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Nature, characteristics of services


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Nature, characteristics of services

  1. 1. Nature, characteristics AndClassification of services
  2. 2. Differentiating services from goods Goods Search goods Experienced goods Only after buying or Prior purchase/use after consumption Tangible Intangible
  3. 3. Differences between services andphysical goodsS.NO. Physical goods services 1 Tangible Intangible 2 Homogeneous Heterogeneous 3 A thing An activity and process 4 Core value produced in Core value produced in the buyer factory and seller interactions 5 Customer do not participate in Customer participate in the the production process production 6 Can be kept in stock Cannot be kept in stock 7 Transfer of ownership No transfer of ownership 8 Production and distribution Production ,distribution and are separated from consumption are simultaneous consumption process
  4. 4. Element Core Goods Core Service Example ExampleBusiness Custom clothier Business hotelCore Business suits Room for the nightPeripheral Garment bag Bath robeGoodsPeripheral Deferred In houseService payment plans restaurantVariant Coffee lounge Airport shuttle
  5. 5. Degree of Interaction and Customization Low High Service factory: Service shop:Degree of labor intensity * Airlines * Hospitals Low * Trucking * Auto repair * Hotels * Other repair services * Resorts and recreation Mass service: Professional service: * Retailing * Doctors High * Wholesaling * Lawyers * Schools * Accountants * Retail aspects of * Architects commercial banking
  6. 6.  Supporting Facility: The physical resources that must be in place before a service can be sold. Examples are golf course, ski lift, hospital, airplane. Facilitating Goods: The material consumed by the buyer or items provided by the consumer. Examples are food items, legal documents, golf clubs, medical history. Information: Operations data or information that is provided by the customer to enable efficient and customized service. Examples are patient medical records, seats available on a flight, customer preferences, location of customer to dispatch a taxi.
  7. 7.  Explicit Services: Benefits readily observable by the senses. The essential or intrinsic features. Examples are quality of meal, attitude of the waiter, on-time departure. Implicit Services: Psychological benefits or extrinsic features which the consumer may sense only vaguely. Examples are privacy of loan office, security of a well lighted parking lot.
  8. 8.  Simultaneity Perishability Intangibility Variability Inseparability
  9. 9. Services are rendered and consumed duringthe same period of time. As soon as the serviceconsumer has requested the service(delivery), the particular service must begenerated from scratch without any delay andfriction and the service consumerinstantaneously consumes the renderedbenefits for executing his upcoming activity ortask.
  10. 10.  The service relevant resources, processes and systems are assigned for service delivery during a definite period in time. If the designated or scheduled service consumer does not request. An empty seat on a plane never can be utilized and charged after departure. When the service has been completely rendered to the requesting service consumer, this particular service irreversibly vanishes as it has been consumed by the service consumer. Example: the passenger has been transported to the destination and cannot be transported again to this location at this point in time.
  11. 11. Services are intangible and insubstantial: theycannot be touched, gripped, handled, lookedat, smelled, tasted or heard. Thus, there is neitherpotential nor need for transport, storage orstocking of services. Furthermore, a service cannotbe (re)sold or owned by somebody, neither can itbe turned over from the service provider to theservice consumer nor returned from the serviceconsumer to the service provider. Solely, theservice delivery can be commissioned to a serviceprovider who must generate and render theservice at the distinct request of an authorizedservice consumer.
  12. 12. Each service is unique. It is one-timegenerated, rendered and consumed and cannever be exactly repeated as the point intime, location, circumstances, conditions, current configurations and/or assigned resourcesare different for the next delivery, even if thesame service consumer requests the sameservice. Many services are regarded asheterogeneous or lacking homogeneity and aretypically modified for each service consumer oreach new situation (consumerised).
  13. 13. Example: The taxi service which transports theservice consumer from his home to the opera isdifferent from the taxi service which transportsthe same service consumer from the opera tohis home – another point in time, the otherdirection, maybe another route, probablyanother taxi driver and cab.
  14. 14. The service provider is indispensable for service delivery as he must promptly generate and render the service to the requesting service consumer. In many cases the service delivery is executed automatically but the service provider must preparatory assign resources and systems and actively keep up appropriate service delivery readiness and capabilities.
  15. 15. Additionally, the service consumer isinseparable from service delivery because he isinvolved in it from requesting it up toconsuming the rendered benefits. Examples:The service consumer must sit in the hairdressers shop & chair or in the plane & seat;correspondingly, the hair dresser or the pilotmust be in the same shop orplane, respectively, for delivering the service.
  16. 16. Direct Recipient of the ServiceNature ofthe Service Act People Things People’s bodies: Physical possessions: Health care Freight transportation Passenger transportation Repair and maintenanceTangible actions Beauty salons Veterinary care Exercise clinics Janitorial services Restaurants Laundry and dry cleaning People’s minds: Intangible assets: Education BankingIntangible actions Broadcasting Legal services Information services Accounting Theaters Securities Museums Insurance
  17. 17. Type of Relationship between Service Organization and Its CustomersNature ofService Delivery “Membership” relationship No formal relationship Insurance Radio station Telephone subscription Police protectionContinuous delivery Electric Utility Lighthouseof service Banking Public Highway Long-distance phone calls Restaurant Theater series tickets Pay phoneDiscrete transactions Transit pass Toll highway Sam’s Wholesale Club Movie theater Airline frequent flyer Public transportation
  18. 18. Extent to Which Service Characteristics Are CustomizedExtent to Which PersonnelExercise Judgment in MeetingCustomer Needs High Low Surgery Preventive health programs High Taxi services Education (large classes) Gourmet restaurant Family restaurant Telephone service Public transportation Hotel services Spectator sports Low Retail banking Movie theater Cafeteria Institutional food service
  19. 19. Availability of Service OutletsNature of Interactionbetween Customer andService Organization Single site Multiple siteCustomer travels to Theater Bus serviceservice organization Barbershop Fast-food chainService provider Taxi Mail deliverytravels to customer Pest control service AAA emergency repairs TaxiTransaction is at Credit card company Broadcast networkarm’s length Local TV station Telephone company