Chapter - 13Chapter - 13Application In Application In

Service SectorService Sector

IntroductionLearning Objectives: Introduction to service sector Creating a distinctive service Service concept Service process cycle and analysis Customer service design Service management system MIS application in service industry MIS service Industry

Introduction

Unlike the manufacturing sector, the service sector does not have physical goods to be manufactured for the customer.

The data processing applications like payroll, accounting and inventory are required in the service industry too, but they may not be all critical to the service industry

Introduction

Service is essentially a process of human interaction.

Any human interaction is knowledge based, hence information based

Introduction Tom peters in ‘The service Edge’ states five

principles of a distinctive service.

1. Listen, understand, and Respond to the customers.

2. Define a superior service and establish a service strategy.

3. Set standards and measure and performance.

4. Select, train and empower the employees to work for the customers.

5. Recognize and reward the accomplishments.

Creating a distinctive service

Service VS productService VS product

Service Product

Service is not tangible. Product is tangible(real or Definite)

Services are offered on Demand Products are offered on payment

Service cannot be Demonstrated Product can be demonstrated

To judge quality of service is difficult due to its customers response and behavior

It can be possible to judge quality of product

Creating a distinctive service To summaries, the service conscious management

would create service focused organization, where:

1. The organization listens, understands and responds swiftly to the changing character of the customer wants, needs and expectations.

2. The organization develops and maintains a ‘customer-friendly’ service delivery system.

3. Organization employs, inspires and develops a customer-oriented frontline personnel.

in sort, the service function essentially is a human interaction between the service receiver and the provider.

Creating a distinctive serviceCreating a distinctive servicePurpose Expectation Perception

Annual Health Check up Quick service and total coverage at single location with proper guidance and advise

Depends on socioeconomic status.

Normal treatment Proper guidance and very less waiting time

Les paper work and infrequent visit

Emergency Immediate attentintion,necessary resources and services are immediately available

Doctor’s choice and a norm of immediate attention

Hospitalization Clean and quiet surrounding.pleasant,stay and fast recovery

Service with smile

Old patient Faster service with least cost and help them

Good layout

Child patient care Parents are relevant Interaction reduced parent anxiety

Service concept Service is an identifiable, intangible activity

or a process designed to fulfill certain expectations of the customer/consumer.

Kotler defines it as ‘service is an activity or a benefit that one part can offer to another which is essentially intangible and does not result in the ownership of anything

To understand the service better, it is necessary to understand its character or attributes as below

Service Concept Service character or attributes as below Intangibility All services are fully intangible i.e they lack

‘physical existence’. They can be seen being delivered and being received by the customer but cannot be displayed.

For example, teacher teaches in the class with textbook, notebook, chalk or transparencies are the goods associated with ‘teaching’, a service where customer is a student.

Service Concept Inseparability of Receiver & Provider In Service case, receiver and provider must be

present. Service process cannot be executed unless both

are present at the site of service delivery. Storage Service being intangible cannot be stored

like goods, which can be stored in the warehouse and can be used at a later date.

Service Concepts Inconsistency( not in agreement) The inconsistency occurs due to different service providers

performing at different times. Though service process is the same, service experience varies

from incident to incident. Every customer has different service expectations. For example, bank’s ATM service is consistent and is

also standard when compared with other banks. However, a service is remembered by its quality

Service Concept The quality of service has two dimensions,

namely:

1. Quality of resources used: service inputs, equipment's, facilities, tools, designs and so on.

2. Functional quality of the process : empathy, level of responsiveness, and process design quality

Note: all services have two components, one basic core and second its features.

Service Quality ModelService Quality Model

Customer Expectations

Service Quality

Customer perceived standard

Functional coreObjective Component

Added featuresComponent servicing the objectives

Service Process cycle and analysis

All services are bound by process steps and each step adds value in the service.

All the steps can be classified in stages based on the role played in the process.

These stages together build a service process cycle The stages in the cycle are:

1. Initiation of service

2. Transition to service

3. Pre-service

4. Service

5. Post-service

  Model of service process cycle

Stage in Service cycle Steps in stage Example of airlines: passenger service

1.Inititation of service Enquiry, information seeking, checking

Checking for flights, timing and facilities

2.Transition of service Steps towards effecting service

Issue of ticket, boarding services

3.pre-service Document checking, guideline etc

Ticket inspection on ground etc

4.Service Effecting service delivery with goods physical assistance

Finding seat,softdrink service etc

5.Post service Providing existence service Arrival guidance,tranport information etc.

Service process cycle and analysis All service stages are applicable in every kind of service in

every environment. The customer satisfaction is best achieved completing these steps in the most effective and efficient manner.

The Responsiveness of the service would increase with: Faster data capture and processing in every interaction. Access to various databases and services. Error free transaction processing and updating. And

application processing at each stage of service cycle.

Customer service Design

  The customer, who initiates the service trigger to avail the service, is influenced by:

Assessment of service, scope, quality Assessment of price of offer and willingness to pay that

price. Perception of service standard. Extend to knowledge about the service. Impact of promotion campaign.

Customer Service Design The Service process designer designs the ‘customer service' based on the

assessment and analysis of customer’s choices, preferences, quality expectations, willingness to pay the price and so on. Following factors influences the customer service design.

Promotion Product Price Place Processes People(process drivers)

Customer Service DesignCustomer Service Design

Product

PromotionPrice

CustomerServicedesign

Place People

CustomerServiceDesign

Customer Service Design The Service will be decided based on the capacity and capability of people and also by the

layout of place and facilities. Customer service design addresses primarily the ‘service product formulation’ which states: Who is customer? What is the service scope? How it is delivered? What is the quality level? What additional features to provide? What should be the price of service? Where it should be offered and what facilities to provide? Who would drive the service process? What kind of promotion would enthuse customers to avail the Service? Any finally, what process design would deliver the scope? Customer service design is crucial for customer satisfaction.

Service Management System(SMS)

Service Management System(SMS)

Initiation ofService

TransitionTo Service

Pre consumptionOf service

Consumption of Service

Post Service consumption

EnquiryProcess

Data capture

ImitationFor service

ScopeOf Service

TransactionOf service

Resource allocation

Pre serviceProcessing

Pre servicingInput processing

Pre serviceIntegration

Stage by stage processing

ServiceDocumentprocessing

DB

Feedback

Service Management System(SMS) Scope and objective in SMS Initiation for service(front End) Scope: answer queries, standard and non-standard. Record the

query details and seek for agreement to avail the service. Capture the data in standard format to initiate service action. Ascertain the service requirement. Create a bill of service offer. Give a service job number. Put the service job in queue. •Objective

: win the customer for availing the service.

Service Management System(SMS) Transition to service(front End) Scope: check, asses, validate the service requirement. Ascertain commercial and technical viability, and operational

feasibility. Check for submission of any document, or goods, which may

be mandatory for service. Obtain formal acceptance for beginning the service. Issue acknowledgement, acceptance card, voucher, and so on. Objective : establish technical, commercial feasibility and obtain

customer acceptance.

Service Management System(SMS)

Pre-service (back End) Scope: inspect all submissions from all points of view. In doubt, clarify and ascertain. Issue service job identity for record, communication, and for

reference at a later date. Update customer database with this service job identity. objective : enlist the service offer with identity.

Service Management System(SMS)

Service(back End) Scope: conducting the customer and/or the goods for service after

execution. Execute all necessary transactions, which are part of service process. Collect transaction results and update the records for reporting. Produce and/or display documents.

Collect relevant data for computing cost of service. Close the service process and obtain acknowledgement of service completion.

Objective : complete the service execution process efficiently and

effectively to the satisfaction of the customer

Service Management System(SMS) Post-Service(front End) Scope: collect feedback on service experience, suggestions if

any. Bill the customer for services availed. Process payment as per terms of services. Up-date customer record, job record, and other information

databases. Generate a report for examination to close the service offer Objective : collect data and information about service for decision-

making and improvement.

Mis application In Service Industry Airlines 1. Passenger information 2. Information on the Aviation industry Hotels 1. Keep track of the customer profile 2. Monitoring occupancy Level 3. Project future needs 4. Monitor the level of expectations 5. Monitor the communication needs 6. Customer database

Mis application In Service Industry Hospital (Front end applications) 1. Patient database 2. Medical server database 3. Resource planning and control 4. Medical case history database Hospital (Front end applications) 1. Core applications 2. Critical control applications

Mis application In Service Industry Banking 1. Customer database 2. Service to the account holders 3. Service for business promotions 4. The index monitoring system 5. Human resource upgrade Insurance 1. Information for new products 2. The settlement of claims 3. Management of the policies

Mis application In Service Industry Utilities Data gathering Data entry Data validation Data processing for billing Total amount Verification Data analysis collection

Mis application In Service Industry Finance: Statement for each amount and scheme Analysis of investment Statement of cash Statements of refunds etc Balance sheet and other legal documents Statement of brockage.commosion etc Query report processing

MIS: service industry

MIS focus on the key factors Factors: People Process technology