services marketing- mod-5

1. EMPLOYEE ROLE IN SERVICE DESIGNING
MODULE-5

2. Provider GAP 3

3. Service Employees
• They are the service.
• They are the organization in
the customer’s eyes.
• They are the brand.
• They are marketers.
• Their importance is evident in:
– The Services Marketing Mix
(People)
– The Service-Profit Chain
– The Services Triangle

4. Service triangle
• Services marketing is about promises.
• The triangle shows the three interlinked groups
that work together to develop, promote, and
deliver services.
• Providers:- employees, subcontractors or
outsources entities.
• All three sides of the triangle are essential to
complete the whole

5. The Service Profit Chain

6. The Services Marketing Triangle
.
Internal
Marketing
Interactive Marketing
External
Marketing
Company
(Management)
CustomersEmployees
enabling
promises
keeping promises
setting
promises
Source: Adapted from Mary Jo Bitner, Christian Gronroos, and Philip Kotler

7. Services quality
• Services quality can be influenced directly by
services employees.
• Reliability:- is often totally within the control of
front-line employees.
• Responsiveness:- personal willingness to help
and their promptness in serving customers.
• Assurance:- credibility, trust, and confidence will
be tied totally to employee.
• Empathy:- employees will pay attention , listen,
adapt according to the customer requirements.

8. Service Employees
• Who are they?
– “boundary spanners”
• What are these jobs like?
– emotional labor
– many sources of potential conflict
• person/role
• organization/client
• interclient
• quality/productivity

9. Boundary spanners
• The front-line service employees are referred
to as boundary spanners.
• Who interact directly with customer.
• Their skills and experiences cover the full
spectrum of job and careers.
• No matter what the level of skills or pay,
boundary-spanning positions are often high-
stress jobs.

10. Boundary Spanners Interact with Both
Internal and External Constituents
.
Internal Environment
External Environment

11. Emotional labor
• The labor that goes beyond the physical or
mental skills needed to deliver quality
services.
• Providing good physical working condition
and allowing employees to take schedule
breaks .

12. Sources of Conflict for
Boundary-Spanning Workers
• Front-line employees often face interpersonal
and inter organizational conflicts on the job.
• Their frustration and confusion can, if the
unattended, lead to stress, job dissatisfaction, a
diminished ability to serve customer and
burnout.

13. Sources of Conflict for
Boundary-Spanning Workers

14. Human Resource Strategies for Closing
GAP 3

15. Customers’ Roles
in Service Delivery

16. Levels of Customer Participation
across Different Services

17. Importance of Other Customers in
Service Delivery
• Other customers can detract from satisfaction:
– disruptive behaviors
– excessive crowding
– incompatible needs
• Other customers can enhance satisfaction:
– mere presence
– socialization/friendships
– roles: assistants, teachers, supporters

18. How Customers Widen Gap 3
• Lack of understanding of their roles
• Not being willing or able to perform their roles
• No rewards for “good performance”
• Interfering with other customers
• Incompatible market segments

19. Customer Roles in Service Delivery
.
Productive Resources
Contributors to
Quality and
Satisfaction
Competitors

20. Customers as Productive Resources
• “partial employees”
– contributing effort, time, or other resources to the
production process
• customer inputs can affect organization’s
productivity
• key issue:
– should customers’ roles be expanded? reduced?

21. Customers as Contributors to Service
Quality and Satisfaction
• Customers can contribute to
– their own satisfaction with the service
• by performing their role effectively
• by working with the service provider
– the quality of the service they receive
• by asking questions
• by taking responsibility for their own satisfaction
• by complaining when there is a service failure

22. Customers as Competitors
• customers may “compete” with the service provider
• “internal exchange” vs. “external exchange”
• internal/external decision often based on:
– expertise
– resources
– time
– economic rewards
– psychic rewards
– trust
– control

23. Services Production Continuum
.
1 2 3 4 5 6
Gas Station Illustration
1. Customer pumps gas and pays at the pump with automation
2. Customer pumps gas and goes inside to pay attendant
3. Customer pumps gas and attendant takes payment at the pump
4. Attendant pumps gas and customer pays at the pump with automation
5. Attendant pumps gas and customer goes inside to pay attendant
6. Attendant pumps gas and attendant takes payment at the pump
Customer Production Joint Production Firm Production

24. Strategies for Enhancing Customer
Participation
.
Effective
Customer
Participation
Recruit, Educate,
and Reward
Customers
Define Customer
Jobs
Manage the
Customer
Mix

25. Strategies for Enhancing
Customer Participation
• Define customers’ jobs
– helping himself
– helping others
– promoting the company
• Individual differences:
– not everyone wants to participate

26. Strategies for Recruiting,
Educating, and Rewarding Customers
1. Recruit the right customers
2. Educate and train customers to perform
effectively
3. Reward customers for their contribution
4. Avoid negative outcomes of inappropriate
customer participation

28. Delivering Service Through
Intermediaries and Electronic
Channels
• Services intermediates perform many
important functions for service provider.
They often co-produce the service
Fulfilling service principals promise to
customers.

29. Service Provider Participants
• service principal (originator)
– creates the service concept
• (like a manufacturer)
• service deliverer (intermediary)
– entity that interacts with the customer in the
execution of the service
• (like a distributor/wholesaler)

30. Key Issues
Involving Intermediaries
• conflict over objectives and performance
• conflict over costs and rewards
• control of service quality
• empowerment versus control
• channel ambiguity

32. Services Intermediaries
• Franchisees:- services outlets licensed by a principal to deliver a
unique service concept it has created or popularized.
• Licensing their brand names, business processes or format, unique
product and services, or reputations in return for fees and
royalties
– e.g., Jiffy Lube, H&R Block, McDonald’s
• agents and brokers:- are representatives who distribute and sell
the services of one or more services suppliers.
– e.g., travel agents, independent insurance agents
• electronic channels
– e.g., ATMs, university video courses, TaxCut software

33. • A franchiser typically begins by developing a
business concept that is unique in some way.

34. Benefits and Challenges for
Franchisers of Service
.
• Leveraged business
format for greater
expansion and revenues
• Consistency in outlets
• Knowledge of local
markets
• Shared financial risk
and more working
capital
• Difficulty in maintaining and
motivating franchisees
• Highly publicized disputes
and conflict
• Inconsistent quality
• Control of customer
relationship by intermediary
Benefits Challenges

35. Benefits and Challenges for
Franchisees of Service
.
• An established business
format
• National or regional
brand marketing
• Minimized risk of
starting a business
• Encroachment
• Disappointing profits and
revenues
• Lack of perceived control
over operations
• High fees
Benefits Challenges

36. Agents and Brokers
• An agent is an intermediary who acts on
behalf of a service principal and is authorized
to make agreements between customers and
the principal.
• Agents broker do not take title to services but
instead deliver the rights to them.
• Brokers bring buyers and sellers together
while assisting in negotiation.

37. Benefits and Challenges in Distributing
Services through Agents and Brokers
.
• Reduced selling and
distribution costs
• Intermediary’s
possession of special
skills and knowledge
• Wide representation
• Knowledge of local
markets
• Customer choice
• Loss of control over
pricing and other
aspects of marketing
• Representation of
multiple service
principals
Benefits Challenges

38. Electronic channels
• Electronic channels are the only services
distributors that do not require direct human
interaction
• Information, education or entertainment

39. Benefits and Challenges in Electronic
Distribution of Services
.
• Consistent delivery for
standardized services
• Low cost
• Customer convenience
• Wide distribution
• Customer choice and
ability to customize
• Quick customer feedback
• Customers are active, not passive
• Lack of control of electronic
environment
• Price competition
• Inability to customize with highly
standardized services
• Lack of consistency with customer
involvement
• Requires changes in consumer behavior
• Security concerns
• Competition from widening geographies
Benefits Challenges

40. Strategies for Effective Service
Delivery through Intermediaries
.
• Measurement
• Review
Control Strategies
• Alignment of goals
• Consultation and
cooperation
• Help the intermediary
develop customer-
oriented service
processes
• Provide needed support
systems
• Develop intermediaries
to deliver service quality
• Change to a cooperative
management structure
Empowerment Strategies
Partnering Strategies