1. SERVICE OPERATIONS
GLOBALISATION

2. GROWTH STRATEGIES
SINGLE SERVICE MULTISERVICE
Focused service Clustered service
SINGLE LOCATION * Dental Practice * University
* Retail store * Apolo clinic
* Family restaurant * Insurance
Focused network Diversified network
MULTILOCATION * Federal express * Banks
* McDonald's
* Hotel chains

3. FRANCHISING
• Expand using own resources
• Franchising is an alternative
• Independent owner operators bound by a
contractual agreement
• Initial investment varies
• Market or region is specified
• Franchiser dictates operating policies
- Purchase source/quality
- No deviation from product
- Franchise fee

4. BENEFITS : FRANCHISEE
• Management training
• Brand name
• National advertising
• Acquisition of proven business
• Economies of scale

5. GLOBAL DEMAND
• Service from centralized location
• Open service centers in new locations

6. OPERATIONAL ISSUES
• Language
• Culture
• Operating standards
• Local firms to handle marketing &
deliveries

7. GENERIC STRATEGIES
GLOBAL TRANSNATIONAL
STRATEGY STRATEGY
HIGH
NO INERNATIONAL MULTIDOMESTIC
STRATEGY STRATEGY
LOW
LOW HIGH

8. GLOBAL STRATEGIES
• World is one large market
• Homogenous approach
• Integrated across countries
• Strong brand name /special identity
• Example : Citibank allows customers to do
banking anyway, anywhere & anytime

9. MULTIDOMESTIC
• Operation in each country is autonomous
serving the needs of the local country
• Staffed /manned by local nationals
• Confederation

10. TRANSNATIONAL
• Service is homogenous : Fast food chains
offering local menus
• R&D (Specialized expertise) centralized
• Centralized procurement

11. BORDERLESS WORLD
• Customer :Availability of information
• Competitors :
- Nothing stays proprietary for long
- First mover
- Timely delivery
- Operating with partners (not alone)

12. BORDERLESS WORLD
• Company : Reduce unit fixed cost
• Airlines & communications
• Huge investments in equipments &
facilities
• Focus shifting from variable cost to fixed
cost
• Search for a larger market

13. BORDERLESS WORLD
• Currencies
• Fluctuating exchange rates
• Hedging & options
• Forced in to global expansion to become
currency neutral

14. BORDERLESS WORLD
• Country
• Economic downturn in one country offset
by operations in other countries
• Compete in competitors country
• Global localization
• Understand the unique service needs
• Local units to be able to modify to meet
the local needs

15. TRANSNATIONAL OPERATIONS
• Cultural transferability :
• Global standardization vs local
customization (Banking – Islamic
countries)
• Language barrier
• Behavioral customs ( non smoking
zones in Restaurants)

16. TRANSNATIONAL OPERATIONS
• Worker Norms :
• Power Distance Index : equality
• Individualism : Focus on individual achievement
• Masculinity :
• Uncertainty Avoidance index : Tolerance
• Long Term Orientation : Long term commitment
& respect for tradition ( strong work ethic &
reward in long term). Change takes time

17. TRANSNATIONAL OPERATIONS
• Host Government policies
• Repatriation of profits
• Entry barrier for certain operations (insurance)
• Delays in licensing agreements
• Foreign airlines landing rights
• Preferential treatment to local shippers
• Nations may perceive threat (economic &
cultural).
• Labor intensive services welcome : creates
more job opportunities

18. GLOBAL SERVICE STRATEGIES
• Efficient delivery system
• High quality product
• Flexible cost structure

19. GLOBAL SERVICE STRATEGIES
• Multi country expansion
• Importing customers
• Following your customers
• Service offshoring
• Beating the clock

20. GLOBAL SERVICE STRATEGIES
Multi country expansion
• Customer travels physically to the service
facility
• Franchisee route
• Clone the service rapidly in multiple
locations
• Customer contact & front office requires
sensitivity to local culture
• Recruit & train locals
• Cultural adaptation a major issue

21. GLOBAL SERVICE STRATEGIES
Importing customers
• Multi service single-site strategy
• Customer to travel long distance or
substitute travel with communication tools
• Example : Universities
Medical centers
Places of tourist attraction

22. GLOBAL SERVICE STRATEGIES
Following your customers
• Follow corporate clients & provide service
in other countries
• Attracting local business may need
modification in the service package
• Examples : Travel agents
Consultants
Auditors
Hotel chains

23. GLOBAL SERVICE STRATEGIES
Service offshoring
• Global service strategy
• Back office operations to cheaper
locations
• BPO
• Examples : Customer service, Financial
analysis, software development

24. GLOBAL SERVICE STRATEGIES
Beating the clock
• Bypass the constraint of domestic time
zones, working hour regulations
• Combining the demand from multiple time
zones can improve productivity of
Reservation clerks
• Example : Telemarketing

25. Service Definitions
Services are deeds, processes, and
performances.
Valarie Zeithaml & Mary Jo Bitner
A service is a time-perishable, intangible
experience performed for a customer
acting in the role of a co-producer.
James Fitzsimmons

26. Definition of Service Firms
Service enterprises are organizations that
facilitate the production and distribution of
goods, support other firms in meeting their
goals, and add value to our personal lives.
James Fitzsimmons

27. Role of Services in an
Economy

28. The Four Realms of an
Experience
Customer Participation
Passive Active
Absorption Entertainment Education
Environmental (Movie) (Language)
Relationship Immersion Esthetic Escapist
(Tourist) (ScubaDiving)