Chapter 5

FOCUS ON SERVICE
PROCESSESS
Chapter Objectives
 Compare and contrast the four stages of operational
competitiveness
 Appreciate the relationship between operations and
marketing as it pertains to developing service delivery system
 Describe the types of operational models that facilitate
operational efficiency
 Consider the challenges associated with applying operational
efficiency model to service organizations and recommend
strategies that overcome some of these difficulties.
Chapter Objectives
 Explain the art of service blueprinting as it relates to the design
of service delivery operations.
 Discuss the role of complexity and divergence as it relates to
new service product development.
 Familiarize the students of service marketing with operations
concepts, and explain the strategic importance of balancing
the operations and marketing functions in service operations.
Four Stages of Operational Competitiveness
1. Available for Service
 Operations for a firm at this level of competitiveness are viewed
as a necessary evil. Operations are at best reactive to the
needs of the rest of the organization and deliver the service as
specified.
 It mission, the operations departments attempts primarily to
avoid mistake.
 Example : would be an individual who sells local concert tickets
online via their own website. Customers place orders and
business simply fulfills the customer orders as they are received.
2. Journeyman
 The service firm may find that it is no longer enough just to have
a basic operation that works.
 The emphasis shift from controlling workers to managing process.
 The firm must now seek feedback from its customers on the
relative costs and perceived qualities of the service to seek
improvement in the service delivery process.
3. Distinctive Competence Achieved
 Operational competitiveness offers world class service delivery
 This level of performance operations not only have a continually
excel, but also become fast learners and adapt to competitive
offerings and customers ever evolving needs.
 It involves a philosophical change of balancing efficiency and
effectiveness.
4. World Class Service Delivery
 The workforce itself must be a source of innovators not just robots
following standardized process.
 To achieve this, the frontline supervisors must go beyond
coaching to mentoring.
Thompson’s Perfect World Model
 J.D. Thompson’s model- proposing that operations’ “perfect

efficiency is possible only if inputs, outputs, and quality happen
at a constant rate and remain known and certain.
 Technical core is the place within the organization where the
primary operations functions are conducted.
 Example : would be an individual who sells local concert tickets
online via their own website. Customers place orders and
business simply fulfills the customer orders as they are received.
The Focused Factory Concept
 An operation that concentrates on performing one particular

task in one particular part of the plant; used for promoting
experience and effectiveness through repetition and
concentration on one task necessary for success
 The focused factory focuses on a part job; once this focus is
achieved the factory does a better job because repetition and
concentration in one area allow the workforce and managers
to become effective and experienced in the task required for
success.
The Plant within a Plant Concept
 The strategy of breaking up large, unfocused plants into smaller

units buffered from one another so that each can be focused
separately.
 Buffering -Surrounding the technical core with input and output
components to buffer environmental influences.
Three Alternatives Proposed by Thompson to
buffering
1. Smoothing- involves managing the environment to reduce
fluctuations in supply and or demand.
2. Anticipating –involves mitigating the worst effects of supply and
demand fluctuations by planning for them.
3. Rationing - Direct allocations of inputs and outputs when the
demands placed on a system by the environment exceed the
system’s ability to handle them.
Five Operations Solutions for Service Firms
1. Isolating the Technical Core - proposes the clear separation of

the servuction system which is characterized by the high
degree of customer contact, from the technical core.
Decoupling - Disassociating the technical core from the
servuction system.
2. Production lining the whole system ( Production line approach)
–The application of hard and soft technologies to a service
operation in order to produce a standardized service product
2. Production lining the whole system ( Production line approach)

Hard Technologies - Hardware that facilitates the production
of a standardized product.
Soft Technologies - Rules, regulations, and procedures that
facilitate the production of a standardized product.
3. Creating Flexible Capacity- used to minimized the effects of
variable demand for example consider how Verizon has increased
the capacity for the Umass Memorial Healthcare system through
the implementation of their SONET Services.
4. Increasing Customer Participation- This approach primarily

focuses on reducing the costs associated with providing the
service to the customer. The essence of increasing customer
participation is to replace the work done by the employees of the
firm with the work done by the customer. Example ATM
5. Moving The Time of Demand to Fit Capacity - utilized to
optimize the efficiency of service operations is the attempts to shift
the time of demand to smooth the peaks and valleys associated
with many services. Example : Discounts or giveaways at peak or
non rush periods.
The Art of Blueprinting
 One of the most common techniques used to analyze and

manage complex production processes in pursuit of operational
efficiency is flowcharting
 BLUEPRINTING - The flowcharting of service operation
Service Blueprint of Luxury Hotel
 Service cost per meal - The labor costs associated with
providing a meal on a per meal basis ( Total labor
cost/maximum output per hour)
 Process time - Calculated by dividing the activity time by the
number of locations at which the activity is performed.
 Activity Time - the time required to perform one activity at one
station.
 Stations- A location at which an activity is performed within a
service blueprint
 Maximum output per hour – The number of people that can be
processed at each station in one hour.
 Bottlenecks – points in the system at which consumers wait the
longest period of time
Constructing the Service Blueprint
 One sided blueprint – an unbalanced blueprint based on

management’s perception of how the sequence of events
should occur.
 Convergent scripts - Employees/consumer scripts that are
mutually agreeable and enhance the probability of customer
satisfaction.
 Divergent scripts - Employees/consumer scripts that mismatch
and point to areas in which consumer expectations are not
being met.
Scripts provide the basis for
1. Planning service encounters

2. Setting goals and objectives
3. Developing behavioral routines that maximize the opportunities
for a successful exchange
4. Evaluating the effectiveness of current service delivery system.
Constructing the Service Blueprint
 Two-sided blueprint – a blueprint that takes into account both

employee and customer perceptions of how the sequence of
events actually occurs.
 Scripts Norms – Proposed scripts developed by grouping
together events commonly mentioned by both employees and
customer, and then ordering those events in their sequences of
occurrence.
Blueprinting and New Product Development:
the role of Complexity and Divergence
 Complexity – A measure of the number of intricacy of the steps
and sequences that constitute a process.
 Divergence – A measure of the degree of freedom service
personnel are allowed when providing a service.
 Volume oriented positioning strategy - A positioning strategy
that reduces divergence to create product uniformity and
reduce costs.
 Niche positioning strategy - A positioning strategy that increase
divergence in an operation to tailor the service experience to
each customer.
Blueprinting and New Product Development:
the role of Complexity and Divergence
 Specialization positioning strategy - A positioning strategy that
reduces complexity by unbundling the different services offered.
 Unbundling- Divesting an operation of different services and
concentrating on providing only one or a few services in order to
pursue a specialization positioning strategy.
 Penetration Strategy - A positioning strategy that increases
complexity by adding more service and or enhancing current
services to capture more of a market.

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FOCUS ON SERVICE

 J.D. Thompson’s model- proposing that operations’ “perfect

 An operation that concentrates on performing one particular

 The strategy of breaking up large, unfocused plants into smaller

1. Isolating the Technical Core - proposes the clear separation of

2. Production lining the whole system ( Production line approach)

4. Increasing Customer Participation- This approach primarily

 One of the most common techniques used to analyze and

 One sided blueprint – an unbalanced blueprint based on

1. Planning service encounters

 Two-sided blueprint – a blueprint that takes into account both

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