1. CHAPTER 10 SERVICE STRATEGY

2. Characteristics of Services Capacity Management Concentrated Service Niches Major Services

3. CHARACTERISTICS OF SERVICES Produced and consumed at the same time More variability in quality control Intangible No inventory with services

4. CAPACITY MANAGEMENT Examples Hotel weekend specials Travel in Europe in low season Ski resorts in March Matching supply and demand for services

5. INCOME TAX Preparation by CPA’S April 10$500 Feb 10$400

6. CONCENTRATED SERVICE NICHES USAA Military Market Lending Tree Online lending Hotels Last minute reservations

7. HYATT PRICING Monday-Thursday$200 Friday-Sunday$100

8. LENDING TREE State Law – Cannot take out equity except by a Texas lending company

9. MAJOR SERVICES Professional Services Health Services Financial Services Educational Services

10. PROFESSIONAL SERVICES Lawyers CPAs Real Estate

11. SIMPLE LEGAL SERVICES Simple wills Simple tax filing Uncontested divorces

12. MAJOR CPA SERVICES Auditing Taxes Consulting

13. MAJOR ACCOUNTING FIRMS Big Four 2009Big Eight 1989 Price Waterhouse Price Waterhouse Coopers Coopers & Lybrand Deloitte Touche Deloitte Haskins & Sells TohmatsuTouche & Ross Ernst & YoungArthur Young Ernst & Whinney KPMGPeat Marwick & Mitchell Arthur Anderson

14. PROFESSIONAL SERVICES CHANGES LawyersPrice Fixing CPA’sSoliciting Competitors’ Business & Advertising

15. HEALTH SERVICES Doctors and nurses Hospitals and clinics Medical insurance

16. DOCTORS AND NURSES General Doctors Specialist Doctors Role of Nurses

17. % OF U.S. MEDICAL SCHOOL DOCTORS AS GENERAL PRACTIONERS 197040% 201315%

18. HOSPITALS AND CLINICS Large hospitals Emergency centers Minor health clinics

19. USE OF HOSPICE CARE 200022% 200942%

20. MEDICAL INSURANCE Medicare Medicaid Insurance providers

21. HOSPITAL PRICING CityHospital ProcedureHospital Cost #1#2 DallasLower Joint Replacement$162k$43k New Jersey Respiratory Ailment $100k$7k AlabamaPneumonia $150k$14k

22. FINANCIAL SERVICES Banking Insurance Stock Brokers

23. DISCOUNT STOCK BROKERS Fidelity Vanguard Schwab

24. EDUCATION SERVICES High Schools Community Colleges Universities

25. HIGH SCHOOL CHOICES Public schools Private schools Charter schools Home schooling

26. COMMUNITY COLLEGES IN HOUSTON AREA Houston Community College San Jacinto College Lone Star College

27. UNIVERSITIES State Public Universities State Private Universities

28. DIFFICULTY OF CHANGE IN EDUCATION Reforming and changing a curriculum is about as difficult as moving a cemetery