CUSTOMER

COMPANYService Delivery

Customer-Driven Service Designs and

Standards

Provider Gap 3

GAP 3

Key Factors Leading to Provider Gap 3

Gap 3: Role of Customers in Operational Design & Delivery

• Customers Not Performing Their Role in the Process– Lack of Understanding– Lack of Ability– Lack of Willingness– Ambiguity & Uncertainty About What They Want

• No Reward for Good Performance• Interaction with Other Customers• Incompatible market segments• Impact: Customers Introduce Variability to an Operation• Solution: Limit & Control Customer Involvement Through

Process Design & Technology

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Customers’ Roles in Service Delivery

• The Importance of Customers in Service Delivery

• Customers’ Roles• Self-Service Technologies—The Ultimate in

Customer Participation• Strategies for Enhancing Customer

Participation

Critical Role of the Customer

The idea of the service factory

Simultaneous Production & Consumption

People in the Service Mix – 7P’s

Employees

Customers

Others

Marketing Exchange --- Creating Value

• By participating in the service delivery process, customers create value for themselves

The Drama Metaphor

• actors• audience• script• setting• props

Levels of Customer Participation Across Different Services

Importance of Other Customers in Service Delivery

• Other customers can detract from satisfaction

• disruptive behaviors• excessive crowding• incompatible needs

• Other customers can enhance satisfaction• mere presence• socialization/friendships• roles: assistants, teachers, supporters

Customer Roles in Service Delivery

Productive Resources

Contributors to Quality and Satisfaction

Competitors

Customers as Productive Resources

• “partial employees”– contributing effort, time, or other resources to

the production process

• customer inputs can affect organization’s productivity

• key issue:– should customers’ roles be expanded?

reduced?

Customers as Contributors to Service Quality and Satisfaction

• Customers can contribute to– their own satisfaction with the service

• by performing their role effectively

• by working with the service provider

– the quality of the service they receive• by asking questions

• by taking responsibility for their own satisfaction

• by complaining when there is a service failure

Customers as Competitors

• customers may “compete” with the service provider• “internal exchange” vs. “external exchange”• internal/external decision often based on:

– Expertise capacity– Resources capacity– Time capacity– economic rewards– psychic rewards– trust– control

The Era of Self-serve Technology

Types of Services –

Technology vs. People based

Natural Evolution to tech-based

Concern with losing the people connection

Technology Spotlight:Services Production Continuum

1 2 3 4 5 6

Gas Station Illustration1. Customer pumps gas and pays at the pump with automation2. Customer pumps gas and goes inside to pay attendant3. Customer pumps gas and attendant takes payment at the pump4. Attendant pumps gas and customer pays at the pump with automation5. Attendant pumps gas and customer goes inside to pay attendant6. Attendant pumps gas and attendant takes payment at the pump

Customer Production Joint Production Firm Production

Strategies for Enhancing Customer Participation

EffectiveCustomer

Participation

Recruit, Educate,and Reward Customers

Define CustomerJobs

Manage theCustomer

Mix

Strategies for Enhancing Customer Participation

Strategies for EnhancingCustomer Participation

• Define customers’ jobs– helping himself– helping others– promoting the company

• Individual differences:– not everyone wants to participate

Strategies for Recruiting,Educating, and Rewarding Customers

1. Recruit the right customers2. Educate and train customers to perform effectively

On site --- place and function orientation

3. Reward customers for their contribution4. Avoid negative outcomes of inappropriate customer participation

Manage the Customer Mix

•Access the compatibility of segments•Isolate incompatible segments•Enhance segment compatibility

Characteristics of Service that Increase the Importance of Compatible Segments