MBA 843N

Services Marketing

Spring 2010

Professor Neeli Bendapudi

Course Materials

Readings available from Carmen Website and case packet available from Uniprint.

Course Description and Objectives

Services are a growing and dominant portion of the global and the US economy. This course will emphasize three roles that knowledge of services can play. One, it will help you deliver better service to external and internal customers. Two, it will help you understand and address the unique challenges of marketing intangible services (e.g. consulting, education, financial, legal, medical) as the core product offering. Third, it will showcase why and how companies that have traditionally viewed themselves as purveyors of physical products (and any associated services as necessary evils) are transitioning to value-added services (e.g. Caterpillar, GE, IBM).

Course Conduct

The course is designed to encourage active learning by participants, within and outside the classroom setting. Preparation for the class sessions will include thorough reading of materials, preparation for class discussion, review of industry trends, and research on guest speakers and topics. The class sessions will encompass case discussion, student presentations, in-class exercises and lectures.

I am deeply committed to facilitating your learning process. If you need any special accommodations because of a disability, please do not hesitate to contact me. For optimal results, I encourage you to contact me within the first two weeks of classes.

Grading and Course Policies

The major grade components and their weights are listed below.

Component Weight

Midterm examination 35%

Services Audit Project 40%

Class Participation 25%

TOTAL 100%

The Fisher College faculty has adopted standardized grading policies. The target average grade for an elective class is 3.5. An ‘A’ translates to 4, ‘A-’ to 3.7, ‘B+’ to 3.3, ‘B’ to 3, ‘B-’ to 2.7 and so on.


I. Examinations

There will be one examination in the class. The exam will be open note and open book. The examination will focus on giving you an opportunity to apply what you have learned to practical business situations. We will discuss the format in class. The exam is worth 35% of your grade.

II. Services Audit Project.

1. Please choose a local service business in an industry of interest to the team. Management support and access to collect the information that will be needed to conduct a service audit is a critical success factor so I strongly encourage you to select a business to which you already have access. Please review with me your selected business in advance of making any commitments to the firm.

2. Limit the scope of your service audit to a well defined service for which you have access and can get the information needed.

3. You must obtain consent from the business that is documented by a note, email or letter. If you have agreed to provide a copy of the final report to management of the business then I expect you to provide that report in person either in a presentation or personal briefing on the contents of the report.

4. The tangible outcomes of the service audit are recommendations to improve the business in various service dimensions. It is essential that each recommendation be feasible to implement and have suggested implementation steps.

5. Organization of the written report

The written report should not exceed 20 pages (excluding tables, figures, and appendix)

a. Executive summary – this could be the only thing read so it needs to be complete, compelling and concise (maximum of 3 pages)

b. Situation analysis

i. A description of the industry selected and the reasons why it was chosen

ii. Current trends in the industry with an emphasis on those that directly impact service delivery and marketing

iii. The competitive situation – who are the major competitions, what are the major competitive issues, etc.

c. The customers -- a description of the current customers for the business

including:

i. Segmentation and its rationale (e.g. reason for use, frequency of use, psychographics, demographics, buying conditions/situations, nature of the service, etc.)

ii. Customer expectations and needs regarding the service performance

iii. Any difficulties or special issues in serving this market

d. The strategy canvas—your understanding of the company’s position in the marketplace

i. Specify the relevant customers and competitors in the current strategy canvas

ii. Suggest any modifications to the strategy canvas

iii. Be sure to follow through on the recommendations in your implementation

e. The marketing plan – describe the business using the traditional 4 P’s (summary description, not detailed as it is not the focus of this audit)

i. A description of the services and products

ii. The pricing of these services and products

iii. Promotional tactics

iv. Place (distribution, etc)

f. The people

i. A description of the frontline and professional service employees involved

ii. Characterize the internal marketing used to motivate the employees

iii. Characterize and evaluate the effectiveness of the internal marketing

g. The process

i. A description of the service delivery process

ii. Provide a service blueprint (map) of the process

iii. Evaluate the process and make specific recommendations to improve

h. The physical evidence

i. A description of the ServiceScape

ii. Describe the role of the ServiceScape in service delivery and how it compares to competitive offerings

iii. Evaluate the physical evidence and make specific recommendations to improve

i. Service quality analysis

i. Discuss the current level of customer satisfaction – provide recommendations to improve

ii. Discuss service quality – provide recommendations to improve

iii. Discuss service recovery programs – provide recommendations to improve

iv. Discuss customer retention programs – provide recommendations to improve

j. Conclusions

i. Discuss the value of this audit to the business and to you

ii. Summarize the findings and list the recommendations

6. Quality Standards.

a. Late or incomplete work is not acceptable

b. Avoid the “too many words, not enough thought,” syndrome

c. Make sure your recommendations are relevant, practical, and action-oriented

7. Presentation

Each team will have a short 20 minutes to give the class a sense of their project and key findings. Be interesting, creative, and compelling in your presentation!
III. Class Participation

A key tenet of services is the interaction between the service provider and the customer in the co-creation of value. Your participation in class contributes to the learning environment and to your own learning. Attendance is a necessary but not sufficient condition for good participation. In a departure from usual practice, you will evaluate your own class participation and recommend a grade. To do this, you will submit a one page self-assessment and a letter grade recommendation on the last day of class before exam week. I strongly recommend that you maintain a record of your participation so that your self-assessment will be complete and based on facts. I reserve the right to adjust the final participation grade if I deem it necessary. The one-page self-assessment of class participation is due on June 4th.

The one-page assessment should follow the following format.

Name:______

Number of classes missed with dates missed:______

I would rate myself among the top ______% in this class in terms of participation

Percentage grade I should get for class participation:______%

My rationale for the percentage grade I gave myself:______


Class Schedule

March 30: Introduction to Services

The Four Things a Service Business Must Get Right

April 01: Rational and Emotional Components of Services

Customer Expectations

Understanding Customer Delight

April 06: Knowing your customers and knowing about your customers

Turn customer input into innovation

CASE: Harvard Graduate Student Housing Survey

Exercise: Customer letters of complaints and compliments

April 08: Knowing about your customers

Customer Feedback Loop

April 13: Service Encounters

Behavioral Science

Blueprinting factsheet

Creative Benchmarking

April 15: Articulating a service strategy

Charting your company’s future

Strategy as plot line

April 20: Physical Evidence of a Service

Clueing in Customers

Can a Website be Social?

Assignment—Comparing congruence in retail sites and websites

April 22: The Service Profit Chain

Putting the SPC to work

CASE: &Samhoud

April 27: Setting Service Standards for Employees

The Living Brand

Setting Behavioral Standards

Assignment—Deciding what is great, good, and poor service

April 29: Delivering Service—The Service Process

Six sigma comes to services

CASE: Shouldice Hospital

Process Audit—Optional reading

May 04: Customer Coproduction

Tradeoff between efficiency and service

CASE: Harley Davidson Posse Ride

May 06: Selling Services

Star Performers

Knowing What to Sell, When, and to Whom—Optional Reading

CASE: Infosys Relationship Scorecard

May 11: Promoting Customer Loyalty

Your loyalty program is betraying you

CASE: Nectar

May 13:EXAMINATION

May 18: Pricing Services

The Economics of a People Business

CASE: Springfield Nor’easters

May 20: Non-profit services

Helping Behavior

Delivering on the promise of Non-profits

CASE: UNICEF

May 25: Service Failure and Recovery

CASE: Northwest Airlines

May 27: Managing yourself as a professional service provider

How leaders use networks

CASE: The Associate Challenge

June 01: Presentations of Service Audits—Written reports are due

June 03: Presentations of Service Audits and Wrap-up of Class