4362ch15 Sp10

Copyright © Houghton Mifflin Company. All rights reserved. 15 | 1

Thinking Globally (Chap. 15)

Culture: set of shared values and beliefs in a society

Services and Culture• Cultural Orientation Toward Nature• Cultural Orientation Toward Activities• Cultural Orientation Toward Time• Cultural Orientation Toward Others


Services and Culture

Cultural Orientation Toward Nature: Do people seek to control their environment, or do they consider it impossible or inappropriate to control?

• Cultures differ in the extent to which individuals expect uncertainties to be controlled at the service encounter.



Cultural Orientation Toward Activities: Do individuals focus on the activity or results of the activity? That is, do individuals focus on the process or the outcome of service delivery.

• Eastern cultures (south Asia) are more likely to emphasize the service experience as opposed to the outcome of a service delivery.



Cultural Orientation Toward Time: Cultures differ in how individuals perceive the duration and the immediacy of the service encounter.

• In Western cultures, time is more absolute and punctuality is an important requirement in service delivery.



Cultural Orientation Toward Others: Group-oriented cultures place less importance on self and more importance on social hierarchy.

• Many western cultures (US) take a strongly egalitarian approach to waiting and would reject any attempt to violate the “first come, first served” rule



Cultural Orientation Toward God:



Hong Kong Disney

Service Standards at Four Seasons: in the US, coffee is left on tables at breakfast; in many parts of Europe (France) customers perceive this as lack of service and servers personally refill coffee cups as needed


Global Trade in Services

Outbound service export strategy: sending the service provider to other countries

• Fast foods, traveling to other countries to offer service



Inbound service export strategy: bringing foreign customers to the service provider’s country.

• Foreign students, patients from other countries



Teleservice export strategy: exporting services by delivering them electronically

• Overcome time & distance barrier• Offshoring: outsourcing services such as

customer service, education, medicine.


Criteria for Entering

Which countries (potential markets)?• Infrastructure, government regulations,

trade barriers

• Quality of labor pool, welcoming environmentliteracy, education level, computer literacy

• Geographically close: Canada, Mexico• Psychic proximity: laws, language, custom


Entry Strategies forGlobal Service Markets

Foreign Direct Investment – Organization chooses to invest its resources directly in another country

Sending service providers to another country



Franchising• Franchisees: service outlets licensed by a

principal to deliver a unique service concept it has created or popularized.

• McDonald’s



Joint Ventures – Organization contracts with local organizations and thereby shares risks and rewards

• Wal-Mart and Bharti Enterprises open Wal-Mart stores in India


Standardization VersusAdaptation of Global Services

Standardization means providing the same service in the same manner around the world

Adaptation means tailoring service offerings to accommodate conditions in each local market



From Table 15.1: Services Theater Decisions

Audience: How do the customers differ?

Actors: Do we use same types of personnel? How should we adapt training? Compensation for foreign service providers?



From Table 15.1: Services Theater Decisions

Setting: How should the setting be redisigned, and what adaptations are necessary?

Performance: How should acts and scripts be adapted?


Key Issues in Standardization vs Adaptation

To what extent should services marketing mix be adapted or standardized?

Review elements of marketing mix and determine which would add more revenue than cost

Standardized Adapted


Key Issues in Standardization vs. Adaptation

Elements of Services Marketing Mix: which will add more revenue than costs ?

Actors (training), setting (change in physical environment), performance (change in acts & scripts)

4362ch15 Sp10

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