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A service perspective on being born too soon

An estimated 15 million babies are born too soon every year. Preterm birth rates increase globally and affect rich countries as much as poor countries. USA, for example is one of the ten countries with the highest numbers of preterm births. The burden of preterm birth is substantial: According to a global rapport from the WHO, 1.1million babies die from preterm birth complications every year (Howson et al. 2012). However, the same WHO report suggests that over 75% of death of preterm birth can be prevented through feasible, cost-effective solutions including the Kangaroo Care method.

Applied Kangaroo Care, foto by Lærdal

The Kangaroo Care (KC) method is proven to have significant positive effects on both survival, growth, development and long term development of preterm infants in addition to parent-child-bonding and stress reduction (Conde-Agudelo and Belizán 2011). It is provided through parents (or substitutes) and with the support of health workers undertaken in neonatal intensive care units. Skin-to-skin contact in chest-to-chest position on the parents´s breast is providing the infant with the warmth that the little body cannot yet hold or produce itself. In addition, the infant is experiencing continuous stimulation through the parent´s own gentile body activity like the sound of the heartbeat, lung activity motion or voice.

The challenge

I felt this current topic was definitely worth spending my theses time and effort on. Even more, when I found out about the big gap between the high potential of the method and today’s actual implementation rate, as is shown in figure 2. What is the reason for bad acceptance and how can implementation be increased?

The KC implementation gap

Design / Methodology 

The main purpose of the thesis was to identify opportunities for scaling up Kangaroo Care (KC) method based on the five principles of service design defined by Stickdorn et al.(2010) I had chosen to apply design thinking methodology on 2 distinct settings, low resource settings and developed settings. The research question was explored through different workshops with experts and main user groups, covering various qualitative design tools as shown in the illustration of the design process in figure 3. The findings were analyzed on the background of the theoretical framework covering the research questions and the topic of value co-creation.

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Why customer experience is important in implementation of digital service channel in B2B area?

Few days ago I read blog post “Matkalla asiakas­lähtöisyyteen” where Maija Isotalus (2015) from Palmu asked customers of B2B companies providing IT continuous services if they see that there is enough of customer focus in business interactions. The results were very alarming. Only 18% of customers felt that companies having right customer focus. In addition,  only 11% of clients felt that companies understand their business and needs. Customer index calculated by author as difference between percentage of respondents who perceive business as truly customer oriented and percentage of respondents who felt that company has low customer orientation was in average on level of -17 (The best index was +50 the lowest -75). That tells a lot about adoption of customer centricity in companies providing IT continuous services. Brian Solis (2015) in his blog “Why Customer Experience is The Catalyst for Digital Transformation” explains that often it is forgotten in companies to ask simple questions “What is really important for customer? ”

Recently, I wrote thesis report about “Factors determining customers’ experience – case Tieto Service Channel” where I analyzed B2B context of providing services through a digital service channel. Getting an understanding over service-dominant logic, value creation aspects, customer driven innovation and IT support service experience aspects helped me to analyze social, behavioral and emotional aspects of company’s interactions with their customers. I relay on Lusch et al. (2007) studies where they explained via Foundation Premises (FP’s) that what defines importance for customer is the value that is co-created with them. They addressed that value is seen as very personal thing and depend on context where attitude, affection, satisfaction and behavioral judgments is taking place. Therefore they pointed out that continuous knowledge gathering and learning from customers creating engaging experience. Klaus and Maklan (2012) explained service experience can be through assessing attributes which helps in interaction with provider of the service and therefore it can point out on customers’ loyalty aspects. Through these aspects, meaning for customers is created about service context and it is shaping preferences toward one or other service (Walter et al. 2010). Johnston and Kong (2011) in their article informed that no matter what is the service, customers will always have experience. What is important to highlight is that they stressed out that companies always say that “we are providing best customer experience” but it does not mean that it is really provided. Brian Solis (2015) argues in his blog that experience is “sum of all touches throughout the customer relationship” and thus it is important that companies are evaluating customer experience factors. Garg et al. (2012) proposed classification of these factors based on criticality in succeeding desired customer experiences and prioritization connected with companies’ importance to understand impact of those factors. He pointed out on 19 of those:

  1. Customer interaction – interaction with company, its employees, physical environments and other customers.
  2. Presence of other customers – offering same or different service.
  3. Employees – those who deliver service to customers.
  4. Servicescape – physical environment where service is happening.
  5. Convenience – numerous activities leading to higher confidence degree.
  6. Customization – specific customer requirements to be taken into consideration.
  7. Value added – add on services to core service.
  8. Speed – responsiveness to customers’ requirements.
  9. Core services – basic service that company is providing.
  10. Service process – set of activities, interaction between them and resources need.
  11. Marketing mix – strategies towards customer expectations.
  12. Online functional elements – website functionality affecting experience of customers.
  13. Online hedonic elements – functionalities attracting customers to navigate and use website.
  14. Online aesthetics – elements that attracting and keeping attention of customer.
  15. Sensory experience – sight, touch, sound, taste and smell connected with aesthetics.
  16. Affective experience – emotional values influencing on interconnection between customer and company (moods, feelings etc.).
  17. Cognitive experience – cognitive and mental abilities of customer.
  18. Behavioral experience – lifestyle, interactions and customer physical experience.
  19. Relational experience – factor related to self-realization of customers beyond service context.

My thesis report goal was to find out what are the factors determining customer’s experience in B2B context on example of digital service channel. I proved findings from theory about experience being very personal and in addition, I was able to indicate real factors which influence on this experience. Figure below presents those factors categorized based on Garg et al. (2012) framework.

customer experience

Research was conducted in Finland and Sweden. It is seen that Finnish and Swedish respondents do not look at issues in the same way. For Finnish respondents service process and customer interaction through process ease, cross product comparison and past experiences are the most important to consider. Finnish respondents are evaluating digital service channel through service interaction activities, specific customer requirements, overall service functionalities and functionalities that attracts to use digital service channel. They judge digital service channel based on experiences with other similar services. Result indicates as well that past experiences that those respondents have with other services are influencing on their confidence level over service during this interactions. Lastly, risk perception was indicated where effective recovery from issues connected with service interaction activities and service functionalities affects their emotional experience. When it comes to Swedish respondents they indicated that past experiences which those respondents have with are influencing on their interactions with digital service channel the most. It is based on emotions triggered during interaction, their perceptions over service processes and functional and attractiveness aspects. In addition, they are evaluating digital service channel pretty much through their first interaction with service where emotional aspects, service interaction activities and their confidence level over service during interactions are the biggest influencers on their perception. Lastly, they are judging digital services based on experiences with other similar services where they are expecting that the interaction with it, specific requirements they have, emotional aspects (wow effects), functionalities that attract to use and additional services that digital service channel provides will be at least on the same level as in other, old services.

Summarizing, customer experience is very important aspects in B2B area. It is defined by various different elements. Presented thesis report discuss issue of trust through its determinants like confidence, honesty and reliability. Special attention is put on customer satisfaction that influence on credibility and benevolence which many researchers connects with customers’ loyalty towards product or service, and having direct implication on retention. Because of that, I put stress on explaining the role of company and its interaction with employees in shaping relationship with customers. I pointed out that together with service processes, activities leading to higher confidence in providing services and emotional values influencing on those interaction, it defines factors influencing on customers loyalty in the context of B2B services. In addition, factors like specific customer requirements, elements and functionalities keeping attractiveness of the service and issues related to self-realizations of customers and their taken-for-granted beliefs determining the most customer experience of digital service channel. A lot to do with those issues has expertise which customers’ in using the service have as well as service customization’s made. Through those aspects customers are creating unique emotional bonding towards brand which unfortunately in some cases was broken because of customers’ betrayal feelings they have after using digital service channel some period of time. Some researches suggest that this fact radiates on extending the psychological distance between employees responsible for customers and customers itself. Therefore, the role of service provider should be in creating outstanding service landscape where multi-sensory and interactive relativistic preference aspects of experiences will help to reengage customers in digital service channel. It should happen with elements embracing in them cognitive, emotional and behavioral responses to this service. As experience is a very personal thing, the qualities like possibility of having choice and be able to compare with other services, way of dealing with problems in service, physical and emotional benefits for customers receiving service are those drivers giving approach that should be taken for setting up, implement and popularize digital service channel.

How do you see importance of embracing customer experience in your organization? If you feel that this is something that might interest you, please look at my thesis report here

Sources:

Solis, B. 2015. Why Customer Experience is The Catalyst for Digital Transformation. Accessed on 25.11.2015 http://www.briansolis.com/2015/09/customer-experience-catalyst-digital-transformation/?utm_content=buffer93c72&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Isotalus, M. 2015. Matkalla asiakas­lähtöisyyteen. Accessed on 25.11.2015 http://palmu.fi/asiakkaita/matkalla-asiakaslahtoisyyteen

Lusch, R.F., Vargo, S.L. & O’Brien, M. 2007. Competing through service: Insights from service-dominant logic. Journal of Retailing, 83(1), 5–18.

Klaus, P., Maklan, S. 2012. EXQ: a multiple-item scale for assessing service experience. Journal of Service Management, 23(1), 5 – 33.

Walter, U., Edvardsson, B., Öström, Å. 2010. Drivers of customers’ service experiences: a study in the restaurant industry. Managing Service Quality, 20(3), 236 – 258.

Johnston, R., Kong, X. 2011. The customer experience: a road-map for improvement. Managing Service Quality, 21(1), 5 – 24.

Garg, R., Rahman, Z., Qureshi, M.N., Kumar, I. 2012. Identifying and ranking critical success factors of customer experience in banks: An analytic hierarchy process (AHP) approach. Journal of Modelling in Management, 7(2), 201 – 220.

 

Master Thesis: Empowering Child Sponsorship with Service-Dominant Logic

Child Sponsorship

Child Sponsorship is highly motivational form of regular giving. Largest child sponsorship organizations in Finland are currently Plan, World Vision and Fida. Picture taken from Fida’s project in Tanzania by Erkki Salo.

In this blog post, I Introduce my master thesis and share some of my personal experiences from the MBA studies. As part of my master thesis (which can be downloaded from here: Salo Erkki Master Thesis) I developed a Service-Dominant Logic based business model canvas application for child sponsorship organizations. With the help of the canvas, value propositions for the child sponsorship of the case organization Fida International were developed.

Turmoil in fundraising

Child sponsorship is a highly popular and high impact form of giving that affects to the lives of 90 million people. In child sponsorship, a donor, called a child sponsor, supports a child in a developing country through regular donations. With the support, a sponsored child receives improved chances in life. The case organization Fida International is one of these organizations with its 5200 child sponsors helping 10 000 children in poor countries.

Child sponsorship organizations, like any other charities, are facing the changing world as donor generations are aging without the younger generations filling in the gap. In order to adapt to the change, donor customers cannot be treated as passive receptors of marketing messages, but instead as co-creators of value. By co-designing services together with customers and with other stakeholders, doors can be opened for innovations.

New Business Model Canvas application for child sponsorship

The starting point of the thesis was that the Business Model Canvas (see my previous blog post) introduced by Osterwalder and Pigneur (2010) can help organizations to visualize and innovate successful business models. Despite of its strengths, it is said to represent an old paradigm of service marketing called goods-dominant logic.

The new paradigm of service marketing introduced by Professors Vargo and Lusch (2004), called the Service-Dominant Logic, challenges the Goods-Dominant Logic. In the Service-Dominant Logic, value is always co-created with customers and is solely determined by the customer.

Therefore, I decided to apply the Business Model Canvas with Service-Dominant Logic and to add also insights found from the fundraising literature and from other available business model canvas applications, such as the Lean Canvas and the Nonprofit Business Model 1.0. After the analysis, I used the original business model building blocks by Osterwalder and Pigneur, but altered the original key questions.

The developed business model canvas application was used as part of the service design process to develop value propositions of the case organization’s child sponsorship. Multiple different stakeholders were involved, and the focus was on the big picture. The chosen service-design process was the Double Diamond. As outcomes of the thesis, the case organization gained a deeper understanding of their donor customer needs and how the developed value propositions were linked to the donor customer’s public and private desired outcomes.

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Master thesis: Designing a service concept for the Finnish grocery trade

by Melanie Wendland, melanie.wendland@gmail.com

Here is a little wrap up of my thesis I just delivered.

Background & Research objective

There is an increased discussion in the news worldwide that people today suffer from health consequences that can be traced back to wrong food consumption. The food consumption many people are used to is on one hand adapted to fit our busy lives and on the other hand promoted by a food industry that tries to maximize profits and increase sales. Especially in Finland, the grocery trade business is organized around making people buy processed, ready made meals.

In contrast to this there is a rising trend of slow living, meaning that people try to decrease speed of life and put more attention to the lifestyle we used to have before life got optimized for efficiency: home grown food, hand prepared and consumed with enjoyment and time. Customers start demanding more transparency, variety and focus on health in the food they consume. Against this backdrop the question arises whether supermarkets in the future should play an active role in educating their customers in a healthy nutrition and take responsibility for their customer’s wellbeing with regards to food consumption.

This gap between changing customer needs and the lack of health supporting services in the grocery trade represents the opportunity for this thesis. The aim of the thesis was to develop a new service concept for the Finnish grocery trade, which encourages supermarket customers to choose healthier and sustainable food.

 Approach & Theory

There are three main theoretical discussions that build the relevant base for the context of the report. The thesis first looks at what a service concept is and how service concept is has been discussed in the academe. The thesis shows that there is no unified accepted definition of the term but the reviewed literature suggests a few common characteristics. The service concept communicates the customer benefit or value of a service idea to stakeholders, employees or customers and should include information about brand and marketing, highlight the strategic intent of the organization, specify the experience the customer receives and describe operational tasks and activities. To make the service concept definition tangible and usable for the context of service design, I mapped service design tools to the characteristics of the service concept. These tools make up the service concept developed in the empirical part of the thesis.

Thesis Structure Melanie Wendland

Thesis Structure Melanie Wendland

In ‘Designing for the grocery trade’ the thesis explores what kind of aspects are relevant when developing new services that deal with food and consumption behavior in supermarket environments. Influencing people’s behavior towards positive change is a challenging task and research suggests that within the context of nutrition supermarket interventions and games have been successful approaches. There are many trends that suggest that changes in customer behavior is changing the way supermarket will function in the future and that business need to react to these in order to stay on the market.

Finally ‘Transformative Services’ as the third theoretical base looks at the concept of services that intent to change the behavior of individuals or groups in order to foster wellbeing among them. Even though research in this area is still limited and recent, there seems to be a common notion that transformative services are considered a way for service business to survive in challenging times of market saturation and lack of differentiation. In order to make the theory of transformative services tangible for the use of developing a service concept, I point out eight ingredients that add transformative character to services.

Methodology

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Engaging stakeholders in the designing of a service: a case study in the B2B service context

Author: Adeyanju Alade. Email: aladeyanju@yahoo.com

The background of this master’s degree thesis was from a Tekes funded project named “Service Innovation through Strategic Stakeholder Integration” (SISSI). SISSI is a joint project undertaken by Laurea University of Applied Sciences in cooperation with Hanken School of Economics, Finland.  In addition, there are two case companies as main partners in SISSI project.

l&tThe topic of this thesis was inspired by the definition of service design as presented by Selgelström. The definition says service design is “the use of designerly way of searching for solutions to problems in people-intensive service systems through the engagement of stakeholders” (Segelström 2010, 16). A rhetorical question of “how stakeholders can be engaged” came up on the mind of the author of this thesis. As a result, the academic journey on this thesis then began.

Stakeholder engagement can be defined as the effort or action an organisation undertakes towards understanding and involving stakeholders “and their concerns in its activities and decision making processes” (Partridge, Jackson, Wheeler & Zohar 2005, 6). A quality stakeholder engagement process has the potential to address complex problems in both private and public sector’s service design and delivery (REVIT, 2007).

The literature review of this thesis covered topics such as service, service dominant logic, service design processes and tools, value co-creation, stakeholders, and stakeholder engagements. Some relevant conclusions and speculations from the perspective of this author were also presented in the literature review. In addition, some gaps were identified in the reviewed literature (see thesis report).

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Service design case study: how to turn customer challenges into new service offerings

Author: Tuomas Suominen, tuomas.suominen@kaakelikeskus.fi

In this blog post, I present how you can turn your customers challenges into new service offerings. The most crucial thing is to gather as much information as you can about your service users daily tasks. In this case study, this was done by interviewing clients. You can be surprised how much your service users have to offer. They can sometimes suggest promising service ideas.

This case study was done as a thesis project at Laurea Service Innovation & Design Masters Program. I was inspired by CEO Lou Gerstners IBM turnaround. IBM was struggling in the 1990s. The new CEO sent his sales staff not to sell, but to ask customers what kind of challenges they faced daily. Gerstner realized that the company should concentrate on solving customer’s problems with their technology knowledge. Inspired by Gerstner, I too wanted to look into my client’s challenges. After all, a challenge is a latent need, and a possible service development case. I concentrated on architect clients, whose work I knew little about.

I decided Service-dominant logic and service design would guide my way in this thesis. Service-dominant logic would be my base theory and service design would serve as application of that theory. I combined the two, and kept their guiding principles in mind while planning my service design process.  After looking at the extant service literature, I decided to co-create the service with clients. I aimed to design a win-win service for both service provider and client.

Näyttökuva 2013-01-01 kohteessa 10.31.25

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Survival guide to Laurea Masters Program

If you are reading this post as a new arrival to Laurea Masters Program, I salute you. Congratulations of getting in for this ride. It’s a ride where you get to meet awesome people and it will provide you in-depth knowledge about service design and all that it has to offer companies. I promise you will leave this program with confidence and knowledge you need to improve your career.

Although I have not graduated just yet, I can now say that I survived the Laurea Masters with decent grades. I came with the patch of 25 students who passed the 2011 entrance test. We were the second patch ever to be accepted to Laurea Service Innovation & Design Masters degree program. Continue reading