MSB
H-8
Managingpeople1.pptxManaging People
Marketing Services 6
Why are service personnel important?
They are service firm and brand
They are marketers
They directly affect customer loyalty
They determine productivity
They affect service quality
They can be a source of competitive advantage
Backstage staff have direct impact on service performance
“Partners are instrumental in all that we do. Our Partners own our business so have a vested interest in its success. They are at the heart of our service offering, embodying our values of trust, respect and fairness and they are the energy and passion that drives our work to be an evermore responsible and sustainable business.”
Sir Charlie Mayfield, Chairman, John Lewis Partnership
Service personnel as boundary spanners
Operate at the boundary of the firm:
Interact with customers
Interact with colleagues
Link the organization with customers
Represent the firm
Pass information in both directions
Conflict
Person/role conflict
Role inconsistent with individual’s personality
Emotional labour: supressing personal feelings in favour of a ‘public display’ of happiness
Role ambiguity and role overload
Organization/client conflict
Personnel are expected to be efficient but also delight customers
Inter-customer conflict
Being flexible in serving the needs of one customer can lower service quality for another customer
Mediating between conflicting customers
Reducing role stress
Employee training
Re-design operating procedure
Manage customer expectations
Segment customer groups to minimise conflict
Delivering quality through people
| Intelligent hiring | Hire for service inclination Be the preferred employer and compete for the best |
| Intensive training | Train for technical and interactive skills Provide supportive technology and equipment Empower Promote teamwork |
| Incessant monitoring | Develop service-oriented internal processes Measure internal service quality Gather customer feedback |
| Inspiring rewards | Provide feedback Reward strong performers to retain the best |
Hiring
‘The right people are your most important asset.
The wrong people are a liability that is often difficult to get rid of’ (anon)
Training
Firm’s culture
Technical skills
Product/service knowledge
Empowerment
Empowering the frontline to make discretionary decisions:
rectify service failures promptly
respond to customer requests promptly
motivates staff
encourages feedback about service design improvements
Most appropriate where:
service is personalized
transactions are extended rather than short-term
service environment is unpredictable
employees have good interpersonal skills
But not always appropriate
Low-contact and/or standardized services
Not all employees want empowerment
Requires appropriate attitudes and skills
Likely to result in higher salaries
Can cause inefficiencies and inconsistency
Reward
Extrinsic motivation
Intrinsic motivation
Important to reward quality service provision
Important to reward good discretionary decisions
Important in order to retain staff
Service-profit chain
Internal Service Quality
(employee
selection,
development, motivation)
Employee Satisfaction
Employee Retention,
Competence
and Productivity
Delivery of External Service Value to Customer
(benefits exceed costs)
Customer Satisfaction
Customer Loyalty
(retention & WOM)
Profitability & Growth
(cheaper to retain existing customers than to attract new customers)
Heskett et al. (1994)
Service culture
Where an appreciation for good service exists and where giving good service to internal as well as external customers is considered the only way to work
(Grönroos, 2007)
Service culture
Requires
Well-defined and communicated service concepts (what, to whom, how)
Appropriate organizational structure (cooperation, communication)
Leadership
Customer-oriented attitude
Customer-oriented attitude
Organizational support
(resources, training, support)
Customer participation
(leading to positive perception of customer)
Deep acting behaviour
(more genuine and authentic)
(Yoo and Arnold, 2016)
Internal marketing
A programme of creating and maintaining internal relationships between people in the organization so that they feel motivated to provide services to internal and external customers in a customer-focused way, and have the skills required and support needed to fulfil their roles as part-time marketers.
(Grönroos, 2007)
Internal marketing
Ensure employees know what is being promised to customers
Ensure employees understand their role in maintaining relationships with customers and have skills and motivation to do so
Sell the brand internally
Ensure channels exist for frontline staff to communicate with senior management
Ensure channels exist for communication across functions
Ensure communication is targeted to back-office personnel
Employees seen as internal customers of the organization who need to be
attracted, motivated, and retained
Customer participation
Customers often co-produce: customization, convenience, speed, productivity, cost reduction, enjoyment
Quality of delivery and outcome can be reduced by lack of knowledge, error, or unwillingness to participate
Customer co-production
Clearly define customer role
Teach customers how to co-produce
Benefits to offset customer resource input
Make participation easy and reliable
Attract appropriate customers
Value co-creation
Co-production is one dimension of a concept called value co-creation (Vargo and Lusch, 2004)
The second dimension is value-in-use, where value is derived from the experience of using the service offering during or after the exchange process
The customer inputs and integrates resources (knowledge, skills, time) with those of the service provider to create value
Customers are ‘partial employees’
References
Grönroos, C. (2007) Service Management and Marketing. 3rd ed. Chichester; Wiley.
Heskett, J. et al. (1994) Putting the service-profit chain to work. Harvard Business Review. 2 (March-April), 164-174.
Vargo, S. and Lusch, R. (2004) Evolving to a new dominant logic for marketing. Journal of Marketing. 68 (1), 1-17.
Yoo, J. and Arnold, T. (2016) Frontline employee customer-oriented attitude. Journal of Service Research. 19 (1), 102-117
