MODUL II - SERVICE STRATEGY AND COMPETITIVENESS

STRATEGIC SERVICE VISION :-

Target market segment Service concept Operating strategy Service Delivery System

3 COMPETITIVE ENVIRONMENT OF SERVICES :-

Relatively Low Overall Entry Barriers Economies of Scale Limited High
Transportation Costs Erratic Sales Fluctuations No Power Dealing with Buyers or
Suppliers Product Substitutions for Service High Customer Loyalty Exit Barriers

4 COMPETITIVE SERVICE STRATEGIES (Overall Cost Leadership) :-

Seeking Out Low-cost Customers Standardizing a Custom Service Reducing the
Personal Element in Service Delivery (promote self-service)Reducing Network Costs
(hub and spoke)Taking Service Operations Off-line

5 COMPETITIVE SERVICE STRATEGIES (Differentiation) :-

Making the Intangible Tangible (memorable)Customizing the Standard Product
Reducing Perceived Risk Giving Attention to Personnel Training Controlling Quality
Note: Differentiation in service means being unique in brand image, technology use,
features, or reputation for customer service.

6 COMPETITIVE SERVICE STRATEGIES (Focus) :-

Buyer Group: (e.g. USAA insurance and military officers)Service Offered: (e.g.
Should ice Hospital and hernia patients)Geographic Region: (e.g. Austin Cable Vision
and TV watchers)

7 CUSTOMER CRITERIA FOR SELECTING A SERVICE PROVIDER:-

 Availability (24 hour ATM)

 Convenience (Site location)
 Dependability (On-time performance)
 Personalization (Know customer’s name)
 Price (Quality surrogate)
 Quality (Perceptions important)
 Reputation (Word-of-mouth)
 Safety (Customer well-being)
 Speed (Avoid excessive waiting)

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8 SERVICE PURCHASE DECISION :-
Service Qualifier: To be taken seriously a certain level must be attained on the
competitive dimension, as defined by other market players. Examples are cleanliness
for a fast food restaurant or safe aircraft for an airline. Service Winner: The
competitive dimension used to make the final choice among competitors. Example is
price.

9 SERVICE PURCHASE DECISION (CONT.):-

Service Loser: Failure to deliver at or above the expected level for a competitive
dimension. Examples are failure to repair auto (dependability), rude treatment
(personalization) or late delivery of package (speed).

10 STAGES IN SERVICE FIRM COMPETITIVENESS :-

12 Case Analysis: American West Airline

Questions: What generic competitive strategy did America West choose when it
entered the air passenger market? What are the dangers of this strategy?

13 Case Analysis: American West Airline

Questions:2. Identify the service winners, qualifiers, and service losers in America
West's market.

14 Case Analysis: American West Airline

Questions:3. How has America West addressed the ”Strategic Service Vision”?Target
Market Service Concept Operating Strategy Service Delivery

15 Case Analyses: American West Airline

4. Prepare a market position map for America West comparing it with American,
Delta and Southwest using the differentiation attributes of "cabin service" and
"preflight service."

VISION STATEMENT:-
It should also be realistic, achievable, and measurable, and reflect your competitive
advantage and differentiation. A vision statement can help you create a strategic
vision that motivates and guides your team and stakeholders.

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DEVELOPMENT OF STRATEGIC SERVICE VISION:-
It guides your service strategy, culture, and standards, and helps you align your
employees, processes, and resources with your service goals. Developing a service
vision can be a challenging but rewarding process that requires careful planning,
research, and communication.
Data envelopment analysis (DEA) is a nonparametric method in operations
research and economics for the estimation of production frontiers. DEA has been
applied in a large range of fields including international banking, economic
sustainability, police department operations, and logistical applications Additionally,
DEA has been used to assess the performance of natural language processing models,
and it has found other applications within machine learning.

Description
DEA is used to empirically measure productive efficiency of decision-making units
(DMUs). Although DEA has a strong link to production theory in economics, the
method is also used for benchmarking in operations management, whereby a set of
measures is selected to benchmark the performance of manufacturing and service
operations. In benchmarking, the efficient DMUs, as defined by DEA, may not
necessarily form a “production frontier”, but rather lead to a “best-practice frontier.”
In contrast to parametric methods that require the ex-ante specification of a
production- or cost-function, non-parametric approaches compare feasible input and
output combinations based on the available data only. DEA, one of the most
commonly used non-parametric methods, owes its name to its enveloping property of
the dataset's efficient DMUs, where the empirically observed, most efficient DMUs
constitute the production frontier against which all DMUs are compared. DEA's
popularity stems from its relative lack of assumptions, the ability to benchmark multi-
dimensional inputs and outputs as well as its computational ease owing to it being
expressable as a linear program, despite its task to calculate efficiency ratios.

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NEW SERVICE DEVELOPMENT CYCLE :-
The new service development process is described in four phases: the idea phase, the
project formation phase, the design phase and the implementation phase.

What is the process of new service development?

Three stages of the NSD process were identified: identification of market needs,
development of new services, and market introduction. Kindström and Kowalkowski
(2009) divided the NSD process into four stages: market sensing, development, sales,
and delivery.
The new service development process is described in four phases: the idea phase, the
project formation phase, the design phase and the implementation phase. The service
is produced in a customer process where customer, company and subcontractors are
actors.
The small business environment today is very dynamic and competitive, and new
product development is a crucial process if you want to survive. For small enterprises
to withstand competition from multinationals, they have to continuously update their
products to conform to current trends. The new product development process is the
cycle that a new product has to undergo from conceptualization to the final
introduction into the market.
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Tip
Five phases guide the new product development process for small businesses: idea
generation, screening, concept development, product development and, finally,
commercialization.

Phase One: IDEA GENERATION

This is the initial stage where a business sources for ideas regarding a new product.
Some of the sources for new product ideas include the business customers,
competitors, newspapers, journals, employees and suppliers. Small businesses may
be limited when it comes to technical research-based idea generation techniques.
This stage is crucial as it lays the foundation for all the other phases, the ideas
generated shall guide the overall process of product development.

Phase Two: SCREENING

The generated ideas have to go through a screening process to filter out the viable
ones. The business seeks opinions from workers, customers and other businesses to
avoid the pursuit of costly unfeasible ideas. External industry factors affecting small
businesses, such as competition, legislation and changes in technology, influences
the enterprise's decision criteria. At the end of the screening process, the firm
remains with only a few feasible ideas from the large pool generated.

Phase Three: CONCEPT DEVELOPMENT

The enterprise undertakes research to find out the potential costs, revenues and
profits arising from the product. The business conducts a SWOT analysis to identify
the strengths, weakness opportunities and threats existing in the market. The market
strategy is set out to identify the product's target group, which facilitates
segmentation of the product’s market. Market segmentation is important as it enables
the firm to identify its niche. The identified niche influences most of the marketing
decisions.

Phase Four: PRODUCT DEVELOPMENT

Product development entails the actual design and manufacture of the product.
Development commences with the manufacture of a prototype that facilitates market
testing. Based upon the results of the tests, the business owner decides on whether to
undertake large-scale production or not.

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Phase Five: COMMERCIALIZATION AND ROLLOUT

Favorable results in the development stage precede large-scale production and

commercialization. Here, the business launches its promotion campaign for the new
product. The market research conducted during the conception stage influences the
timing and location of the product launch.

SERVICE BLUEPRINTS:-
Definition
Summary: Service blueprints visualize organizational processes in order to optimize
how a business delivers a user experience.

What Is a Service Blueprint?

Definition:-
A service blueprint is a diagram that visualizes the relationships between different
service components — people, props (physical or digital evidence), and processes —
that are directly tied to touch points in a specific customer journey.

Think of service blueprints as a part two to customer journey maps. Similar to

customer-journey maps, blueprints are instrumental in complex scenarios spanning
many service-related offerings. Blueprinting is an ideal approach to experiences that
are omnichannel, involve multiple touchpoints, or require a crossfunctional effort (that
is, coordination of multiple departments).

A service blueprint corresponds to a specific customer journey and the specific user
goals associated to that journey. This journey can vary in scope. Thus, for the same
service, you may have multiple blueprints if there are several different scenarios that it
can accommodate. For example, with a restaurant business, you may have separate
service blueprints for the tasks of ordering food for takeout versus dining in the
restaurant.

Service blueprints should always align to a business goal: reducing redundancies,

improving the employee experience, or converging siloed processes.

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BENEFITS OF SERVICE BLUEPRINTING :-

Service blueprints give an organization a comprehensive understanding of its service

and the underlying resources and processes — seen and unseen to the user — that
make it possible. Focusing on this larger understanding (alongside more typical
usability aspects and individual touch point design) provides strategic benefits for the
business.

Blueprints are treasure maps that help businesses discover weaknesses. Poor user
experiences are often due to an internal organizational shortcoming — a weak link in
the ecosystem. While we can quickly understand what may be wrong in a user
interface (bad design or a broken button), determining the root cause of a systemic
issue (such as corrupted data or long wait times) is much more difficult. Blueprinting
exposes the big picture and offers a map of dependencies, thus allowing a business to
discover a weak leak at its roots.

In this same way, blueprints help identify opportunities for optimization. The
visualization of relationships in blueprints uncovers potential improvements and ways
to eliminate redundancy. For example, information gathered early on in the
customer’s journey could possibly be repurposed later on backstage. This approach
has three positive effects: (1) customers are delighted when they are recognized the
second time — the service feels personal and they save time and effort; (2) employee
time and effort are not wasted regathering information; (3) no risk of inconsistent data
when the same question isn’t asked twice.

Blueprinting is most useful when coordinating complex services because it bridges

cross department efforts. Often, a department’s success is measured by the
touchpoint it owns. However, users encounter many touchpoints throughout one
journey and don’t know (or care) which department owns which touchpoint. While a
department could meet its goal, the big-picture, organization-level objectives may not
be reached. Blueprinting forces businesses to capture what occurs internally
throughout the totality of the customer journey — giving them insight to overlaps and
dependencies that departments alone could not see.

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An example blueprint for an appliance retailer

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KEY ELEMENTS OF A SERVICE BLUEPRINT :-

Service blueprints take different visual forms, some more graphic than others.
Regardless of visual form and scope, every service blueprint comprises some key
elements:

 Customer actions

Steps, choices, activities, and interactions that customers perform while

interacting with a service to reach a particular goal. Customer actions are derived
from research or a customer-journey map.

In our blueprint for an appliance retailer, customer actions include visiting the
website, visiting the store and browsing for appliances, discussing options and
features with a sales assistant, appliance purchase, getting a delivery-date
notification, and finally receiving the appliance.

 Front stage actions

Actions that occur directly in view of the customer. These actions can be human-
to-human or human-to-computer actions. Human-to-human actions are the steps
and activities that the contact employee (the person who interacts with the
customer) performs. Human-to-computer actions are carried out when the
customer interacts with self-service technology (for example, a mobile app or an
ATM).

In our appliance company example, the frontstage actions are directly linked to
customer’s actions: the store worker meets and greets customers, a chat
assistant on the website informs them which units have which features, a trader
partner contacts customers to schedule delivery.

Note that there is not always a parallel front stage action for every customer
touchpoint. A customer can interact directly with a service without encountering
a frontstage actor, like it’s the case with the appliance delivery in our example
blueprint. Each time a customer interacts with a service (through an employee
or via technology), a moment of truth occurs. During these moments of truth,
customers judge your quality and make decisions regarding future purchases.

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  Backstage actions

Steps and activities that occur behind the scenes to support onstage happenings.
These actions could be performed by a backstage employee (e.g., a cook in the
kitchen) or by a frontstage employee who does something not visible to the
customer (e.g., a waiter entering an order into the kitchen display system).

In our appliance-company example, numerous backstage actions occur: A

warehouse employee inputs and updates inventory numbers into the point-of-
sale software; a shipping employee checks the unit’s condition and quality; a
chat assistant contacts the factory to confirm lead times; employees maintain
and update the company’s website with the newest units; the marketing team
creates advertising material.

 Processes

Internal steps, and interactions that support the employees in delivering the
[Link] element includes anything that must occur for all of the above to
take place. Processes for the appliance company include credit-card
verification, pricing, delivery of units to the store from the factory, writing
quality tests, and so on.

In a service blueprint, key elements are organized into clusters with lines that separate
them. There are three primary lines:

1. The line of interaction depicts the direct interactions between the customer and
the organization.
2. The line of visibility separates all service activities that are visible to the
customer from those that are not visible. Everything frontstage (visible) appears
above this line, while everything backstage (not visible) appears below this line.
3. The line of internal interaction separates contact employees from those who
do not directly support interactions with customers/users.

CONCLUSION :-

Service blueprints are companions to customer-journey maps: they help organizations

see the big picture of how a service is implemented by the company and used by the
customers. They pinpoint dependencies between employee-facing and customer-
facing processes in the same visualization and are instrumental in identifying pain
points, optimizing complex interactions, and ultimately saving money for the
organization and improving the experience for its customers.
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What are the elements of service delivery?
The five elements required to deliver a service are the customers, the contact
personnel, the physical support, the service and the internal system or back office of
the organization.
What are the 4 elements of service?
Its production may or may not be tied to a physical product”. There are four
characteristics of service: Intangibility, Inseparability, Variability, and
Perishability (Kotler and Keller, 2007). As service's nature is intangibility, therefore
manufacturing and service delivery is more complex than a product.
What are the 4 components of service delivery?
 Service culture. Service culture relates to the leadership principles, vision,
mission, work habits and values of a service provider company. ...
 Employee engagement. ...
 Service quality. ...
 Customer service.
What are the phases of service delivery system?
The process of the service delivery is divided into two phases: Initiation phase:
establishing the requirements for the second part. Execution and Verification phase:
executing the data transfer, verifying, and confirming results.
What are service elements examples?
Service Elements means those (cost) elements of the Service that form a Functional
Service Component including (for example) but not limited to servers, software,
management and monitoring.
SERVICE DESIGN:- Customer Journey and Service Design
The goal of customer-journey maps is to better understand the end users' journey. This
journey includes their thoughts and emotions. In contrast, service blueprints reflect the
organization's perspective and thus include frontstage actions, backstage actions, and
support processes.

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What is the difference between customer journey and service design?
The primary focus of a customer-journey map is to learn more about the end user,
while the focus of a service blueprint is to document how the organization creates that
experience.
What are the 5 stages of customer service journey?
Customer journeys map out various buyer interactions in order to track how and why
prospects become paying customers. The customer journey consists of 5 broad stages:
1. Awareness,
2. Consideration,
3. Decision,
4. Retention,
5. Advocacy.
What is customer journey design?
Creating a customer journey map is the process of forming a visual representation of
customers' processes, needs, and perceptions throughout their interactions and
relationship with an organization. It helps you understand the steps customers take –
the ones you see, and don't – when they interact with your business.
What are the 7 phases of customer journey?
Broken down, the customer journey consists of 7 phases;-
1. Out Of Market
2. Trigger
3. Initial Brand Consideration
4. Active Evaluation
5. Purchase Decision
6. Experience
7. Loyalty

SUMMARY:

 Companies that put the customer at the heart of their business are more profitable
than their competitors. The biggest growth factor? They focus on a customer
journey strategy.

 The customer journey follows the complete lifecycle from awareness to loyalty,
allowing you to match communication strategies with customer expectations at
each stage of the journey.

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 The process requires mapping the journey, their touchpoints and yours to identify
gaps in communication. Here, we provide you with the templates and framework to
map the customer journey.

"The customer is king!"

What is a customer journey?

A customer journey is the complete experience a customer has with an organization.

It encompasses all customer interactions across all channels, devices and touchpoints
throughout every stage of the customer lifecycle – from awareness to loyalty.

Companies use a wide range of channels to communicate with their customers, but
often fail to connect each activity with the customer journey. Sales and marketing
strategies become isolated from one another, which leads to a disconnected customer
experience.

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But, isn’t the customer journey the same thing as customer experience?

Well, not quite.

The difference between the customer journey and customer experience is this:

 The customer journey is what they do at each stage of the customer lifecycle
 The customer experience is how they feel about the entire customer lifecycle

Searching for a new pair of trainers in Google, making a purchase online and then
wearing them the next day is part of the customer journey. Finding the website easy to
use, being surprised with overnight shipping and feeling appreciated with a hand-
written thank you note from the brand, is an example of customer experience.

And that's the kind of experience that customer's are willing to pay more for.
86% of customer's are willing to spend more on products for a great customer
experience.

So, how do you make sure that the customer's experience with your company is a
positive experience?

You start by mapping the customer journey.

Mapping the customer journey is the number one strategy that high performing CX
execs use to improve the customer experience. If you want to be a high performer,
then follow the steps below.

Mapping Out Customer Journey Can Be Split Into 3 Distinct Stages:

1. Drawing out the customer journey lifecycle

2. Identifying company and customer touchpoints
3. Analyzing gaps between existing strategies and expectations

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It’s important to note that the customer journey cannot be drawn out from your own
perspective – it has to be drawn out from your customers’ point of view.

This means that you put yourself in their shoes and think like a customer.

To do this, you need to speak with your customers and collect what is known as voice
of customer feedback.

Not sure what to ask your customers?

Here's some sample questions that we've used during our own customer journey
process:

 What happened inside your company that caused you to search for a new product?
 What is your research process for finding a new product?
 How did you find [your company name]?
 How important is a free trial during your buying process?
 Specifically, what made you choose [your company] versus [a competitor]?

Hearing the steps your customers took to make a purchase with you is incredibly
valuable.

Yet surprisingly, only 1 in 5 businesses collect this kind of feedback to improve the
customer journey.

If you're not optimizing the journey based on what your customers do, then it's
nothing more than guesswork.

Here's a great example of when guesswork (as in most cases) goes wrong.

In 2015, SuperOffice launched a free trial offering.

For more than 3 years, our main call to action on the website was to promote a free
trial.

But when our Chief Marketing Officer, Jennifer Lim Lund, interviewed our customers
in August 2018, we found out that a free trial is not part of the buying process for our
ideal target customer. Instead, they prefer to sign up for a live demonstration. And our
demo form was difficult to find.

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In other words, we were making it difficult for our ideal target customers to buy
from us.

Since then, we've replaced our main call to action from a free trial sign up to a
demo request and by doing so, we've seen the number of requests from our target
audience increase by more than double.
Optimizing the customer journey based on direct feedback resulted in 174%
more sign ups from our ideal target customer.

Now, imagine being able to scale these results across every phase of the journey?

This simple interview process helped us understand our customers needs better.

Once you understand the needs of your customer in all phases on their lifecycle – you
can then meet and exceed their expectations at every phase of the customer journey.

But before we go into the discussion of phases, let’s take a look at what the benefits of
mapping out the customer journey are for your business.

THE BUSINESS BENEFITS OF THE CUSTOMER JOURNEY:-

Imagine being able to predict the next step of your target customer…

...that’s the “super” power of the customer journey!

In fact, this is the exact reason why 69% of businesses list the customer journey as
a top investment priority this year.

Marketers have gone one step further, stating that the customer journey is a top
priority for the next two years!

Yet, for companies that have a formal customer journey strategy, the evidence is
compelling.
An Aberdeen Group research paper found that companies with a formal customer
journey program experience year over year growth that includes:

 18X faster average sales cycles,

 56% more cross-sell and up-sell revenue,
 10X improvement in customer service costs,
 5X greater revenue from customer referrals,
 54% greater return of marketing investment (ROMI).

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The business benefits of optimizing the customer journey are clear.

But, there’s more good news.

The same study by Aberdeen Group found that only 36% of companies have a
process to map out the customer journey, making this a huge opportunity to create
a competitive advantage for your business.

But what are the customer journey phases?

The 7 phases of the customer journey

The customer journey is linked to each instance that the customer comes into direct
contact with your company or product:

 Before a purchase - customer's will come into direct contact with online
advertising, social media, email marketing
 During a purchase - customer's will come into direct contact with sales
teams, consultants and your company website
 After a purchase - customer's will come into direct contact with training
material, follow-up enquiries and future customer marketing communication

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Broken down, the customer journey consists of 7 phases; Out of market, trigger,
initial brand consideration, active evaluation, purchase decision, experience and
loyalty.
Let’s take a look at each phase (and the customer’s mindset) in more detail – starting
with the out-of-market phase. In this example, we’ll be viewing the customer journey
from the perspective of a B2B buyer.

1. Out-of-market phase
In the out-of-market phase, the customer is looking to improve their business. They
want their company, department or team to be more productive and more efficient. At
this phase, they may not know how to achieve these goals, but they are open to
inspiration.

2. Trigger phase
The trigger phase begins once the customer uncovers the opportunity to grow their
business. It could be that sales are going down or that customer complaints are
growing, but these indicators act as a trigger to changing the way they work.

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3. Initial brand consideration phase
Once the customer identifies a solution to their problem, they will begin their initial
search. A project group, involving all stakeholders will be formed to identify the top
brands in their market, to scope the project and to review key functionality and
technical requirements – leading to a “long list” of potential solutions.

4. Active evaluation
The long list becomes a short list once the initial brand review is complete. The
customer will then contact each vendor and invites them to a meeting or demo. After
the demo, the customer will review solutions based on trust, expertise and scalability.

5. Purchase decision phase

The customer chooses a vendor, agrees on a solution and signs the contract. The
implementation process begins and an internal “roll out” team is formed. With support
from the solution provider, the customer outlines success criteria, KPIs and launch
timeline.

6. Experience phase
The customer wants to get the solution up and running quickly and for the launch to
be as smooth as possible. This involves making sure all users are fully trained and
have access to a consultant or account manager for support (when they need it).

7. Loyalty phase
After the initial roll out, the customer is happy to see fast results. The provider
continues to follow up, implements the solution company-wide and and continues to
help the customer reach their goals.

Mapping The Customer Touch Points :-

If the journey is the mindset of a customer...

...then the touchpoints are the path he/she takes to engage with a company at each
phase.
Mapping the touchpoints, and putting the right content assets and distribution
channels to each phase of the journey is one of the most important factors of future
digital initiatives, according to a survey by Regalix.

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In the example below, we’ll explore the touchpoints based on a journey for a B2B
customer.

 Out-of-market: Open to inspiration, the customer attends industry conferences,

reads thought leadership content and stays updated on new trends via social
media.

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 Trigger: Being proactive, the customer uses Google search, video platforms (i.e.
YouTube) and reads more niche blogs.

 Initial brand consideration: With a long list of providers, the customer visits
company websites, comparison sites and review platforms.

 Active evaluation: Trust is important, so the customer downloads research

papers from the vendor, reads in-depth case studies and customer references.
Before requesting a live demo.

 Purchase decision: Dealing directly with the sales team, the customer signs the
paperwork.

 Experience: The implementation phase begins, and the customer is given access to
onboarding material, which includes user guides, training
documents and product videos.

 Loyalty: The solution is rolled out company wide and when needed, the customer
has access to phone and email customer service teams, live chat on the
website, self-service support and a knowledge base.

It’s, of course, a simplified version of the customer journey and its key touchpoints.
But it shows how important it is for a company to be actively present where its
potential and existing customers are.

 Do you actively speak at industry conferences?

 Is your business listed on vendor comparison websites?

 Is your website visible in Google search?

If you answered ‘No’ to any of the questions above, then chances are that your
potential customers simply won’t find you.

Said another way…

If you don’t base your strategy on the customer journey, then you will lose out on
new business.

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Aligning your strategy with the customer journey:-

Now that you have drawn out the customer journey and touchpoints from your
customers’ perspective, you can now map out the touchpoints you use to try to reach
your customers today, based on your existing business strategies – allowing you to
identify the gaps.

A simple table can work for the gap analysis exercise.

For example, today we use direct mail to reach out-of-market buyers and use social
media as a way to engage with prospects in trigger phase.

Once you have mapped out existing touchpoints, you can then layer them on top of
your customer’s touchpoints, providing you with an overview of what you’re
currently doing today versus what you should be doing to reach your customers.

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Now, if you’re a customer-centric company, you should get an exact match with your
strategies lining up exactly with the customer journey. Sales and marketing teams are
aligned, customer churn is low and your customer base is happy and loyal.

However, if you’re not customer-centric, there will be a mismatch in activity and

expectations.

Once you have completed this exercise, what’s likely to happen is that you will notice
two key points:

1. You are spending too much time on activities that don’t impact the customer
journey.
2. You are spending too little time on activities that do impact the customer
journey.

Based on this, you need to prioritize what you do based on what's more important -
activities that align with journey versus activities that don't align with the journey...

Now, here comes the easy part:

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Scrap all the activities you are currently doing that have no impact on the
customer journey and double down on activities that do – because the more often
you can meet the customer at each stage of the journey, the more likely they are to do
business with you.

CONCLUSION:-

The power has completely shifted from brand to consumer.

And while the customer journey might be a new term, it won’t be long before it
becomes critical to your business strategy.

Putting the customer at the heart of your organization is no longer a “nice to have”,
it’s an entry level requirement to having a successful business in 2021.

Today, two out of three companies do not map their strategies to the customer
journey – giving you a huge competitive advantage, if you take it.

For those companies that have a customer journey strategy in place, they’ve been able
to reduce costs, improve sales performance and are overall, much more profitable.

Design Thinking Methods To Aid Service Design :-

For organizations in the service industry, service design thinking can be the difference
between success and failure. A properly designed service puts the consumer at the
centre of the design process; service design thinking means organizing resources and
planning business activities with the aim of improving the experiences of consumers,
as well as employees.

Developing an effective service design can be challenging, but these five core
principles, coined by Marc Stickdorn, can help.
User-centered
Design your services around your consumers’ needs. You need to know how
consumers experience the service. Ask them questions, like how they feel about using
the service and what their expectations are.

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The answers will tell you where you can improve, so pay attention. It’s all about what
the consumers want.
Co-creative
All stakeholders should be involved in the service design process. You can’t co-create
value without involving users at every step of the process, including the design,
production, and development steps.

When organizations collaborate with stakeholders everyone has the opportunity to

share their experiences and perspectives on a particular service. For example, if a
restaurant is developing a new app for customers, they should involve the
development team, the social team and customer representatives in order to know
what the customers usually ask for. This means all stakeholders will feel valued and it
will essentially create a better service for the organization.
Sequencing (iterative process)
Sequencing helps determine the timeline of a project. Service design thinking
deconstructs customer journeys into single touchpoints and service interactions. When
these are combined it creates service moments. Every customer journey follows a
three-step transition of pre-service period (getting in touch with a service), the actual
service period (when the service consumers experience a service), and the post-service
period. The customer service journey should be visualized as a sequence of
interrelated actions.
Evidencing (Visual communication)
It can be hard to focus in on the details of a large, complicated project. Visual aids can
help.

Prompt your team to use pictures, graphs, and images wherever they can. Visual tools
like these are less complicated and easier to digest; they allow the team to remember
important points, and they help bring ideas to life.

Visualizing the service in this way during development helps the team to improve the
design and ensures that customers will be satisfied at the end of the process.
Holistic
As a service designer, it is important to think about each aspect of the service and
every perspective in which it exists.

Holistic services consider the whole user journey and each consumer touchpoint. A
holistic approach can be achieved by using personas to highlight different user

25
 experiences and journeys, such as The ITIL Story in ITIL® Foundation: ITIL 4
Edition.
Service design thinking is an effective way of tackling problem solving. It encourages
users to define value and is a method that continuously gathers feedback on what is
and isn’t working. The ultimate objective of the service design thinking process is to
identify solutions on to the original challenge that are desirable, feasible, and viable.
These five principles will help you to design effective services, which will in turn help
to create a strong reputation for your organization and more value for users and
customers.
What are the methods of design thinking?

Design thinking is a non-linear, iterative process that teams use to understand users,
challenge assumptions, redefine problems and create innovative solutions to prototype
and test. Involving five phases—Empathize, Define, Ideate, Prototype and Test—it is
most useful to tackle problems that are ill-defined or unknown.

LOCATING FACILITIES AND DESIGNING THEIR LAYOUT :-

Some of the key factors that influence facility location are the following:
 Proximity to customers, suppliers, and skilled labor.
 Environmental regulations.
 Financial incentives offered by state and local development authorities.
 Quality-of-life considerations.
 Potential for future expansion.
Facility Location

Of all the pieces of the planning puzzle, facility location is the most strategic and
critical. Once you build a new manufacturing facility, you have made a substantial
investment of time, resources, and capital that can’t be changed for a long time.

26
Selecting the wrong location can be disastrous. Some of the key factors that influence
facility location are the following:

 Proximity to customers, suppliers, and skilled labor

 Environmental regulations
 Financial incentives offered by state and local development authorities
 Quality-of-life considerations
 Potential for future expansion

The next step, after planning the production process, is deciding on plant layout—how
equipment, machinery, and people will be arranged to make the production process as
efficient as possible.

Facility Layout

After the site location decision has been made, the next focus in production planning
is the facility’s layout. The goal is to determine the most efficient and effective design
for the particular production process. A manufacturer might opt for a U-shaped
production line, for example, rather than a long, straight one, to allow products and
workers to move more quickly from one area to another.

Service organizations must also consider layout, but they are more concerned with
how it affects customer behavior. It may be more convenient for a hospital to place its
freight elevators in the center of the building, for example, but doing so may block the
flow of patients, visitors, and medical personnel between floors and departments.

There are four main types of facility layouts: process, product, fixed-position, and
cellular.

The process layout arranges workflow around the production process. All workers
performing similar tasks are grouped together. Products pass from one workstation to
another (but not necessarily to every workstation). For example, all grinding would be
done in one area, all assembling in another, and all inspection in yet another. The
process layout is best for firms that produce small numbers of a wide variety of
products, typically using general-purpose machines that can be changed rapidly to
new operations for different product designs. For example, a manufacturer of custom
machinery would use a process layout.

27
models of facility locations (Huff's retail model)
The Huff Model is an established theory in spatial analysis. It is based on the principle
that the probability of a given consumer visiting and purchasing at a given site is a
function of the distance to that site, its attractiveness, and the distance and
attractiveness of competing sites.

HUFF MODEL :-
In spatial analysis, the Huff model is a widely used tool for predicting the probability
of a consumer visiting a site, as a function of the distance of the site, its attractiveness,
and the relative attractiveness of alternatives. It was formulated by David Huff in
1963.[1] It is used in marketing, economics, retail research and urban planning,[2] and is
implemented in several commercially available GIS systems.
Its relative ease of use and applicability to a wide range of problems contribute to its
enduring appeal.

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Role of service-scape in layout design.
For businesses that provide more intangible services, such as restaurants and salons, a
servicescape helps customers to create expectations and build an impression of that
service as soon as, or even before, they enter the physical environment in which the
service is taking place.

What is the role of service scape in layout design?

The servicescape performs four important roles - packaging - presents the outward
appearance to the public; facilitator - guides the efficient flow of activities; socialiser -
conveys expected roles to both employees and customers and differentiator - serves as
a point of difference by signalling which segments of the

SERVICE SCAPE
Servicescape is a model developed by Booms and Bitner[1] to emphasize the impact of
the physical environment in which a service process takes place. The aim of the
servicescapes model is to explain behavior of people within the service environment
with a view to designing environments that does not accomplish organisational goals
in terms of achieving desired behavioural responses. For consumers visiting a service
or retail store, the service environment is the first aspect of the service that is
perceived by the customer and it is at this stage that consumers are likely to form
impressions of the level of service they will receive.[2]
Booms and Bitner defined a servicescape as "the environment in which the service is
assembled and in which the seller and customer interact, combined with tangible
commodities that facilitate performance or communication of the service". [1] In other

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words, the servicescape refers to the non-human elements of the environment in which
service encounters occur. The servicescape does not include: processes (e.g. methods
of payment, billing, cooking, cleaning); external promotions (e.g. advertising, PR,
social media, web-sites) or back-of-house (kitchen, cellars, store-rooms,
housekeeping, staff change rooms), that is; spaces where customers do not normally
visit.
The servicescape includes the facility's exterior (landscape, exterior design, signage,
parking, surrounding environment) and interior (interior design and decor, equipment,
signage, layout) and ambient conditions (air quality, temperature and lighting). In
addition to its effects on customer's individual behaviors, the servicescape influences
the nature and quality of customer and employee interactions, most directly in
interpersonal services.[3] Companies design their servicescapes to add an atmosphere
that enhances the customer experience and that will affect buyers' behavior during the
service encounter.[4]

Service Quality: SERVQUAL,Walk through Audit, Dimensions of Service

quality & other quality tools.
The Servqual model is based on the idea that customer views of five key dimensions
—tangibles, reliability, responsiveness, assurance, and empathy map—are the best
predictors of service quality. Servqual uses a questionnaire with paired statements for
each category to figure out how good the service is.
What are the 5 dimensions of service quality SERVQUAL?
Servqual is a model used to measure service quality, which consists of five
dimensions:
1. Tangibles,
2. Reliability,
3. Responsiveness,
4. Assurance,
5. Empathy.

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 How can we use SERVQUAL to measure service quality?
Here are three ways you can use a SERVQUAL survey:
1. Measure a guest's specific customer service experience. ...
2. Identify strengths and weaknesses: Ask guests if anything about their recent visit
stood out to them.
3. Gauge customer loyalty: Ask guests how likely they are to recommend your
attraction?

What is walk-through audit in service quality?

Walk-Through Audit means an inspection of a facility to identify maintenance,
operational or deficient equipment issues and also to identify areas that need further
evaluation.

What is a walkthrough in audit?

A walk-through test is a procedure used during an audit of an entity's accounting

system to gauge its reliability. A walk-through test traces a transaction step-by-step
through the accounting system from its inception to the final disposition.

What are four stages of quality audit?

The key to an effective audit, whether internal or external, is good planning. The
essential steps involved are: planning, executing, reporting and follow up/closure.

What is the main purpose of a walk-through?

In general, a walkthrough has one or two broad objectives: to gain feedback about the
technical quality or content of the document; and/or to familiarize the audience with
the content. A walkthrough is normally organized and directed by the author of the
technical document.

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Five dimensions of service quality

Every industry has different service quality standards. After all, you don’t expect the
same type of service from a hotel and a retail store. And service quality also varies by
brand promise, as a five-star resort has very different expectations than a roadside
motel.

Despite these variations, there is a popular and standard way to measure service
quality: SERVQUAL. Coined by Valerie Zeithaml, A. Parasuraman, and Leonard
Berry in the book Delivering Quality Service, SERVQUAL is a widely-used metric
based on a set of five dimensions that customers have consistently ranked as the most
important for service quality in any industry.

The five service quality dimensions are tangibility, reliability, responsiveness,

assurance, and empathy.

Tangibility

Tangibility is the appearance of physical facilities, equipment, personnel, and

communication materials.

Customers tend to expect clean and professional facilities and shops, employees who
look groomed and neat, and well-written and designed materials such as menus,
websites, and signs. Attention to appearance can indicate that your company takes
customer comfort seriously.

While appearance is not the most critical aspect of service, it does make a difference
in how customers perceive your business, especially if your brand promises a
premium or luxury experience.

Reliability

Reliability is the ability to perform the promised service dependably and accurately.

Doing what you say you’re going to do when you say you’re going to do it is essential
to pleasing your customers. They want to rely on your business to deliver a working
product or effective service, to get help when they need it, and for all of this to happen
in a timely fashion.

Customers want to count on the businesses they buy from - that’s at the heart of this
dimension.

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Responsiveness

Responsiveness is the willingness to help customers and provide prompt service.

Responding quickly to customer questions and concerns is vital, especially in today’s

fast-paced world. Responsiveness even applies when customers are slow in
responding to you. Answer swiftly to, at the very least, let customers know that you’re
working on their request.

Responsiveness lets your customers know that you’re listening to them and working
actively to solve their problems.

Assurance

Assurance is the knowledge and courtesy of employees and their ability to convey
trust and confidence.

Customers expect businesses to be the experts in the service they deliver.

Communicating that expertise to customers helps reassure them that they can trust
you, whether you accomplish this by displaying credentials and
industry certifications or customer testimonials.

Assurance is significant when customers have many options but aren’t sure who to
trust when purchasing. Suppose you run an ecommerce store, for example. In that
case, customers are bombarded regularly with ads from potentially untrustworthy
online shops all day, so you need to determine how to set yourself apart and gain
consumer trust.

Empathy

Empathy is the caring, individualized attention the firm provides its customers.

Customers want to feel like they’re more than a transaction; they want to build a
relationship with your business. Even if you have the best product or services on the
market, you can still fall short of their expectations.

Showing empathy to customers means ensuring your company showcases your care.
Training employees on how to provide excellent and empathetic service—where
smiles and engaging conversation occur regularly—can help you exceed
expectations.

33
 How to measure the five dimensions of service quality

The 5 service quality dimensions are used to measure your customers’ expectations
versus how the service was actually delivered.

Measuring these dimensions regularly over time can help your business understand
customer expectations, perceptions, and areas for improvement, as well as track your
progress in increasing your service quality.

There are many ways you can measure the SERVQUAL dimensions.

Service quality questionnaires

To improve your business’s service, you need to understand how satisfied customers
are and if their expectations are fulfilled. One of the best ways to do this is by asking
customers for their feedback using service quality questionnaires.

These questionnaires are typically sent after a customer interaction, like a store visit or
an online help form submission. They aren’t meant for merely gathering data. If your
customer reports a negative experience or interaction, you should follow up with them
right away to resolve it and report on the action taken.

Advantages of service quality questionnaires

Service quality questionnaires have several advantages. Since they’re sent

immediately after an interaction, the details are still relatively fresh in the customer’s
mind and thus more accurate. They also offer information quickly so you can take
swift action on the most pressing issues.

Sample questions

 The service rep helped to solve my issue (strongly agree to strongly disagree)

 Which of the qualities of the service rep did you like? (patient, friendly, responsive,
willing to help, empathetic, etc.)

 Was there anything about our service that stood out to you?

 Over the next year, how likely are you to use our product or service again? (strongly
agree to strongly disagree)

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In-app surveys

In-app surveys are another effective mechanism for gathering customer feedback
directly. Instead of sending a survey via email or paper format, in-app surveys pop up
while the customer uses your mobile app.

You can use these surveys to ask customers one or two quick questions about an in-
store experience they just had, or about the app itself, or another aspect of your service
quality.

Advantages of in-app surveys

In-app surveys offer a quick and easy way for customers to give their feedback. Since
the experience doesn’t take them out of the app, they can give a quick rating. They
also allow you to hone in closely on the app experience itself, which can be useful if
that’s one of the primary ways your customers interact with your business.

It’s best not to ask for long open-ended answers through in-app surveys because
typing detailed responses on a mobile phone can require too much effort for
respondents.

Qualitative analysis: documentation

You can also check the data and information you’re already collecting to develop a
deeper understanding of your service. Qualitatively analyzing written and recorded
customer service records, like chat transcripts and call records, can yield insights
about the customer experience you may have missed otherwise.

To perform this qualitative analysis, you can go through low-rated recorded

interactions to examine what went wrong and use the insights to adjust rep behavior or
solve systemic issues.

You can also examine highly-rated interactions to see what separates the best
customer service agents from their lower-performing peers and use those insights to
train reps as well.

Advantages of documentation analysis

Documentation analysis can be an effective companion to customer surveys. It allows

you to determine how effective your customer service team is at providing high-

35
 quality service. And with the issues identified, you can provide further training for
reps to improve future interactions or identify pain points in your system.

Customer Effort Score (CES)

The CES system is a popular customer loyalty metric. It measures how easy you make
it for customers to do business with your company, whether that’s making a purchase,
setting up a service, or solving a problem.

CES is measured by asking customers to agree or disagree with the following

statement: “[Company] made it easy for me to handle my issue.” The respondents can
choose from seven answers ranging from strongly disagree (score 1) to strongly agree
(score 7).

Calculate CES score by finding the average of all responses:

 (Total sum of responses) ÷ (Number of responses) = CES score.

Advantages of CES

While ease isn’t everything, it’s undoubtedly a vital part of the customer experience.
If you make it overly challenging for customers to get help with a problem or buy
something, they’re bound to be frustrated. CES is a metric you can use to discover
issues and come up with actionable solutions.

And CES is a good predictor of customer loyalty. CEB research found that 96% of
customers with a high effort score were less loyal in the future, compared to just 9%
of those with low effort scores.

First contact resolution ratio

First contact resolution happens when a customer reaches out to your business with a
problem, and that problem resolves during the first session; no follow-up or back-and-
forth is happening.

Calculate the first contact resolution ratio by dividing the number of issues resolved
through a single response by the number that required more responses.

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 Advantages of first contact resolution ratio

Avoiding the frustrating and time-consuming back-and-forth that can happen when a
customer encounters an issue is very satisfying. They get their problem solved faster,
and they don’t need to explain their issue repeatedly.

Having a higher first-contact resolution ratio indicates that your customer service team
is skilled at resolving issues and using the proper channels. For example, it’s often
hard to fix a problem at first contact in email, but a phone call or chat option can
improve that ratio.

Leading metrics analysis

The surveys and methods described above focus on the outcome of the interaction, the
customer’s subjective experience. But there’s also value in investigating the inputs,
which are the elements that make for a quality service delivery.

These inputs are called leading metrics.

Examples of input metrics

 First response time: How quickly a customer receives a response to their question or
issue.

 Response time: The average time in between responses. For example, if an issue
takes 3 email responses to solve, and the time between each message is 3 and then 5
hours, your average response time is 4 hours.

 Backlog inflow/outflow: The number of cases submitted as compared to the number

of cases closed. A backlog of open cases might indicate it’s time to hire more
employees.

 Customer success ratio: The number of customers who found what they were
looking for compared to those who didn’t.

 Average queuing wait time: The average time customers need to wait for service.

 Problem resolution time: The average time it takes for an issue to be resolved.

 Minutes per call: How much time customers spend on the phone with a
representative. This metric can help identify your most effective representatives.

37
These are only a few examples of potential input metrics. There may be others more
relevant to your industry or customer service model. Finding the inputs that have the
most significant impact on your service quality can take some research and
experimentation, so don’t be afraid to think outside of the box.

Advantages of leading metrics analysis

Input metrics can help you set targets for your service team in areas that are under
their control. While customer satisfaction depends on many subjective and out-of-
control factors of your team and your business, focus on improving actions you can
control.

Key takeaways

Determining how effective your business is at delivering high-quality service to your

customers can seem challenging. First, focus on the right way to measure the five
most important dimensions of customer service. After that, you’ll be on your way to
making the most effective improvements to increase customer loyalty and
satisfaction.

Looking for the best way to send feedback surveys, analyze customer data, and
improve your service quality? GetFeedback offers a complete customer experience
platform that can take your business to the next level. View our pricing and service
options today to learn more

SERVICE GUARANTEE &SERVICE RECOVERY:

What is service guarantees and recovery?
A service guarantee is a marketing tool service firms have increasingly been using to
reduce consumer risk perceptions, signal quality, differentiate a service offering, and
to institutionalize and professionalize their internal management of customer
complaint and service recovery Dwayne D.

Service recovery
Service recovery is an organization's resolution of problems from
dissatisfied customers, converting those customers into loyal customers.[1] It is the
action a service provider takes in response to service failure.[2] By including customer
satisfaction in the definition, service recovery is a thought-out, planned process of
returning aggrieved/dissatisfied customers to a state of satisfaction with an

38
organization/service.[3] Service recovery differs from complaint management in its
focus on immediate reaction to service failures. Complaint management is based on
customer complaints, which, in turn, may be triggered by service failures. [4] But since
most dissatisfied customers are reluctant to complain,[5] service recovery attempts to
solve problems at the service encounter before customers complain or before they
leave the service encounter dissatisfied. Both complaint management and service
recovery are customer retention strategies.[6] Researchers recently proved that
strategies such as value co-creation and follow-up can improve the effectiveness of
service recovery efforts.[7]

What are the three types of service recovery?

Three categories of recovery strategies can be distinguished: Customer recovery is
aiming at satisfied customers, process recovery tries to improve processes and
employee recovery as an internal marketing strategy to help employees coping with
failure and recovery situations.

Service guarantees have been attributed the benefit of improving the overall service of
a service provider. However, little research has been carried out within the area. This
article focuses on one aspect of the service guarantee, the effects that service
guarantees may have on service recovery. Critical incident data were collected using
the critical incident interview technique with customers of Radissons AS, a worldwide
hotel chain using a service guarantee. One contribution of this article is that the
interviews convey that the implicit guarantee may serve as a risk reducer, which
contradicts and adds to previous research. Previous research states that only the
explicit guarantee has these benefits. In this case, the guarantee does not reduce risk in
the purchase or consumption stage, but after the consumption when the service has
failed, as the customer finds out about the guarantee in the recovery situation. Another
contribution of this article is that service guarantees are found to influence the
outcome of service recovery as they affect how employees behave to recover the
customer.
How to provide Service guarantee?
To be effective guarantees must be easy to understand and communicate so that
customers can have clear awareness of the benefits of the guarantees. In addition, the
guarantee must be important to the customers, provide adequate values to offset
service failure, easy to take advantage of, and be credible.
What makes a good service guarantee?
39
 The best service guarantee promises customer satisfaction unconditionally, without
exceptions.

What are the types of service guarantee?

7 types of satisfaction guarantees for ecommerce
 The money-back guarantee. ...
 The best price guarantee. ...
 The lifetime guarantee. ...
 The free trial guarantee. ...
 The 'try before you buy' guarantee. ...
 The free samples guarantee. ...
 The first-purchase guarantee.

How to recover from Service failure?

What are the seven service recovery strategies?
1. Make the service fail-safe.
2. Track complaints.
3. Take immediate action.
4. Explain the situation to the customer.
5. Treat customers nicely.
6. Forge a strong relationship with customers.
7. Customer experience after service recovery.

Stage 1: MAKE THE SERVICE FAIL-SAFE :-

Let’s put it this way – if you’re teaching someone to drive, you first want to make sure
that the car works properly. Thus the first strategy is to make sure that the service
delivery is flawless. This requires proper commitment towards the customers from the
management down.

Stage 2: TRACK COMPLAINTS

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Would you believe it if we told you that most customers do not bother to
complain? Instead, 91% of them will switch to a competitor straight away.
Therefore, if you want to retain your customers, you need to encourage them to send
complaints. Whether that’s through QR code stickers, a toll-free helpline, or a social
media handle, you should make it easy for the customers to contact you.
In addition, a feedback tool like our support ticketing system would help you track the
complaints and assign them to your colleague for immediate resolution.

Stage 3: TAKE IMMEDIATE ACTION

Why are people willing to wait in line for a movie but not a complaint? That’s
because the first line promises entertainment at the end, while a complaint is just
another chore.
So it’s no surprise that long waiting times can cost you at least 75% of your
customers. It will only increase their frustration when they know that it will take you
at least a few hours to respond. So the quicker you resolve the issue, the better the
chances of successful service recovery.
Let’s imagine that, despite your best efforts, it will take a while to resolve the issue. In
that case, make sure that you inform the customer about it and tell them why.

Also, outline the steps that you are taking to solve the problem. In most cases, this
kind of acknowledgment will cool the customer down quickly.

Stage 4: EXPLAIN THE SITUATION TO THE CUSTOMER

In this stage, you need to let the customer understand why the service failure occurred
in the first place.

Once they know what happened, they will be more than willing to forgive you for the
issue. Ensure that you inform the customer about the situation with as much politeness
and patience as possible.

Stage 5: TREAT CUSTOMERS NICELY

There are no ifs and buts there. At no point should a customer feel as if their issues are
not getting the attention they deserve.

They need to know that you are doing everything within your power to fix the
problems as quickly as possible. Therefore, they should focus on positive aspects like
the speed and ease of issue handling, the promptness of the follow-ups, etc.

If they have gone through many hassles, an extra or a freebie can help smooth over
hurt feelings and restore the relationship.

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Stage 6: FORGE A STRONG RELATIONSHIP WITH CUSTOMERS
It is a fool-proof service recovery strategy that pays off long-term. When you have a
strong relationship with customers, they will be more forgiving of your mistakes. Isn’t
that how most relationships work too?

For a strong relationship with customers, they should feel that you will have their
backs in case of a service issue. However, it cannot be a one-sided relationship at all.
When they trust you implicitly, you need to ensure that you are worthy of their trust.

Stage 7: CUSTOMER EXPERIENCE AFTER SERVICE RECOVERY

The next stage is to determine what customers felt after the service recovery and what
your business can learn from this experience.

Next, we recommend using experience management tools to understand the

effectiveness of the service recovery experience.
Moreover, service recovery tools like control charts, cause and effect diagrams,
blueprinting, etc., help you maintain control of your recovery strategies.

What are the benefits of having efficient service recovery strategies?

1. Retains loyal customers

Effective service recovery strategies can change the attitude and behavior of the
customers towards the organization. Customers who have been faithful to you will
feel vindicated for sticking with you, and new customers will be more inclined to do
business with you again.

For recovery strategies to be most effective, it is best to personalize them for different
customer types.

2. Increases loyalty
When there is a strong affinity for the customer towards an organization, they are
more likely to purchase more. They are also easier to up sell and cross-sell.

With the right set of customer recovery strategies, you will be able to develop this
affinity. They will also not be swayed by price increases when convenience and good
customer service are part of it.

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3. Creates brand ambassadors
Simply put, your customers are a built-in marketing channel. Some companies do
service recovery so well that customers love to talk about it – leading to positive
word-of-mouth.

What’s more, service recovery strategies are the perfect way to demonstrate that your
brand stays true to your values. It will also make you seem reliable in terms of the
product you sell and the service you offer. What business doesn’t benefit from that
kind of street cred?

4. Troubleshooting service failures

When there are so many processes at play, service failures at some point are a given.
However, suppose some issues crop up repeatedly, like abandoned carts or customers
churning after 30-50 days.

In that case, it’s a sign that something’s going wrong, and you need to improve your
process. If you want specific data, you can ask customers what went wrong. For
example, here’s a customer exit survey by SurveySparrow.

5. Increases customer satisfaction

Probably one of the most under-rated and practical benefits of service recovery
strategies: they will leave your customers satisfied.

Once your customers go through a service failure and see that you have handled it
professionally, they will be happy. And happy customers are loyal customers.

What are the steps a business should take to build a service recovery team?

1. Involve the leadership team

When the leadership team is involved, it becomes easy to get access to all the
resources required. However, to ensure that something like this is possible, the
leadership team should know how much the business loses out when they let the
negative experiences slide without taking any action.

2. Write down recovery criteria

It’s essential to understand when an interaction with a customer qualifies for service
recovery. There are three criteria you need to remember:
 What is the priority and severity of the issue? Is it severe enough to require an
immediate resolution?
 Do you have an appropriate recovery strategy?

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  Are your current resources enough to fix this issue?
If yes, then do it. The recovery criteria can be changed when there are changes to your
internal structure and preferences.
3. Start a service recovery team
If you want your service recovery strategies to bear fruit, you need to build a service
recovery team that is well-equipped and well-trained.

In some cases, it makes sense for customer agents to handle the service recovery cases
because they already have the training. Otherwise, you need dedicated people to make
your service recovery strategies a success.

4. Build a process
You need to develop a service recovery process for different types of negative
interactions. These provide guidelines for customer service recovery to handle issues
with consistency.

For example, suppose the feedback is about the customer onboarding process for a
SaaS company. In this case, the service recovery team should assist the sales team in
solving the customer’s queries and leave the user in no doubt about the software’s
value. They should be able to act quickly to resolve issues with minimal fuss for the
customer.
5. Measure the impact of your service recovery strategies
Once you have solved the issue, make sure that you reach out to the customer again.
Ask them their opinion on your service recovery efforts.

It has two advantages: you find out what you can do to improve the steps next time.
Two, it makes the customer inadvertently focus on the positive experience they just
had from you. This positive experience has a huge impact on customer loyalty, repeat
purchases, and referrals.

Apart from just checking on one service recovery incident, you should know how you
fare as a business overall. So ensure that you measure the entire service recovery
funnel – from feedback ticket to successful service recovery.

Best practices for implementing effective service recovery strategies

No matter how good some system is, it needs to have the right conditions to work
effectively. Let us look at some of the best practices for implementing service
recovery strategies effectively.

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1. Make feedback easy
Many companies lose customers simply because they don’t know or have a specified
channel to share complaints. Here’s where online survey tools
like SurveySparrow can help because you can integrate surveys with your help
channels, mail them or embed them in your website. Such tools let your customers
share feedback 24/7.
2. Keep surveys at every interaction touchpoint
In this day and age, your help channel might not be the first point of contact in case of
trouble. For example, 47% of all customers will call out a brand on social media if
they think it will make the brand pay attention to their problem.
That’s why it’s essential to discover all your interaction touchpoints and
create personalized feedback surveys for each one – so that you can find the issue
before it finds you. You can also send surveys via text or email at appropriate
intervals. They will allow your customers to voice their feelings.
3. Develop a culture where complaints are welcome
Your culture should be such that each customer complaint is considered as an
opportunity. Think of it this way: a customer complaint is your chance to make things
right for them and also improve the process while you’re at it.

So your recovery procedures should be precise yet adaptable for a customer’s unique
needs, and your service recovery team should know how to resolve complaints
effectively yet humanely.

4. Be proactive in communication
Every reasonable person knows that issues will crop up – what’s important is how you
handle them.

Keeping this in mind, an unhappy user is irritated and is looking for ways to vent their
frustration. So the best way to take it is to send an instant response. This simple action
will save much strife for you.

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