5questions about Strategic Services Marketing

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• GO through history of southwest airlines
• Watching these videos think about the main strategic priority of Song and Southwest in how their people sustain their business or how they stage experience.
• For chap 11 we focus on the stargeic management of human resources for services
• Boundary spanners
• They are: the service, the organization, the brand, marketers
• Video: Herb Kelleher, former CEO Southwest Airlines
• Business strategy coming from top management – instilling a service culture takes time; cannot decide overnight: counter example Song building a airlines by branding its people
• uthwest Airlines Co. (NYSE: LUV) is a major U.S. airline, the world's largest low-cost carrier, headquartered in Dallas, Texas. The airline was established in 1967 by Herb Kelleher [6] and adopted its current name (Southwest Airlines) in 1971.[7] The airline has nearly 46,000 employees as of December 2014 and operates more than 3,800 flights per day.[8] [9] As of 2014, it carried the most domestic passengers of any U.S. airline.[10] As of May 2016, Southwest Airlines has scheduled service to 97 destinations in 40 states, Puerto Rico, and abroad.

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How do you make sure that the people who come in the company and then stay there are hired, retain, well??

You start by hiring a great HR; the People department at Southwest not the HR department,

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Paradox of services: best company to work for but worst companies to be clients of.

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Nike: banking on activities outside work: the sport facilities are disconnected from the work spaces; promotional vide only shows the former.

Google: everything integrated work, play, service, embodies the work structure expected; always on potentially; transportable work.

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Core values: Ritz Carlton ; ladies and gentlemen serving ladies and gentlemen

Southwest: people do no use I otherwise fired or not hired.

Use pee hiring for key positions; interviews people on the job to figure out the key trait for high performance (eg. Interviewed the top 35 pilots).

What is the advantage of having people who are team players?

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Go page 282 Matrix in textbook

As a manager you may have to pick a side.

Often boundary spanners get scolded for the entire organization’s mistakes; they are the face they are there. Need to be ready for that.

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When most people think of Nike, they think of superstar athletes like Michael Jordan, Mia Hamm, and Tiger Woods. When Nike's own employees think of their company, they think of a retired university track coach, an Olympic runner whose career ended tragically in a 1975 car crash, and a so-so athlete whose achievements as an entrepreneur far outpaced his accomplishments as a runner.

Most people have heard of Nike CEO Phil Knight, a middle-distance runner who turned selling shoes out of his car into a footwear-and-apparel colossus. But few know of Nike cofounder Bill Bowerman, Knight's coach, or of Steve Prefontaine, the now-deceased runner who was also coached by Bowerman and whose crusade for better equipment inspired Bowerman and Knight to build the Nike empire. Yet, inside Nike, those three figures are more relevant to the company's sense of identity than any of its superstar spokespeople.

Why? Because Nike has made understanding its heritage an intrinsic part of its corporate culture. Think of this approach as internal branding: The stories that you tell about your past shape your future. Which is why, these days, Nike has a number of senior executives who spend much of their time serving as "corporate storytellers" — explaining the company's heritage to everyone from vice presidents and sales reps to the hourly workers who run the cash registers at Nike's stores. "Our stories are not about extraordinary business plans or financial manipulations," explains Nelson Farris, 57, Nike's director of corporate education and the company's chief storyteller. "They're about people getting things done."

And like all great stories, the ones about Nike offer archetypes that people can learn from. When Nike's leaders tell the story of how Coach Bowerman, after deciding that his team needed better running shoes, went out to his workshop and poured rubber into the family waffle iron, they're not just talking about how Nike's famous "waffle sole" was born. They're talking about the spirit of innovation. Likewise, when new hires hear tales of Prefontaine's battles to make running a professional sport and to attain better-performing equipment, they hear stories of Nike's commitment to helping athletes.

Over the past couple of years, Nike has experienced the roller coaster that lots of companies ride: euphoric periods of growth followed by setbacks and public backlash. But through all of these ups and downs, winning companies hold on to their values. "To survive those downtimes," explains Farris, "you have to understand what real teamwork is — keeping promises, keeping commitments. Not everyone understood this, but both Knight and Prefontaine did, because that's what Bowerman taught his athletes. As one of our first employees said, 'Not everyone grew up on the track with Bowerman. They didn't understand what it took to be great.' "

To foster that kind of understanding, the company launched its corporate-storytelling program. When the program started, in the late 1970s, it was an hour-long lesson given to new employees when they arrived to sign their W-2s. Today, orientation lasts two days, and the story of Nike's heritage is the first item on the agenda. With the company back on the growth track, Farris envisions a day when the orientation process will last a week and take place at "Nike University."

Storytelling isn't just for new hires. Each "Ekin" ("Nike" spelled backwards) — Ekins are tech reps known for their Swoosh ankle tattoos — undergoes a nine-day Rookie Camp at Nike headquarters in Beaverton, Oregon. A full day is spent in Eugene, where Ekins run at the Hayward field track (where Bowerman coached) and visit the site of Prefontaine's fatal car crash. "We're connecting what we're doing today back to Nike's heritage," says Dennis Reeder, 45, Ekins training manager.

As Nike gets even bigger, its storytellers feel that their mission becomes even more critical. "Every company has a history," says Dave Pearson, 43, a training manager and storyteller. "But we have a little bit more than a history. We have a heritage, something that's still relevant today. If we connect people to that, chances are that they won't view Nike as just another place to work."

Contact Nelson Farris by email ([email protected]), or visit Nike on the Web (www.nike.com).

Sidebar: Shoe Stories

Nike spares no expense when it comes to telling the stories of Phil Knight, Bill Bowerman, Steve Prefontaine, and the founding of the company. Here's what goes on these days around the Nike campfire.

Bring Your Heritage to Life

The Nike store in Eugene, Oregon opened last May. Think of it as Nike's Smithsonian Institution. A Heritage Wall includes everything from the shoe molds that Bowerman made with his family's waffle iron to the first pair of Nike running shoes to ever cross a finish line.

Tell Your History by Design

Whether it's Bowerman Drive (which leads into the Nike campus), the Joe Paterno Child Development Center (named after the Penn State football coach), or the Bo Jackson fitness Center, every aspect of Nike's headquarters reinforces its heritage.

Tell Your Story to Your Customers

Nike's corporate storytelling does not end with its employees. "Ekins," for example, are responsible for telling the Nike story to salespeople at the Athlete's Foot, Foot Locker, and other large retailers that carry the Nike product line.

Why? "Because when people understand why we exist, what our foundation is, and who we are today, then they understand that all of our products are still rooted in improving an athlete's performance," says Ekins training manager Dennis Reeder. "It's no different from how it was when Bill Bowerman was in his workshop, tinkering and crafting shoes for his athletes at the University of Oregon — only now we're doing it on a much larger scale."

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There are informal and formal training.

McDonald’s Hamburger University is called the Harvard of the fast food industry. In fact in China the school’s one per cent acceptance rate leaves Harvard in the dust.Today Hamburger University has campuses in Oak Brook, Ill., Tokyo, London, Sydney, Munich, São Paulo and Shanghai.

More than 275,000 franchise owners and managers have completed the intense week-long training program and now have Hamburgerology degrees.

Its first class of 15 graduated in 1961. Now the school brings in 5,000 students every year

Every McDonald's manager is required to go through the training — including CEO Jim Skinner

HU exists solely to teach business and social skills for managers. McDonald's was the first restaurant company to do this. Check out the professors in the background evaluating students:

Hamburger University's professors have the ability to teach in 28 languages

If you complete the program, you'll get this diploma. HU is accredited by the American Council on Education and credit can be applied towards college

The management courses are like B-school classes focusing on sales growth and how to run a business.

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• Remember the Ritz Carlton example.
• Firm’s business strategy is based on personalised, customised service and competitive differentiation
• Emphasis on extended relationships rather than short-term transactions
• Use of complex and non-routine technologies
• Service failures are non-routine and cannot be designed out of the system
• Business environment is unpredictable, consisting of surprises
• Managers are comfortable letting employees work independently for benefit of firm and customers
• Employees seek to deepen skills, like working with others, and have good interpersonal and group process skills

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$2000 more a sign of trust to employees than a service failure recovery devices

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Southwest: do not select if uing I too much or being rude to assisnats, etc.

Also peer hiring is often used.

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Southwest Airlines only do internal training: use it as a instrument to instill a culture

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4) Feed your tribe-lore. Many know the famous Innovation Kitchen and the Winnebago that was bought on Craig’s List for $750 as their conference room. It’s a nod to Phil Knight (Nike’s founder) who sold shoes in the back of his RV. The clock inside the Winnebago reads 2:59 all day. It is said “That’s to signify a sub-3 hour marathon.” These stories circle as legends around the company, grounded in the 11 Maxims, which employees quote regularly and unprompted:

#1 “It is our nature to innovate.”

#4 “Simplify and go.”

#6 “Be a sponge”

#7 “Evolve immediately.”

But behind this impressive brand is an even more impressive company culture. I had the luck to spend some time with Nike employees during several Nike projects I did for my previous agency Boondoggle. Nike is a company of memes, stories and remarkable traditions. Take their chief storyteller, Nelson Farris, who collects all stories and memes. Take the inventor of the Nike Air, Frank Rudy. And of course, their numerous athletes, like Steve Prefontaine.

But even more, their Ekins. Ekins are official company storytellers employed to evangelise about the Nike brand and its sports technology. Before being unleashed on the world, each “Ekin” (“Nike” spelled backwards) is required to undergo an almost military-like training regime comprising a nine-day rookie camp at Nike’s headquarters in Oregon and a full day’s running at the Hayward field track where Nike-founder Bill Bowerman worked as a track coach. Almost unbelievably, as a further sign of their devotion to the brand, each Ekin is then invited to have the Nike ‘swoosh’ tattooed on their ankle ahead of their ‘graduation’. Talking about employer brand dedication.

I got to meet several Ekins. Amongst them, Bruno Garcia (right on the picture), a New York-based Ekin, might be the most remarkable one. He got the Nike Ekin tattoo (which is the Nike logo backwards, like “Ekin” is “Nike” spelled backwards) as well as Greek goddess Nike’s victory wings on his calves. Futhermore, he is very active within the Hash House Harriers, “a drinking club with a running problem”. Sounds like a foolish fraternity, but the HHH represent more than 1700 chapters throughout the world and have a yearly conference in Asia that assambles more than 17.000 HHH runners. With such ambassadors, you hardly need an advertising campaign.

So, the next time you use Nike as a best practice, please let’s not use it for Nike+, great campaigns or being an awesome brand. Give Nike some credit for being the company with a most remarkable company culture.

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Customer Participation

• Actions and resources supplied by customers during service production and/or delivery
• Includes mental, physical, and even emotional inputs
• Three levels: low, medium, and high (do not confuse

Customers can negatively affect service delivery

• Lack of understanding of their roles
• Not being willing or able to perform their roles
• No rewards for “good performance”
• Interfering with other customers
• Incompatible market segments
• with levels of contact)

Other customers can detract from satisfaction:

• disruptive behaviors
• overly demanding behaviors
• excessive crowding
• incompatible needs

Other customers can enhance satisfaction:

• mere presence
• socialisation / friendships
• roles: assistants, teachers, supporters, mentors

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• by performing their role effectively
• by working with the service provider
• by asking questions
• by taking responsibility for their own satisfaction
• by complaining when there is a service failure

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• Melbournse McDonal`s

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Higher level of particpaiton advisable when service production and delivery are inseprarable; markeing benefits (cross selling, loyalty building) plus customers can substitude for inforamiotn and labor provided by employees.

Increased participation desirable when customers want that as well; imprve their satisfaction,

Golden rule: customer better served if they partiucipate more if service is transformational: education, health care, some legal services, fitness. Take onership for their service.

Up to service provider, boundary spanner to aduste depending on perceptions.

B ot bo serviuce; could be contractually agrred on.,

Faceboook great example: multiple segments co exit; possibility to fulfill social need, self esteem need or self actualization need.

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GOFUndme : customer role needs to be explained; veyr new service; unusual business model; etc, reward:donoars are customers tooÉ Social and financial ewaward 9if investing in products);

Communautor honor system for distance drivemn until 2013; before GPS tracker for cars. Still has one key for every car! Anybody can potentially drive off witgh any car at any point.Importance of the honor ssytem code undisction booklet, etc.

https://www.gofundme.com/crowdfunding

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To use capacity tot he fullest; swimming pools must manage a varied and heterogeenous customer mix.

Coogee Pavillion

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SSTs Advantages

• Time savings
• Cost savings
• Flexibility
• Convenience of location
• Greater control over service delivery
• High perceived level of customisation

SSTs Disadvantages

• Anxiety and stress experienced by customers who are uncomfortable with using them
• Some see service encounters as social experiences and prefer to deal with people

Key weakness of SSTs: too few incorporate service recovery systems

• Customers still forced to make telephone calls or personal visits

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