This document discusses service delivery processes and how to improve efficiency. It covers balancing customer contact with operational efficiency. Firms must balance demand cycles and the length of customer experiences. Applying concepts like Thompson's perfect world model, focused factories, and plant-within-a-plant can help isolate technical cores and minimize customer interactions to improve efficiency. Blueprinting maps out service processes to identify bottlenecks and opportunities to streamline flow and reduce costs and wait times. The goal is to understand unique aspects of service delivery and improve customer involvement and operational performance.

1. SERVICES
MARKETING
CHAPTER 4
SERVICE DELIVERY PROCESS

2. HIGHLIGHTS
 Marketing & Operations
 Art of Blueprinting

3. OUTCOME
 Identify & understand services’ unique delivery system
 Importance of customer’s involvement in services
 Know the basics of blueprinting

4. CUSTOMER’S INVOLVEMENT
 Replace the work done by employees with work done by
customers
 Pro: convenient for customers, flexibility & accessibility
 Cons: increased risk, less control & loss of human contact

5. MARKETING & OPERATIONS
1. Balance is critical
2. Service firms must be efficient (in a perfect world)
3. Applying the efficiency models
4. Art of blueprinting

6. 1. BALANCE IS CRITICAL
 A trade-off in terms of:
 Type of demand; High-contact Vs. Low-contact
 Cycle of demand; scheduling, production & capacity, planning
& forecasting
 Length of service experience

7. BALANCE: HIGH-CONTACTVS.
LOW CONTACT
 High-contact: operations must be near customers
 Low-contact: operations must be placed near supply,
transportation or labour

8. BALANCE: CYCLE OF DEMAND
 Scheduling:
 customer is part of schedule & must be accommodated
(High-contact)
 Customer is concerned mainly with completion date (Low-
contact)
 Production Planning:
 Orders cannot be stored (High-contact)
 Backlogging is possible (Low-contact)

9. BALANCE: CYCLE OF DEMAND
 Forecasting:
 Short term, time oriented (High-contact)
 Long term, output oriented (Low-contact)

10. BALANCE: LENGTH OF SERVICE
EXPERIENCE
 High-contact: service time depends on customer’s needs
 Low-contact: work is performed on customer surrogates
(ex: forms), time standard can be tight

11. 2. SERVICES FIRMS MUST BE
EFFICIENT (IN A PERFECT WORLD)
i. Thompson’s Perfect-World Model
ii. Focused Factory Concept
iii. Plant-Within-A-Plant Concept

12. THOMPSON’S PERFECT-WORLD
MODEL
 Technical core: the place within a firm where primary
operations are conducted
 Perfect world: efficiency is possible only if inputs, outputs &
quality happen at a constant rate and remain known &
certain

13. FOCUSED FACTORY CONCEPT
 An operation that concentrates on performing one
particular task in one particular part of the service
experience (specialization)

14. PLANT-WITHIN-A-PLANT
CONCEPT
 Breaking up large, unfocused activities into smaller units
buffered from one another
 Buffering: surrounding the technical core with input &
output to shield it from outside influences
 Done through smoothing, anticipating & rationing

15. APPLYING EFFICIENCY MODELS
TO SERVICES
1. Isolating the technical core (decoupling)
&
2. Minimizing the servuction model (decoupling)
3. Production –lining the whole system
4. Creating flexible capacity
5. Moving the time demand

16. EFFICIENCY: DECOUPLING
 Disassociating the technical core from the servuction
model

17. EFFICIENCY: PRODUCTION-
LINING
 Production line approach: application of hard & soft
technologies
 Hard tech: hardware that facilitates the production of
standardized services
 Soft tech: rules, regulations & procedures

18. EFFICIENCY: FLEXIBLE
CAPACITTY
 Part time employees
 Cross-training employees
 Sharing capacity with other firms

19. THE ART OF BLUEPRINTING
 Flowcharting of a service operation:
1. Identify the directions in which processes flow
2. The time it takes to move from one process to the next
3. Cost involved with each process
4. Amount of inventory build-up at each step
5. Bottlenecks in the system
 Point where customers wait the longest

20. EXAMPLE OF SIMPLE
BLUEPRINT

21. THANKYOU
Q&A