the nature of services. learning objectives n n classify a service into one of four categories using...
TRANSCRIPT
![Page 1: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/1.jpg)
The Nature of Services
![Page 2: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/2.jpg)
Learning Objectives Classify a service into one of four categories
using the service process matrix. Describe a service using the four dimensions
of the service package. Discuss the managerial implications of the
distinctive characteristics of a service operation.
Discuss the insights obtained from a strategic classification of services.
Discuss the role of a service manager from an open-systems view of service.
![Page 3: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/3.jpg)
An Integrated Approach to Service Management
The Eight Components • Product Elements • Place, Cyberspace, and Time • Promotion and Education • Price and Other User Outlays + Process + Productivity and Quality + People + Physical Evidence
Require the Integration of Marketing, Operations, and Human Resources
![Page 4: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/4.jpg)
Service/Product Bundle
Element Core GoodsExample
Core ServiceExample
Business Custom clothier Business hotel
Core Business suits Room for the night
PeripheralGoods
Garment bag Bath robe
PeripheralService
Deferred payment plans
In house restaurant
Variant Coffee lounge Airport shuttle
![Page 5: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/5.jpg)
The Service Process Matrix
Degree Degree of Interaction and Customization
of labor Intensity Low High
Service factory: Service shop:
* Airlines * Hospitals
Low * Trucking * Auto repair
* Hotels * Other repair services
* Resorts and recreation
Mass service: Professional service:
* Retailing * Doctors
High * Wholesaling * Lawyers
* Schools * Accountants
* Retail aspects of * Architects
commercial banking
![Page 6: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/6.jpg)
The Service Package
Supporting Facility: The physical resources that must be in place before a service can be sold. Examples are golf course, ski lift, hospital, airplane.
Facilitating Goods: The material consumed by the buyer or items provided by the consumer. Examples are food items, legal documents, golf clubs, medical history.
Information: Operations data or information that is provided by the customer to enable efficient and customized service. Examples are patient medical records, seats available on a flight, customer preferences, location of customer to dispatch a taxi.
![Page 7: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/7.jpg)
The Service Package (cont.)
Explicit Services: Benefits readily observable by the senses. The essential or intrinsic features. Examples are quality of meal, attitude of the waiter, on-time departure.
Implicit Services: Psychological benefits or extrinsic features which the consumer may sense only vaguely. Examples are privacy of loan office, security of a well lighted parking lot.
![Page 8: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/8.jpg)
Distinctive Characteristics of Services Customer Participation in the Service Process:
attention to facility design but opportunities for co-production
Simultaneity: opportunities for personal selling, interaction creates customer perceptions of quality
Perishability: cannot inventory, opportunity loss of idle capacity, need to match supply with demand
Intangibility: creative advertising, no patent protection, importance of reputation
Heterogeneity: customer participation in delivery process results in variability
![Page 9: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/9.jpg)
Strategic Service Classification (Nature of the Service Act)Strategic Service Classification (Nature of the Service Act)
Direct Recipient of the ServiceNature of
the Service Act People Things People’s bodies: Physical possessions: Health care Freight transportation Passenger transportation Repair and maintenance
Tangible actions Beauty salons Veterinary care Exercise clinics Janitorial services Restaurants Laundry and dry cleaning
People’s minds: Intangible assets: Education Banking
Intangible actions Broadcasting Legal services Information services Accounting Theaters Securities Museums Insurance
![Page 10: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/10.jpg)
Strategic Service Classification (Relationship with Customers)Strategic Service Classification (Relationship with Customers)
Type of Relationship between Service Organization and Its CustomersNature of Service Delivery “Membership” relationship No formal relationship
Insurance Radio station Telephone subscription Police protection
Continuous delivery Electric Utility Lighthouse
of service Banking Public Highway
Long-distance phone calls Restaurant Theater series tickets Pay phone
Discrete transactions Transit pass Toll highway Sam’s Wholesale Club Movie theater Airline frequent flyer Public transportation
![Page 11: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/11.jpg)
Strategic Service Classification (Customization and Judgment)Strategic Service Classification (Customization and Judgment)
Extent to Which Service Characteristics Are Customized
Extent to Which Personnel exercise Judgment in meeting customer Needs High Low
Surgery Preventive health programs
High Taxi services Education (large classes) Gourmet restaurant Family restaurant
Telephone service Public transportation
Hotel services Spectator sports
Low Retail banking Movie theater
Cafeteria Institutional food service
![Page 12: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/12.jpg)
Strategic Service Classification (Nature of Demand and Supply)Strategic Service Classification (Nature of Demand and Supply)
Extent of Demand Fluctuation over Time
Extent to which Supply is Constrained Wide Narrow
Electricity Insurance
Peak demand can Telephone Legal services
usually be met Police emergency Banking
without a major delay Hospital maternity unit Laundry and dry cleaning
Tax preparation Fast food restaurant
Peak demand regularly Passenger transportation Movie theater
exceeds capacity Hotels and motels Gas station
![Page 13: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/13.jpg)
Strategic Service Classification (Method of Service Delivery)Strategic Service Classification (Method of Service Delivery)
Availability of Service Outlets
Nature of Interaction between Customer and Service Organization
Single site Multiple site
Customer travels to Theater Bus service
service organization Barbershop Fast-food chain
Service provider Taxi Mail delivery
travels to customer Pest control service AAA emergency repairs
Taxi
Transaction is at Credit card company Broadcast network
arm’s length Local TV station Telephone company
![Page 14: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/14.jpg)
Open Systems View of Services Service Process Consumer Evaluation
Consumer arrivals Consumer participant departures Criteria
(input) Consumer-Provider ( output) Measurement
interface
Control Monitor
Customer demand Service operations manager Service personnel
Production function:
Perceived needs Alter Monitor and control process Schedule Empowerment
Location demand Marketing function: supply Training
Interact with consumers Attitudes
Control demand
Modify as necessary
Define standard
Service package
Supporting facility
Communicate Facilitating goods Basis of
by advertising Explicit services selection
Implicit services
![Page 15: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/15.jpg)
Auto Garage Service Package
Supporting Facility
Facilitating Goods
Information
Explicit Services
Implicit Services
![Page 16: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/16.jpg)
Auto Garage Distinctive Service Characteristics
Intangibility
Perishability
Heterogeneity
Simultaneity
Customer Participation in the Service Process
![Page 17: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/17.jpg)
Auto Garage Service Classification
Nature of the service act
Relationship with customers
Customization and judgement
Nature of demand and supply
Method of service delivery
![Page 18: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/18.jpg)
Managing Auto Garage
How could Auto Garage manage its back office (repair operations) like a factory?
How can Auto Garage differentiate itself from dealers?
![Page 19: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/19.jpg)
Topics for Discussion What are the characteristics of services that will be
most appropriate for Internet delivery? When does collecting information through service
membership become an invasion of privacy? What are some management problems associated
with allowing service employees to exercise judgement in meeting customer needs?
What factors are important for a manager to consider when attempting to enhance a service firm’s image?
What contributions to the management of professional service firms can a business school graduate provide?
![Page 20: The Nature of Services. Learning Objectives n n Classify a service into one of four categories using the service process matrix. n n Describe a service](https://reader036.vdocuments.us/reader036/viewer/2022082517/56649dbc5503460f94aae03b/html5/thumbnails/20.jpg)
Interactive Class Exercise
The class breaks into five groups and each group is assigned one of the service classifications (e.g., nature of act, relationship with customer, customization, nature of demand, or method of delivery) to come up with an example for each of the four quadrants in the matrix.