Service Design in Product Service Systems for Small and Medium Sized Enterprises

Service Design in Product Service Systems for Small and Medium Sized Businesses Prof. Jürgen Faust, Thomas Schönweitz SDN Conference 2009, 27.10.2009

A Short Definition:
“ Service design is simply
the application of
human-centric ideas and methods
of design to services.”
(Pinhanez, 2009, p. 3).
Pinhanez C. 2009. Services as Customer Intensive Systems. Design Issues 25(2): 3-13 Service Design

Design Development Products Utility Functionality Universal aesthetics Goods, Services and Identities Marketability Symbolic diversity Folk and local aethetics Interfaces Natural interactivity Understandability Reconfigurability /adaptability Multiuser systems/ Networks Informativeness Connectivity Accessability Projects Social viability Directionality Commitment Discources Generativity Rearticulability Solidarity 20th century 21st century

Products vs. Services Shostack GL. 1977. Breaking Free from Product Marketing. The Journal of Marketing 41(2): 73-80

Products and Services Shostack GL. 1977. Breaking Free from Product Marketing. The Journal of Marketing 41(2): 73-80

SMEs
Bolton Report
Owner Managed
Financially independent
Small market share
Dept. O f Trade and Industry
Small: 0 - 200 employees
Medium: 201 - 500 employees
Bruce, D et al.: Effective design management for small businesses, Design Studies 20 (1999) 297–315

SMEs
“ The category of micro, small and medium-sized enterprises (SMEs) is made up of enterprises which employ fewer than 250 persons and which have an annual turnover not exceeding 50 million euro , and/or an annual balance sheet total not exceeding 43 million euro .” (European Commission, 2003)
European Commission. 2009. The new SME definition - User guide and model declaration. Enterprise and Industry Publications: Brussels

Characteristics of SMEs Limited Financial Resources Limited Scope Limited Research Capabilities Flat Hierarchies Local Focus Faster Response Times More Options for Subsidies and Funding Less political influence Limited Market Share

Causes for Design Project Failures at SMEs
Lack of senior management commitment to design
Poor financing of projects i.e. allocating insufficient funds to cover cost
Inappropriate sourcing of design competencies
Incomplete design brief i.e. the brief fails to take account of user needs, pricing strategy, etc.
Bruce, D et al.: Effective design management for small businesses, Design Studies 20 (1999) 297–315

Why is it important for SMEs to build upon SD? Hollins G. & Hollins B. 1993. Total Design : Managing the design process in the service sector. Pearson Education: London 41,9% in the Concept Phase 45,6% in the Production

Suggested Origin of Costs in Service Design Hollins G. & Hollins B. 1993. Total Design : Managing the design process in the service sector. Pearson Education: London 50% in the Concept Phase 50% in Implementation

Suggested Origin of Costs in Service Design Hollins G. & Hollins B. 1993. Total Design : Managing the design process in the service sector. Pearson Education: London Investments in Analysis and Design reduce risk and the cost of failure.

Service Design Processes in all Shapes and Sizes

Service Design Process for SMEs

Stakeholders
Competiton
Customers
Employees
CEOs
...
Public / PR
Public / Local community
Cooperating Partners
Suppliers
Banks / Financial Institutions
Government

Stakeholder Levels

Service Design Tools for SMEs

Service Design Tools for SMEs ANALYZE DESIGN DEVELOP IMPLEMENT Observation Interviews Questionnaire Storyboard Character Profiles Personas Offering Map Mock Up Blueprint U s e Cases Service Prototype

Case Study
Retail Optometrist in Munich
Founded 1980
Five Branches
37 Employees
< 5 Mio. Annual Revenue
4th largest Optometrist in Munich

Services Chart / Status Quo

Objects of Analysis

Methods used

The Process of Purchase and Manufacturing

Service Blueprint

Findings
Successful Creation of a new Service
Company Awareness for the necessity of Design
High Employee Engagement and Motivation
Fast and Usable results on constrained budget and time
Many solutions to existing problems were found that were not related to the service that was to be developed
Many new Ideas for further development and new projects evolved
Changes in company procedures encouraging employee innovation
Improved innovation-skills in the company

Now whats the deal with SMEs?
Problem:
Lack of senior management commitment to design
Poor financing of projects i.e. allocating insufficient funds to cover cost
Inappropriate sourcing of design competencies
Incomplete design brief i.e. the brief fails to take account of user needs, pricing strategy, etc.
Solutions:
Simplify the Design Process and enable fast prototypes
Use readily available stakeholders as resources
Use few but powerful Design Tools and Methods

More Info: www.mhmk.de and www.servicebydesign.de Find us at LinkedIn and Twitter ( @netsaver ) Thank You for the Opportunity!

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Service Design in Product Service Systems for Small and Medium Sized Enterprises

by Thomas Schönweitz on Oct 30, 2009

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Service Design in Product Service Systems for Small and Medium Sized Enterprises — Presentation Transcript