organizing for service leadership
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W ha t Busin ess A re W e In?
W ha t Service Pro cesses C a n Be U sed in O ur O pera tio n? (PRO CESS)
W ho A re O ur C usto m ers a nd H o w Sh o u ld W e Rela te to Th em ?
W ha t Price Sho u ld W e C h arge? (PRICE AN D O TH ER U SER O U TLAYS)
H o w to C o m m u nica te? (PRO M O TIO N & EDU CATIO N , PH YSICAL EV IDEN CE)
O ptio ns fo r D e livery? (PLACE, CYBERSPACE & TIM E, PH YSICAL EVIDEN CE)
H o w C a n W e Ba la nce ?PRO DU CTIV ITY AN D Q U ALITY
W ha t Sh o u ld be the C o re a nd Supp lem en ta ry Elem en ts o f O u r Service Pro duct? (PRO DU CT ELEM EN TS)
H o w Sh o u ld W e M a tch D em a nd a nd Pro ductive C a pa city?
W ha t A re A ppro pria te Ro les fo r Peo p le a nd Techno lo gy? (PEO PLE)
H O W CAN O U R FIRM A CH IEVE SERVICE LEADERSH IP?
Do we have a coherent vision for the future? Is this vision defined and driven by a strong, effective
leader (or leadership team)? Do our marketing strategies enable us to beat the
competition and create profits? Are our services recognized for superior value and
quality? Are we known for superior operations and innovative
use of technology? Are our employees loyal, productive, proactive, and
customer oriented? Do we have a reputation as an outstanding place to
work? Are we viewed as an ethical organization?
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Loya lty
Service Q ua lity
Productivity& O utputQ ua lity
EM PLO YEES
C apability
Satisfaction
ServiceValue
CU STO M ERS
Satisfaction Lo ya lty
RevenueG row th
Profitabilitiy
O pera ting stra tegy a ndservice delivery system
Serviceconcept
Ta rget M a rket
Interna l Externa l
1. Customer loyalty drives profitability and growth
2. Customer satisfaction drives customer loyalty
3. Value drives customer satisfaction
4. Employee productivity drives value
5. Employee loyalty drives productivity
6. Employee satisfaction drives loyalty
7. Internal quality drives employee satisfaction
8. Top management leadership underlies chain’s success
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Source: Heskett et al
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Customers
The Marketing Imperative
Human Resources Imperative
The Operations Imperative
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Defining Three Functional Imperatives
Marketing imperative •Target “right” customers and build
relationships•Offer solutions that meet their needs•Define quality package with competitive
advantage
Operations imperative•Create, deliver specified service to target
customers•Adhere to consistent quality standards•Achieve high productivity to ensure
acceptable costs
Human resource imperative•Recruit and retain the best employees for
each job •Train, motivate them to work well together•Achieve both productivity and customer
satisfaction
Transfers and cross training
Cross functional taskforces
New tasks and new people
Process management teams
Gain-sharing programs
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Service Losers› Only survive because of lack of viable alternatives in
marketplace› Delivering service seen as necessary evil
Service Nonentities› Traditional operations mindset--achieve cost savings
by standardization› Rudimentary marketing, often emphasizing price
discounts› Philosophy of “If it isn’t broken, don’t fix it”
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Service Professionals› Clear positioning strategy, pricing based on value› Operations driven by customer satisfaction,
competitive orientation› Employees are close to customers
SERVICE LEADERSSERVICE LEADERS› Crème de la crème of their industries› Names synonymous with providing outstanding
service, creating customer delight› Innovative in each functional area of management
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Create sense of urgency to develop impetus for change
Put together strong team to direct process Create appropriate vision of where organization must
go Communicate new vision broadly Empower employees to act on vision Produce sufficient short term results to create
credibility Build momentum to tackle tougher problems Anchor new behaviors in the organizational culture
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Source: John Kotter
Vision, charisma, persistence, high expectations, expertise, empathy, persuasiveness, integrity
Ability to visualize quality of service as foundation for competing
Believe in people who work for the firm, make good communications a priority
Possess a natural enthusiasm for the business, teach it to others, pass on nuances/secrets/crafts of operating
Cultivate leadership qualities of others in organization
Use values to navigate through difficult times
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Shared perceptions or themes regarding what is important
Shared values about what is right and wrong Shared understanding about what works and
what doesn’t Shared styles of working and relating to
others Shared assumptions and beliefs about why
these things are important
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Climate: Tangible working environment atop underlying culture
Influential factors for employees include:› flexibility: feeling of freedom to innovate, › sense of responsibility › level of standards that people set› perceived aptness of rewards› clarity about mission and values› level of commitment to a common purpose
Climate for service: shared perceptions concerning practices, procedures, types of behaviors that:› are expected concerning customer service, service quality› bring rewards for those who perform them well
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Ineffective Coercive leaders (“Do what I tell you”) Pacesetting leaders (“Do as I do, now”)
(unless team is highly motivated and competent)
Effective Authoritative leaders (“Come with me”) Affiliative leaders (“People come first”) Democratic leaders (“What do you think?”) Coaching leaders (“Try this”)
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Source: Daniel Goleman