Current trends that shape the western economies are the growing importance of services, the need for innovation, changes in consumer and business markets, and the advancements in information and communication technology. Technological developments like the digitalization of information, the increased processing capacity of computer chips, miniaturization and increased mobility of devices, the use of sensors and location technologies, increased interoperability between services, security, and natural interfaces (Brouwman, Van den Hooff, Van de Wijngaert, & Van Dijk, 2005) enable mature architectures and platforms for knowledge sharing, collaboration, and electronic commerce transactions, anywhere, anytime.
Nowadays development of the new innovative services is an important driver for economic growth. In the book Mobile Service Innovation and Business Models, the authors present a theoretically grounded yet practical approach to designing business models for electronic services, including mobile ones. The book consists of two parts.
“The effective service innovation happens if entrepreneurial innovation group with technical capabilities can unite material, service and experience to provide market accepted new service. “
The subsequent blog post peeks into the book “User-based innovation in Services” by Jon Sundbo and Marja Toivonen and takes you to insight concepts as to how and why these concepts are useful. The subsequent sections will discuss about the interesting concepts and topics from the literature.
Before we start it’s important to understand the term ‘Users’. Let’s quickly make our understanding, users or receivers of the services are generally termed as customers, clients or consumers. The customer is the One that buys goods or services and can still resale after processing. The consumer is the one that acquires goods or services for direct use or ownership rather than resale. The client is a party for which professional services are rendered.. The “Users” is used as super set, has full blown ecosystem which is driven socially, culturally or individually. Now when we understand users’ as the driving force for service innovation and users’ various distinctions, let’s move towards various concepts.
“New service development: the process from idea to launch of a new service”
“New service development is a modification of current services and or adaptation of the service that is already offered in another geographical market.” (Edvardsson, Gustafsson, Johnson, Sanden 2000).
Why is new service development so important?
Today´s business life is all about competition and Innovative service is the means that companies differentiate themselves from the current intense competitive market. Companies are constantly trying to differentiate themselves from other players in market field. Previously markets have been really product/manufacturing oriented. Mainly all the tools are then developed towards this manufacturing idea so service innovation and new service development are poorly researched and understood areas. But today´s business needs to take these things into consideration in order to survive. In order to develop new ideas companies need new tools for their work.
The heart of the book is to develop strong customer relationships through quality service by integrating customer focus across the firm. Services marketing is different from goods marketing in significant ways and it requires strategies and tactics that traditional marketing do not fully reflect.
There are many techniques and methods discussed in the book by the authors, but we are concentrating this review on Relationship Marketing and Service Blueprint. These form the bedrock of any service marketing, because for services to be well marketed, good relationship with customers is of high importance which requires strategies that will make it happen alongside with the blueprint of the services that will enable customers to have a clearer picture of the firm’s offerings. The authors described the two highlights extensively and are reviewed below.
I pass by specialized coffee shop daily when going to lunch. Well, I don’t just pass by. It is the place for me to enjoy quality coffee, good service and relax before heading back to the office. It is my sanctuary which I have managed to fit to my daily routines. It just has something that the coffee shop next to it doesn’t have. Reflecting to personal experiences for buying a coffee from the specialized coffee shop, it has limited selection of tea’s, coffee beans and truffles. Coffee is made based on daily selection or based on customer selection. Each customer is served personally and there is social interaction between the customer and barman. So it is not just about the coffee or tea. Here can be identified use environment where the service is used, customer participation when there is selection to choose from and social interaction between the service user and service provider. Regular visitors don’t mind about queuing because they know they get personal and good service. Even though when the action stays the same, other variables bring new elements to the experience and this makes it memorable.
The book gives a comprehensive overview of the service business development in the business environment of capital goods and brings together years experience on how manufacturing companies can create value through services. It also discusses the challenges of how to generate revenue of the services itself (along with products) and what kind of strategies can be used in different stages and types of the manufacturing companies in global business.
1 Challenges and common questions
When developing services in manufacturing firms it is a change in value creation and leap from production minded one-off sales culture to long-term customer relationship building culture that creates value to customer in broader scale. Continue reading →
The title of Jan Carlzon’s book, “moment of truths” is perhaps the main reason I chose to read the book among other recommended books. The term “moment of truth” became a household name to me as far back as my past studies in Sales and Marketing at Helsinki Business College. Carlzon’s book laid emphasis to a customer-centric and service-driven organization which also gives good consideration to employee reward and engagement. I found Carlzon as a visionary leader who has the ability to combine two or more leadership styles as the situation demands to get the needed result. I found out that in order for a leader to be successful he/she must be prepared to see things from multiple perspectives, inspire his followers, and provide the enabling environment for them to deliver good result. Carlzon’s in my opinion applied and experimented authoritative, democratic, and affiliative leadership style at one time or the other in most of his relationship with his followers. Continue reading →