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Managing services

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  • 1. Nature of services Services are everywhere Service is  ‘an act or performance that one party can offer to another;  That is essentially intangible;  And does not result into the ownership of anything.  Production may/may not be tied to a physical product.
  • 2. Nature of services Service Mix  Pure tangible goods; e.g. Phenyl  Tangible good + accompanying service; cars  Hybrid; restaurants  Service + accompanying goods; travel  Pure service; education, consulting
  • 3. Nature of services Equipment based (ATMs) / people based (consulting, cleaning) Requires the client’s presence (brain surgery); car washing doesn’t. Services for personal or business needs. Profit/non profit; public/private ownership.
  • 4. Characteristics of Services Intangibility  No idea of the outcome of the service.  Therefore, ‘tangibilize the intangibles’.  Through physical evidence and presentation.  Place  People  Equipment  Price  Communication materials.
  • 5. Characteristics of Services Inseparability  Produced and consumed simultaneously.  The client is present when the service is produced.  The provider becomes a part of the service. Variability  Human behavior cant be standardized.  Try to hire good people.
  • 6. Characteristics of Services Perishability  Services can’t be stored  Can’t store for peak demands  Differential pricing  Reservation systems  Increased consumer participation
  • 7. Managing Service Quality Gap 1:  Consumer expectation and management perception Gap 2:  Management Perception and service-quality specification
  • 8. Managing Service Quality Gap 3:  Service quality specification and service delivery Gap 4:  Service delivery and external communications Gap 5:  Perceived service and expected service
  • 9. Managing Service Quality Reliability  Ability to perform promised service accurately Responsiveness  Willingness to help customers, prompt service Assurance  Knowledge and courtesy of employess
  • 10. Managing Service Quality Empathy  Caring, individualized attention Tangibles  Appearance of physical facilities, equipment, personnel, etc.
  • 11. Best Practices Strategic concept: be “customer -obsessed” Top management commitment Set high standards Self-service technologies (SSTs) – ATM, IRCTC Monitoring Systems Satisfying employees as well as customers