BA19802 – Services Science

and Service Operational

management
Unit 1 - Introduction
Unit 1- Introduction
• Service operations consists of working with professional service teams,
customer success teams, customer support teams and customer experience
teams.
• Like most operations roles, service operations aims to support and amplify a
team’s capacity in addition to helping them scale. This is a challenging role
because it requires balancing the needs of internal stakeholders and external
customers.
• Most companies might not have a dedicated service operations team to
accommodate the day-to-day need for service operations. Rather, there
might be specialists assigned to fulfilling service operations needs on the
company’s business operations or revenue operations team.
• One of the core components in service operations is the setup and
maintenance of infrastructure used by the service arm of an organization.
That means ensuring not just that the proper tools are in place to maximize
the team’s efficiency, but also that the tech stack is easy for their customers
to realize value from.
Unit 1- Introduction
 Unit 1- Introduction
Market Size of Service Sectors in India: From Financial Year 2016 to 2023, the Gross Value Added of service sectors in India grew
to US$ 1,064.8 billion from US$ 1,005 billion, at the Compound Annual Growth Rate of 1.45%. In Financial Year 2020, the total
market of export from service sector is US$ 214.14 billion and import is US$ 131.41 billion.
Indian Government is also taking aggressive steps to boost India’s commercial services exports share in the global services market,
and to make India 5 Trillion- Dollar economy in the next five years.
Some Major Steps Taken by the Indian Government to Promote Growth in Service Sector are:
✔ To facilitate broadband across all villages of the country by 2022, the Indian Government has launched the National Broadband
Mission.
✔ The Central Government increased incentive by 2% under services exports from India.
✔ To ensure easy trade in the service sector, the Government of India is removing many trade barriers.
Top Service Sector Companies in India:
✔ Reliance Industries
✔ HDFC Bank
✔ ICICI Bank
✔ Tata Consultancy Services
✔ Larsen & Toubro
✔ State Bank of India
✔ NTPC
✔ Kotak Mahindra Bank
✔ Axis Bank
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Role of Service Sector for the Growth of Indian Economy:

✔ Service sector gives significant contribution in the GDP of the country. It not only provides the large number of
employments but also trade in services improves economic performance significantly in the country. Below
mentioned points explain the main role of the service sectors in the development of Indian economy.
✔ Service Sector Enhances the GDP of the Country: Service sector plays a crucial role to enhance the GDP of the
country. In 1990, the GDP of the country was 5.7%. After the economic liberalization in 1991, the country
witnessed a GDP growth of 8.6% during the period 2004-05 to 2009-10.
✔ Creates Employment Opportunities: Service sector creates employment opportunities for the people of the
country. India has witnessed a structural change in terms of employment during the period 1983 to2004-05.
Before 1983, Agriculture and construction sectors were major job creators in the country. But after 1991, several
sub-sectors like trade, hotels, restaurants, and transport, etc. created a lot of employment opportunities. Now
within the service sector, employment opportunity is highest in finance, insurance, and business services,
followed by trade, hotels and restaurants, and transport, etc.
✔ Contribution to India's Service Trade: Service sector plays a crucial role to raise the volume of exports in the
country. According to the Balance of Payment data, India’s service trade has witnessed the growth of 22.2% and
25.3% during 2004-05 and 2008-09 respectively.
✔ Contribution Toward Human Development: Service sector encourages some valuable services like health
services, educational facilities, IT, and IT-enabled services (ITEs), skill development, health tourism, sports,
cultural services, etc. which is a valuable contribution toward human development and improvement of quality of
life of the people which directly helps in the growth of Indian economy.
 Unit 1- Introduction
What is the Service Sector in India?
The service sector is also known as the tertiary sector. It is one of the three sectors of the economy, the other two
being the primary sector (which includes agriculture, forestry, mining, and fishing) and the secondary sector (which
involves manufacturing and construction).
What are the Examples of the Service Sector?
✔ Retail and Wholesale Trade: This includes selling products to consumers (retail) and distributing products to
retailers (wholesale).
✔ Hospitality and Tourism: Services related to hotels, restaurants, travel agencies, and tourism destinations.
✔ Finance and Banking: Services provided by banks, insurance companies, investment firms, and other financial
institutions.
✔ Healthcare: Medical services, hospitals, clinics, and healthcare professionals.
✔ Education: Educational institutions, teachers, and educational support services.
✔ Information Technology and Software: Software development, IT consulting, and tech support.
✔ Entertainment and Media: Film, television, music, publishing, and digital media.
✔ Professional Services: Legal, accounting, consulting, and other professional services.
✔ Transportation and Logistics: Services related to the movement of goods and people, such as shipping,
logistics, and transportation companies.
✔ Government Services: Public administration, law enforcement, and regulatory agencies.
 Unit 1- Introduction
What is the Service Sector in India?
The service sector in India encompasses a wide range of economic activities
that provide intangible services rather than physical goods.
The service sector in India includes:
✔ Information Technology (IT) and Software Services
✔ Business Process Outsourcing (BPO)
✔ Financial Services
✔ Healthcare and Medical Tourism
✔ Education and Training
✔ Telecommunications and Internet Services
✔ Tourism and Hospitality
✔ Entertainment and Media
✔ Legal and Professional Services
✔ Retail and E-commerce
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What is the Role of the Service Sector in India?
The service sector plays a crucial role in India’s economy.
Here are some key roles and contributions of the Service sector in India:
✔ Economic Growth: The service sector accounts for most of the country’s economic output. The services sector contributes over
50 percent to India’s GDP.
✔ Employment Generation: The service sector is a major source of employment in India. It provides jobs to 30.7% of the Indian
population.
✔ Foreign Exchange Earnings: Services like information technology (IT), business process outsourcing (BPO), and medical
tourism have generated substantial foreign exchange earnings for India.
✔ Global Outsourcing Hub: India is a global outsourcing hub, particularly for IT, BPO, and knowledge-based services.
✔ Knowledge-Based Economy: The country produces many highly skilled professionals, including software engineers, doctors,
engineers, and business analysts.
✔ E-commerce and Retail Growth: The retail and e-commerce subsectors have experienced significant growth in recent years,
driven by increasing consumer spending and digital transformation.
✔ Tourism and Cultural Exchange: The tourism and hospitality sector contributes to cultural exchange and the growth of the
country’s reputation as a global tourist destination.

What is the Current Rate of the Service Sector in India Currently?

The services sector accounts for 54 percent of India’s Gross Value Added (GVA). The services sector made a remarkable recovery
in the fiscal year 2022-23, posting a Year-on-Year (YoY) growth rate of 8.4%. This is a significant improvement compared to the
7.8% contraction witnessed in the preceding financial year, as emphasized in the Economic Survey 2022-23 presented by the Union
Minister for Finance & Corporate Affairs, Smt Nirmala Sitharaman in Parliament today.
 Unit 1- Introduction
What are the Challenges Faced by the Service Sector in India?
The service sector in India, while a key driver of economic growth and employment,
faces several challenges.
✔ Regulatory Complexity: Complex and frequently changing regulations can create
hurdles for businesses in the service sector.
✔ Infrastructure Constraints: Inadequate infrastructure, such as transportation and
logistics, can hinder the efficient delivery of services.
✔ Skilled Labor Shortages: While India produces a large number of graduates and
skilled professionals, there can be a disconnect between the skills possessed by the
workforce and the demands of certain service sectors.
✔ Technology Adoption: While India has made significant progress in the IT and
software services sector, many other service industries lag behind in adopting
technology for efficiency and competitiveness. Digital transformation is essential
in today’s global service environment.
✔ Data Privacy and Security: In the digital age, concerns about data privacy and
security have become more pronounced. Service providers must navigate complex
data protection laws and ensure the safe handling of customer data.
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Nature of services:
✔ Intangibility
✔ Inseparability
✔ Variability
✔ Perishability
✔ Heterogeneity
✔ Customer Involvement
✔ Service Environment
 Unit 1- Introduction
Service Encounter:
Service encounter is generally defined as a consumer's direct contact
with a service provider, including both face-to-face interaction and
experience, service encounter as “any discrete interaction between the
customer and the service provider relevant to a core service offering”.
Types:
✔ Remote Encounter: Encounter can occur without any direct human
contact is called as
✔ Phone Encounters:- In many organizations, the most frequent type of
encounter.
✔ Face-to-Face Encounters: A third type of encounter is the one that
occurs between two persons.
Unit 1- Introduction
Unit 1- Introduction – Service Package
Unit 1- Introduction
A service package is a bundle of services that are sold together as a unit by a
company. Customization service involves adding one-time effects to a product
at the customer's request. Customer contact service is about contacting others
in behalf of a client.

Service managers have difficulty describing their product. This problem is

partly a result of the intangible nature of services, but it is the presence of the
customer in the process that creates a concern for the total service experience.
Consider the following examples. For a sit-down restaurant, atmosphere is
just as important as the meal because many diners regard the occasion as a
way to get together with friends. A customer’s opinion of a bank can be
formed quickly on the basis of a teller’s cheerfulness or the length of the
waiting line. The service package is defined as a bundle of goods and services
with information that is provided in some environment.
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Features of the bundle:
✔ Supporting facility: The physical resources that must be in place before a service
can be offered. Examples are a golf course, a ski lift, a hospital, and an airplane.
✔ Facilitating goods: The material purchased or consumed by the buyer, or the items
provided by the customer. Examples are golf clubs, skis, food items, replacement
auto parts, legal documents, and medical supplies.
✔ Information: Data that is available from the customer or provider to enable
efficient and customized service. Examples include electronic patient medical
records, airline Web site showing seats available on a flight, customer preferences
from prior visits, GPS location of customer to dispatch a taxi, and Google map link
on a hotel Web site.
✔ Explicit services: The benefits that are readily observable by the senses and that
consist of the essential or intrinsic features of the service. Examples are the
absence of pain after a tooth is repaired, a smooth-running automobile after a tune
up, and the response time of a fire department.
✔ Implicit services: Psychological benefits that the customer may sense only
vaguely, or the extrinsic features of the service. Examples are the status of a degree
from an Ivy League school, the privacy of a loan office, and worry-free auto repair
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Unit 1- Introduction
Unit 1- Introduction
Service Dominant Logic:
 Unit 1- Introduction
Service Dominant Logic emphasizes on the following:
✔ Value co-creation: Value is not created solely by the producer and consumed by
the customer. Instead, it is co-created through interactions between the provider
and the customer. Both parties contribute to the value creation process.
✔ Service as the fundamental basis of exchange: Services are viewed as the
primary unit of exchange, whether they are delivered through tangible goods,
intangible services, or a combination of both.
✔ Customer-centric perspective: SDL places a strong emphasis on understanding
and meeting the needs, preferences, and experiences of customers. Businesses
should focus on building long-term relationships and delivering personalized
solutions to customers.
✔ Networks and relationships: Value creation often occurs within networks of
interconnected actors, including customers, suppliers, partners, and other
stakeholders. Businesses should collaborate and engage with these networks to
enhance value creation.
✔ Continuous innovation: SDL encourages businesses to continuously innovate and
adapt to changing customer needs and market dynamics. This involves not only
innovating products and services but also innovating in the way value is delivered
and experienced by customers.
Unit 1- Introduction
Goods Dominant Logic:
Goods dominant logic (GDL) represents the traditional perspective in
marketing, which focuses primarily on tangible goods as the central unit
of exchange. In contrast to service dominant logic (SDL), which
emphasizes the importance of services and relationships in value
creation, goods dominant logic places greater emphasis on the physical
products themselves.
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 Unit 1- Introduction
Key principles of goods dominant logic include:
✔ Product-centric view: GDL revolves around the production and exchange of
tangible goods. It assumes that customers primarily seek out and purchase physical
products to satisfy their needs and desires.
✔ Value in the product: In GDL, value is often seen as inherent in the product itself.
The emphasis is on the features, quality, and functionality of the goods being
offered, rather than on the services or experiences surrounding them.
✔ Transaction-focused: Exchange is typically viewed as a one-time transaction
between the producer and the consumer, with the primary goal being the sale of the
product.
✔ Marketing mix emphasis: Traditional marketing strategies under GDL often
revolve around the four Ps: Product, Price, Place, and Promotion. These elements
are designed to create awareness of the product, stimulate demand, and facilitate its
distribution and sale.
✔ Limited customer involvement: While customer needs and preferences are
considered in the design and marketing of products, the focus is primarily on
delivering a finished good that meets those needs, rather than actively involving
customers in the value creation process.
Unit 1- Introduction