Amity Business School

Amity Business School

MBA Class of 2010, Semester III

Classification of Services
Prof. P K Bansal

Service Process A Strategic Insight

Amity Business School

A service is essentially a process and not a physical product. Process is directed at different ends depending upon the nature of service. Some services process people and some may process objects. Service process can be manual or mechanised or involve both. Part of the service organisation that has direct control and responsibility of the service processes is called service operation system, involving interplay of people and equipments. A customer because of his physical presence in the system or factory, is more concerned with operations happening in front of him unless when services fail to conform to expectations.

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Visible portion of overall service depends on the nature of service process. It also decides, the importance of the duration a customers physical presence is required in a service system. This leads to an important classification on the basis of two important dimensions: 1. What is processed? Object or a Person

1. How is it processed? What is the Nature of Process? Tangible or Intangible actions

Strategic Classification
People
Services directed at peoples bodies. ( People Processing )

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Things
Services directed at goods and other physical possessions ( Possession Processing ) Freight Transportation Repair / Maintenance Dry Cleaning Services directed at intangible assets. ( Information Processing ) Banking Legal Services Insurance

Tangible Actions

Health Care Beauty Salons Restaurants Public Transportation

Intangible Actions

Services directed at peoples minds. ( Mental Stimulus Processing ) Education Theaters Information Services

People Processing

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1. Customers must physically enter the system. 2. Sometimes, service provider goes to customer with necessary tools. 3. People must be prepared to spend time actively cooperating with the service operation. Level of involvement can vary. Managers must think about processes / outputs in terms of what happens to customers or what benefits are created. Identify non-financial costs, time, mental and physical effort, fear, and pain etc.

Possession Processing

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Working to tight deadlines to restore customers possessions to good working order. People are less physically involved and usually, no real need for them to enter the service; often limited to requesting the service; explaining the problem or paying the bill only. The output in each instance, whether, installing software or repairing car etc. should be a satisfactory solution to a stated problem.

Mental Stimulus Processing

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Services that interact with peoples mind. Anything touching peoples mind has power to shape attitudes and influence behaviour. Customers are in a position of dependency, and a potential for manipulations. Hence, strong ethical standards and careful oversight are required. Recipients should spend time but not necessarily be physically present in a service factory; just mentally in communication with information being presented. Information based content can be converted to digital bits, recorded or transformed into manufactured products viz. CDs, Videos, which can be packed and sold like any physical product.

Information Processing

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Most intangible form of service output. Customer involvement determined more by tradition or personal desire to meet face to face and not by the needs of the operational process. Customer / Supplier learn each others needs, capabilities and personalities by personal meetings, however this relationship can also be build / sustained on trust or telephonic contact.