Course Code: 19MMT506A

Course Title: Services Marketing

Course Leader:

Prof H N Nagesha
E-mail: hnagesha.ms.mc@msruas.ac.in

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 Unit 8
Designing and Managing Service Processes

• Introduction
• Flow-charting Customer Service Processes
• Blueprinting Services to Create Valued
Experiences and Productive Operations
• Service Process Redesign
• Customer as Co-Producer
• Self-Service Technologies

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 Introduction

• Customer’s perspective
– Services are experiences
– E.g., calling a customer contact center or visiting a library

• Organization’s perspective:
– Services are processes to be designed and managed to create
the desired customer experience
– Processes are architecture of services

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 Introduction
• Processes:
– Describe the method and sequence in which service
operating systems work
– Link together to create the value proposition promised to
customers

• High-contact services:
– Customers are an integral part of the operation
– Badly designed processes are likely to annoy customers

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 Flow-charting Customer Service Processes
• Flowcharting is a technique:
– For displaying the nature and sequence of the different steps
involved in delivering service to customers
– To understand the totality of the customer’s service
experience
– Provide valuable insights into the nature of an existing
service
– Help to understand the nature of the customer’s
involvement with the service organization
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 Flow-charting Customer Service Processes

1. People processing: Services directed at people’s bodies.

People enter the service system physically
2. Possession processing: Services directed at physical
possession. Customer involvement is limited
3. Mental stimulus processing: Services directed at
people’s mind
4. Information processing: Services directed at intangible
assets

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 Flow-charting Customer Service Processes

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 Flow-charting Customer Service Processes

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 Flow-charting Customer Service Processes
Mental Stimulus Processing – Weather Forecast

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 Flow-charting Customer Service Processes
Information Processing – Health Insurance

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 Service Blueprint

• To design new services or redesign existing ones

• Specifies in detail how a service process should
be constructed
• Includes details as to what is visible to the customer
and potential fail points in the service process
• Services processes have a largely intangible structure
and difficult to visualise

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 Service Blueprint

• Blueprint of services involve

– Flows
– Sequences
– Relationships
– Dependencies of activities

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 Developing Service Blueprint

• Identify key activities in creating and

delivering the service
• Distinguish between front stage (what
customers experience) and back stage
• Chart activities in sequence
• Show how interactions between customers
and employees are supported by backstage
activities and systems

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 Developing Service Blueprint

• Establish service standards for each

step
• Identify potential fail points
• Focus initially on “big picture”
• Later drill down for more detail in
specific areas

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 Service Blueprinting: Key Components

1. Define standards for front stage activities

2. Specify physical evidence
3. Identify principal customer actions
4. Line of interaction (customers and front stage
personnel)
5. Front stage actions by customer-contact
personnel

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 Service Blueprinting: Key Components

6. Line of visibility (between front stage and

backstage)
7. Backstage actions by customer contact personnel
8. Support processes involving other service
personnel
9. Support processes involving IT

Where appropriate, show fail points and risk of excessive

waits
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 Blueprinting a Hotel Stay

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 Improving Reliability of Processes
by Failure Proofing

• Analysis of reasons for failure reveals opportunities for

failure proofing to reduce/eliminate risk of errors
• Errors include:
– Treatment errors—human failures during contact with
customers
– Tangible errors—failures in physical elements of service

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 Improving Reliability of Processes
by Failure Proofing

• Fail-safe procedures include measures to prevent

omission of tasks or performance of tasks
– Incorrectly
– In wrong order
– Too slowly
– Not needed or specified
• Need fail-safe methods for both employees and
customers

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 Service Process Redesign

• Redesign vitalises outdated processes

• Reasons for outdating of processes:
i. Changes in technology
ii. Change in customer needs
iii. Added service features
iv. New offerings
v. Natural deterioration of internal processes and
creeping bureaucracy

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 Service Process Redesign- Components

1. Eliminating non-value-adding steps

2. Shifting to self-service
3. Delivering direct service
4. Bundling services
5. Redesigning the physical aspects of service
processes

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 Service Process Redesign- Components

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 Customers as Co-Producers:
Levels of Participation in Service Production
• Low Participation Level
– Employees and systems do all the work

– Products tend to be standardized

– Payment may be the only required customer input

– Visiting a movie theater or taking a bus

– Routine cleaning or maintenance: customers other than

providing access to service providers and making payment

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 Customers as Co-Producers:
Levels of Participation in Service Production
• Medium Participation Level – Customer inputs required
to assist provider:
– Provide needed information, instructions

– Make personal effort

– May share physical possessions

– Ex: Hair wash and cut, accountant preparing a tax return

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 Customers as Co-Producers:
Levels of Participation in Service Production
• High Participation Level:
– Customer works actively with provider to co-produce the
service

– Service cannot be created without the customer’s active

participation

– Marriage counseling and some health-related services

– Improvement of the patient’s physical condition -

rehabilitation or weight loss
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 Self Service Technologies (SSTs)

• Self-service is ultimate form of customer

involvement in service production
– Customers undertake specific activities using facilities
or systems provided by service supplier
– Customer’s time and effort replace those of employees

• Concept is not new—self-serve supermarkets date

from 1930s, ATMs and self-serve gas pumps from
1970s

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 Self Service Technologies (SSTs)

• Today, customers face wide array of SSTs to deliver

information-based services, both core and
supplementary
• Many companies seek to divert customers from
employee contact to Internet-based self-service

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 Service Firms as Teachers:
Well-trained Customers Perform Better
• Firms must teach customers roles as co-producers of
service
• Customers need to know how to achieve best results
• Education can be provided through:
– Brochures
– Advertising
– Posted instructions
– Machine-based instructions
– Websites, including FAQs
– Service providers
– Fellow customers

• Employees must be well-trained to help advise, assist

customers
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 Managing Customers as Partial Employees
to Increase Productivity and Quality
1. Analyze customers’ present roles in the business and
compare to management’s ideal
2. Determine if customers know how to perform and
have necessary skills
3. Motivate customers by ensuring that will be
rewarded for performing well
4. Regularly appraise customers’ performance; if
unsatisfactory, consider changing roles or termination

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 The Problem of Customer Misbehavior –
Identifying and Managing “Jaycustomers”
Jaycustomer
• A customer who behaves in a thoughtless or abusive fashion,
causing problems for the firm itself, employees, other customers
Why do jaycustomers matter?
• Can disrupt processes
• Affect service quality
• May spoil experience of other customers
What should a firm do about them?
• Try to avoid attracting potential jaycustomers
• Institute preventive measures
• Control abusive behavior quickly
• Take legal action against abusers
• BUT firm must act in ways that don’t alienate other customers

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 Types of Jaycustomer

1. Thief – seeks to avoid paying for service

2. Rule breaker – ignores rules of social behavior
and/or procedures for safe, efficient use of service
3. Belligerent – angrily abuses service personnel /other
customers) physically and/or emotionally
4. Family Feuders – fight with other customers in their
party/group
5. Vandal – deliberately damages physical facilities,
furnishings, and equipment
6. Deadbeat – fails to pay bills on time
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 References

– Lovelock, Wirtz and Chatterji (2013), Services

Marketing - People, Technology and strategy, 7th
Edition, Pearson Education

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 Disclaimer

• All data and content provided in this presentation

are taken from the reference books, internet –
websites and links, for informational purposes only.

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