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DESIGNING & MANAGING
SERVICE PROCESSESDIMPLE UDANI
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Blueprinting Services to
Create Valued Experiences and
Productive Operations
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Developing a Blueprint
Identify key activities in creating anddelivering service
Define big picture before drilling down toobtain a higher level of detail
Distinguish between front stage andbackstage
Clarify interactions between customers andstaff, and support by backstage activities andsystems
Identify potential fail points; take preventivemeasures; prepare contingency
Develop standards for execution of each
activity times for task completion,maximum wait times, and scripts to guide
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Key Components of a Service
Blueprint
1. Define standards for front-stage activities
2. Specify physical evidence
3. Identify principal customer actions
4. Line of interaction (customers and front-stagepersonnel)
5. Front-stage actions by customer-contact personnel
6. Line of visibility (between front stage and
backstage)7. Backstage actions by customer contact personnel
8. Support processes involving other servicepersonnel
9. Support processes involving IT
- Identify fail points and risks of excessive waits
- Set service standards and do failure-proofing
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OTSU Opportunity to Screw
Up Consists of fail points and waiting
times
Fail points result in failure to accessthe core service product
Waiting times are the possibilities of
delays between specific actions
requiring the customer to wait
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Improving Reliability by Failure
Proofing
Analysis reveals opportunities for failureproofing
Need fail-safe methods for both employees
and customers
Errors include treatment errors and tangibleerrors
Goal of fail-safe procedures is to preventerrors such as: Performing tasks incorrectly, in the wrong order,
too slowly
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Setting Service Standards
Design high standards for each step to satisfy and delight
Time parameters, correct performance, prescriptions for style
and demeanor
First impressions affects customers evaluations of quality during
later stages of service delivery
Customer perceptions of service experiences tend to be cumulative
For low-contact service, a single failure committed front stage is
relatively more serious than in high-contact service
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Redesigning Service Processes
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Mitchell T. Rabkin MD,
formerly president ofBostons Beth Israel Hospital
Institutions are like steel beamsthey tend to rust.What was once smooth and shiny and nicetends to become rusty.
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Why Redesign?
Revitalizes process that has become outdated
Changes in external environment make existingpractices obsolete and require redesign ofunderlying processes
Rusting occurs internally
Opportunities exist to achieve a quantum leap inproductivity and service quality
Key Measurements
1. Reduce service failures
2. Reduce cycle time
3. Enhance productivity
4. Increase customer satisfaction
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Approaches and Potential
Benefits
Service process redesign encompassesreconstitution, rearrangement, or
substitution of service processes as
categorized below: Eliminating non-value-adding steps
Delivering direct service
Shifting to self-service Bundling services
Redesigning the physical aspects of
service processes
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The Customer as Co-Producer
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Levels of Customer
Participation
Customer participation is the actions andresources supplied by customers during
service production and/or delivery Three Levels
LowEmployees and systems do all the work
MediumCustomer inputs required to assistprovider
HighCustomer works actively with provider
to co-produce the service
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Self-Service Technologies
(SSTs)
Customers undertake specific activitiesusing facilities or systems provided byservice supplier Customers time and effort replace those of
employees
Challenge:
Getting customers to use new technology
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Self-Service Technologies
(SSTs) Information-based services lend
selves particularly well to SSTs Used in both supplementary services and
delivery of core product
Organizations seek to divert customersfrom employee contact to Internet-basedself-service
Economic trade-off between declining
cost of these self-service systems andrising cost of labour
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Customer Co-production Using
SSTs
Productivity gains and cost savings resultwhen customers take over work previouslyperformed by employees
Lower prices, reflecting lower costs, inducecustomer to use SSTs
Research shows that customers tend totake credit for successful outcomes, but not
blame for unsuccessful ones
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Customer Co-production Using
SSTs Critical to understand how consumers
decide between using an SST option versusrelying on a human provider
SSTs present both advantages and
disadvantages
Benefits: Time and cost savings, flexibility,convenience of location, greater controlover service delivery, and a higher
perceived level of customization Disadvantages: Anxiety and stress
experienced by customers who areuncomfortable with using them
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What Aspects of SSTs Please or
Annoy Customers?
People love SSTs when
SST machines are conveniently located andaccessible 24/7
Obtaining detailed information andcompleting transactions can be done fasterthan through face-to-face or telephonecontact
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What Aspects of SSTs Please or
Annoy Customers?
People hate SSTs when
SSTs failsystem is down, PINnumbers not accepted, etc
They forget passwords, fail to provideinformation as requested, simply hitwrong buttons
Key weakness of SSTs: Too fewincorporate service recoverysystems
Customers still forced to maketelephone calls or personal visits
Blame service provider for notproviding more user-friendly system
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HSBC: The worlds local bank
Source: Courtesy HSBC
Global site brought to customers local computer
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Putting SSTs to Test by
Asking a Few Simple Questions
Does the SST work reliably?
Firms must ensure that SSTs aredependable and user-friendly
Is the SST better than interpersonalalternatives?
Customers will stick to conventional
methods if SST doesnt create benefitsfor them
If it fails, what systems are in place torecover?
Always provide systems, structures, and
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Customers as Partial Employees
Customers influence productivity and qualityof service processes and outputs
Customers who are offered opportunities toparticipate at active level are more likely to be
satisfied
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Customers as Partial
Employees However, customers cause one-third of all
service problems
Difficult to recover from instances ofcustomer failure
Focus on preventing customer failure bycollecting data on problem occurrence,analyzing root causes, and establishingpreventive solutions
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Customers as Partial
Employees Managing customers as employees helps
to avoid customer failures
Conduct job analysis of customerspresent role in businesscompare
against role that firm would like customersto play
Educate customers on how they areexpected to perform and what skills are
needed Motivate customers by ensuring that they
will be rewarded if they perform well
Appraise customers performanceregularly
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Dysfunctional Customer Behaviour
Disrupts Service Process
Add i th Ch ll f
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Addressing the Challenge of
Jaycustomers
A customer who behaves in a thoughtless
or abusive fashion, causing problems for
the firm, its employees, and othercustomers
Add i th Ch ll f
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Addressing the Challenge of
Jaycustomers
No organization wants anongoing relationship with anabusive customer
Divergent views onjaycustomers
Six types:
The Thief
The Rule-Breaker
The Deadbeat The Belligerent
The Family Feuders
The Vandal
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Consequences of Dysfunctional
Customer Behavior
Consequences for staff working front stage
Abused employees may find their emotionsnegatively affected and/or suffer long-termpsychological damage
Productivity and quality may suffer
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Consequences of Dysfunctional
Customer Behavior
Consequences for customers can be bothnegative and positive
Exposure to unpleasant incidents canspoil consumption experience; Badbehaviour can be contagious
But customers may rally to support ofabused employee
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Consequences of Dysfunctional
Customer Behavior
Consequences for organization
Unmotivated employees may work less
effectivelyAbused employees may take medical
leave
Direct financial costs of restoring
damaged property, legal fees, payingfraudulent claims
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THANK YOUDIMPLE UDANI