CO - CREATION

OF QUALITY
SERVICE
CONTENT
CUSTOMER`S ROLE IN VALUE C0-CREATION
Customer involvement in service
innovation provides benefits for firms
through the co-creation of value. For
example, value co-creation (e.g., meet
customers' needs and help customers to
get more value) is critical for enhancing
firm value, and it also provides competitive
advantages (Wu, Lin, & Yu, 2019).
Value co-creation is loosely defined
as a collaboration between an
organization and its customers to
deliver or create the service that
would be acceptable to the latter.
The whole process of service delivery
is still managed by the organization,
but the customer plays an important
part in realizing the result.
When customers feel empowered, with
passion and a sense of ownership of the
offering, they are willing to contribute
extensively for the benefit of the firm and
the broader service system. Further,
engaged customers impact other
stakeholders' willingness to engage with
the focal firm and thereby offer a valuable
channel to new customer and stakeholder
relationships (Jaakkola & Alexander,
2014).
Customers role is viewed as partnership
wherein the insights relayed by the
clients become valuable inputs in
improving the services. Further, in the
creation of value, both customers and
service organizations develop a
collaborative relationship which creates
benefit for both. Co-creation of value is a
two-way road where expectations and
objectives from two parties may not be
on the same direction.
It is very important that value co-
creation should be sourced from
both sides of stakeholders. Inputs
should be derived from all
stakeholders in order to create a
service acceptable to all.
 1. Customers as
extended employees
2. Customers as
proponents to quality
THREE MAJOR ROLES
PLAYED BY of service
CUSTOMERS IN 3. Customers as
SERVICE CO-
CREATION AND competitors
DELIVERY
 1. Customers as extended employees
Among service-oriented organizations, Since customers' involvement
customers are significant part of the in the production process
organization's ability to deliver service. affects the quality and
Oftentimes, customers are participants quantity of production, there
in the production process of services by are different points of view
means of contributing time, effort, and emanating from this method.
even resources.
First, some experts believe that this could be a cause of uncertainty
wherein the demands, attitudes, and actions of customers may affect
productivity. In order to maximize efficiency in production, customers
need not get involved in activities that do not require their participation.
On the contrary, the second point of view believes that if customers are
treated as "part employees" of the organization and their roles are
designed to maximize their contribution, organization and be rendered
more eficiently. When customers are property guided and oriented on
the tasks, they tend to perform their part productively and effectively.
Many organizations are shifting to this style of service
delivery not only to increase productivity, but due to
cost benefit as well. However, if customers do not see
any clear benefit from being part of coproducing the
service, they will likely resist or do not participate in
the process.
2. Customers as proponents to quality of service
The primary objective of customers is to have their needs met by
the service organization. If the customer participation has been
effectively designed, then it is likely that the needs of the customers
will be met and the benefits would be attained. These services
would be realized based on the satisfaction and expected results
required by customers no less. In essence, the customers share in
delivering their own satisfaction and value for services.
Often, customers' reactions to service delivery,
including raising questions on the process,
complaining during service failures, and
owning accountability to achieve satisfaction,
can contribute in the delivery of quality service.
3. Customers as Competitors
This role of service customers suggests that customers can
be the competitors of the service organizations. If the
customers realize that they can perform the required service
whether partially or entirely, then the service provider may
not be needed at all. In this way, the customer performs the
tasks on his/her own and lets go of the service provider.
In cases concerning organizations as customers, they
may decide to hire outsourced services and to develop
or create an in-house team to perform required tasks.
For example, a hotel may decide to end their
partnership with a catering organization and to form a
team of chefs to prepare the food requirements of the
establishment.
In cases where organizations decide to produce a service by
itself, they should consider several factors such as: expertise
and capacity of the firm to perform tasks efficiently;
availability of resources within reach; ability to produce the
service on a timely manner; financial costs of producing the
service; psychological rewards (satisfaction, enjoyment, and
contentment); and ability to control the process and outcome
SELF-SERVICE
TECHNOLOGY (SST)
Self-service technology is an
innovation in providing service
outputs created exclusively by
customers without interaction or
engagement with the employees
of service organizations. Page 03
 Self-service technology is defined as
"technological interfaces that enable
customers to produce a service
independent of direct service
employee involvement" (Meuter,
Ostrom, Roundtree, & Bitner, 2000;
Considine & Cormican, 2016).
Self- service technology (SST) adoption has been cited by
businesses as a critical element in controlling costs and
improving customer experience (Considine & Cormican,
2016).
 Through the introduction of technology-
based self-service channels, customers have
become "active participants" rather than a
"passive audience" in service delivery
(Prahalad & Ramaswamy, 2000) as cited by
Scherer, Wünderlich & Wangenheim (2015).
Both business practice and research highlight the benefits of
technology-based self- service channels, such as an increased
operational performance and reduced costs (e.g., Ba et al.,
2010; Kumar & Telang, 2012; Schultze & Orlikowski 2004;
Scherer et al., 2015).
In the hospitality and tourism industry, the advancement of
technology and the onset of Industrial Revolution 4.0 have made self-
service technologies proliferate. Different organizations from the
different sectors of the tourism industry saw the advantages of these
advances, including savings on the costs and efficiencies of operations,
growth on sales, increased customer satisfaction, and competitive
advantage.
List of some of the self-service
technologies:
1. Automated teller machines of banks
2. Automated and interactive voice
response phone systems
3. Airline reservation and check-in
4. Airport reception and information
kiosks
5. Automated and online gambling or
betting machines
6. Food ordering and delivery
7. Hotel reservation, check-in, and checkout
8. Electronic blood pressure machines
9. Smart watches and gadgets monitoring
health conditions
10. Self-scanning (price scanner) at groceries
and retail stores
11. Internet banking
12. Package and money transfer tracking
13. Online shopping
14. Online training and education
15. Online applications
Organizations believe that
when they transfer from
manual service to technology-
based process, they could
save more from personal
service. If communicated
properly to customers, the
method would most likely
succeed.
Clients tend to look for
information, services, and products
via Internet. Online purchases,
deliveries, and transactions are
very popular nowadays because of
the convenience and ease of doing
business. Organizations that do not
have online access can be
considered at a disadvantage
against its competitors.
Advantages and
Disadvantages of
Using SSTs
Service organizations must
understand that customers do not
automatically accept or embrace
changes in procedures of doing
business even when these are
considered as upgrades or for better
transactions. Further, the benefits that
SSTs provide should be felt by both
the organizations and customers.
When implementing SSTs,
organizations should consider the
following advantages and
disadvantages when introducing
it.
THE MOST COMMON
ADVANTAGES ARE AS
FOLLOWS:
 1. CONVENIENCE
Convenience may include ease of use,
faster transactions, 24-hour service,
and presence in strategic areas.
Customers will enjoy access to SSTs
where they have the ability to pay
bills anytime of the day and through
simple use of cellphones from
anywhere in the country.
2. CONTROL
Customers prefer organizations that could
provide them options where they can
easily make decisions, monitor the
progress of their transactions (forwarding
organizations provide global positioning
system or or GPS tracking), personalize the
service offered (banks, hotels, and
restaurants readily provide the usual
preferences of tanks, regular customers).
3. LESS COST
Customers are not just looking for cheaper
prices, but also value for money. If an
organization can provide customers with the
same quality of service at a lower cost, the
organization would most likely be the choice.
At present conditions, most customers are
looking for possible transactions that can
provide them with alternatives that could
minimize costs and yield better returns.
4. EFFICIENCY
Many customers who have availed of SST-
aided transactions will agree that it is faster
to transact business because of the
accuracy of data and uniform process
undertaken do not vary from time to time.
Also, users get detailed information and
complete transactions faster than they
could through face-to-face encounters or
telephone contact (Wirtz & Lovelock, 2018).
THE MOST COMMON
ADVANTAGES ARE
AS FOLLOWS:
1. MACHINE FAILURE/BREAKDOWN
Since services are mostly assisted by
machines, it is not remote that
something might happen along the
way. It may be frustrating for
customers when, as least expected,
the machine breaks down resulting
in becoming offline, not properly
dispensing goods, access is rejected,
or simply is not issuing receipts.
2. POOR DESIGN/NOT USER-FRIENDLY
Machines are sometimes difficult to
use. Sometimes, the process is
complicated, elaborate, and fixed
(no flexible alternative), and it takes
several tries to get the transaction
or registration process completed.
In these scenarios, customers would
prefer personal transactions with
company representatives.
3. LIMITED OPTIONS
Most of the time, only the options that
are included in the menu page can be
transacted successfully. Personal
needs or customized requirements
cannot be accommodated and
processed. Questions beyond the
usual procedures cannot be
processed outright. Personal touch of
service is eliminated.
SST may be unsuccessful when
customers see that they do not
benefit from it, nor customers feel
that the ability to use the system is
futile. Worst, customers tend to shy
away from SST that do not properly
inform them how to use the system.
According to the study conducted by
Ida (2017), the service users' activity in
a value creation affects customers'
value of the service. The activity and
attitude of individuals related to
performance of an extra-role in service
interaction are less favorable than the
required in-role behavior.
The demand for support is also
important when considering
investment in SST because if
demand is low, the most cost-
effective option is to continue
with the traditional support
representatives (Considine &
Cormican, 2016).
Management should ensure that
each customer segment is addressed
appropriately. That is, managers
should pay close attention to what
type of tasks different customer
segments are willing to perform by
themselves (i.e., via self- service, see
Campbell et al., 2011; Scherer et al.,
2015).
It is important for managers to understand how
customers experience their relationship with a
provider through a variety of channels and over
time. Rather than optimizing individual service
channels in terms of service quality or service
productivity, service providers should
concentrate on a more holistic view of a
customer's service experience in a multichannel
setting and the unique value- in-context
customers can derive from each channel over
the duration of their relationship with the firm
(Scherer et al., 2015).
Guest Involvement
and Customer
Participation
The design and scope of customer
participation in delivering the service affect
the organization's productivity, the quality of
service it renders, level of customer
satisfaction, and competitiveness against its
rivals. Hence, the objective of customer
participation is to enhance the organization's
productivity and increase the seven of
partiomer satisfaction and encourage
efficient use of the system by customers.
In a study conducted by Shamim and Ghazali (2014),
customer return on investment, service excellence,
aesthetic value, and playfulness are few of the
Important factors in retailing which can significantly
develop customers participation and citizenship
behavior toward value co-creation. Social influence in
the form of compliance, internalization, and
identification can significantly play moderating roles in
further shaping customer value co-creation behavior.
Determine the
Role of the
Customer
Service-oriented organizations should identify the level of
participation of customers during the formulation of strategies.
Different types of services may require different levels of customer
participation. Purchase of food or groceries may only require
minimal participation from clients; whereas, purchase of airline
ticket or hotel booking may ask for inputs about customers' profile
and preferences. In some cases, greater participation in co-creating
the service is needed such as weight reduction programs, online
education, or competency training.
Organizations decide on the extent of customer
participation on the delivery of service. These
organizations may also have the option to decrease or
increase customer participation to make the co-creation
more effective. Decisions to adjust the level of participation
should be based on the impact on both organizations and
customers.
After the level of participation of customer has been
determined, the organization may outline the tasks and
roles of the customers.
The most common task performed by customers is to
provide information or resources formerly performed by
employees. With the increase participation of customers,
employees are eased out from tasks in service production.
At some point, customers perform tasks in the
organization not only for themselves, but also for other
customers. These tasks happen when fellow customers
help out or assist others who are not yet familiar with the
system. New clubhouse members who are unfamiliar with
the policies and procedures are oriented by seasoned
members to make them feel welcome.
Customers also perform promotional activities for
organizations. The recommendations or good
reviews shared by some customers to their fellow
customers are ways of putting customers as
promoters or salespeople for the company.
Find, Inform, and Reward
the Right Customers
After the tasks of customers have
been defined, the organization can
start enabling the role. The
customers would be considered as
partial employees of the
organization, and at some point, the
organization must come up with
strategies to make their efforts
worthwhile.
First, the organization must be able to
attract the right customers to fill the roles.

Second, customers need to be informed or

educated so that they perform their roles
properly.

And finally, customers would perform

tasks effectively and actively if they are
rewarded for their efforts.
Manage the
Customer
Segments
Service organizations cater to
different market segments. These
segments have different types of
needs and character. These
differences may either
complement or contradict each
other which would lead to
customer dissatisfaction.
Supermarkets and groceries answer to
shoppers of different types; some are buying
for personal consumption; others are for
families; and some for groups or
establishments. With these, checkout
counters are provided for small quantity
shoppers, separate from the bulk buyers to
avoid long queues for both types of customers
and avoid long waiting time for express
shoppers. This situation is related to the
concept known as compatibility management.
Compatibility management is the process
of managing the encounters or
interactions and space requirements of
several market segments in order to
maintain customer satisfaction and avoid
customer flight.
There are several strategies suggested
to manage multiple segments catered
to by an organization.
An organization can target
particular groups of customers by
positioning itself and segmenting
the particular group of customers.

Another strategy is to group

together compatible market
segments in order to avoid
conflict with each other.
Lastly, organizations may
deploy employees that are
trained to observe customer
interactions and anticipate
potential conflicts.
Note: Not one strategy may apply to all types of
customers. The success of each would depend on
how the customers would be able to appreciate
the value of the services rendered to them.
Hospitality organizations are free to choose the
styles that would cater the most to their clients.
As service providers, organizations need to be
sensitive to customers' needs, and in return,
these organizations would most likely reap the
reward when customers are satisfied
THANK
YOU