MANAGING SERVICES FOR BUSINESS MARKETS

(Chapter 9)

PIYUSA DAS, ASST PROFESSOR (KSOM)

Case Analysis submission – next class
 Chapter 8 case ( Vscan: GE Healthcare’s pocket-sized
imaging device)
The Customer Experience Lifecycle
 Recent research discovered that
only 8% of customers think
that their experience with their
vendors were superior, whereas
80% of vendors think that they
delivered a superior one

 By focusing on core products instead of

understanding the customer’s experience,
many companies lose their customer and
never know why.

 Also, by not understanding the customer,

companies lose an opportunity to create
value and cement relationships.
Customer Experience Journey
One way to understand the
customer better is to “Map” out
experiences at various
“touchpoints.”

Touchpoints are spots where a

seller has direct or indirect
contact with the customer about
the product or service over
time.

The map points out what is most

important in the
seller/customers’ experience.
From a Product to a Solutions Perspective
Product Perspective Solutions Perspective
Value Win by creating innovative products and Win by creating and delivering
Proposition enriching features of existing products superior customer solutions
Value Value is created by the firm Value is co-created by the customer
Creation and the firm
Designing Start with the product or service, and Start with the customer problem, and
Offerings then target customer segments then assemble required products and
services to solve the problem
Company- Transaction-based Interaction-based and centered on the
Customer co-creation of solutions
Relationship
Focus on Quality of internal processes and company Quality of customer-firm interactions
Quality offerings
RELATIONAL PROCESSES COMPRISING A CUSTOMER SOLUTION

 Defining Customer
Requirements and Business
Needs
 Customizing and Integrating
Good and Services to Fit
Customer’s Requirements
 Deploying and Installing Products
in a Customer’s Environment
 Providing Ongoing Post-
deployment Customer Support
 Delivering Effective Customer Solutions

Customer’s
Supplier’s Role
Role
To Develop
multi-domain
Cross-unit Document Process Customer Political Operational
Skills and
Coordination Emphasis Articulation Adaptiveness Counselling Counselling
boundary-
spanning Skills
Business Product-Service Classification
Based on Tangibility Continuum
Services: Characteristics
Service Quality Dimensions
Reliability
The ability to perform the promised service
•Service is accomplished
On time
In the same manner
Without errors
Every time
• Back office
Billing accuracy, book keeping
Responsiveness
 Willingness to help customers and to provide
prompt service
 Keeping customers waiting for no apparent reason
 Ability to recover service failure quickly
Assurance
 Knowledge and courtesy of employees
 Ability to convey trust and confidence
 Competence to perform the service
 Politeness and respect for the customer
 Effective communication
 Customer’s best interests at heart
Empathy
 Caring, individualized attention
 Approachability
 Sensitivity
 Effort to understand the customers’ needs
 Airline agent try the best to find a flight for missing connection
customer
Tangibles
 The appearance of physical facility, equipment, personnel, and
communication materials.
 Tidiness of physical surrounding
 Noise
Service Recovery
 Club Med: an all-inclusive resort
 Pre-recovery phase
 With dark cloud forming in the sky
 Outdoors activities will be cancelled
 Alternative activities planned
 Immediate recovery phase
 Organized group games
 Putting a stage show
“the Club Med magic”
 Follow-up phase
 Give away complementary service
 Free lunch
 Discount for return visits
Service Packages
 The service package can be
thought of as the product
dimension of service, to
include:
1. Essential concept of
the service
2. Range of service
provided
3. Quantity, quality and
level of service
Conceptualizing the Service Product
Customer Benefit Concept

Service Concept

Service offer

Service Delivery System

Hybrid Offerings
 Combination of one or more goods and one or more services
that together offer more customer benefits than if the good
and service were available separately
 The installed base of products at customer organizations
represents a unique asset for most manufacturing firms.
 Four resources:
 1. Installed base;
 2. Product development assets
 3. Sales
 4. Field service organization
Distinctive Capabilities to Launching Hybrid
Offerings
 Service-related data
processing and
interpretation capability
 Execution risk assessment
and mitigation capability
 Design-to-service
capability
 Hybrid offering sales
capability
 Hybrid offering
deployment capability
Classifying Services on Hybrid Offerings
Product life cycle • Services to facilitate the customer’s access to supplier’s goods and
ensure its proper functioning
services • Inspection of ATM Machines, Recycling of a Power Transformer

Asset Efficiency • Services to achieve productivity gains from assets invested by

customers
services • Remote Monitoring of Jet Engine

Process support • Services to assist customers in improving their own business

processes
services • Logistics consulting for a material handling processes in a warehouse

Process delegation • Services to perform processes on behalf of Customers

services • DuPont not only supplies paints but manages paint-shops of Ford
Class Exercise: 30 Minutes(for Submission) + 15 Minutes (for Q & A)
Placement Champions Agency- 2.5 Marks
• You are working on a business idea
to help MBA colleges in final
placements by bridging the gap
between company requirements
and student skillsets

• In a group of 4, discuss and elaborate

on following
• Segmentation of B-Schools for
your service offering
• Conceptualize the Service
Product
• Customer Experience Journey
Q & As