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service - work done by one person or group that benefits another; "budget separately for goods and services" • service - an act of help or assistance; "he did them a service" • service - the act of public worship following prescribed rules; "the Sunday service" • service - a company or agency that performs a public service; subject to government regulation • service - employment in or work for another; "he retired after 30 years of service" • military service: a force that is a branch of the armed forces • service - Canadian writer (born in England) who wrote about life in the Yukon Territory (1874-1958) • service - avail: a means of serving; "of no avail"; "there's no help for it" • service - tableware consisting of a complete set of articles (silver or dishware) for use at table • service - servicing: the act of mating by male animals; "the bull was worth good money in servicing fees" • service - (law) the acts performed by an English feudal tenant for the benefit of his lord which formed the consideration for the property granted to him • service - serve: (sports) a stroke that puts the ball in play; "his powerful serves won the game" • service - be used by; as of a utility; "The sewage plant served the neighboring communities"; "The garage served to shelter his horses"

Intangible products that are not goods (tangible products), such as accounting, banking, cleaning, consultancy, education, insurance, know how, medical treatment, transportation. Sometimes services are difficult to identify because they are closely associated with a good; such as the combination of a diagnosis with the administration of a medicine. No transfer of possession or ownership takes place when services are sold, and they (1) cannot be stored or transported, (2) are instantly perishable, and (3) come into existence at the time they are bought and consumed.

Service (economics)
A service is the intangible equivalent of a good. Service provision is often an economic activity where the buyer does not generally, except by exclusive contract, obtain exclusive ownership of the thing purchased. The benefits of such a service, if priced, are held to be self-evident in the buyers willingness to pay for it. Public services are those society pays for as a whole through taxes and other means. By composing and orchestrating the appropriate level of resources, skill, ingenuity,and experience for effecting specific benefits for service consumers, service providers participate in an economy without the restrictions of carrying stock (inventory) or the need to concern themselves with bulky raw materials. On the other hand, their investment in expertise does require consistent service marketing and upgrading in the face of competition which has equally few physical restrictions. Many so-called services, however, require large physical structures and equipment, and consume large amounts of resources, such as transportation services and the military. Providers of services make up the tertiary sector of the economy.

Service characteristics
Services can be paraphrased in terms of their generic key characteristics. 1. Intangiblity Services are intangible and insubstantial: they cannot be touched, gripped, handled, looked at, smelled, tasted or heard. Thus, there is neither potential nor need for transport, storage or stocking of services. Furthermore, a service cannot be (re)sold or owned by somebody, neither can it be turned over from the service provider to the service consumer nor returned from the service consumer to the service provider. Solely, the service delivery can be commissioned to a service provider who must generate and render the service at the distinct request of an authorized service consumer. 2. Perishability

Services are perishable in two regards

The service relevant resources, processes and systems are assigned for service delivery during a definite period in time. If the designated or scheduled service consumer does not request and consume the service during this period, the service cannot be performed for him. From the perspective of the service provider, this is a lost business opportunity as he cannot charge any service delivery; potentially, he can assign the resources, processes and systems to another service consumer who requests a service. Examples: The hair dresser serves another client when the scheduled starting time or time slot is over. An empty seat on a plane never can be utilized and charged after departure. When the service has been completely rendered to the requesting service consumer, this particular service irreversibly vanishes as it has been consumed by the service consumer. Example: the passenger has been transported to the destination and cannot be transported again to this location at this point in time.

3. Inseparability The service provider is indispensable for service delivery as he must promptly generate and render the service to the requesting service consumer. In many cases the service delivery is executed automatically but the service provider must preparatorily assign resources and systems and actively keep up appropriate service delivery readiness and capabilities. Additionally, the service consumer is inseparable from service delivery because he is involved in it from requesting it up to consuming the rendered benefits. Examples: The service consumer must sit in the hair dresser's shop & chair or in the plane & seat; correspondingly, the hair dresser or the pilot must be in the same shop or plane, respectively, for delivering the service. 4. Simultaneity Services are rendered and consumed during the same period of time. As soon as the service consumer has requested the service (delivery), the particular service must be generated from scratch without any delay and friction and the service consumer instantaneously consumes the rendered benefits for executing his upcoming activity or task. 5. Variability Each service is unique. It is one-time generated, rendered and consumed and can never be exactly repeated as the point in time, location, circumstances, conditions, current configurations and/or assigned resources are different for the next delivery, even if the same service consumer requests the same service. Many services are regarded as heterogeneous or lacking homogeneity and are typically modified for each service consumer or each new situation (consumerised). Example: The taxi service which transports the service consumer from his home to the opera is different from the taxi service which transports the same service consumer from the opera to his home - another point in time, the other direction, maybe another route, probably another taxi driver and cab.

or even impossible. etc. completely. to evaluate or compare services prior to experiencing the service delivery. There are demand fluctuations and it can be difficult to forecast demand. commissioned according to the needs of his service consumers by the service customer from the accountable service provider. finally. as are the relationships between these processes. From the service consumer's point of view.Each of these characteristics is retractable per se and their inevitable coincidence complicates the consistent service conception and make service delivery a challenge in each and every case. attorneys. Both inputs and outputs to the processes involved providing services are highly variable. Proper service marketing requires creative visualization to effectively evoke a concrete image in the service consumer's mind. exceptions include utilities. mostly in close coaction with his service suppliers. and. consistently and concisely specified by means of the following 12 standard attributes which conform to the MECE principle (Mutually Exclusive. making it difficult to maintain consistent service quality. and financial advisers maintain long-term relationships with their clientes for decades. Demand can vary by season. rendered individually to an authorized service consumer at his/her dedicated trigger. business cycle. generated by functions of technical systems and/or by distinct activities of individuals. time of day. Service definition The generic clear-cut. There is consumer involvement as most service provision requires a high degree of interaction between service consumer and service provider. Service specification Any service can be clearly. rather than a precisely determined process. The human factor is often the key success factor in service economies. It is difficult to achieve economies of scale or gain dominant market share. Mass generation and delivery of services is very difficult. Collectively Exhaustive) 1. This can be seen as a problem of inconsistent service quality. respectively. consumed and utilized by the triggering service consumer for executing his/her upcoming business or private activity. these characteristics make it difficult. For many services there is labor intensity as services usually involve considerable human activity. Human resource management is important. Accountants. These repeat consumers refer friends and family. There is a customer-based relationship based on creating long-term business relationships. helping to create a client-based relationship. complete and concise definition of the service term reads as follows: A service is a set of singular and perishable benefits • • • • • delivered from the accountable service provider. Service Consumer Benefits .

Service Delivering Price The meaning and content of these attributes are: 1. Service Support Times 7. Service Impairment Duration per Incident 10. the service output or the service outcome. 5. Service Consumer Count specifies the number of intended. Service Delivery Unit 12. 4. Service Delivering Readiness Times 6. . Service Delivery Point describes the physical location and/or logical interface where the benefits of the service are triggered by and rendered to the authorized service consumer. consumable and effectively utilizable for any authorized service consumer and which are rendered to him as soon as he trigger one service.2.g. Service Delivering Readiness Times specify the distinct agreed times of every day of the week when • • • the described service consumer benefits are o triggerable for the authorized service consumers at the defined service delivery point o consumable and utilizable for the authorized service consumers at the respective agreed service level all the required service contributions are aggregated to the triggered service the specified service benefits are comprehensively rendered to any authorized triggering service consumer without any delay or friction. Service Consumer Count 5. At this point and/or interface. maximum e-mailbox capacity per registered and authorized e-mail service consumer. clearly identified. Service Delivery Point 4. 3. Service Consumer Benefits describe the (set of) benefits which are triggerable. Service Fulfillment Target 9. Service-specific Functional Parameters 3. definitely registered and authorized service consumers which shall be and/or are allowed and enabled to trigger and consume the commissioned service for executing and/or supporting their business tasks or private activities. 2. the preparedness for service delivery readiness can be assessed as well as the effective delivery of the service itself can be monitored and controlled. The description of these benefits must be phrased in the terms and wording of the intended service consumers. explicitly named. Service-specific Functional Parameters specify the functional parameters which are essential and unique to the respective service and which describe the most important dimension(s) of the servicescape. Service Delivering Duration 11. e. Service Support Languages 8.

During the defined service support times. the service desk can be reached by phone. service quality degradation. referring to the location of the intended service consumers. Service Support Languages specifies the national languages which are spoken by the service desk team(s) to the service consumers calling them.e. 11. referring to the location of the intended and/or triggering service consumers. respectively. particularly in the event of service denial. e-mail. 12. an incident. Service Delivering Price specifies the amount of money the service customer has to pay for the distinct service volumes his authorized service consumers have consumed.The time data are specified in 24 h format per local working day and local time. Service Fulfillment Target specifies the service provider's promise of effectively and seamlessly delivering the specified benefits to any authorized service consumer triggering a service within the specified service times. the service delivering price comprises two portions . Service Delivery Unit specifies the basic portion for rendering the defined service consumer benefits. The service delivery unit is the reference and mapping object for the Service Delivering Price. service delivery disruption or service denial. It is expressed as the promised minimum ratio of the counts of successful individual service deliveries related to the counts of triggered service deliveries. for all service costs as well as for charging and billing the consumed service volume to the service customer who has commissioned the service delivery. Service Impairment Duration per Incident specifies the allowable maximum elapsing time between • • the first occurrence of a service impairment. Service Support Times specify the determined and agreed times of every day of the week when the triggering and consumption of commissioned services is supported by the service desk team for all identified. web-based entries and/or fax. registered and authorized service consumers within the service customer's organizational unit or area. i. etc. 10. i.e. work month. Normally. triggered and/or rendered services. Service Delivering Duration specifies the promised and agreed maximum period of time for effectively rendering all specified service consumer benefits to the requesting service consumer at his currently chosen service delivery point. 7. calenderer. 6. whilst the service consumer consumes and utilizes the requested service. The effective service fulfillment ratio can be measured and calculated per single service consumer or per service consumer group and may be referred to different time periods (workday. The service desk is/shall be the so called the Single Point of Contact (SPoC) for any service consumer inquiry regarding the commissioned. 8. the full resumption and complete execution of the service delivery to the content of the affected service consumer. The time data are specified in 24 h format per local working day and local time.) 9.

a popular concept is the idea of the caseload. o staged prices depending on consumed service volumes. Under English law. technical systems. litigants. service access price a price portion covering the service consumption based on o fixed flat rate price per authorized service consumer and delivery period without regard on the consumed service volumes. On a daily basis. Some service dramas are tightly scripted. o fixed price per particularly consumed service delivering unit. this is an offence under the Theft Act 1978. employees must balance the needs of any individual case against the needs of all other current cases as well as their own personal needs. Service delivery The delivery of a service typically involves six factors: • • • • • • The accountable service provider and his service suppliers (e.g. computer systems) The physical facilities (e. if a service provider is induced to deliver services to a dishonest client by a deception.e. a restaurant provides a physical good . Some service managers use the term "moment of truth" to indicate that defining point in a specific service encounter where interactions are most intense. buildings. others are more ad lib. dispute resolution. in all those fields. including the client(s). which refers to the total number of patients. Role congruence occurs when each actor follows a script that harmonizes with the roles played by the other actors.g.g. The service-goods continuum The dichotomy between physical goods and intangible services should not be given too much credence. parking. These are not discrete categories. In some service industries.[citation needed] Most products fall between these two extremes. and social services. Many business theorists view service provision as a performance or act (sometimes humorously referred to as dramalurgy. A script is a sequence of behaviors followed by all those involved. waiting rooms) The requesting service consumer Other customers at the service delivery location Customer contact The service encounter is defined as all activities involved in the service delivery process. perhaps in reference to dramaturgy). The location of the service delivery is referred to as the stage and the objects that facilitate the service process are called props. cash registers. especially health care. For example. clients. or claimants that a given employee is presently responsible for. the people) Equipment used to provide the service (e. Most business theorists see a continuum with pure service on one terminal point and pure commodity good on the other terminal point. i.• • a fixed basic price portion for basic efforts and resources which provide accessibility and usability of the service delivery functions. vehicles.

Parenthetical notations indicate how specific occupations and organizations can be regarded as service industries to the extent they provide an intangible service. as opposed to a tangible good. service refers to quality of customer service: the measured appropriateness of assistance and support provided to a customer. This particular usage occurs frequently in retailing. but also provides services in the form of ambience.5% of the U. • • • • • • business functions (that apply to all organizations in general) o consulting o customer service o human resources administrators (providing services like ensuring that employees are paid accurately) childcare cleaning. And although some utilities actually deliver physical goods — like water utilities which actually deliver water — utilities are usually treated as services.(the food). repair and maintenance services o janitors (who provide cleaning services) o gardeners o mechanics construction o carpentry o electricians (offering the service of making wiring work properly) o plumbing death care o coroners (who provide the service of identifying cadavers and determining time and cause of death) o funeral homes (who prepare corpses for public display.S. The following is an incomplete list of service industries. In a narrower sense. reports the International Monetary Fund. etc. the setting and clearing of the table. Services accounted for 78. cremation or burial) dispute resolution and prevention services o arbitration o courts of law (who perform the service of dispute resolution backed by the power of the state) o diplomacy o incarceration (provides the service of keeping criminals out of society) o law enforcement (provides the service of identifying and apprehending criminals) o lawyers (who perform the services of advocacy and decisionmaking in many dispute resolution and prevention processes) o mediation o military (performs the service of protecting states in disputes with other states) . grouped into rough sectors. USA was the largest producer of services followed by Japan and Germany. compared to 20% in 1947. List of economic services In 2005. economy in 2007[1].

• • • • • • • • • • • • • negotiation (not really a service unless someone is negotiating on behalf of another) education (institutions offering the services of teaching and access to information) o library o museum o school entertainment (when provided live or within a highly specialized facility) o gambling o movie theatres (providing the service of showing a movie on a big screen) o performing arts productions o sexual services o sport o television fabric care o dry cleaning o Self-service laundry (offering the service of automated fabric cleaning) financial services o accountancy o banks and building societies (offering lending services and safekeeping of money and valuables) o real estate o stock brokerages o tax preparation foodservice industry personal grooming o hairdressing o manicurist / pedicurist o body hair removal o dental hygienist health care (all health care professions provide services) hospitality industry information services o data processing o database services o Interpreting o Translation risk management o insurance o security social services o social work transport Public utility o electric power o nat’ural gas o telecommunications o waste management o .

o water industry .

eliminating much of the drudgery in such tasks. 31(2). or nations. New York. 1962. "Anyone seeking an introduction to queueing theory. "Properly designed service technology systems allow relatively inexperienced people to perform very sophisticated tasks quickly — vaulting them over normal learning curve delays. One recent definition of a service system is a value coproduction configuration of people.. CSS) is a configuration of technology and organizational networks designed to deliver services that satisfy the needs. 3532. Given the growing importance of this term in the literature. some service systems may perform coercive service activities. Overview "Service system" is a term very frequently used in the service management. and shared information (language. agents of the state may use coercion in accordance with laws of the land. examples. Illus. 137. laws. . John Riordan. etc. A service system worldview is a system of systems that interact via value propositions. History Usages of the term service system (bold added) are provided below: The earliest known usage of the phrase service system in a book title is: Stochastic Service Systems. MIT Sloan Management Review. x + 139 pp.Service system A service system (or customer service system. service engineering. Most service system interactions aspire to be win-win. this entry begins to organize historical usages.sciencemag. The smallest service system is a single person and the largest service system is the world economy. For example.). 742 Usages from Quinn and Paquette (1990) Technology in Services: Creating Organizational Revolutions. p." Examples: "Domino's Pizza … industrial engineering and food science research automated the making of a pizza to as near a science as possible. no. The external service system of the global economy is considered to be nature's services or ecosystem services. Service systems can be characterized by the value that results from interaction between service systems. While the term frequently appears. and inferred definitions. and Science 7 September 1962: Vol. whether the interactions are between people. However. internal and external service systems connected via value propositions. service operations. technology. it is rarely defined. businesses.. Wiley." Also a Science article was published by John Riordan http://www. non-coercive. services marketing. and service design literature. measures. or aspirations of customers. wants.

. Progressing down the continuum toward lower custom contact are mixed services (e." "Not only does one have to consider the implications on product design and how this affects marketing." Inferred definition: Service systems. are designed to allow inexperienced people to perform very sophisticated service provisioning tasks quickly.." "The environment in which a service organization operates will be instrumental in determining how the service system. Service systems can be placed on a continuum that ranges from high customer contact to low customer contact during the creation of the service." "Capital intensity of the service system also serves as the basis of classification." Examples: "Pure services (e.. It is." "Customer satisfaction is the most basic concept underlying TQM. and work control functions … Federal Express … Its DADS (computer aided delivery) and COSMOS II(automated tracking) systems give FedEx maximum responsiveness. health centers and personal services) represent the highest level of customer contact. quasimanufacturing (e. laws... Production and Operations Management.When a client contracts with an architect to design a home.g. should be designed. On the other hand.." "The level of customer involvement in the creation of a service is also a dimension used to classify services.yet ensuring higher quality and uniformity. and Chung (1999) Service Typologies: A State of the Art Survey.. operations.. marketing. cash flow.. branch offices of post offices). and global environment . Customer involvement means the level of interaction the customer has with the service system and the level to which the customer can actually affect the service delivery process." Inferred definition: Service systems are organizations designed to delivery services that satisfy the needs and wants of the organization's customers. The capital intensity of the service system ranges from low to high. This illustrates the need to address interactions between the marketing and operations functions and to integrate these functions for the betterment of the firm.. a customer who has purchased an airline ticket has little opportunity for involvement in the service delivery or to impact how the service is going to be provided. therefore... Marketing. automobile assembly plants). home office of banks). payroll. finding that its store managers were still spending fifteen to twenty hours per week on paperwork. Then. and culture to successfully operate internationally. but is also may have significant implications for the design of the service system. Goh. .. Global service organizations must also appreciate and understand local customers. of critical importance that the service system and the services it is designed to deliver satisfy the needs and wants of the organization's customers..g.g. Usages from Cook. Domino's introduced NCR "mini-tower" systems at its stores to handle all of the ordering. also known as service technology systems. "Customer contact is one of the primary criteria used to classify service operations and refers to the physical presence of the customers in the service system during the provision of the service.. inventory.g. as well as the services themselves. 8(3). and manufacturing (e.. a relationship involving high customer involvement is created.

and then specify the distinctive characteristics of a service system: A system is an organized set of objects which process inputs into outputs that achieve an organizational purpose and meet the need of customers through the use of human. and informatic enablers in a sociological and physical environment (adapted from Nadler 1981. and level of customer involvement. (5) processes . (2) goals . and payment mechanisms for providing a level of service.physical. Vargo. physical. This would encourage it to determine the optimal configuration of goods. ecological or legal factors influencing the system. technological.physical.considerations have significant implications for the design of a service system. "Stated alternatively. It could charge per cubic foot of climate maintained on a monthly or annual basis and/or through a payment plan involving gain sharing. and the optimal payment mechanism in exchange for providing the service.aims. It is architectured as a set of nine interlinked classes of objects: (1) customers those benefiting from the system (or otherwise affected by it). purposes or central meaning of the system and the organizations. the organization is encouraged to think about the service system." Examples: "For example. informational or human entities after processing by the system. (2) goals - .as initiator and receiver of the service (e. (8) informatic enablers information and knowledge resources supporting the system. financial. then it could decide to sell climate control for a building rather than just mechanical devices. and Malter (2006) Marketing as Service-Exchange: Taking a Leadership Role in Global Marketing Management. and (9) environment . Organizational Dynamics..physical resources which aid in operating the system. organizational networks. A seller entering into such an arrangement has an incentive to look at everything about the building that will influence heating and cooling costs. Service system topics Definition Karni and Kaner in "An engineering tool for the conceptual design of service systems" first provide a general definition of a system." Inferred definition: Service systems are optimal configurations of goods.g. economic. reliability . Checkland 1981). Usages from Lusch. if any. for a level of service.human resources owning and/or operating the system. the optimal organization or network configuration to maintain the service. if a heating and air conditioning equipment manufacturer views itself in the temperature control business. or information entities to be processed by the system. in which costs are reduced as system performance rises.or both). (3) inputs . (4) outputs . social. the customer is characterized as looking for novelty. A service system is nevertheless distinguished from other types of systems by the fact that the customer may be actively involved in all nine classes: (1) customer . thus benefiting financially both the firm and the customer. (6) human enablers . Three criteria used to classify service systems include: customer contact. That is. 35(3).physical. service-dominant logic offers opportunity for the organization to focus on selling a flow of service.transformations for obtaining outputs from inputs. human. (7) physical enablers . capital intensity.

(7) physical enabler .g.g. Three criteria used to classify service systems include: • • • customer contact.g. an Internet shopper demands 24-hour availability of a dialogue facility)..g. (3) input .as setting constraints or standards for acceptable service levels (e. service systems are a type of complex system that is partially designed and partially evolving.g... Service systems are designed to deliver or provision services. (6) human enabler . operations. and level of customer involvement. branch office of a post office or bank) to complete multinational corporations and their information systems ( applying his own knowledge to the process (e... (4) output as a client upon whom a service has been performed (e. Every service system is both a service provider and a customer of multiple types of services. an Internet shopper uses his own computer to access the vendor site).g. Federal Express). architect. Because service systems are designed both in how they provision and consume services.. an Internet sales transaction incorporates a dialogue facility between a customer and a sales agent). the patient after treatment). Properly designed service systems employ technology or organizational networks that can allow relatively inexperienced people to perform very sophisticated tasks quickly — vaulting them over normal learning curve setting the primary objectives for the design and operation of the service ( providing a resource to the process (e. capital intensity. Since the term service is often defined as value a resource in the process (e. (8) informatic enabler . Prime Movers are the ones who reconfigure value-creating systems. as people adjust to new circumstances. an Internet shopper uses his own know-how regarding the product to configure the model he wishes to buy). In this a client upon whom the service is to be performed (e. The language. an Internet sales transaction involves the customer as an independent agent). (5) process as a participant in the process (e. Richard Normann in "Reframing Business" introduces the notion of a value-creating system. and (9) environment .. Norman writes about the unbundling and rebundling of value-creating systems as one of the main trends of our time. and beliefs of the people that make up a service system may evolve over time. entrepreneur) to a portion of a government agency or business (e.g.g. norms. a service system might well be called a value-coproduction system. Design of service systems Marketing. a patient coming for treatment). attitudes. the service should an Internet shopper to configure the product variant he wishes to purchase)... services .g. but they often consume services as well.g. cities. universities.. and national governments are designed service systems. and global environment considerations have significant implications for the design of a service system. Domino's Pizza. Ideally. Types of service systems Service systems range from an individual person equipped with tools of the trade (e. Hospitals. empowerment of both service provider employees and customers (often via self service) results from well designed service systems.

credit cards usage is part of a service system in which the more people and businesses that use and accept the credit cards. Service systems may include payment mechanisms for selecting a level of service to be provided (upfront or one time payment) or payment based on downstream value sharing or taxation derived from customers who received the benefit of the service (downstream or ongoing payment). staff and operating room unit inside a hospital that is part of a nationwide healthcare provider network). the more value the credit cards have to the provider and all stakeholders in the service system. a national service system may be designed with policies that enable more citizens (the customers of the nation) to become an entrepreneur. Service system designers or architects often seek to exploit an economic complementarity or network effect to rapidly grow and scale up the service. For example. aspirations) innovation. . business model (or value proposition) innovation. For are often linked into a complex service value chain or value network where each link is a value proposition. Service system innovation often requires integrating technology innovation. Payments may also be in the form of credit (creative arts) or other types of intangible value (see anthropological theories of value and theory of value). and thereby create more innovation and wealth for the nation. needs. social-organizational innovation. Service systems may be nested inside of service systems (e. and demand (new customer wants.

a high degree of interaction would imply that the customer can demand more or less of some aspects of the service. The upper left quadrant contains firms with a low degree of labor intensity and a low degree of interaction and customization. Customization refers to the need and ability to alter the service in order to satisfy the individual customer's particular preferences. The Service Process Matrix can be useful when investigating the strategic changes in service operations. The horizontal axis is a continuum with a high degree of customer interaction and customization on one end (right) and a low degree of customer interaction and customization on the other end (left). or in this case service. For example. and customization. is a continuum with a high degree of labor intensity on one end (bottom) and a low degree of labor intensity on the other end (top). Customer interaction represents the degree to which the customer can intervene in the service process. This quadrant is labeled “Service Factory.” Low labor intensity and little or no customer interaction or customization makes this quadrant similar to the lower right area of the Product-Process Matrix where repetitive assembly and … . The classification characteristics include the degree of labor intensity and a jointly measured degree of customer interaction and customization. The vertical axis on the matrix. In addition. By paying close attention to the challenges associated with their related classification. as shown in Figure 1. The matrix was derived by Roger Schmenner and first appeared in 1986.Service Process Matrix The Service Process Matrix is a classification matrix of service industry firms based on the characteristics of the individual firm's service processes. Although considerably different. service firms may improve their performance. requires a high content of time and effort with comparatively little plant and equipment cost would be said to be labor intense. each with a unique combination of degrees of labor intensity. the Service Process Matrix can be seen somewhat as a service industry version of Wheelwright and Hayes' Product-Process Matrix. A firm whose product. Labor intensity can be defined as the ratio of labor cost to plant and equipment. This results in a matrix with four quadrants. customer interaction. there are unique managerial challenges associated with each quadrant of the matrix.

This results in a matrix with four quadrants. Customization refers to the need and ability to alter the service in order to satisfy the individual customer's particular preferences. By paying close attention to the challenges associated with their related classification. This allows service firms in this quadrant to operate in a fashion similar to factories. A firm whose product. Labor intensity can be defined as the ratio of labor cost to plant and equipment. each with a unique combination of degrees of labor intensity. there are unique managerial challenges associated with each quadrant of the matrix. The upper right quadrant contains firms with a low degree of labor intensity but a high degree of interaction and customization. Firms classified as service factories include truck lines. The lower right quadrant is labeled "Professional . The classification characteristics include the degree of labor intensity and a jointly measured degree of customer interaction and customization." Hospitals. auto repair shops and many restaurants are found in this quadrant. The vertical axis on the matrix.Service Process Matrix The Service Process Matrix is a classification matrix of service industry firms based on the characteristics of the individual firm's service processes. In addition. as shown in Figure 1. This quadrant is labeled "Service Factory. The matrix was derived by Roger Schmenner and first appeared in 1986. service firms may improve their performance. The upper right quadrant is labeled "Service Shop. the lower right quadrant contains firms with a high degree of labor intensity and a high degree of interaction and customization. is a continuum with high degree of labor intensity on one end (bottom) and low degree of labor intensity on the other end (top). Although considerably different." These firms can take advantage of economies of scale and may employ less expensive unskilled workers as do most factories. Customer interaction represents the degree to which the customer can intervene in the service process. a high degree of interaction would imply that the customer can demand more or less of some aspects of the service. The horizontal axis is a continuum with high degree of customer interaction and customization on one ends (right) and low degree of customer interaction and customization on the other end (left)." Mass service providers include retail/wholesale firms and schools. or in this case service." Low labor intensity and little or no customer interaction or customization makes this quadrant similar to the lower right area of the Product-Process Matrix where repetitive assembly and continuous flow processes are located. requires a high content of time and effort with comparatively little plant and equipment cost would be said to be labor intense. This quadrant is labeled "Mass Service. Finally. hotels/motels. hence the title "Service Factory. The Service Process Matrix can be useful when investigating the strategic changes in service operations. The lower left quadrant contains firms with a high degree of labor intensity but a low degree of interaction and customization. The upper left quadrant contains firms with a low degree of labor intensity and a low degree of interaction and customization. the Service Process Matrix can be seen somewhat as a service industry version of Wheelwright and Hayes' Product-Process Matrix. For example. customer interaction and customization. and airlines.

Obviously. a Service Factory. The attraction seems to be better control. The legal field. Doctors. Dotchin and Oakland proposed that in addition to the four categories: service factory. hospitals have seen movement within the matrix. accountants. mass service. be it with professional services. as evidenced by the fact that the diagonal transverses each of those quadrants. a hospital that specializes in one type of surgery so that customization is at it lowest. as opposed to professional services which are directed to things. The need for control is not as great for service factories and professional services. need for control would be greater for service shops. the most prolific amount of advertising seems to come from lawyers seeking cases involving bankruptcy and uncontested divorces. The fast food industry has taken restaurants into the Service Factory area through the dramatic elimination of customization and lowering of labor intensity. a Professional Service. MOVEMENT WITHIN THE MATRIX On Wheelwright and Hayes' Product-Process Matrix processes appear on a diagonal running from the upper left corner to the lower right corner. hold the lettuce. special orders don't upset us!" Also. and mass services. would be a movement toward the service factory.Service. thereby. is a prime example of "up the diagonal" movement. architects. a notional diagonal can be said to run from the upper left corner to the lower right corner of the Service Process Matrix. Other than personal injury. customer interaction putting it into the Service Shop category. Firms that position themselves directly on the diagonal are seen to be the most efficient. ." This quadrant is similar to the upper left section of the Product-Process Matrix where job shops and batch processes are found. achieved with little contact time. Obviously. The traditional restaurant had a considerable degree of customization. lawyers. which lie below the diagonal. By handling this case "in bulk" the attorney also lowers the labor intensity by handling multiple cases in one trip to the court house and enjoys economies of scale just like a factory. In 1994. or service shops. the degree of standardization may vary. and investment bankers are typical service providers that tend to be labor intense and have a high degree of customer interaction and customization. thereby high contact. This. Schmenner also states that most services that have changed their positions within the matrix over time have tended to move up the diagonal. They justify the inclusion by describing personal services as those directed at people. which lie completely above the diagonal. these are the cases that require the least amount of customization. any move up the diagonal. Similarly. However. From the perspective of the matrix. Those firms most affected by a move up the diagonal would be found in the professional services where labor intensity and interaction/customization was high. mass service and professional service. of course. Schmenner states that many of the segmentation steps taken by service firms have been toward the diagonal. a fifth category should be added: personal service. service shop. implies a decrease in the degree of interaction and customization and a decrease in labor intensity. Witness Wendy's where you can "hold the pickles. Consider Shouldice Hernia Centre in Canada. Most have surely noticed the increase of television advertising on the part of some in the legal profession.

However. RECENT CHANGES While the concept of the Service Process Matrix is conceptual or theoretical in nature. in an attempt to validate the idea that management challenges do differ across the different types of services represented by the quadrants of the Matrix. Capital decisions. workforce issues such as hiring. training. customization and labor intensity. . In addition. it should be noted that in 2000. Capital decisions and fighting cost increases were found to be more important for the service factory and the service shop than for mass service and professional service. Firms with high degrees of interaction and customization must manage higher costs resulting from lack of economies of scale. Since capacity is some-what inflexible. In addition. Verma's findings did not closely match the proposed expectations. technological advances and scheduling service delivery are perceived to be more of a challenge in high interaction/customization. The managerial hierarchy tends to be flatter and less rigid. quality of work life and benefits. Starting new operations. and loyalty were found to become less important at interaction/customization increases. employee welfare and workforce scheduling are critical. benefits. Warehouse stores such as Sam's Club and Internet sales have allowed retailers to move from Mass Service to Service Factory by drastically cutting labor intensity. employee development and control. implying the need to closer monitor technological advances.allowing them to run as a service factory rather than a service shop. workforce scheduling and managing organizational hierarchy were found to be more important for service factory and service shops. Even banking has made movement toward the Service Factory with the universal use of ATMs. some have gone in the opposite direction by becoming fullservice boutiques and specialty stores stressing customer interaction. Conversely. higher skilled labor costs more and demands more attention. Firms with low customer interaction and customization face more marketing challenges than other firms. For firms with high labor intensity. MANAGERIAL CHALLENGES There are a number of proposed challenges for management that are inherent in a firm's position within the Service Process Matrix. training. the classic managerial pyramid with many layers and a rigid relationship between layers is appropriate. Retailing has also seen changes within the Matrix. For these firms standard procedures are safe to use. using a broad sample of quantitative data. The importance of managing employee career advancement and marketing of services increases as labor intensity increases. The need to "warm up" the service dictates special attention to physical surroundings. Rohit Verma conducted an exploratory study. hiring. For firms with low labor intensity. plant and equipment choices are extremely important. scheduling service delivery is more important so demand must be managed. employee scheduling.

providing insight into service productivity. restaurants appeared as service shops. but productivity that results from "swift. rather than degree of labor intensity and degree of customer interaction and customization.As such. in the previous Matrix. . only four of 22 management challenge relationships proposed by the Service Process Matrix were supported by the empirical analysis. not all services fit cleanly into these quadrants. The previously noted challenges for managers remain the same. Schmenner updated the Service Process Matrix by redefining the axes and the resulting diagonal. Although. traditional restaurants are still service shops but gourmet restaurants could be considered professional service and fast food restaurants (with their quick throughput time) would be service factories. For example. the issue was not control. Even Flow = degree of variation. Throughput time is the time that elapses between the services or facilitating good's initial availability until the service is complete. even flow. The Y axis changes from labor intensity to relative throughput time. Even Flow: Swift = relative throughput time. the Product Service Matrix continues to be the standard classification scheme utilized in service research. interaction and customization are sources of variation. It also provides insight into how service firms differentiate themselves from each other as well as helping to explain why successful service firms achieved their positions and maintained them. He had earlier stated that the lure of the diagonal was the need for control but later changed his mind. firms would strive to move left and upward or up the diagonal. Despite this. Even Flow argues that productivity increases as the flow of products and information becomes faster and variability decreases." in the sense that variation occurs in providing the service not that the firm provides a variety of services. He stated that in retrospect." The concept of Swift. With the new axes. particular services may now be spread out in the Matrix. Of course. In 2004. Hence. The Service Process Matrix is now represented by Swift. Redefining the axes of the Matrix then causes the classification of services to change from the type service itself to the provider of the service. Hence the X axis of the Service Process Matrix changes from interaction and customization to degree of "variation. Consider Southwest Airlines whose turnarounds are done swiftly with little variation. In order to improve productivity then. it is instructive.

or in this case service. For example. the Service Process Matrix can be seen somewhat as a service industry version of Wheelwright and Hayes' Product-Process Matrix. The Service Process Matrix can be useful when investigating the strategic changes in service operations. By paying close attention to the challenges associated with their related classification. A firm whose product. Labor intensity can be defined as the ratio of labor cost to plant and equipment. Although considerably different. service firms may improve their performance. .Service Process Matrix The Service Process Matrix is a classification matrix of service industry firms based on the characteristics of the individual firm's service processes. a high degree of interaction would imply that the customer can demand more or less of some aspects of the service. The matrix was derived by Roger Schemer and first appeared in 1986. Customer interaction represents the degree to which the customer can intervene in the service process. there are unique managerial challenges associated with each quadrant of the matrix. The classification characteristics include the degree of labor intensity and a jointly measured degree of customer interaction and customization. requires a high content of time and effort with comparatively little plant and equipment cost would be said to be labor intense. In addition.

You can enhance the service and convenience of Package Services by adding extra services such as insurance and Delivery Confirmation. and other printed matter. except for Bound Printed Matter. mail that is refused or is otherwise undeliverable will be returned to the sender marked "postage due".Notice 123. books. Bound Printed Matter .Package Services Minimum Weight: none Maximum Weight: 15 pounds (for Bound Printed Matter). compare the costs and service between Priority Mail and Package Services. Lower postage prices are available for bulk quantities of Package Services that meet additional standards for volume. the postage costs are very similar to Priority Mail but Priority Mail gets there faster and includes free forwarding and return. catalogs. There also is a barcoded discount available for Parcel Select pieces. Package Services does not include free forwarding and return. 70 pounds (for Parcel Select. These services are available for a small fee. Media Mail. undeliverable Bound Printed Matter is disposed of at the local office. If you are mailing merchandise. catalogs. Each subclass is best suited for a certain kind of mail. and destination entry. so be sure to pick the one that best suits your mailing. and Library Mail—(and other) postage prices: Price List . circulars. Parcel Select Used by commercial mailers for mailing merchandise. In many cases. and Library Mail) Package Services is a class of mail primarily intended for merchandise. but mailers can use ancillary service endorsements to tell the Postal Service how to treat undeliverable mail. Package Services does not receive expedited service. Unendorsed. There are bulk prices and destination entry prices available for mailers who send large quantities of Parcel Select items. Package Services—including Parcel Select. Decision Tree: Six easy questions will lead you directly to the information you need about Parcel Select. There are four subclasses of Package Services (see below). Bound Printed Matter. Media Mail. Unendorsed Package Services. presort. and other printed material.

printed test materials. printed educational charts. Decision Tree: Six easy questions will lead you directly to the information you need about Bound Printed Matter. e. Not be stationery. Calculate postage for Bound Printed Matter Media Mail Generally used for books (at least eight pages). There are commercial prices. loose-leaf pages and binders consisting of medical information. letters. figures. or images (or any combination of them). Be paid by permit imprint. spiral binding. There also is a barcoded discount available for Bound Printed Matter pieces. c. promotional. There are presorted prices available for bulk quantities of Media Mail (minimum quantity is 300 pieces). Loose-leaf binders and similar fastenings are not considered permanent. sound recordings. Advertising restrictions apply. and research institutions to mail educational and research material. Consist of sheets of which at least 90% are imprinted by any process other than handwriting or typewriting with words. The minimum quantity is 300 pieces. such as pads of blank printed forms. d. and destination entry discounts available for bulk quantities of Bound Printed Matter. There is also a barcoded discount available for Media Mail. Decision Tree: Six easy questions will lead you directly to the information you need about Media Mail. or stitching. characters. film.Bound Printed Matter must: a. f. play scripts. Library Mail Used by qualifying institutions like libraries. and computer-readable media. Not have the nature of personal correspondence. printed music. directory. universities. There are presorted prices available for bulk quantities of Library Mail (minimum quantity is 300 pieces). zoos. . Be securely bound by permanent fastenings such as staples. carrier route prices. or editorial material (or any combination of such material). glue. Consist of advertising. b.

There is also a barcoded discount available for Library Mail. . Decision Tree: Six easy questions will lead you directly to the information you need about Library Mail.

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You're giving your clients a defined result with a clear timeframe and set price. A market research consultant working with corporate clients at $150 per hour could instead provide a "Market Position Blueprint" for a flat fee of $2500." or even "I'm not quite clear what it is I'd be getting. all to be delivered with 30 days.Marketing professional services: package professional services Turn Your Services into a Product One of the biggest challenges in selling professional services is that what you are offering is intangible. making it easy for them to buy. Even if you price your package at slightly less than what you would earn for working the same amount of time at an hourly rate. "I don't want to leave it open-ended. you offer a "One-Day Makeover" at a price of $495. Until your prospective clients experience what you do. Purchasing something with a name attached makes it feel much more tangible than simply buying hours. and recommendations for improving the client's market position. and shopping trip. they have no way of knowing if it will turn out. Your product can't be seen. and attach a distinctive name. the client must first trust that your work will produce the result that they need. This awkward term simply means that you make your service look more like a product. the client runs less risk. whether they will like it. To make a buying decision." You can overcome these barriers to making a sale by "productizing" your services. You will hear them say. Once you show a client what you are capable of. There's also an emotional comfort factor in buying a package. For you. you are able to let clients experience a range of the services you offer and suggest additional ways they can work with you. or tasted. They don't have to worry about cost overruns or getting an unexpected result. qualitative data from interviews with six loyal customers. You give it a defined scope. touched." "I'm not sure my budget will allow for this. . Let's say you are an image consultant. They know how soon the result they are paying for will be delivered. so that it becomes easier for your clients to buy. fit it into a limited time period. and how well it will work in their situation. The most common way to package professional services is by the hour or day. color consultation. Instead. more business will often result. and you've been selling your time for $75 per hour. assign it a definite price tag. Plus. you will probably profit more because more of your time will ultimately be sold. and they keep paying until the project is declared complete. offering a package helps you get your foot in the door." "That seems high for an hourly rate. When buying your services in a package. and include a wardrobe assessment. Clients know in advance exactly what they are paying and what they will get for it. The client pays for your time. But clients are often resistant to this. The package would include a comparison matrix of three key competitors.

and perhaps even allow you to trademark it. You want a memorable results-oriented name that will help you to stand out from the competition. and other tools that you develop only once and use over and over. This effectively allows you to charge for the same work more than once. worksheets. Is there a specific set of steps you usually follow when first working with a new client? Activities that you perform repetitively with many people give you an opportunity to create templates. In a survey quoted by the late Howard Shenson in "The Contract & Fee-Setting Guide for Consultants & Professionals. Get a free copy of "Five Secrets to Finding All the Clients You'll Ever Need" at . and more profitable engagements. To launch your first product. C." consultants working exclusively on a fixed-price basis had 87% higher profits than those working on a daily or hourly basis. you may not need to do much more than develop a standard format for what you are already doing. Hayden is the author of Get Clients NOW! Thousands of business owners and salespeople have used her simple sales and marketing system to double or triple their income. Be sure to spend some time on coining a unique name for your product. more repeat business. and name your new invention. Taking this critical step toward making your services more tangible can result in easier sales. To determine which of your services would be best to turn into a product. set a price. consider what your target market most often wants from you.Many consultants find that fixed-price contracts are much more profitable than working by the hour.J.

Profit. directs and monitors operational/tactical activities of Staff. Walk the Talk. Skills Education and Experience Required: Demonstrate solid understanding of business planning methods. and Profit is the natural result. have the right products. innovative systems integration and consulting services. Plan for and deliver a workforce that ensures profitability. services). Additional guidance/criteria: 1) Directs and controls activities within a single country or a sub-region which is part of a larger geographical Region. Professional Services Manager Job Description Manage the delivery of high-quality. 2) Typically reports to MG2 or MG3. Applies advanced subject matter knowledge to manage staff activities in solving common and complex business/technical issues within established policies. Has accountability for results of a major program in terms of cost. strategy and direction . Provides guidance on process improvements and recommends changes in alignment with business tactics and strategy for area of responsibility. Products (HW. put your customers and your associates first. Plans. solutions.What are the biggest challenges facing a Regional Service Manager in this economy? To embrace and internalize the right order of priority of the three “P”s in Services. 3) Manages at least 4 employees and typically between 8 and 15 direct reports. 1. direction and people management. Critical Competencies to Drive Business Results: Strategy Operationalization & Implementation Establishes and drives the operationalization and execution of HP's business vision. Manages non-exempt/exempt individual contributors and/or supervisors. 2. and then … and only then 3. Staff members' work may involve strategic issues. Recruits and supports development of direct staff members. Span of Control guidelines may differ from these numbers. Provide expertise to the Practices. People (customers and employees).

and ensure their effective engagement Program Coordination Coordinates day-to-day activities to meet project/program requirements Engagement Resourcing & Optimization Applies understanding of opportunity requirements to resource. and the competitive landscape in which they are sold HPS Solution Interfaces Understands how services in area-of-responsibility fit within or interface with the sales of other solutions . the business challenges addressed by HP Services (HPS)/Business Unit (BU) solutions. tracks and enforces spending parameters to protect HP's business assets.Cost and Budget Management Establishes. key technology concepts. or HP's partner strategies Change Management Develops methods for supporting innovation and change across the organization Problem Solving Approaches problems in a rational manner using sound strategies that ensure comprehensive understanding and effective resolution . other Global/General Business Unit (GBU)s. and HP's strategy for market penetration Executive Business Relationship building Builds executive business-oriented relationships at the highest levels in pursuit of alliances that will advance or protect HP's corporate interests HPS/BU Solutions Understands HPS/BU solutions in area-of-responsibility. manage & optimize engagements efficiently and cost-effectively Coaching/Supervision Assesses and manages employee performance to ensure individual and group excellence HPS/BU Business Context Understands the market segments sold into.HPS. product roadmaps.what they consist of.

You also need to be detail-oriented. Commercial rental property includes strip malls. The property manager also collects rent and arranges for evictions when rent is not paid. There are commercial property managers and residential property managers. In some areas. and condominiums. Many property managers are self employed and run small firms where they manage the properties of several individual property owners. Commercial property managers oversee the business of renting to business tenants. property managers must be licensed to prove they are qualified to carry out all of the duties required of a property manager. dealing with tenants. Residential property managers deal strictly with rental properties people live in such as houses. you usually need at least a two-year college degree. As they conduct business on the behalf of the property owner. To secure a job as a property manager. screening tenants. The property manager is the person who is called when there is an emergency that involves the property. property manager's duties include overseeing property maintenance. or a few years experience as an office manager or similar employment. and renting out the property on the owners behalf. . and office buildings. but you are beholden to look out for the property owner's best interest. the licensing requirements provide peace of mind to the owners. large shopping malls. There are two basic types of property management.The Duties and Challenges of a Property Manager If you are interested in working as a property manager. You need to have good people skills. You need excellent clerical and managerial skills. and second to the tenants who they need to ensure can have quiet enjoyment of the property. The duties of a property owner can vary from property to property and from owner to owner. The property manager's first duty is to the property owner who they work for. A successful firm can easily grow into a thriving business. you will need several different skills and abilities. There may be times when you know the tenant's grievance is right. apartments. Generally. finding new tenants.