Chapter 2

NAME MATRIC NUMBER

NUR FATIN FATIHAH BINTI AHMAD RUZI 2013

PRESENTER

PREPARED FOR : PM DR SHIREEN

PUBLIC SERVICE MANAGEMENT & QUALITY

UNIVERSITI TEKNOLOGI MARA SHAH ALAM FACULTY OF ADMINISTRATIVE SCIENCE AND POLICY STUDIES

UNDERSTANDING SERVICES (PUBLIC)

Atomistic model of serviceBases of classificationImplication classificationThe front stage/ delivery systemThe back stage/ technical systemThe marketing systemCore and peripheral service

Atomistic Model of Service

Lynn Shostack created a Atomistic model / molecular model that can be applied to goods or service .

Use chemical analogy to help marketers visualize and manage the term

‘TOTAL MARKET ENTITY’ At the center is the core benefit=

Address basic customer need, with the link to a series of other characteristics.

Surrounding the molecules= represent PRICE, DISTRIBUTION, MARKET POSITIONING (communication message)

A change in one element may COMPLETELY alter the nature of the entity

EXAMPLE of 3 tailored travelling experience for 3 different markets. (VIRGIN AIRLINES)

For students/ backpackers or during bad economic conditions, what they want?◦ reaching from one destination to the other◦ cheap flights+hostels, bed and breakfast

For business travelers, what they want? ◦ schedule frequency along with comfort ◦ a comfortable travel + hotel with internet, office facilities.

For tourists with families what they want? ◦ in-flight and post-flight services (hotels) ◦ comfortable flight-but not too expensive + hotel near a tourist

destination

Various markets demand differently. Air Asia offers low cost air travel : the travelers are not provided

certain tangible elements such as food and drink in-flight. Challenge : create an experience for each market

◦ to understand how consumers perceive a certain service ◦ what as a firm they should do to manage and meet the

expectations

Bases of Classification

Tangible Intangible

People processing and possession processing.

Mental stimulus processing and information processing.

People Processing

Customers must:•Physically enter the service factory•Co-operate actively with the service operation

Managers should think about process and output from customer’s perspective •To identify benefits created and non-financial costs:•Time, mental, physical effort

Possession Processing

Customers are less physically involved compared to people processing services.

Involvement is limited.

Production and consumption are separable.

TANGIBLE

Mental Stimulus Processing

Ethical standards required when customers who depend on such services can potentially be manipulated by suppliers

Recipients should spend time but not necessarily be physically present in a service factory; just mentally in communication with information being presented.

Core content of services is information-based that can be converted to digital bits, recorded or transformed into manufactured products

Can be “inventoried”

Information Processing

Information is the most intangible form of service output.

But may be transformed into enduring forms of service output.

Customer involvement determined more by tradition or personal desire to meet face to face

and not by the needs of the operational process.

Line between information processing and mental stimulus processing may be blurred

INTANGIBLE

Tangible People

(people’s bodies)Possession

(physical possession)

• Passenger transport • Health care• Lodging • Beauty salons• Physical therapy • Fitness centers• Restaurants/bars • Haircutting• Funeral services

• Cargo/Freight transport • Repair and maintenance• Warehousing/storage • Janitorial services• Retail distributrion • Laundry and dry cleaning• Refueling • Landscape/lawn care• Disposal/RecyclingIntangible

People (mental stimulus processing –

people’s mind)

Possession (information processing – intangible assets)

• Advertising/PR • Arts and Entertainment• Broadcasting/cable • Management consulting• Education • Information services• Music concerts • Psychotherapy• Religion •Voice telephone

• Accounting • Banking• Data processing • Data transmission• Insurance • Legal services• Programming • Research• Securities investment • Software consulting

Implication of Classification

Design of the service factory .Alternative channels for service

delivery.Balancing demand and supply.Make the most of information

technology.Clarifying the benefits delivered.

The Front Stage / Delivery System

Service process take place Occurs at service

encounter High-contact service

between customer & service provider (customer highly involve)

Customer also interact with environment, physical facilities & other customer

Moment of truth take place

Mind set of front stage

Create good service experiences (ex: enjoyable, unique, responsive to their needs)

Example

The waiter serve the food to the customer according to what customer order

The Back Stage / Technical System

Input are processed & element of service product is created

Invisible to the eye of the customers

What goes in back stage not the interest of the customer unless it effect the quality of front stage activities.

Mindset of back stage

Follow different goals and technique

Strive for efficiency, standardization

Treat people as abstract actors

Example

Chef at the kitchen cook the food order by the customer

The Marketing System

What is marketing system?

Understanding service products, consumers and markets

Involve customer and service provider

Developing customer relationships

Applying the 8P’s Striving for service

excellence

Core and Peripheral Service

Core service Peripheral Service

Is the main service provided by the company

Component related to how the customer is treated when finding,

buying and using the service

WHEN PRODUCT IS SERVICEExample

Flying the passengers and their baggage safely from point A to

point B

ExampleHow well customers are treated when they call up to compare

fares/ make reservation, check in at the airport,

take flight to the destination and pick up their bags at the end

of the flight

Product core:WHEN THE PRODUCT IS A

TANGIBLE GOODEX: TV SET

Service component:HOW WELL THE BUYER IS

TREATED WHILE SHOPPING, BUYING AND USING THE TV SET

QUESTION AND ANSWER SESSION