service service development 2021
TRANSCRIPT
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New Service Development
Service Innovation
Service Design and Service Package
Service Design Examples
Shin‐Ming GuoNKUST
I. Innovation in Services
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Idea Generation: Customers, Employees, Competitors, Technology
Basic Research: Pursue a planned search for new knowledge regardless of possible application. (number theory)
Applied Research: Apply existing knowledge to problems in creation of new service. (security coding)
Development: Apply knowledge to problems to improve a current service. (on‐line shopping)
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New Service Development Cycle
Technology-Driven Service Innovations
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Source of Technology
Service Example Service Industry Impact
Power/energy Jet aircraft Electric vehicles
International flight is feasibleBattery charging/exchange
Facility design Hotel atriumEnclosed stadium
Feeling of grandeur/spaciousnessYear‐around use
Materials Digital cameraSynthetic engine oil
Photo printing/TourismFewer oil changes
Methods Just‐in‐time (JIT)Da Vinci surgery
Reduce supply‐chain inventoriesSurgeons and quality improvement
Information e‐commerceInternet
Increase market to world‐wideVideo on demand
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Zipcar: Refining the Business Model
Service Concept: provides short‐term, on‐demand use of private cars conveniently located and easily accessible to customers.
Target Market: People living in big cities where public transportation is established, parking is expensive, and the need to drive is limited.
https://www.youtube.com/watch?v=cX2xJOo5LIs
II. Service Design
Customer Participation
Simultaneity
Perishability
Intangibility
Heterogeneity
Supporting Facility
Facilitating Goods
Information
Explicit Services
Implicit Services
location, interior design
capacity planning, waiting line management
service encounter
revenue management
service blueprint, service recovery
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Service Design Elements
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Design Elements Topics
Structural
Delivery system Process structure, service blueprint, strategic positioning
Facility design Servicescapes, architecture, process flows, layout
Location Geographic demand, site selection, location strategy
Capacity planning Strategic role, queuing models, planning criteria
Managerial
Information Technology, scalability, use of Internet
Quality Measurement, design quality, recovery, tools, six‐sigma
Service encounter Encounter triad, culture, supply relationships, outsourcing
Managing capacity & demand
Strategies, yield management, queue management
Service Design: Shouldice Hospital
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Service Package for Car Sharing
Supporting Facility: office, parking space, maintenance center.
Facilitating Goods: membership card, cars, recorder, gasoline.
Information: web site, reservation system, driving records.
Explicit Services: cleanliness, convenience.
Implicit Services: 247 availability, environmental friendly service.
Operational Decisions
1. Who can use the service?
2. How to select and reserve a car?
3. How to get access to the car?
4. What about refueling?
5. How to return the car?
6. How to charge?
7. What about maintenance?
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Strategic Positioning via Process Structure
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Degree of Complexity: Measured by the number of steps in the service process, e.g., a clinic is less complex than a general hospital
Degree of Divergence: Amount of discretion permitted the server to customize the service, e.g., the activities of an attorney contrasted with those of a legal assistant
Controlling Complexity
• One‐stop service results in lower complexity.
• Focused strategy must be unique or of very high quality.
• Adding more services to increase revenue from each customer creates high complexity.
• Superstores with banking, flower shops, and food service complicate the management process.
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Service Process Matrix: Divergence
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Cus
tom
er c
onta
ctDivergence
Structural Alternatives for a Restaurant
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No Reservation
Take Reservation
Table Selection
Self-seating Seat guestsSeat guests
Recite menu
Fills out order Take orders Take orders
Personal service
Call numberServe
dinner setsSeparate-course
service
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III. Process Design: Service Blueprinting
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Failsafing (pokayokes)
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Service Encounter = moments of truth
Every customer contact is an opportunity to satisfy the customer.
To improve customers’ perception of service quality.
Service failures are often caused by interruptions or negligence.
Task to be done
Treatment accorded to the customer
Tangible features of the service
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Swim Lane Flowchart (for low contact service)
A visual representation that groups functional areas responsible for different sub‐processes into lanes.
All functions contributing to this process are included in the flowchart.
The columns represent different departments or functional areas, and
the steps appear in the department column where they are performed.
The customer is also shown as one of the column headings.
Special dotted‐line arrows show the handoffs from one department to
another when the outgoing arrow from a step goes to another column.
Handoffs are points where cross‐functional coordination is at particular
risk
Zipcar: Service Process Design
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Customer Interaction: Information Technology
• Mobile technology enables vehicle reservation and usage.
• Wireless transmission authorizes users, read odometer, mileages, and time stamps.
Support Process: Maintenance and Relocating
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Increasing Customer Value
𝑉𝑎𝑙𝑢𝑒Process quality Results produced
Cost of acquiring the service Price to the customer
𝑉𝑎𝑙𝑢𝑒Qualit𝑦
Cost
Business Collaboration for Car Sharing
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IV. Generic Service Design Example 1
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Production Line Treat the service as a manufacturing process
Focus on tangibles, not people
Low divergence (standardization) uniform quality
Low contact cost and consistent quality
Technology fool‐proofing equipment and service flow
Generic Service Design Example 2
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Customer as Co‐Producer having customers taking a greater role enhances the service
Self service cost, speed, convenience, high divergence
Substitute Technology for People 247 service availability
Appointments and reservations
Customers generated content Wiki, e‐markets
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Generic Service Design Example 3
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Customer Contact how to achieve efficiency with customer participation
Separation of high and low contact operations
Employee empowerment + Keep track of customers’ preferences High Complexity, High Divergence
Sales opportunities via customer relationship Service Encounter, Service Guarantee
Challenges for Service Design
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Limited ability to protect intellectual properties.
Definition of the intangibles.
Incremental nature of innovations.
Limited ability to build prototypes or conduct tests
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Conclusion
• The process is the product.
• Service‐system matrix ≈ product‐process matrix
• Service blueprint ≈ process flow chart
• Inventory and scheduling are often not available to service operations.
• Expect and manage variability of service encounter
• Parts of the service packages are defined by the training and treatment the workers receive.
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