Page 221 - DMGT522_SERVICES MANAGEMENT

Services Management

Notes
Example: Continuing with the example of IDBI, the bank has to educate its officers,
channel partners like share brokers and investment consultants about the bonds, its features and
benefits.

Notes When SAS was in deep trouble, its CEO tried to revitalise the organisation by re-
energizing the employees.

“As soon as we received permission from the board, we distributed a little red book
entitled ‘Let’s get in there and fight’ to all 20,000 employees. This gave staff, in very
concise terms, the information about the company’s vision and goals that the board and
top management already had. We wanted everyone in the company to understand the
goal: we couldn’t risk our message becoming distorted as it worked its way through the
company”.
“The new energy at SAS was as a result of the 20,000 employees all striving towards a
single goal every day”.
3. There should be consistency in the service strategy and the systems that are developed to
run the day-to-day operations to achieve the strategic goal. Systems would be designed
only after the service strategy becomes clear and is agreed on. The systems would then
greatly aid the service transactions/encounter. This would greatly affect the feeling of the
customers, which would lead to their satisfaction.

Example: Thomas Cook might have a strategy this tourist season for its inbound tour
packages. It has over 56 branches all over the country. Tour packages can have customised
itinerary plans. But it should set up systems to carry out the strategy. Else, there would be
confusion in all the branches, duplication in jobs like calculation of itinerary tariffs, repeat
handling of the same enquiries from all the branches and of course ad hoc decisions will take
place.

4. The impact of organisational systems on customers: This would in turn greatly influence
their service experience.

Example: Continuing with the Thomas Cook example, if the organisational systems are
faulty, like the communication to the inbound tourists (the itinerary details), or if a Thomas
Cook employee is not aware of the latest currency exchange rates or the hotel tariffs – then the
customer is discouraged and leaves with a lasting impression of the organisation as being
inefficient and incompetent.
5. The importance of organisational systems and employee efforts: Rules and regulations
should aid an employee in giving of his best, not hinder him in his service transactions.
“Giving someone the freedom to take responsibility releases resources that would
otherwise remain concealed,” said Jan Carlzon, the legendary head of Scandinavian Airlines
System (SAS). Carlzon was responsible for turning around SAS. Organizational systems
should “transform people from administrators (read clerks) to leaders and facilitators.”
The rules and regulations should empower the employee and facilitate him in
intrapreneurship-entrepreneurship inside an organisation.

6. The interaction between the customer and service provider: It is these interactions that give
rise to service encounters or critical incidents. They are also called Moments of Truth
(MOT). The quality of these interactions is the source of customer satisfaction.

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