Service Design and Process Selection Objectives of lecture

Service Design and Process Selection • Objectives of lecture: – Differentiate the different scopes of a service design exercise – Outline the difference between the design of services and the design of tangible goods – Stress the importance of customer contact in the design process – Provide a service design process model – Illustrate it with an example MGT 3303 Michel Leseure

A Framework for Categorizing New Services MGT 3303 Michel Leseure

Categories of New Services MGT 3303 Michel Leseure

Service vs. Goods • Differences in service design and manufacturing product development: – Service design and process development can be simultaneous – Service operations cannot be copyrighted to protect them from imitation by competitors – The service package is the major output of NSD – Prior training strongly influences the service package – Service organizations can change their service offerings very rapidly MGT 3303 Michel Leseure

The New Service Development (NSD) Process MGT 3303 Michel Leseure

NSD Process (From Johnson, Menor, Roth, and Chase) MGT 3303 Michel Leseure

Customer Contact A Driving Specification • Customer Contact – The presence of the customer in the system • Extent of Contact – The percent of time the customer is involved relative to the time required to deliver the service – An indication of how difficult the service is to design • The higher the interaction, the more difficult – Gives an indication of the type of systems which should be adopted MGT 3303 Michel Leseure

Major Differences between High- and Low-Contact Systems in a Bank MGT 3303 Michel Leseure

Service-System Design Matrix MGT 3303 Michel Leseure

The Service Process Matrix Source: Roger W. Schemenner, “How Can Service Businesses Survive and Prosper? ” Sloan Management Review 27, no. 3 (Spring 1986), pp. 21– 32. MGT 3303 Michel Leseure

Service Design Example Online Dating MGT 3303 Michel Leseure

MGT 3303 Michel Leseure

www. menara. ma MGT 3303 Michel Leseure

Designing a New Service Organization – “Service Vision” or Strategy – Identification of the target market • Who is our customer? – Defining the service concept • How do we differentiate our service in the market? • What is our service package and its operating focus? – Creating the service delivery system • What processes, staff, and facilities are needed? – Examples: • QFD: Matching service objectives with processes • Use of SADT (Service design) MGT 3303 Michel Leseure

Example: Online Dating Services • “Service Vision” – Identification of the target market • Who is our customer? • Example – Dating Direct – Mission statement • “Dating. Direct. com's mission statement is to serve its members needs with the best possible online dating service with the highest quality of support. ” – Identifying the customer • Established 4 years ago as a place for singles serious about finding a partner. MGT 3303 Michel Leseure

Developing the Service Strategy • Position the service – Example: service factory (online dating) rather than professional service (introductory agency) • Use generic service strategies – The Production Line Approach • Orientation is toward the efficient production of results—precisely controlled execution of the “central function”. – Example: how the search can be specified, and how the results are presented – Non production line approach: customisable – The Customer Involvement Approach • Having the customer take a greater participatory role in the production of the service. – Example: Use automatic matching or not? – The Personal Attention Approach • The central focus is complete customer attention and satisfaction at all times. – Example: Not where online dating can be positioned – Nordstrom MGT 3303 Michel Leseure

Defining the Service Concept • Many tools and techniques can be used to represent what the service concept is • Example: – Using the Quality Function Deployment Framework – One of the most thorough approach to an integrated design approach MGT 3303 Michel Leseure

Using QFD: (1) Service Objectives • Start by listing the key objectives of the service – Serious – Customer service (how to? , what if? ) – Effective (introduction, matching process, etc. ) – Selective – Safe – Enjoyable – Interactive MGT 3303 Michel Leseure

Using QFD: (2) List Processes/Technology • List all the processes and technologies you can use to achieve the strategic objectives – Anonymous messaging – Filtering – Rich profile • Picture(s), self-description, basic information – Automatic matching – Chat rooms • Moderated, non-moderated – Search facilities • Listing: Online • Listing: Matching • Listing: Most recently searching MGT 3303 Michel Leseure

Using QFD: (3) The QFD Grid MGT 3303 Michel Leseure

Using QFD: (4) Actual vs. Current Performance MGT 3303 Michel Leseure

Using QFD: (5) Process Importance Weak = 1 point Moderate = 3 points Strong = 9 points To what extent a process supports Strategic objectives MGT 3303 Michel Leseure

Using QFD: (6) Objectives Conflicts MGT 3303 Michel Leseure

Using QFD • QFD can also be used: – To map competitors’ service design against own design – To identify the most useful technology – To identify objectives which are not supported – To introduce and assess new processes • Example: Add moderation to the dating example MGT 3303 Michel Leseure

Designing The Process • The service industry has been criticised for its adhoc design of processes • Embedded, tacit knowledge of service workers • Describing services through a flow chart can be difficult! • SADT: – Structured Analysis and Design Technique – Start at a conceptual level and progress by more and more detailed levels – Used successfully in service industry: • • Training system modelling Back office operations in banking Cheque processing operations Cash management MGT 3303 Michel Leseure

SADT: Generic Structured Activity Box MGT 3303 Michel Leseure

Context Diagram MGT 3303 Michel Leseure

Decomposition of Activity Diagram MGT 3303 Michel Leseure

Suggested Homework • • Problem 3 -13, p. 113 Problem 3 -15, p. 113 Case problem 3. 1, p. 113 Draw an SADT diagram of the registration process MGT 3303 Michel Leseure