Deck 2: The Nature of Services

Question 1

How could Village Volvo manage its back office (i.e., repair operations) like a factory ?

Answer 1

The service operation sector is highly customer oriented and the process has to be more streamlined so as to avoid chaos and delay in the service provided. A better performing service provider would have all the process happening in the desired sequence and functionality would be monitored by the supervisors for quality as well as productivity.
The retailing marker may focus on the supply of the products and services as well. Both are customer oriented and the characteristics of these do not vary much. In case of the product manufacturing, there would be a predetermined process sequence as of input of the raw materials, processing operations in separate departments and finally the finished goods. The service operations need not follow the exact procedure, how ever in order to yield better results the production frame work of the factories can be set as a bench mark.
In the case of the Village Volvo, a study can be done on how the operations in the back office are done similar to that of a factory as follows.
Step 1 : In a factory before starting the business deal, negotiations would be carried out on between the two parties with regard to the rate, delivery time and the level of quality expected in the products. In the Village Volvo too the same scenario is followed where the customers are given a detailed note on the repair work to be performed, the time taken for the same and the cost estimation. The customer could then decide whether to process or make some alternatives.
Step 2 : As in the factories where a pilot run would be carried out for understanding the feasibility of the large scale production, in Village Volvo, the mechanics take the car for a test drive to understand the trouble better and then suggest for repair or replacement of the spare parts.
Step 3 : The factories follow a time schedule for a particular work to be done and do not encourage any change in the predetermined work sequence. In Village Volvo too the customers are given a time schedule for their car and the mechanic would perform the task on that particular time schedule so as to ensure the quality of work and not affecting the sequence of the process.
Step 4 : The product of the manufacturing units are tested for the quality and performance. The came procedure is being followed in the Village Volvo where the cars after repairing or servicing is taken for a test drive by the mechanics along with the customer to ensure that the issue is rectified. This shows the quality conscious work nature of the firm.
Apart form this the Village Volvo also has a storage space as in the factories to store the spare parts and accessories so that the customers need not wait for long for the replacements. The performance of the Village Volvo is commendable as it follows a factory model outlet to ensure the quality of the service and customer delight.

Question 2

How can Village Volvo differentiate itself from Volvo dealers ?

Answer 2

In retailing business whether it be products or services, satisfaction of the customers is the main agenda. The customers on the other hand tend to choose the business operation that provides more attributes than the rest. This forces the retailers to make them unique from the rest of the dealers so as to attract more customers and enhancing business.
Surviving in the highly competitive business market is a constant threat to the dealers. The managers of the firm have to develop strategic plans to stand out of the crowd and increase the customer count. The customers also look for dealers that provide more services or discounts while making a purchase. This behavior of the customers need to be taken in to account by the managers while planning for strategic implementation of the business plans.
Village Volvo has been doing pretty well in the business and let us examine what makes it a better service provider than its dealers.
1. Unlike other dealers of the Volvo, the managers of the Village Volvo take out time to discuss with the customers the issues they are facing and the possible solutions for the same in the most cost effective way. This would make the customer feel important and can also customize the services. The customer would not only opt for Village Volvo for future services but also refer others too. This would enhance the reputation and business of the Village Volvo.
2. The CCVD method followed by the Village Volvo makes them unique from the rest of the dealer. By this method the history of the services and the repair done on the vehicle would be saved and also as an additional feature, the customers would be reminded for the next schedule of service which is highly appreciated by the customers.
3. Unlike other dealers who would dump the worn out and old spare parts in the trash, the Village Volvo makes it sure that these are recycled and there by producing very less trash. This environment friendly gesture attract customers of similar mind set and enhances the image of the firm.

Question 3

Describe Xpresso Lube's service package?

Answer 3

The service operators popularize themselves in the form of service packages they provide so as to gain more customers. The service packages may be referred to as the services and the information relevant to it being made accessible to the customers in the particular environment.
As a part of the expansion in the global business there are many dealers for the same service and each of them claim to be better and unique than the other in some of the attributes. The service package of a service provider determines the uniqueness of the operator in various aspects with regard to the working environment. The most common attributes taken in to consideration for a service package are supporting facility, facilitating goods, explicit services and implicit services. The ultimate aim of the service package is to ensure quality in the service and customer satisfaction, as they are the key elements for a business to be successful.
The service package of the Xpresso Lube can be described with regard to the above features as follows.
1. Supporting Facility: The supporting facility of the service package attracts more customers and the satisfaction level of the customers would be higher if this facility is found to be pleasing. The Xpresso Lube is located in the main street near to the university making it easily accessible to the students and the staffs. They also provide transportation facility to and from the Lube to the customer place. This would reduce the rush in the Lube and make a place of preference for the working customers.
2. Facilitating Goods: The Lube is provided with a coffee bar with a large waiting area with sufficient tables and chairs. The waiting area is extended to out side covered area so as to use in the pleasant weather. This would make the customers to wait leisurely with out getting tired of the time taken for the service. The stereo music system and the different reading material available help to make the customers comfortable. The customers can make their shopping in the near by local shops by leaving the vehicle for service which would be taken as an added advantage for choosing the Lube.
3. Explicit services: The explicit services of the Lube that makes them more preferred dealer than the others can be to and for transportation of services, customers can view the lower side of the vehicle to identify the issue with the presence of the lift and the services are charged comparatively reasonable and cheaper.
4. Implicit services: The implicit services that makes the Lube win the trust of the customers can be the presence of the coffee bar and a pleasant ambience in the waiting room, music being played in the coffee bar, the honest approach of the mechanics towards the customers.

Question 4

How are the distinctive characteristics of a service operation illustrated by Xpresso Lube?

Question 5

Characterize Xpresso Lube in regard to nature of the service act, relationship with customers, customization and judgment, nature of demand and supply, and method of service delivery.

Question 6

What elements of Xpresso Lube's location contribute to its success?

Question 7

Given the example of Xpresso Lube, what other services could be combined to "add value" for the customer?

Question 8

What are the characteristics of services that will be most appropriate for Internet delivery?

Question 9

When does the collection of information from service membership become an invasion of privacy ?

Question 10

What are some of the management problems associated with allowing service employees to exercise judgment in meeting customer needs ?

Question 11

Illustrate the "distinctive characteristics of service operations" for a service with which you are familiar.

Question 12

What factors are important for a manager to consider when attempting to enhance a service organization's image ?

Question 13

Critique the "Distinctive Characteristics of Service Operations" by arguing that the characteristics of, customer participation, simultaneity, perishablity, intangibility, and heterogeneity, may apply to goods as well.

Question 14

Describe Village Volvo's service package.

Question 15

How are the distinctive characteristics of a service firm illustrated by Village Volvo ?

Question 16

Characterize Village Volvo in regard to the nature of the service act, the relationship with customers, customization and judgment, the nature of demand and supply, and the method of service delivery.