Service marketing class assignments

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LECTURE 1

CASE: IBM: A SERVICE COMPANY? More than two decades ago IBM was on the brink of being broken up into a number of “Baby Blues”. However, under Lou Gerstner and Sam Palmisano, IBM was transformed from a Big Blue Dinosaur (almost falling apart) into the EBusiness Services Firm of the Future.

Please, prepare the assignments below.

a) Describe the developments IBM has gone through since the beginning of the 1990s.

http://www.adaptivecycle.nl/images/Mini_case_study_IBM_5.pdf - Source of info

IBM (international business machines) has been one of the few companies still alive and well that were founded in the 19th century, and for that it can thank its multiple transformations throughout centuries. IBM has been stabilizing its business until the 1990s, where a big disruption and tech advancement happened. IBM has produced everything in-house, hence high prod costs, and held the entire supply chain, hence more supply chain expenses. They had amazing customer service and have implemented new strategy, but its massive control over processes made them cost-inert. Not until Louis V Gerstner decided to 'clear out' the business by selling parts which aren't as effective as the competition (e.g. telecommunication, corporate aircraft fleet) and changing some technologies (eg is bipolar to CMOS circuit boards). Then, instead of bringing product to perfection, they decided to tap into the needs in the market and find solution. Interestingly, he has also managed to shift power from management comitee and their demands to demands of the consumer directly. Gerstner called this "a customer is running IBM".

b) Describe IBM’s current service strategy and service concept (https://www.youtube.com/watch?v=RmkwrnB20LM)? IBM’s annual report might also provide more insights in its current service strategy (https://www.ibm.com/annualreport/).

"At the deepest level, the most important fact about IBM’s 2017 was not our return to revenue growth in the fourth quarter or the continued scaling of our new products and services or our patent achievement. It is our reaffirmation of IBM’s essential identity.

IBM is an enterprise technology company. We deliver services with the simplicity, speed and delight of the best consumer products and services, but we are very clear on whom we serve. We are dedicated to our clients’ success,

Many types of clouds exist, but only the IBM Cloud is built for the enterprise, is able to handle all kinds of data and applications, and provides seamless integration of artificial intelligence, world-leading security and the ability to evolve over time."

so....

-patents

-service

-b2b

-decentralized/entrepreneural

-staying 'up to date'

-unification of mini business cells

c) What have been the consequences for IBM of NOT having implemented the current service strategy?

-being unprofitable -- massive org will lead to inert changes -- as the speed of change quckens, IBM falls behind -- globalization fine tunes needs of the market, IBM becomes redundant -- in the bloom of entrepreneurship IBM falls shoof satisfying more refined consumer needs -- competitors appear who are better at this -- IBM loses market share, performs poorly overall, mplementing change gets tough -- would need a radical overhaul

d) How has this service strategy affected IBM’s financial performance (https://www.ibm.com/annualreport/)?

e) IBM has acquired SPSS Inc. in 2009 (http://www03.ibm.com/press/us/en/pressrelease/28522.wss). How could this strengthen IBM’s service strategy?

"With this acquisition, we are extending our capabilities around a new level of analytics that not only provides clients with greater insight -- but true foresight,"

SPSS Chief Executive Jack Noonan said he expects the deal to speed up the adoption of predictive analytic software. Noonan called the deal, "A highly complementary move from both a technology and market position perspective."

--> a faster, more responsive develpment of tech that will serve consumers and solve problems more quickly

f) Typically, the addition of services is referred to as servitization, or servitization of manufacturing (Dinges et al., 2015). Describe the current trends in servitization and try to find two examples of servitization, one in a B2C setting and one in B2B setting. Does servitization lead to increased financial performance? Find included a number of selected literature suggestions below. However, note this is not necessarily an exhaustive nor complete list. Feel free to find some relevant additional literature to deal with the assignments above!

In essence servitization is a transformation journey - it involves firms (often manufacturing firms) developing the capabilities they need to provide services and solutions that supplement their traditional product offerings. More formally, my colleagues and I at Cranfield University defined servitization as "the innovation of organisation’s capabilities and processes to better create mutual value through a shift from selling product to selling Product-Service Systems". Two other definitions accompany this: (i) the idea of a product-service system - "an integrated p

This shift in business model is important because it means the interests of clients and providers are much more closely aligned. ​​​​​​​

selling solutions rather than products

Literature Suggestions _____ (2002), “IBM Global Services: A Brief History”, IBM Corporate Archives, IBM, http://www-03.ibm.com/ibm/history/documents/pdf/gservices.pdf, retrieved 2016.02.01. Dinges, V., Urmetzer, F., Martinez, V., Zaki, M. and Neely, A. (2015).The Future of Servitization: Technologies That Will Make A Difference. Cambridge Service Alliance, University of Cambridge, Cambridge, UK, http://cambridgeservicealliance.eng.cam.ac.uk/resources/Downloads/Monthl y%20Papers/150623FutureTechnologiesinServitization.pdf, retrieved 2017.02.27. Kirkpatrick, D. (1999), “IBM From Big Blue Dinosaur To E-Business Animal IBM's services now matter more than its hardware. That's the key to Lou Gerstner's remarkable turn-around - and to IBM's future”, Fortune, 26 April, 10 http://money.cnn.com/magazines/fortune/fortune_archive/1999/04/26/25876 3/index.htm, retrieved 2016.02.01.

The cases need to be prepared in advance for in-class discussion, but no formal presentation is required. The cases constitute an integral part of class participation.

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LECTURE 2

CASE: STARBUCKS Please, Starbucks is one of the iconic, global service firms. Answer the following questions below. You may visit www.starbucks.com and the Starbucks Youtube channel, https://www.youtube.com/user/Starbucks, for more inspiration.

• Have you ever visited Starbucks. If yes, please describe your “experience”. You may use the consumer choice model in Figure 2.2 (WZBG, p. 30) to structure your “experience” (see also Pine and Gilmore, 1998). Recently, customer journey mapping has been proposed to describe a service experience (http://files.thisisservicedesignthinking.com/tisdt_cujoca.pdf).

• Is the Starbucks “Experience” actually a service or a “product” (https://www.youtube.com/watch?v=vD-O3AzP8GI)? Justify your answer. • Describe the impact of the service properties on the expanded marketing mix for Starbucks.

• Chase and Dasu (2001) propose a number of operating principles for service encounter management on the basis of behavioral science findings. Could this work out for Starbucks? Product Price Place Promotion People Physical Evidence Process SERVICES 13

• What is the role of technology (including social media) in the Starbucks service experience (https://medium.com/rta902/brewing-a-strong-socialmedia-presence-a-starbucks-analysis-7a9f162db21f)? Literature Chase, R.B. and Dasu, S. (2001).”Want to Perfect Your Company’s Service? Use Behavioral Science,” Harvard Business Review, 79(6), pp 78-85. Pine, B. J., & Gilmore, J. H. (1998). Welcome to the experience economy. Harvard Business Review, 76(4), 97-105. Verhoef, P. C., Lemon, K. N., Parasuraman, A., Roggeveen, A., Tsiros, M., & Schlesinger, L. A. (2009). “Customer Experience Creation: Determinants, Dynamics and Management Strategies.“ Journal of Retailing, 85(1), 31- 41.

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LECTURE 3

CASE: YO! Sushi Please visit the YO! Sushi website at https://yosushi.com/.

• Describe the YO! Sushi’s service concept (https://www.youtube.com/watch?v=rc0RWtzKmt8 )?

• What could be the impact of “Big Data” (see McAfee & Brynjolfsson, 2012) on YO! Sushi? What is the role of social media (Kumar and Mirchandani, 2012; Tiago and Verissimo, 2014)?

• How can YO! Sushi use online reviews (e.g., on http://www.tripadvisor.com) to improve its customer service? 16

• What is the role of technology in the YO! Suchi service strategy (https://www.youtube.com/watch?v=uHNkWpPNK9A)?

• Can the YO! service concept be extended into other services (http://yo.co.uk/) and internationally? Literature Kumar, V. & Mirchandani, R. (2012), “Increasing the ROI of Social Media Marketing,” MIT Sloan Management Review, 53(1), 55-61. Mcafee, A. & Brynjolfsson (2012), “Big Data: The Management Revolution,” Harvard Business Review, 90(10), 60-68. Tiago, M. T. P. M. B., & Veríssimo, J. M. C. (2014). Digital marketing and social media: Why bother?. Business Horizons, 57(6), 703-708. The cases need to be prepared in advance for in-class discussion, but no formal presentation is required. The cases constitute an integral part of class participation.

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LECTURE 4

CASE: APPLE STORE VERSUS MICROSOFT STORE The introduction of the Apple Store proved to be a huge success for Apple. The Apple store with its motto “Enriching People’s Lives” has become a pivotal element in Apple’s (service) strategy. As of 2011, Microsoft started opening similarly designed stores. In the 1980s Microsoft introduced its Windows operating system “inspired “ by Apple’s graphical operating system, and went on to dominate the PC operating system market. Is history repeating itself? MICROSOFT Store:

VIDEO: http://www.youtube.com/watch?v=Nqlhzve4BOw A more in-depth analysis of the Apple store format is included in this video: http://www.youtube.com/watch?v=p5tuYT6At_s. Please, prepare the assignments below.

a) How has Apple successfully developed its service concept for the Apple store in terms of service operations building blocks? More particularly, focus on people (employee skills, training, motivation, corporate culture, recruitment, etc.), process (complexity, support, accessibility, ease of use, functionality, etc.) and physical evidence (signs, symbols, scents, colors, ambient conditions).

b) What is the potential dark side of the Apple store service concept?

c) Is emulating the Apple Store a good idea for Microsoft? Can other retailers learn from the Apple store? Samsung recently has recently introduced the Samsung Experience Store at Best Buy in the US (https://www.youtube.com/watch?v=fO50CESjqhw). Another copycat?

d) Samsung has started an advertising campaign attacking Apple’s brand image (http://www.youtube.com/watch?v=bJafiCKliA8). Please, explain the underlying logic of the campaign and how it might affect the Apple store and Apple?

e) How is the current status of Apple Store vs. Microsoft store (http://www.businessinsider.de/apple-store-vs-microsofts-flagship-storepictures-details-2018-1?op=1)? Find included a number of selected literature suggestions below.

However, note this is not necessarily an exhaustive nor complete list. Feel free to find some relevant additional literature to deal with the assignments above!

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LECTURE 5

CASE: TESCO “Our mission is to earn and grow the lifetime loyalty of our customers.” – Sir Terry Leahy, Chief Executive Officer, Tesco Please, study the Rowley (2005) for more information on the TESCO Clubcard Loyalty Scheme (https://www.youtube.com/watch?v=bUqYMgwHqlI). More information on TESCO is available from the TESO website (www.tesco.com) or from this BBC documentary (https://www.youtube.com/watch?v=YWMYXlPERQ). Answer the questions below:

• Describe the history of the TESCO Clubcard Loyalty Scheme.

• How do Tesco’s CRM practices converge or differ from local European retailers?

• Provide an update on Tesco’s current clubcard CRM program. See for instance, http://www.moneysavingexpert.com/shopping/reclaim-tescovouchers or http://www.telegraph.co.uk/finance/personalfinance/householdbills/10273842/Tesco-Clubcard.

• What role could mobile technology and social media play in Tesco’s CRM program (https://www.youtube.com/watch?v=PvFMWNJtyaQ)? Literature Rowley, J. (2005), "Building Brand Webs: Customer Relationship Management through the Tesco Clubcard Loyalty Scheme", International Journal of Retail & Distribution Management, 33(3), 194-206.

other assignments

Assignments: A Service World without Borders Please, prepare the assignments below.

a) Service Firms can use five basic globalization strategies: (1) multicountry expansion, (2) importing customers, (3) following customers, (4) service offshoring and (5) beating the clock (See also Table 14.2 in FF.14, p. 357).

Please, find a European example (the FF book is rather US-centric) for each of these strategies and use the key questions in Table 14.2 to verify for the suitability of the choice (i.e., Do you think this strategy makes sense for the service firm?)

b) Regarding service offshoring which service jobs are most suitable to service offshoring? What are the current trends in service offshoring? (See 23 for instance, http://www.deloitte.com/view/en_US/us/Services/additionalservices/Service-Delivery-Transformation/index.htm)

c) Cultural transferability is a key dilemma for service providers. An especially, interesting case is that of MacDonald’s entering France, the land of haute cuisine, fine wine, exquisite cheese and probably the last place to set up a fast-food operation. How has MacDonald’s been able to expand its market position in France?

d) Franchising is common vehicle to expand service operations internationally. What are the advantages and disadvantages for a franchisee and franchisor regarding international operations? Find a franchise on http://www.franchiseeurope.com and assess its viability on your local market? In other words, a franchise format you would invest your own money in! Find included a number of selected literature suggestions below. However, note this is not necessarily an exhaustive nor complete list. Feel free to find some relevant additional literature to deal with the assignments above! Literature Suggestions Fancourt, L, Bredesen, L and Majka, N. (2012), “Born in the USA, Made in France: How McDonald's Succeeds in the Land of Michelin Stars”, Knowledge@Wharton http://knowledge.wharton.upenn.edu/article.cfm?articleid=2906, retrieved 2012.11.26. Klender, M (2009), “Reports of the death of shared services offshoring have been greatly exaggerated”, Deloitte, http://www.deloitte.com/view/en_US/us/Services/additionalservices/Service-DeliveryTransformation/e10a089c0f553210VgnVCM200000bb42f00aRCRD.htm, retrieved 2012.11.26. McKendrik, J. (2012), “Offshoring Trend Set to Reverse: Study”, http://www.smartplanet.com/blog/business-brains/offshoring-trend-set-toreverse-study/23082, retrieved 2012.11.26. The assignments need to be prepared in advance for in-class discussion, but no formal presentation is required. The cases constitute an integral part of class participation.

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LECTURE 6

Assignment: Service Technology Please, prepare the assignments below.

a) Self-service technologies can have positive effects for customers and services firms. Provide an overview of the benefits and concerns of using self-service technologies? What are important future trends? See Castro et al. (2010) for an insightful overview and future outlook. Have their predictions materialized?

b) Smart services have important implications for the competitive advantage of service firms in B2C (http://techcrunch.com/2012/04/21/rise-of-smartmobile-services/) and B2B (https://hbr.org/2005/10/four-strategies-for-theage-of-smart-services). What are the most important trends of smart services for (service) firms?

c) Both Google (Google Shopping Express; https://www.google.com/shopping/express/) and AMAZON (AMAZON FRESH; http://fresh.amazon.com) have start up online grocery shopping. However, market growth seems quite modest (e.g., http://blogs.cisco.com/cle/fresh-fast-and-local-online-grocery-shopping-iscoming/). What are the most important barriers that stops online grocery shopping from realizing its true potential?

d) Recently AMAZON has introduced AMAZON GO (https://www.nytimes.com/2018/01/21/technology/inside-amazon-go-astore-of-the-future.html) as store of the future. Moreover, retailers in China, such as Bingobox, might even be ahead of AMAZON GO. Describe how AMAZON GO works and whether the business model makes sense. What is AMAZON GO’s key value proposition? Would this also work for other services? Find included a number of selected literature suggestions below. However, note this is not necessarily an exhaustive nor complete list. Feel free to find some relevant additional literature to deal with the assignments above! 25 Literature Suggestions Baya, V. & Wood, L. (2015). Service Robots: The Next Big Productivity Platform. Technology Forecast: Future of Robots, Issue 2, PWC, https://www.pwc.com/us/en/technologyforecast/2015/robotics/features/assets/26769-2015-tech-forecast-roboticsarticle-1-v6.pdf, retrieved 2017.02.14 Castro, D., Atkinson, R.D. and Ezell, S. (2010). Embracing the Self-Service Economy. ITIF report, April 14th, http://www.itif.org/publications/embracingself-service-economy, retrieved 2012.11.26. Doorn, van J., Mende, M., Noble, S. M., Hulland, J., Ostrom, A. L., Grewal, D., & Petersen, J. A. (2017). Domo arigato Mr. Roboto: Emergence of automated social presence in organizational frontlines and customers’ service experiences. Journal of Service Research, 20(1), 43-58. Lacity, M. C., & Willcocks, L. P. (2016). A New Approach to Automating Services. MIT Sloan Management Review, 58( 1), 41-49. The assignments need to be prepared in advance for in-class discussion, but no formal presentation is required. The cases constitute an integral part of

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