CHAPTER 12 PEOPLE IN SERVICES Introduction ~ Types of service personnel : Contact personnel, Support personnel — Developing: customer conscious employees : Hire the right people, Develop people to deliver quality service (Empowerment), Provide support system, Retain the best people ~ Quality circles = Objectives of quality circle — Need for quality circle - Summary — Questions. INTRODUCTION (in orgahigations manufacturing tangible goods, the personnel perform their duties in the factories, away from customers. In services, personnel come in contact with the customers in the process of production and consumption of servic he-inseparable nature of service emphasizes the point that the human element forms an important aspect in the service industry{ According to some authors “people”, the fifth element in the service- marketing mix applies not only to personnel butit recognises the role of the “participants””- both employees and customers in the service deliv ivery process}, ‘But, as we look at a marketing mix variable as controllable element, we deal with management of people within the organisation as a key task. In service business, the service personnel reflect the organisational realities, it is through the interaction with the staff, the customer forms an opinion of the organisationCA service firm may have all equipment and technical facilities, and yet may not be able to provide satisfactory customer is may be due to the f interpersonal relationship between the service ice provider and in such cases, the customer develops negative attitude towards the firm. Tt Therefore, service lf and customer ori nted attitude in “the service employees are - the service, the organisation in the eyes of the customer and they are the marketer”. ~ TYPES OF SERVICE PERSONNEL The personnel in a service organisation can be classified on various bases. Since customer contact is a vital part of the quality of service experience, the classification can be determined on the basis of whether it is labour intensive (people based) or equipment based. In the equipment based services, the equipment or machine is critical in providing the service while labour plays @ secondary role. The equipment based industries include automatic car washes, automatic vending machines etc. The equipment may be operated automatically or or by unskilled o1 few service organisations are so technologically advanced that they can operate without the employees. At the same time many service industries are highly labour intensive. In this case the human element is primary to service creation and delivery, tools are secondary. People based services include domestic services, repairs, catering, consulting, counselling etc. Personnel are needed for ‘Scamad with CanScamerpeople in Services 1731 operational tasks, marketing tasks and administration tasks, Labour intensive services tend to be more diverse and hetrogeneous than equipment based services, Often customers tend to view the service provider of people-based services as the service itself. Since customer contact is vital determinant of the quality of service experience, the classification of Personne] from marketing view point would be the customer contact and non contact employees. tr Customer Contact Employees These personnel come in contact with customers in the process of service delivery. They are also called as frontline staff or “boundary spanners”, They include front office staff, airhostess, bank clerk, waiters in hotels etc. These contact employees are of great influence to the customers’ perception of the organisation. Because the contact employees represent the organisation and can directly influence customer satisfaction, they perform the role of marketer. However, service firms vary in terms of degree of the personnel -customer contact. High contact personnel : When the physical presence and interaction of the customer with the employee is for a longer time, like in the case of restaurant, hospitals and educational institutions, it is called high contact. These kind of services are difficult to control because the length of time affects the perception of service as the contact employee represents the organisation and can directly influence customer satisfaction, Such employees perform the role of marketers. Low contact personnel : When the period of interaction of the customer and the employee is very small like in the case of retailing, bank or post office, it is called low contact. In these cases, - the customers’ perception of quality does not have much bearing on the contact personnel. The low contact personnel must therefore be trained on high technical and analytical attributes rather than on interpersonal skills. Additionally, the contact personnel may be further categorised on the basis of their skill and expertise. Skilled and professional : Some contract personnel apart from possessing inter personal © skills may need to be professionally qualified and possess the skill and expertise to deliver the service, e.g. doctors, lawyers, consultants etc. Non professional : Some contact personnel may not require special skill in delivering the service. They are low paid and just order takers, e.g. telephone operators, retail clerks, courier delivery personnel ete. They are low on mechanical skills and education but high on task based skills. No matter whatever is their level of skills, the front line staff, require the ability to handle interpersonal conflicts and deliver the service to the satisfaction of the customers. 2. Support Personnel or Non-contact Employee / The employee who contributes to the service delivery but do not come into contact with the customer is called non-contact employee. Such employees include chefs in hotels, cockpit crew in airlines, administrative staff. These employees possess high technical skill and must be highly competent in their work. Without customer focussed support personnel it is impossible for the contact personnel to deliver quality service. The support personnel may be management support or technical support personnel. © The management support personnel make sure that th to do their job. They direct and motivate the frontline personnel. ‘Scamad with CanScamer e contact personnel get the right resources1174 Services Marketing The technical support personnel operate at the back stage and are not visible to the customer, The frontline staff will be capable of providing satisfied service to customers only if the support personnel help them to achieve the service operation. They indirectly influence perception of quality service as, if they fail to perform it may create a negative impact on the customer. (Figure12.1) Service operations systems Physical Service A support ‘Management | anid technical personnel Not visible to Visible to customer customer +—— Direct interaction + - ~~~ Secondary interactions Fig. 12.1 The Visible and Invisible Staff in Service Operation (Source : P. Biglier and E. Langeard “Conceptual approach of the service offering") Helen Woodruffe describes the different roles of service personnel as follows: Primary - where the service is actually carried out by the service provider. E.g doctor, lawyer etc. Facilitating - where employees facilitate the service transaction and participate in it. Eg. Bank counter staff, waiter at a hotel, front office personnel. Ancillary - where the employee helps to create the service exchange but is not a part of it. E.g. travel agent, Insurance agent etc. or even a supervisory staff of the service organisation. Ina hospital for example, although the doctor performs the primary function, the frontline staff arrange the appointments and the administrative staff provide the adequate support system. Thus, the overall service offering will be made up of a combination of the service personnel. 1 DEVELOPING CUSTOMER CONSCIOUS EMPLOYEES \~ Bill Marriott of Marriott Hotels once asked job candidates, that the hotel chain wants to satisfy three groups - customers, employees and shareholders. While all the three groups are important, he asked, in which order the groups should be satisfied. Most candidates said that the customers must be satisfied first. Bill Marriott, however, reasons differently. First the employee must be satisfied; if the employees love their jobs and feel a sense of pride in the hotel, they will serve the customers well, Satisfied customers will return frequently, which in turn yields a level of profit that will satisfy their shareholders. ‘Through research, examining the link between the key elements of healthy business, the Gallup model (Figure 12.2) that describes the path between the individual contribution of every employee and the ultimate result of increase in company value. ‘Scamad with CanScamerin Services people In 1754 ‘Real profit increase Sustainable growth Loyal customers Trained and motivated employees Fig. 12.2 Link between Employees and Profits (Source : First, Break all the Rules ~ Marcus Buchingham and Curt Coffman) It is obvious that for a service organisation to thrive, the frontline staff need to operate with a consistently high level of concern about the needs of the customer. If service people are unfriendly, unhelpful, incooperative or uninterested in the customer needs, the customer tends to project that same attitude on to the organisation as a whole. > ROLE OF THE FRONTLINE STAFF The front line staff as well as the support staff are important for the success of service delivery. The front line staff who provide a link between the external customer and the internal operations of the organisation, serve a critical function in understanding, filtering and interpreting information and resources to and from the organisation and its external customers. In addition to mental and Physical skills, the frontline staff require extra ordinary levels of emotional labour, ability to handle interpersonal and interorganisational conflict and use their discretion to trade off between quality and productivity on the job. * Emotional labour draws on the feelings of the employee to be effective on the job without absorbing the bad mood of the customer. Friendliness, courtesy, empathy and responsiveness directed towards customers all require large amount of emotional labour from the front line Staff of the service firm. * Frontline staff often face inter-personal and inter-organnisational conflicts on the job. In some situations, they feel conflicts between what they are asked to do and their own personalities and values, for e.g. the role conflict may arise when employees are required to change some aspect of their appearance to conform to job requirements. Another type of conflict may arise when the organisation’s policies does not allow the employee to accommodate the client and Satisfy the needs of the customer. Sometimes conflict may occur when the employee may be ‘Scamad with CanScamerV17 Services Marketing serving customers in tur (e.g. a bank teller, a doctor) or serving customers simultaneously (e.g. teachers, entertainer) as they may need to be flexible to satisfy the needs of individual customer, Service Quality and Employee Behaviour i 5 The five dimensions of service quality - reliability, responsiveness, assurance, empathy and tangibility can be directly influenced by the service employee. - Reliability : Delivering the service as promised is often totally within the ‘control of frontline employees. Even in case of automated services such as ATMs, vending machines, support personnel are critical to make sure all systems are working properly. 2. Responsiveness : Frontline employees often directly influénce customer perception. of responsiveness through their willingness to help and their promptness in serving customers. 3. Assurance : Service quality is highly dependant on employees ability to communicate their credibility and to inspire trust and confidence. 4. Empathy : Organisations can deliver caring and individualised attention to customers only through employees, Empathy implies that employees will pay attention, listen-adapt and be flexible in delivering what individual customers need. 5. Tangibility : Employee appearance and dress are important aspects of tangible dimensions of quality along with other factors like service decor etc. Exhibit 12.1 (Source : Service Marketing - Zeitham! and Bitner) All these provide concrete evidence that a satisfied employee makes satisfied customer. Thus, human resource management emerges as an important management function in service marketing. Human resource management involves all managerial decisions and actions that affect the nature of the relationship between the organisation and its employees - its human resource. According to Zeithaml and Bitner, a complex combination of strategies is needed to ensure that service employees are willing and able to deliver quality service and that they should stay motivated to perform in customer oriented and service minded organisations. These involve - 1) hire the right people 2) develop people to deliver service quality 3) provide needed support system and 4) retain best people. [Refer Fig. 12.3] Develop people to deliver ‘Customer oriented service Retain the Provide the employees support system Fig. 12.3 Human Resource Planning for Service Employees ‘Scamad with CanScamerle in Services ae 177 0 1. Hire the Right People The first step towards developing service conscious em people to deliver the service. loseesis to recruit and select he right Recruiting and selecting the right employees have always been a challenge for managers, To get the right and best people the organisation must compete with the other firms. In onder cy attract the talented prospects, the service firm must market itself to be known as preferred employee inaparticular industry (Exhibit 12.2) Human Touch to Wealth If there is one software company in India that has won the hearts of aspiring developers and caught their imagination, it is the Bangalore based Infosys Technologies. The strength of Infosys lies in employing the best quality of professionals as the company believes that leamability is extremely important, specially because they have to relate to the changing preference of its customers, Infosys has also ensured that there is respect for every professional and employee working in the company. 20th September 1999 - Deccan Herald. Exhibit 12.2 Apart from the recruitment advertisement in the newspaper, there are a number of ways of recruiting service personnel - namely- campus recruitment from vocational schools or colleges, career fairs or placement agencies. Referrals are another way of recruiting - a current employee who may know some one who is qualified and interested in the open position will refer him for the post. This referral source is low cost and yields a good number of prospects. Software firms encourage their present staff to refer potential employees. Some firms try innovative methods of recruiting staff. (Refer exhibit 12.3) Mc Donalds once included an abbreviated job application form on every paper placemat. These placemats are given to their customers when they pickup their food orders. Mc Donalds views every customer as a potential employee! Exhibit 12.3 Once. the potential employees have been identified, the service firm needs to screen the candidate to identify the best people, The screening procedure involves selecting the best match or “fit” into the organisational setting. Depending on the nature of interaction, customers look at certain qualities in the service provider to assess the quality of service, e.g., friendliness and sense of fun in theme parks, empathy in hospitals, professionalism in legal and consultancy firms. Therefore, apart from other personal traits of the applicant, the service employee need two special capabilities: (a) Competency to serve (b) Inclination to serve Service competencies are the skills and knowledge necessary to do the job. It may relate to basic intelligence, physical requirement or professional qualifications. . Service inclination indicates the interest of the employee in doing the service related jobs, which is reflected in their attitude towards serving customers and others in their jobs. A good selection process must assess both the capabilities of the employee. Depending on the nature of job, the assessment of jobs of competency and inclination will include a variety of tests ‘Scamad with CanScamer1 178 Services Marketing and interviewing format. Frontline personnel need to be flexible to respond to a customer as individuals with individual needs so that they can deal with non-routine situations. The selection procedure may include role-play and simulation. 2. Develop People to Deliver Quality Service Once the organisation has selected and recruited the right fit, the recruits must be initiated into the working of its cultural setting. Orientation is the process of telling the employee what is expected of him, and socializing is the process by which he begins to experience it. The following diagram explains the employee development in the customer satisfaction. Figure 12. Socialisation Technical training Willingness Ability Orientation Quality Personal Skill Training Satisfied ‘Customers Service Authority Fig. 124 Employee Development in the Customer Satisfaction Wheel (Source : Peter Mudie and Angela Cottman -The Management and Marketing of services) The service organisation can develop people to deliver quality service through adequate training, empowering the staff to be responsive to the needs of the customer and prompting team work to Support the service delivery process. (a) Training ‘The service firm must train and work with the new recruits to ensure quality service. The employees generally undergo training in both technical and interactive skills. Technical skills may be taught through an orientation programme, formal education or as on-the -job training (see Exhibit 12.4) The international Holiday Inn chain has its own Holiday Inn University and in India, the Oberois have their own training schools. Apart from the technical skills, the interactive skills allow the employee to provide courteous, caring, responsive and empathetic service. The interactive skills ‘Scamad with CanScamer| people in Services P 179 1 | . ] also called as attitude training involve training programmes that focus o1 i tT i ] ly n specific social s s as eye contact, smiling, tone of voice, standards of dress and the like. ann neDonal die a8 Organisation that develops, operates, franchises and services a world wide system of est repare, asset imi i Bett Prepare, assemble, package and sell a limited menu of quickly Prepared and moderately The ‘Managers and franchisees must qualify from the Hamburger University at Illinois. Formal class room sessions are provided in which participants learn management skills, market evaluation, financial budget and the reinforcement of Ray Kroc’s philosophy, Q.S.C.V (Quality, Service, Cleanliness and Value). Training for employees begin with one to one instruction and in-store video tapes on how to cook a better burger and how to keep the fries crisp, The book at McDonald's spells out procedures and details for instance “Cooks must tum, never flip hamburgers” or “If they haven't been purchased, Big Macs must be discarded in 10 minutes and French fries in 7 minutes. Cashiers must make eye contact and smile at every customer” and on it goes. Exhibit 12.4 Itis not the front line staff who needs this combination of service skills and interactive training. The support staff and managers also need service training, because unless contact employees experience the same values and behaviour from their supervisor, they are unlikely to deliver high quality service to the customer. (Refer exhibit 12.5) .. The Walt Disney company sells family entertainment through its theme parks, resorts, films and consumer products. Walt Disney once said, “you can dream, create, design and build the most wonderful place in the world, but it requires people to make that dream a reality.” The cast members (the new recruits) are trained at the Disney University that teaches “Disney Courtesy” Their two day orientation called ‘Traditions’ provides the cast members full understanding of Disney's corporate traditions and values, provide skills for the ‘performance’ of their act. The cast members do not wear uniforms but wear costumes, they are not on duty but on stage. Visitors are guests and the cast members are hosts. Every cast member knows something about the company, its history and success, its management style before he actually goes to work. They are also shown how each division is related to the “show.” The Disney executives leave their desks to sell tickets, load and unload rides and take any of the 100 on- stage jobs that make the entertainment parks come live. The support system for the people on stage is also dramatic. For example, there are hundreds of phones hidden in the bushes, hot lines to a central question-answering service. Exhibit 12.5 Training and development programme, when used properly can have huge pay offs in ane performance. Training is not imparted to just the new recruits, there is also a place in a goo training plan for a certain amount of personal enrichment programme. Personal gurichment training deals with matters such as self esteem, confidence, values clarification, interpersonal skills, stress management and goal setting. (6) Empowerment ; Apart from training many organizations have discovered that to be truly responsive fe Ca Needs of the customer, frontline staff need to be empowered to accommodate customer reques' ‘Scamad with CanScameri sind Services Marketing to recover on the spot when things go wrong. Essentially empowerment means that the management veste decision making or approval authority in employees. Zeithaml and Bitner define empowermen, as giving employees the desire, skill, tools and authority to serve the customer. In the past the employees were expected to follow procedurally driven operations. Ifthe customer came up with specific requirements or deviations from the stipulated: standard, the employee would have to check with his superior. The customer judges an organisation by the response he receives from his frontline employees. So the employee must be in a position to render prompt service with due courtesy. Empowerment has become important for several reasons. First globalisation and liberalised economy have facilitated the influx of dynamic service providers and a range of service offering. This increased competition requires more and more innovations, which require more freedom for the innovators. Hence empowerment is fast becoming essential part of modem organizational structure. This is especially true in service organisations, where a large proportion of service decision must be taken by the front line staff. For managers who have empowered employees, the pay-off has been great. Some of the advantages of empowerment are: (a) Sense of belonging : When employees are given the power to. make decisions, it gives them a tremendous sense of belonging. This sense of belonging brings with it a deep- rooted sense of commitment, responsibility and the desire to do one’s best. (b) Great interaction : As they feel committed to provide quality service, it will encourage the employee to remain highly involved in the service delivery process. Empowered employees interact with customers with more care, warmth and enthusiasm. This goes a long way in enhancing the image of the company. (c) Creative ideas : When employees are empowered, they feel responsible for the service outcome and they will be an excellent source of idea about new services or how to improve current offering. (@) Quick online responses : Empowered employees face customers with confidence as they have all the necessary resources for solving potential problems. An angry and frustrated customer can be turned into a satisfied customer with quick online responses. (€) Word-of-mouth advertisement : Creative problem solving always pleases customers who will be a great word-of-mouth advertisement for the firm. Moreover, satisfied customer returns to the service firm. Though the benefits are many, the empowerment policy may fail if the empowered employee make costly decisions that organisations cannot afford. Sometimes organisations dump on the frontline staff the inefficiencies in the service delivery system. Empowerment puts new demand on employees. The employees have to take a lot of responsibilities and not everybody will be willing to do it. Hiring and retaining empowered employees with abilities and initiative require high wages: The reduction in standardisation and ‘increase in employee discretion due to empowerment make a a feeling in customers that some frontline staff are more generous and accommodating than others. ‘ The organisation needs to deliberate carefully on questions such as why to empower, how (0 empower and when to empower. Exhibit 12.6 ‘Scamad with CanScamerpeopl In Services 1818 : Bowen and Lawler's Dimension ARGGiing ho need to BRapOwer ian a “Needto Empower ‘Yes No {,Basic business strategy. - Customised for individual Ht ‘customers ‘2, Customer interaction“ ~ High contact and long-term Infrequent transactic relationship Lae 3, Technology Labour intensive " Equipmentintensive - 4.Business environment Unpredictable Highly predictable 5, Employee attitude Ambitious, risk takers i ; and challenge seekers Exhibit 12.6 Empowerment will be successful only if the following considerations are satisfied. + Employees must be trained properly. + The management and employees must share the vision of best customer service. + ‘The manager must have faith in the ability of their employees. © The organisation culture must support the risk taking behaviour that is n * The benefits of empowerment must be shared. ‘Thus empowerment asks a lot of both frontline staff and organisation. It calls for consistency, trust from managers and demands skill, knowledge and motivation on the part of the ment is not something that can be given, itis only an encouragement to the employees eeded to succeed. openness and staff. Empower to take, (c) Promote teamwork As service jobs are frequently frustrat will not only reduce the stress and strain of Employees who feel supported with the te quality service. One way of promoting teamwork is to encourage the attitude tha customer. Even those employees who do not interact directly with the customer need to know the integral role played by them in the service delivery process. Service blueprint is a useful tool that describes the role played by the employees in the service delivery system. ‘Team goals and rewards will also promote teamwork. 3, Provide Support System ‘The employees require adequate support in delivering the customer promise, The support must be from the co-workers, supervisors and the management. The types ‘of support which are generally expected to.boost quality service are - mnt + Emotional support - the decisions taken by the employees * Communication support - information that explains complex transactions. * Technological support - the tools and equipment to do,the jobs. . alll ‘Scamad with CanScemer ting, demanding and challenging, a teamwork environment f the frontline staff, it also enhances customer satisfaction. amwork will be able to maintain enthusiasm and provide everyone has'a aré backed by their manager.1182 Services Marketing Thus is a service organisation everyone has a service role. The management needs to develop a customer driven culture to excel in all aspects of service delivery. In order to encourage adequate internal support, some organisations devise a system to reward the internal service. This reward need not be monetary, but some kind of an “appreciation cheque” ft 7) signed by the service recipient in favour of the employee who rendered the service. Appreciation cheques ~ acredit for enhancing Customer/ Employee Satisfaction Date: To in recognition of. (activity) which resulted in (benefit) Signature: Name: Bank of XYZ Co, Exhibit 12.7 4. Retain the Best People It is not sufficient for the service firm to hire, train and develop employees to deliver quality service. They must also strive to retain the best people in the business. In order to achieve this, the service firm must treat employees as customers and also include them in the company’s vision. Employees will be motivated to déliver quality service if they realise, however small their job may be, how it fits into the wheel of organisation. To retain its best people, the service organisation must appreciate and reward its employees. Performance appraisals are useful tools not only for evaluating the work of the employees, but also Tor developing and motivating them. An effective performance appraisal system will not only evaluate employees’ aptitudes, but also opportunities- those elements in the work system that contribute to performance. The appraisal should be more meaningful and purposeful. It should be conducted frequently and should encourage a mixture of formal and informal appraisal. The formal appraisal is more often used as a primary evaluation, and informal appraisal is useful for more frequent performance feedback. Since the employee of the service firm has a lot of interaction with different people, the performance appraisal rating can be derived from supervisor, co-worker, ‘Subordinates, and customers and also through self-evaluation. The results of the rating of the appraisal should be commiinicatéd'to the employee. ‘ The purpose of the appraisal is to recognise the employee performance andxeward him, Reward systems need to be linked to the organisation’s vision and also on those factors that are critical (0 the service firm. E.g. Customer satisfaction in every service encounter in the case of restaurant. ‘Scamad with CanScemerpeople in Services 183 I ‘The rewards can range from annual cash bonus, words of praise from the Vice-President, articles in the company newspaper or annual report of the any, provide a Visible recognition among peers. Lapel pins, badges and other forms of praise may al8o form a part of the reward system. Involvement of the employee in the deliberations which is normally beyond the scope of his ibrmal job, To include the spouse and family in the celebration of success or even “small wiris”. entive vouchers OMe Innovative rewards Tor émployees is to-serid them shopping with (see exhibit 12.8) = — ‘Among the latest in the line of rewards to employees in India are the Incentive vouchers - an exclusive reward system designed to provide corporate bosses with the flexibility to niake the reward system less monotonous. Accor Corporate Services has drummed up three reward structures - where the vouchers. | rewarded to the employees can be exchanged for clothes, jewellery, books, dinner and other services; reservations can be made for travel plans and ble on huge range of goods ar services each time it is used. > Source : Times of India , 20th November 1999. Satyam Computer Service is in the process of drawing up entrepreneurial programme with the company to fund employees with sound business idea and startup spirit. By this they see a great opportunity for multifold value creation for themselves. Though this is not aimed at employee retention as they already have Employee Stock Option Plan (ESOP), but sure itis a win-win situation for both the employee and the company Source: Times of India, 20th September 1999 Exhibit 12.8 ‘Scamad with CanScamer8 The Service Process SSS 8.1 INTRODUCTION Customers of service organization obtain benefits and satisfactions from the services themselves and from how those services are delivered. The way in which service systems operate is crucial. Service systems which operate efficiently and effectively can give marketing management considerable marketing leverage and promotional advantage. It is clear that a smooth running service operation offers competitive advantages, particularly where differentiation between service products may be > minimal. In service systems the marketing implications of operational performance are so important that the two functions have to co-operate, In services, marketing must be just as involved with the operational aspects of performance as operations managers; that is, with the *how” and the ‘process’ of service delivery, Operations management is not just concerned with manufacturing. Here we define operations as the means by which resource inputs are combined, reformed, transformed or separated to create useful outputs (goods and services), Operations management is concerned with planning, organizing and controlling this resource conversion process which is illustrated in Figure 8.1. The concept of ‘useful’ is important; for the purpose of the process is to add ‘utility’ o ‘value’ over and above the costs incurred in obtaining system inputs and in undertaking the transformation process. Figure 8.1 ; OPERATIONS SYSTEM. Materials Labour Machines Resource Power Conversion Process Information Technology Inputs Outputs, 8.2 CLASSIFICATION OF SERVICES OPERATING SYSTEMS, Services operating systems may be classified in a number of ways, Two considered here for illustrative purposes are according to : (a) the type of process; (b) the degree of contact. A. The type of process ; Three types of processes of relevance to service organization ate: (a) line operations; (b) job shop operations y (c) intermittent operations 131 ‘Scamad with CanScamera a Services Marketing and Manageme, ii ions: . . Th ae operation there is an arranged sequence of operations ba et ie eee vice is produced by following this sequence. In manufacturing, an y line for domesie Saar eon fies this type of process; in services, a self-service restaurant typifies this process, Foran asia sve amoug a sequence of stages although there is no reason why’ cs Should notemain stationary and receive a sequence of services. The high degree of nter-seaonp between different elements of. line operation mean that performance overall is limited by performance at the weakest link in the system and hold-ups can arise (e.g. a slow check-out operator in a seit service cafeteria), Also it tends to be a relatively inflexible type of-process although tasks in the process can be specialized and made routine giving more speedy performance. This process is mos. Suitable in service organizations with high volumes of fairly continuous demand for relatively standard kinds of service. Job Shop Operations ‘A job shop operation produces a variety of services using different combinations and sequences of activities) The services can be tailored to meet varying customer needs and to provide a bespoke service. Restaurants and professional services are examples of job shop operations. While flexibility is a key advantage of this type of system it may suffer from being more difficult to schedule, from being more difficult to substitute capital for labour in the system and from being more difficult to calculate the capacity of the system. * Intermittent Operations Intermittent operations refer to service projects which are one off or only infrequently repeated, Examples include the construction of new service facilities, the design of an advertising campaign, the installation of a large computer or the making of a major film. The scale of such projects makes their management a complex task. Such projects provide an appropriate field for the ready transfer of many project control and scheduling techniques like Critical Path Analysis. The scale and infrequency of these projects make them different in kind from line and job shop operations. B. The Degree of Contact Managing service operations with a high level of customer contact with the service delivery process presents different challenges compared with those systems where there is a low level of customer contact. The amount of customer contact has an effect on may of the decisions operations managers have to make. These kinds of systems (high contact or low contact) have an effect upon service operations and have implications for managers of service systems. Some of these a (a) high contact systems are more difficult to control since the customer can make an input! the process or even disrupt the process; (b) in high contact systems the customer can affect the timing of demand and it is more difficult to balance the capacity of the system to meet demands placed upon it; (©) workers in high contact systems can have a great influence upon the customers’ view of the service provided; in high contact systems production scheduling is more difficult; itmay be more difficult to rationalize high contact systems (e.g. by substituting technology) itmay be beneficial to separate high contact and low contact elements of a service syste™ and encourage staff specialization in these different functions because of the varying skill required, Both of the schemes outlined are useful ways of classifying service systems for operation#! Purposes. Both however imply that the sequence of operations involved in the service process can &° made explicit to enable the systems to be categorized according to degree of contact: One step that service managers can take to understand their process of service delivery is to flow chart the syste" ‘and the interactions with customers within that system, ‘Scamad with CanScamerThe Service Process 133 8.3 POLICIES AND FLOWCHARTING : J Flow charting offers a number of advantages including: (a) Providing a visual representation of the service system. It shows what activities take . place and how they relate to each other; (b) identifying Possible bottlenecks in the process and estimating capacity required at each stage; (©) identifying the steps in which the customers is involved in the process; (d) identifying information Tequirements at each stage of the process. Some of the key questions service man: organizations emerge from this kind of analysis. They include: ‘What steps are involved in the process? Are they arranged logically? Can some steps be eliminated or combined? Are the capacities of each step balanced? Where are customers involved in the process? Can unnecessary customer contact be reduced or eliminated? Can technology be used to speed up the process? Can some steps in the process be transferred elsewhere? lagers need to consider in developing policy for service fundamental decision in managing a service operation is what level of capacity will be provided, Too much may make the operation uneconomic; too little can cause bottlenecks in service delivery, customer resentment because of inefficiency and lost business. In some s ystems it is not easy to identify when peak loads will occur or to transfer them when they do (e.g. holiday resorts during a fine spring Weekend). In manufacturing systems inventory acts as a buffer between the system and demands placed upon it. Most service systems do not have the luxury of such a buffer ‘stock of service’. A constant difficulty then for many service operations is the balancing of supply and demand. F ‘Scamad with CanScamer1 PROCESS FLOW CHARTS The process flow chart is the primary tool for developing and describing the conversion system. It provides two essential types of information about the conversion process: * The actions performed on materials, information, or people in. providing the service. * The relationships among processes. Relationships refer to the order in which actions are performed, what processes have to be performed first, which can be performed in parallel, and what has to be completed before the next step can begin. Category y Description g a z Operation ‘An operation performed by the server off-line or customer self-service. A possible service failure point ‘Customer contact An occasion when server and customer interact. An opportunity to influence customer service perceptions Travel ‘The movement of customers, servers. or information between operations. Delay Inspection Delay resulting in a queue and a need for waiting space for customers An activity by customer or server to measure service quali Dvugeo Fig. 13.4 Service Process Chart Categories and Symbols ‘Scamad with CanScamergewvie Process 199 I For flow process charts, five standardized pictorial s il s ymbols are used to describe the proces: ‘These are (1) Operations, (2) Customer contact (3) Travel (4) Delay and (5) Inspection as shown in Figure 13.4. The chart can track the flow of products, customers, or information. An example of aflow process chart for mortgage application and approval is given in Figure 13.5. In this example, the flows of information and paper work for a particuiar customer are charted. Screen applicants Request credit bureau analysis Move to mortgage officer Wait for credit report Inspect property Wait to be processed Complete application, verification and disclosures Wait for closing, Transport documents for further verification, property ‘and credit analysis Request verification of income, account balances, and employment history in writing ‘Wait for verification of documents to be completed Transfer title Verify settlement of funds and insurance requirements Execute all loan documents Conduct property appraisal and land survey Store information in computer Conduct title search Fig. 13.5 Flow Process Chart for Mortgage Application and Approval a on the distance a customer or item is moved, the time d the time a customer or item spends waiting. This iciency of a specified order of operations. .d, combined, resequenced, or simplified. plan of a facility as an aid to improving Flow process charts often include dat Tequired to process a customer or item, an additional information helps managers to analyze the effi Hopefully, tasks can be identified that should be eliminate Often the flow process chart is also superimposed on a floor facility layout and eliminating bottlenecks. ‘Scamad with CanScamer— DESIGNING SERVICE PROCESS The factors to be considered in the service process design and implementation are ; 1. The Service Itself It is necessary to understand whether the service itself is process dependent, most equipment based services (lawn care, laundry) and services with highly intangible attributes (banking, legal, insurance) are process dependent. 2. Customer Participation For most service systems the customer is present when the service is being performed. Instead of being a passive bystander, the customer represents productive labour just at the moment it is needed. Opportunities exist for increasing productivity by shifting some of the service activities on to the customer. Further more, customer participation can increase the degree of customisation. Involving the customer in the service process can support a competitive strategy of cost leadership with limited customisation, if focused on a self serve customer market. Depending on the degree of customer involvement a spectrum of service delivery system is possible, from self-service to complete dependence on a service provider. For example, consider ‘Scamad with CanScamerservice Process 189 1 services of a real estate agent. A home owner hi i it is eee ran ‘as the option of selling the home Personally as 3, Degree of Customer Contact Customer contact refers to the physical pres i customer contact can be measured by the ae eee ene a (ee mute . fae A mer is in the system relative tothe total service time. In the high contact Services, the customer determi imi : fs 5 a rmines the timing of demand and the nature of ihe services by direct Participation in the process. The perceived quality of service is deeming to a large extent by the customer's experience. Consumers have no direct influence on the Production Process of low contact systems because they are not present. Even if aservice falls into the high contact Category, it may still be possible to seal off some operations to be runasa factory. For example, the maintenance operations of a public transportation system and the laundry of a hospital are plants within a sei a s vice system. When service systems are decoupled into high and low contact operations, each area can be designed separately to achieve improved performance. 4, Degree of Divergence A standardised service (low divergence) is designed for high volumes with a narrowly defined and focused service. The tasks are routine and require a workforce with relatively low levels of technical skills. Because of the repetitive nature of the service, opportunities for the substitution of automation for labour abound, (e.g. use of vending machines, automatic car wash) reducing the discretion of service workers. For customised services (high divergence) more flexibility and judgement are required to perform the service tasks. In addition more information is exchanged between the customer and service worker. These characteristics of customised services require high levels of technical and analytic skill because the service process is unprogrammed and not well defined (e.g. counseling, landscaping). To achieve customer satisfaction, decision making is delegated to service workers. 5. Location of Service Delivery : ; : Should the service delivery process be located at the service providers premises or should the Process be carried out at the customers place. For some services like painting, carpet cleaning, lawn care etc., the service has to be delivered at home. Services that generally require the customer to come to the supplier have a greater opportunity to control the delivery experience e.g. dry cleaning, legal, medical etc.,) However increasingly many services are being delivered without the customer and supplier meeting ¢.g. telephone banking, ATMs etc. 6. Complexity of Service ; ' ; Complexity reflects the number of steps involved in delivering the service. jneiher tie service is high or low in complexity and in divergence can be readily determined by looking atitsb 7 int For e.g. a physician’s service is high in both complexity and divergence. Hotel services are high in Complexity but low in divergence. ‘Scamad with CanScamer—§ SERVICE BLUEPRINT A service blueprint is basically a flowchart of the service Process. It is a map in which all the elements or activities, their sequencing and interaction, can be visualized. In the simplest terms, a service system blueprint is a picture of a service system. A concept blueprint is a macro-level blueprint. It conveys the service concept by showing the service at an overview level. A concept blueprint demonstrates how each job or department functions in relationship to the service as a whole, Concept blueprints do not normally stand alone. A detailed blueprint is a micro-level blueprint. It conveys details of the service system identified but not described on the concept bluepzint. ‘The key steps in preparing the service blueprint are as follows : « Identify the activities involved in delivering the service and present these in a diagrammatic form. The level of detail will depend on the complexity and nature of the service. 2. Identify the fail points, These are stages where things might go wrong. The actions necessary to correct these must be determined, and systems and procedures developed to reduce the likelihood of them occurring in the first instance. 3. Set standards against which the performance of the various steps might be measured. Frequently, this is the time taken to deliver the service. 4. Analyze the profitability of the service delivered in terms of the number of customers served during a period of time. The blueprint is a map or flowchart of all the transactions that constitute the service delivery Process. Figure 13.3 shows the service blueprint for student registration in a college. Some activities are processing information, others are interactions with customers, and still others are decision Points. A detailed study of the blueprint could suggest opportunities for improvement and also the need for further definition of certain processes. The line of visibility.separates activities of the front office, where customers obtain tangible evidence of the service, from the back-office processing, which is out of customer view. The high- and low-contact parts of the service delivery process are kept physically separate, but they remain linked by communications. This separation does highlight the need to give special attention to operations . above the line, where customer perceptions of the service’s effectiveness are formed. The physical " Setting, the décor, employees’ interpersonal skills, and even printed material all make peo about the service. Designing an efficient process is the goal of the back office, but indirectly back-office operations have an effect on the customer owing to delays and errors. ‘Scamad with CanScamerServices Marketing 3 ; o clarity of place to general appearance, photos, course info, z signs sit, toilets refreshment availablity info. timetables Arrive Queue —» Give —» Get —» See ~» Se —> See i basic student ~—-accomm. ~—finance.-=— ‘Depart. -Depart. 3 | info, card officer officers member line of + * + + interaction .¥ + + + + Greet Register Cardand Arrange Arrange Get time table . and student photo room payment and course £ $ direct process info. line of visibility Enter it Registry Finance. system ————+> system system lists _— ee Fig. 13.3 Service Blueprinting - Student Registration Process in a College invisible support Processes The blueprinting exercise also gives managers the opportunity to identify potential fail points and design “foolproof” procedures to avoid their occurrence, thus ensuring the delivery of high quality service. A blue print is a precise definition of the service delivery system that allows management to test the service concept on paper before final commitments are made. The blue print also facilitates problem solving and creative thinking by identifying potential points of failure and highlighting opportunities to enhance customers’ perceptions of the service. ‘Scamad with CanScamer