ALIGNING SERVICE DESIGN AND STANDARDS Part 4 ALIGNING SERVICE DESIGN AND STANDARDS

Provider Gap 2 Customer-Driven Service Designs and Standards COMPANY Customer-Driven Service Designs and Standards Service Design and Standards Gap Company Perceptions of Consumer Expectations Part 4 Opener

Service Development and Design Chapter Service Development and Design 9 Challenges of Service Design New Service Development Types of New Services Stages in New Service Development Service Blueprinting Quality Function Deployment High-Performance Service Innovations

Objectives for Chapter 9: Service Development and Design Describe the challenges inherent in service design. Present the stages and unique elements of the new-service development process. Demonstrate the value of service blueprinting and how to develop and read service blueprints. Present lessons learned in choosing and implementing high-performance service innovations.

Figure 9.1 Risks of Relying on Words Alone to Describe Services Oversimplification Incompleteness Subjectivity Biased Interpretation

Types of New Services major or radical innovations start-up businesses new services for the currently served market service line extensions service improvements style changes

Figure 9.2 New Service Development Process Business strategy development or review New service strategy development Idea generation Front-end Planning Screen ideas against new service strategy Concept development and evaluation Test concept with customers and employees Business analysis Test for profitability and feasibility Service development and testing Conduct service prototype test Market testing Implementation Test service and other marketing-mix elements Commercialization Sources: Booz-Allen & Hamilton, 1982; Bowers, 1985; Cooper, 1993; Khurana & Rosenthal 1997. Postintroduction evaluation

Markets Offerings Current Customers New Customers Existing Services Figure 9.3 New Service Strategy Matrix for Identifying Growth Opportunities Markets Offerings Current Customers New Customers Existing Services Share building Market development New Services Service development Diversification

Figure 9.5 Service Blueprinting A tool for simultaneously depicting the service process, the points of customer contact, and the evidence of service from the customer’s point of view. Process Service Blueprint Points of contact Evidence

Service Blueprint Components Customer Actions line of interaction “Onstage” Contact Employee Actions line of visibility “Backstage” Contact Employee Actions line of internal interaction Support Processes

Figure 9.6 Service Blueprint Components

Figure 9.7 Blueprint for Express Mail Delivery Service PHYSICAL EVIDENCE Truck Packaging Forms Hand-held Computer Uniform Truck Packaging Forms Hand-held Computer Uniform Customer Calls Customer Gives Package Receive Package CUSTOMER Line of interaction (On Stage) Driver Picks Up Package Deliver Package CONTACT PERSON Line of visibility (Back Stage) Customer Service Order Line of internal interaction Airport Receives & Loads Fly to Sort Center Dispatch Driver Fly to Destination Unload & Sort Load On Truck SUPPORT PROCESS Load on Airplane Sort Packages

Figure 9.8 Blueprint for Overnight Hotel Stay Service PHYSICAL EVIDENCE Hotel Exterior Parking Cart for Bags Desk Registration Papers Lobby Key Elevators Hallways Room Cart for Bags Room Amenities Bath Menu Delivery Tray Food Appearance Food Bill Desk Lobby Hotel Exterior Parking Arrive at Hotel Give Bags to Bellperson Call Room Service Check out and Leave CUSTOMER Go to Room Receive Bags Sleep Shower Check in Receive Food Eat Line of Interaction Greet and Take Bags (On Stage) Process Registration Deliver Bags Deliver Food Process Check Out CONTACT PERSON Line of Visibility (Back Stage) Take Food Order Take Bags to Room Line of Internal Interaction Registration System Registration System Prepare Food SUPPORT PROCESS

Figure 9.9 Building a Service Blueprint Step 1 Identify the process to be blue-printed Step 2 Identify the customer or customer segment Step 3 Map the process from the customer’s point of view Step 4 Map contact employee actions, onstage and back-stage, and/or technology actions Step 5 Link contact activities to needed support functions Step 6 Add evidence of service at each customer action step

Application of Service Blueprints New Service Development concept development market testing Supporting a “Zero Defects” Culture managing reliability identifying empowerment issues Service Recovery Strategies identifying service problems conducting root cause analysis modifying processes

Blueprints Can Be Used By: Service Marketers creating realistic customer expectations: service system design promotion Operations Management rendering the service as promised: managing fail points training systems quality control Human Resources Management empowering the human element: job descriptions selection criteria appraisal systems System Technology providing necessary tools: system specifications personal preference databases

Figure 9.10 House of Service Quality for Village Volvo Source: J. A. Fitzsimmons and M. J. Fitzsimmons, Service Management, 3rd ed. (New York: Irwin McGraw-Hill, 2000), p. 58.