toward building a
During and after consumption, consumers experience the service performance and compare it to their loyal customer base.
expectations. Satisfaction judgments are then formed on the basis of this comparison.

• If performance perceptions are worse than expected, it is called negative disconfirmation.

• If performance is better than expected, it is called positive disconfirmation.
• If it is as expected, then it is simply called confirmation of expectations.
2) Service Quality

The intangible nature of services makes them harder to evaluate than goods. In addition, customers often
experience the servuction process. We define excellent service quality as a high standard of performance
that consistently meets or exceeds customer expectations. It is critical to improve service quality and keep
it at high levels as it is a key driver of important customer behaviors, including word of mouth, repurchasing,
and loyalty.

Customer Satisfaction versus Service Quality

Both customer satisfaction and service quality are determined by comparing customers’ expectations with
their performance perceptions. However, satisfaction and service quality are very different constructs.
Specifically, satisfaction is an evaluation of a single consumption experience. It is a direct and immediate
response to that experience and may be seen as a fleeting judgment. In contrast, service quality refers to
relatively stable attitudes and beliefs about a firm.

Note that consumers’ repurchase intentions are influenced by their general beliefs about the service quality
of the firm rather than by individual, transaction-specific satisfaction judgments formed immediately during
and after consumption.

Dimensions of Service Quality

Valarie A. Zeithaml, Leonard Berry, and A. Parasuraman have identified 10 dimensions used by consumers
in evaluating service quality. In subsequent research, they found a high degree of correlation between
several of these variables and consolidated them into five broad dimensions:

• Tangibles (appearance of physical elements)

• Reliability (dependable and accurate performance)
• Responsiveness (promptness and helpfulness)
• Assurance (credibility, security, competence, and courtesy)
Group 4: Designing and Managing Service Processes So if you prepare flowcharts for a variety of service, doon mo man-notice na although magkakaiba yung
core products, yung mga common supplementary elements – From Info, billing, reservations, and Order-
From the customer’s perspective, services are experiences. Like calling a customer contact center or taking ay nare-recur or nagrerepeat lang.
visiting a library. While from the organization’s perspective, services are process that have to be designed
and managed to create the desired customer experience. • Shows how nature of customer involvement with service organizations varies by type of service:

This makes PROCESSES the ARCHITECTURE OF SERVICES. 1. People Processing

2. Possession Processing
Process describe the method and sequence in which service operating systems work and specify how they 3. Mental-Stimulus Processing
link together to create a value proposition promised to the customers. 4. Information Processing
So badly designed processes are likely to annoy the customers because it results in a slow, frustrating, and (Pakitingan nalang yung flowchart examples ko dun sa ppt hehehhehe)
poor-quality service delivery. Also, poor processes makes it difficult for front-line employees to do their
jobs well and it results into low productivity and increases the risk of service failures. Basta sa Flowchart, it describes the existing process in a fairly simple form.

FLOWCHARTING CUSTOMER SERVICE PROCESSES

A. SYMBOLS COMMONLY USED IN FLOWCHARTS Blueprinting Services to Create Valued Experiences and Productive Operations

(tandaan niyo na wag kayo gagamit ng kung ano ano lang na symbols sa flowchart hehe) Everything the customer has is an experience when they interact with the company that is why some
business do better than other. What if you design a business around CUSTOMER EXPERIENCE? This is
known as Blueprinting.
Start/End Symbol
The terminator symbol marks the starting or ending point of the system. A. SERVICE BLUEPRINTING
- key tool we use to design new services (or redesign existing ones).
Action or Process Symbol - It is a more sophisticated version of Flowcharting.
A box can represent a single step or and entire sub-process within a - specifies in detail how a service process should be constructed and includes details as to what is
larger process. visible and invisible to the customer and where there are potential fail points and waitlist in the
service process.
Decision Symbol
A decision or branching point. Lines representing different decisions B. WHERE DID BLUEPRINT COME FROM?
emerge from different points of the diamond. - Designs for new buildings/ships where usually displayed by architectural drawings called blueprints.
- It is printed in a blue special paper
Arrow
Indicates the flow of the process. C. DEVELOPING A BLUEPRINT
- Identify key activities in creating and delivering service in question and specify the linkages of the
activities.
- Initially, mas maganda na gino-group yung mga activities in order to Define “big picture” and then
B. FLOWCHARTING SERVICE DELIVERY
later, you can refine any activity by “drilling down” to obtain a higher level of detail
• Flowcharting is a technique for displaying the nature and sequence of the different steps in
delivering service to customers. -- Example nito is yung sa Boards Aircraft sa PPT 😊
• Also offers way to understand totality of the customer’s service experience. Blueprint is all about DETAILS!!
So creating a flowchart for a specific service is very useful sa pagdistinguish between at what the
D. ADVANTAGES OF BLUEPRINTING
customers use as Core Service at yung mga involved na service elements na nags-supplement sa core
1. Distinguish between “frontstage” and “backstage”
product na naidiscuss sa Flower of Service.
- Frontstage: what customers experience
Example: - Backstage: activities of employees and support process, where customers cannot see them.
2. Clarify interactions and support by backstage activities and systems
Restaurant: - By clarifying the interrelationships among employee roles, operational processes, IT, and customer
interactions, blueprint can facilitate the integration of Marketing, HR, Operations, and IT.
Core Product: Food and Beverages 3. Identify potential fail points
Supplementary Services: Reservations, Valet Parking, Ordering in Menu, Billing, Payment, Use of CR. - It gives the managers the opportunity to identify the Fail points in the process. FP are the points na
kung saan may risk na may mangyayaring mali at makakapagcause ng pagbaba ng Service Quality.
- If they are aware of the FP, they can prepare a Contingency Plan or preventive measures.
4. Pinpoint stages where customers commonly have to wait G. KEY COMPONENTS OF THE BLUEPRINT
- Dito makakadevelop ng Standards for execution in every activity including the Completion of task,
scripts, in order to guide the interaction between the staffs and customers.

E. BLUEPRINTS CAN BE USED BY:

1. Service Marketers
o To Create realistic customer expectations
2. Human Resources
o To Empower the human element
3. Operations Management
o To Render the service as promised
4. System Technology/ IT
o To Provide necessary tools

F. HOW TO BUILD YOUR OWN SERVICE BLUEPRINT

1. Come up with a customer scenario

- It may be beneficial to include REAL Customers in the conversation to ensure that your scenario is as
true as the customer’s real or desired experience as possible.
2. Map out the customer experience
- Whatever scenario you decide on, plot out the actions the customer will take in CHRONOLOGICAL
ORDER. (ETO YUNG CUSTOMER ACTION SA COMPONENTS)
3. Built out from the customer’s actions
- Once you have the customer service experience laid out – ADD THE OTHER CATEGORIES; Front-
stage, Back-stage, Physical Evidence, etc.
- Also answers, “What do employees do during each action the customer takes?” and “What support
processes come into play?”
4. Clarify lanes of responsibility and action
1. Physical Evidence
- Use different lines of separation to keep each category in its own clearly marked lane and to
- Tangibles that customers are exposed to that can influence their quality perceptions
illustrate the ways different actors interact during the process.
- Though first in line, it is usually the last element added.
o Line of Interaction
o Line of Visibility EX: Building exterior, Bill, Equipments, Décor, etc.
o Line of Internal Action
2. Customer Actions
- Include all the steps that customers take part in as part of the service delivery process
5. Clarify cross-functional relationships EX: Visit a website, Make a purchase, order
- After mapping out each category, add another level of detail to your SB by including arrows.
- You can also show relationships and dependencies that run across different categories through 3. Line of Interaction
arrows. - Indicates where customer interacts with the service employee.
4. Front-stage employee actions
- What customers see and who they interact with.
Single Arrow: The exchange occurs in the direction indicated.

Double Arrow: Shows 2 shapes depend on each other in some way. EX: Deliver food the customers, Deliver Bill, Greet customers, etc.

5. Line of Visibility
- Where employee or organizational processes became invisible to the customer
6. Back-stage employee action
- All other employee actions, preparations, or responsibilities customers don’t see but that make the
service possible.

EX: Employees writing content in a website

 7. Support processes Examples that prepare the customer for the encounter include printing dress code requests on invitations,
- Activities carried out by individuals and units within the company who are not contact employees, sending reminders of dental appointments, and printing guidelines on customer cards
but need to happen for the service to be delivered.
- Either Support processes involving other service personnel or information technology J. Identifying Bottleneck

EX: Management, Maintenance A bottleneck is a point of congestion in a production system) that occurs when workloads arrive too
quickly for the production process to handle.
(Para maintindihan niyo pa lalo kung ano yung mga andito, check niyo nalang sa PPT yung dalawang
examples 😊) SERVICE REDESIGN

Always remember that Blueprint helps us identify OPPORTUNITIES. Every touchpoint – People, place, Service process redesign revitalizes processes that have become outdated. However that
props, partners, and the process – has the opportunity to PROVIDE VALUE to the customer and the service doesn’t necessarily mean the processes were poorly designed in the first place. Rather, changes in
provider. technology, customer needs, added service features, and new offerings may have made existing processes
crack and creak.
H. BENEFITS OF SERVICE BLUEPRINTING
Characterized the problem as “institutional rust” and declared: “Institutions are like steel
 Facilitates a top down, bottom up approach beams—they tend to rust. What was once smooth, shiny and nice tends to become rusty.”13 He
suggested two main reasons for this situation.
 Facilitates internal communication between departments and SBUs

David Maister coined the acronym OTSU (“opportunity to screw up”) to highlight the importance of 2 reasons for Service Redesign
thinking about all the things that might go wrong in delivering a particular type of service.
1. The first involves changes in the external environment that make existing practices obsolete
 Application of Fail Safe Methods such as Pokayokes and require redesign of the underlying processes
2. The second reason it reflects a natural deterioration of internal processes, creeping
 Identifies Bottlenecks
bureaucracy, or the evolution of spurious, unofficial standards.
I. Pokayokes

Japanese approach to 'mistake proofing' in all aspects of manufacturing, customer service, 4 Key Features of Redesigning Services
procurement, etc. In fact, the original term was Baka-Yoke or “fool-proof”. Due to the inappropriateness 1. Reduced number of service failures.
of the term, “mistake-proofing” became the preferred term. 2. Reduced cycle time from customer initiation of a service process to its completion.
3. Enhanced productivity.
The concept developed out of the need to achieve quality in production processes. It was 4. Increased customer satisfaction
Shigeo Shingo, one of the pioneers of the Toyota Production System, who proposed the concept. Richard 5 Approaches and Potential Benefits of Redesigning Services:
Chase and Douglas Steward introduced this concept to fail-safe service processes.
1. Eliminating Non value-adding steps
One of the most useful Total Quality Management (TQM) methods in manufacturing is the 2. Shifting to Self Service
application of poka-yoke, or fail-safe, methods to prevent errors in manufacturing processes. 3. Delivering Direct Service
4. Bundling Services
5. Redesigning physical aspects of service process
2 Kinds of Pokayokes A. CUSTOMERS AS CO-PRODUCERS

1. Server Pokayokes Customer participation refers to the actions and resources supplied by customers during service
production and/or delivery, including mental, physical, and even emotional inputs.
Server poka-yokes ensure that service employees do things correctly, as requested, in the right order
and at the right speed. Examples include surgeons whose surgical instrument trays have indentations for Levels of Customer Participation
each instrument. For a given operation, all of the instruments are nested in the tray so it is clear if the
surgeon has not removed all instruments from the patient before closing the incision. 1. LOW - Employees and systems do all the work. Payment may be the only required customer input.

2. Customer Pokayokes Ex. Transportation, Cinema

Customer poka-yokes usually focus on preparing the customer for the encounter (including getting 2. MEDIUM - customer inputs are required to assist the firm in creating and delivering service and in
them to bring the right materials for the transaction and to arrive on time, if applicable), understanding providing a degree of customization.
and anticipating their role in the service transaction, and selecting the correct service or transaction.
Ex. Tailor Shops, Salon
3. HIGH - customers work actively with the provider to co-produce the service. Service cannot be
created without the customer’s active participation. In fact, if customers fail to assume this role
effectively and don’t perform certain mandatory production tasks, they will jeopardize the quality of
the service outcome.

Ex. Clinic, Gym

B. CUSTOMERS AS PARTIAL EMPLOYEES

1. Recruitment and Selection – Recruit customers that possess the competency to perform the
necessary tasks
2. Job Analysis – Are customers aware of their roles and equipped with the required skills?
3. Education and Training - Information required for them to perform their roles via instruction
or video demonstration
4. Motivate – Ensure that they will be rewarded for good performance
5. Appraise – For sub-par performances, improve customer training or change the role or process
6. Ending – Last resort: if customer is non-compliant consider termination of the relationship

“Partial employees” who can influence the productivity and quality of service processes and outputs.

C. SELF SERVICE TECHNOLOGIES

The ultimate form of involvement in service production is for customers to undertake a specific
activity, using facilities or systems provided by the service supplier. In effect, the customer’s time and
effort replaces that of a service employee.

Consumers are faced with an array of self-service technologies (SSTs) that allow them to
produce a service independent of direct service employee involvement. 29 SSTs include automated
banking terminals, self-service scanning at supermarket checkouts, self-service gasoline pumps, and
automated telephone systems such as phone banking, automated hotel checkout, and numerous
Internet-based services.

Advantages of SST’s

1. Time and Cost savings

2. Flexibility
3. Convenience
4. Greater Control over service delivery
5. High Perceived Level of Customization

Disadvantages of SST’s

1. Anxiety and Stress experienced by customers

2. Some see Self Service encounters as social experiences and prefer to deal with people
3. Lack of assistance in using SST’s
4. Unreliable system
5. Lack of knowledge in using SST’s