DESIGN OF SERVICES

&
SERVICE BLUE PRINT
 SERVICE DESIGN DEFINITIONS

• Service
– Something that is done to, or for, a customer

• Service delivery system

– The facilities, processes, and skills needed to
provide a service

• Product bundle
– The combination of goods and services provided to
a customer
 SERVICE DESIGN

Begins with a choice of service strategy, which

determines the nature and focus of the service,
and the target market

– Key issues in service design

• Degree of variation in service requirements

• Degree of customer contact and involvement
 CHARACTERISTICS OF SERVICES
(1 OF 3)
1. Services are acts, they are intangible but highly
visible to the customers
2. Most services contain a mix of tangible and
intangible attributes
3. Services have customer contact
4. Service performance can be affected by workers’
personal factors
5. Services are created and delivered at the same time
and are not consumed but experienced, cannot be
inventoried.
 CHARACTERISTICS OF SERVICES
(2 OF 3)
6. Services are idiosyncratic
7. Everyone is an expert on service
8. In service business quality of work is not quality of
service
9. Services have low barriers to entry
10. Services are perishable
11. Location is important for service
 CHARACTERISTICS OF SERVICES
(3 OF 3)

12. Services are inseparable from delivery

13. Service requirements are variable
14. Services tend to be decentralized and dispersed
15. Services are consumed more often than products
16. Services can be easily emulated
17. Services often take the form of cycles of encounters
involving face-to-face, phone, Internet,
electromechanical, and/or mail interactions
 SERVICE BUSINESSES

A service business is the management of

organizations whose primary business requires
interaction with the customer to produce the service

• Facilities-based services: Where the customer

must go to the service facility

• Field-based services: Where the production

and consumption of the service takes place in
the customer’s environment
 SERVICE DEMAND VARIABILITY

 Demand variability creates waiting lines and idle

service resources

 Service design perspectives:

• Cost and efficiency perspective
• Customer perspective
 SERVICE DEMAND VARIABILITY……

 Attempts to achieve high efficiency may

depersonalize service and change customer’s
perception of quality

 Customer participation makes quality and demand

variability hard to manage
 DIFFERENCES BETWEEN PRODUCT AND
SERVICE DESIGN (1 OF 2)

 Service design often focuses more on intangible

factors

 Less latitude in finding and correcting errors

before the customer, so training & process design
are important

 As services are noninventoriable, capacity issues

are very important
 DIFFERENCES BETWEEN PRODUCT AND
SERVICE DESIGN (2 OF 2)
 Services are highly visible to consumers and must be
designed with that in mind

 Some services have low barriers to entry and exit, so

service design has to be innovative and cost-effective

 As convenience is a major factor, location is important

to service design

 Service design with high customer contact generally

requires inclusion of the service delivery package
 SERVICE DELIVERY SYSTEM

Components of service delivery system:

Facilities
Processes
Skills
 SERVICE DESIGN
• Service design involves:

– The physical resources needed

– The goods that are purchased or consumed by

the customer

– Explicit services

– Implicit services
 PERFORMANCE PRIORITIES IN SERVİCE
DESIGN
• Treatment of the customer
• Speed and convenience of service delivery
• Price
• Variety
• Quality of the tangible goods
• Unique skills that constitute the service offering
 PHASES IN SERVICE DESIGN
 Conceptualize

 Identify service package components

 Determine performance specifications

 Translate performance specifications into design

specifications

 Translate design specifications into delivery

specifications
 THREE CONTRASTING SERVICE DESIGNS
• The production line approach (ex. McDonald's)

• The self-service approach (ex. automatic teller

machines)

• The personal attention approach (ex. Ritz-Carlton

Hotel Company)
 THE SERVICE DESIGN PROCESS
Desired service
experience
SERVICE SERVICE
CONCEPT Targeted PACKAGE
customer Physical Sensual Psychological
items benefits benefits
Performance Specifications
Customer Customer
requirements expectations
DESIGN SERVICE
CUSTOMER
SPECIFICATIONS PROVIDER

COST AND
ACTIVITIES FACILITY PROVIDER
TIME
SKILLS
ESTIMATES
DELIVERY
SPECIFICATIONS

SCHEDULE DELIVERABLES LOCATION

SERVICE
 SERVICE SYSTEMS

 Service systems range from those with little or no

customer contact to very high degree of customer
contact such as:
– Insulated technical core (software development)
– Production line (automatic car wash)
– Personalized service (hair cut, medical service)
– Consumer participation (diet program)
– Self service (supermarket)
DESIGN DECISION HIGH-CONTACT SERVICE LOW-CONTACT SERVICE
Facility Convenient to customer Near labor or
location transportation

Facility Must look presentable, Designed for efficiency

layout accommodate customer needs,
and facilitate interaction with
customer
Quality More variable since customer Measured against
control is involved in process; established standards;
customer expectations and testing and rework
perceptions of quality may possible to correct
differ; customer present when defects
defects occur

Capacity Excess capacity required to Planned for average

handle peaks in demand demand
 DESIGN FOR HIGH-AND-LOW CONTACT SERVICES
(2 of 2)
DESIGN DECISION HIGH-CONTACT SERVICE LOW-CONTACT SERVICE

Worker skills Must be able to interact well Technical skills

with customers and use
judgment in decision making

Scheduling Must accommodate customer Customer concerned

schedule only with completion
date

Service Mostly front-room activities; Mostly back-room

process service may change during activities; planned
delivery in response to and executed with
customer minimal interference

Service Varies with customer; Fixed, less extensive

package includes environment as well
as actual service
 SERVICE BLUEPRINTING

 Service blueprinting is:

 A method used in service design to describe

and analyze a proposed service

 A useful tool for conceptualizing a service

delivery system
 SERVICE MAPPING/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 Points of Contact

Mappin
g Evidence
 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
Service Blueprint Components

line of interaction

line of visibility

“BACKSTAGE” CONTACT EMPLOYEE ACTIONS

line of internal interaction

SUPPORT PROCESSES
 MAJOR STEPS IN SERVICE BLUEPRINTING

1. Establish boundaries
2. Identify sequence of customer
interaction
3. Prepare a flowchart
4. Develop time estimates
5. Identify potential failure points
6. Determine which factors can influence
profitability
SERVICE BLUE PRINT - EXAMPLE
 BLUEPRINTS CAN BE USED BY:

• Service Marketers • Human Resources

– creating realistic – empowering the human
customer expectations
• service system design element
• promotion • job descriptions
• selection criteria
• appraisal systems

• Operations Management
– rendering the service as
• System Technology
promised – providing necessary
• managing fail points tools:
• training systems • system specifications
• quality control • personal preference
databases
 BUILDING A SERVICE BLUEPRINT

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 SERVICE FAIL-SAFING
POKA-YOKES (A PROACTIVE APPROACH)
(Trying to avoid a mistake from becoming a defect/error)

• Keeping a mistake
from becoming a TASK

service defect

• How can we fail- TREATMENT TANGIBLES

safe the three Ts.?
 APPLYING BEHAVIORAL SCIENCE TO
SERVICE ENCOUNTERS

 The front-end and back-end of the encounter are not

created equal
 Segment the pleasure, combine the pain
 Let the customer control the process
 Pay attention to norms and rituals
 People are easier to blame than systems
 Let the punishment fit the crime in service recovery
 CHARACTERISTICS OF A WELL-
DESIGNED SERVICE SYSTEM (1 OF 2)

1. Each element of the service system is consistent

with the strategic and operating focus of the firm

2. It is user-friendly

3. It is robust and easy to sustain

4. It is structured so that consistent performance by

its people and systems is easily maintained
 Characteristics of a Well-Designed
Service System (2 of 2)

5. It provides effective links between the back office

and the front office so that nothing falls between
the cracks

6. It manages the evidence of service quality in such

a way that customers see the value of the service
provided

7. It is cost-effective

8. It ensures reliability and high quality

 CHALLENGES OF SERVICE DESIGN

1. Variable requirements

2. Difficult to describe

3. High customer contact

4. Service – customer encounter

 GUIDELINES FOR
SUCCESSFUL SERVICE DESIGN
1. Define the service package
2. Focus on customer’s perspective
3. Consider image of the service package
4. Recognize that designer’s perspective is different
from the customer’s perspective
5. Make sure that managers are involved
6. Define quality for tangible and intangibles
7. Make sure that recruitment, training and
rewards are consistent with service expectations
8. Establish procedures to handle exceptions
9. Establish systems to monitor service
 BENEFITS OF SERVICE BLUEPRINTING
 Provides a platform for innovation.
 Recognizes roles and interdependencies among
functions, people, and organizations.
 Facilitates both strategic and tactical innovations.
 Transfers and stores innovation and service
knowledge.
 Designs moments of truth from the customer’s point
of view.
 Suggests critical points for measurement and feedback
in the service process.
 Clarifies competitive positioning.
 Provides understanding of the ideal customer
experience.