Product Plus

Preface

1. The Little Airline That Could

How customer hatred of two existing carriers gave the founders of Southwest Airlines a chance to launch an airline that loves its passengers and has grown to become America's 7th largest.

2. What Type of Service Are You Offering?

Tunnel vision leads some managers to overlook innovations and strategies occurring outside their own industry. Yet seemingly different services may share common operational and marketing characteristics, depending on whether they process people, physical objects, or information.

3. Every Business Competes On Service

If a business can't perform well on its core product, its chances of survival are bleak. But innovations on the core are often quickly copied. For customers, the product plus of differentiation and added value comes from a whole bundle of supplementary services that enhance the appeal of the core product.

4. User Friendly versus User Hostile

An operations-driven business risks presenting a hostile face to customers. Yet efficiency, cost control, and employee well-being are important. Can there be a happy meeting of minds between operations and marketing?

5. Product Plus Management: In Pursuit of Compatible Goals

Organizations succeed in the long term by offering customers better value do competitors; employing people and suppliers who see value in their relationship with the organization; and creating value for their owners.

6. The Search for Synergy in Service Management

Successful service businesses create operations and delivery systems that simultaneously appeal to their target customers, are well matched to the capabilities of a willing workforce, and allow the firm to operate efficiently. We contrast approaches at Firstdirect, the all-telephone bank, and Southwest Airlines

7. Service as an Art Form

The theater provides a good analogy for service delivery, with actors, stage sets, scripts, costumes, and even music. Backstage activities (which the customer doesn't see) exist only to create and support good performances on-stage.

8. Who Defines Quality: You or the Customer?

Historically, quality was defined by operations managers. Only recently has quality come to be defined with reference to customer needs and expectations. Many quality improvement programs have not met expectations; we consider some of the reasons why.

9. Absolutely, Positively: achieving Systemic Quality

Few service firms have made such concerted efforts to improve quality on a company-wide basis as Federal Express, We look at how FedEx's highly systemic operation works and see what others can learn from studying the key components of its "no secrets" approach to quality improvement.

10. Process and Progress: Understanding the Customer Experience

To obtain the benefits they want from a particular service, customers move through a series of steps. By flowcharting the process from start to finish, managers can understand how a particular type of customer experiences the service drama. We see how Boston's Beth Israel Hospital has used this approach.

11. From Turn-Offs to Turn-Ons

At each step in the unfolding of the service drama, any firm has numerous opportunities to turn off its customers. But those same customers also have an ideal scenario in mind of what they would like the process and output to be. Restaurants provide a fertile example

12. Product Plus Services: Like Petals on a Flower

Even though the core product may vary widely from one type of business to another, the supplementary services surrounding that service are often common to a great many different industries. These supplementary services can be clustered into eight groups.

13. Cultivating the Flower of Service

In today's economy, manufacturing firms are hybrids. Not only must they excel at the physical aspects of production, but they also have to be skilled service providers, too. Some firms subcontract key service tasks. But outsourcing is not for everyone, especially if, like White Flower Farm, you want to control the complete package presented to customers.

14. Problem Solving and Service Recovery

Losing customers hurts profits. The art of service recovery focuses on fixing problems in ways that retain customer loyalty. Managers also need to make sure that problems don't recur. This means getting to the root cause, not just treating the symptoms.

15. Sometimes the Customer is Wrong

Nobody really believes the statement "The customer is always right." And they shouldn't. One type of wrong customer simply doesn't fit the firm's capabilities; the other meets the target market profile but behaves badly toward the business, its personnel and facilities, and even other customers.

16. getting the most out of your Productive Capacity

Most service operations have upper limits to their productive capacity. Under conditions of fluctuating demand, management needs to balance supply and demand in ways that ensure that the firm's human and physical assets are being utilized in the most profitable way.

17. Technology: Servant or Master?

To an increasing degree, product plus performance depends on intelligent use of technology-especially information technology (IT). New developments often generate the most interest, but service firms should focus their attention on how to integrate technology's capabilities with customer needs and corporate goals

18. 24-365-Global: Service Anytime, Anyplace

As companies' expand their marketing horizons from local to regional to continental to global, customers increasingly expect to be able to get information, place orders, and resolve problems 24 hours a day, 365 days a year wherever they may be. Hewlett Packard obliges.

19. Parlez-Vous Français?

Doing business only in English may become a product minus as national economies become more multicultural, as people travel more, and as markets become more international. Fortunately, many solutions are available to help firms solve the language problem.

20. Sustaining the Human Side of the Enterprise

Despite the advances in technology and self-service, many businesses still depend heavily on employees to serve customers directly or to work backstage in support of front-stage activities. Current thinking from both academic research and innovative companies offers important new insights.

21. The Strategic Route to Product Plus Management

Becoming and remaining a product plus organization can't be achieved through a series of tactical moves. There has to be an overarching strategy that reflects holistic thinking and involves integration of the marketing, operations, and human resource functions.

NOTES

INDEX

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Last Updated 00-03-16

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