Summary – Service
Industry II
EXAM PREPARATIONS FOR Y1Q3
By: Jeffrey Engels
|
,TABLE OF CONTENT
Lectures & Training Sessions……………………………………………………………………………………………………p.2-p.18
Week 1……………………………………………………………………………………………………………………….…p.2-p.4
Week 2……………………………………………………………………………………………………………………….…p.5-p.8
Week 3……………………………………………………………………………………………………………………….p.9+p.10
Week 4………………………………………………………………………………………………………………………p.11-p.13
Week 5…………………………………………………………………………………………………………………..…p.14+p.15
Week 6……………………………………………………………………………………………………………………..p.16+p.17
Week 7………………………………………………………………………………………………………………………………p.18
Book Summaries……………………………………………………………………………………………………………………p.19-p.33
Chapter 4 - Service process design (p.64–68 + p.70-72)………………………..…………………..p.19+p.20
Chapter 7 - The role of facilities management in designing the service experience (p.141-
p.147)……………………………………………………………………………………………………………………………….p.21
Chapter 9 - Pricing Services……….……………………………………………………………………………...p.22-p.27
Chapter 10 - Capacity Management (p. 202 - p.213 +p.226-p.241)……………………….…..p.28-p.31
Chapter 17 - Managing services across national boundaries (p.422-p.423)……………............p.32
Chapter 18 - Servitization - or why services management is relevant for manufacturing
environments (p.430-p.432)…………… …..……………………………………………………………………………p.33
Practice test (based on the lectures)……………………………………………………………………………………………..p.34
Answers to the test……………………………………………………………………………………………………………….p.35+p.36
1
,Lectures & Training Sessions
Week 1
Price
Of the classical four Ps of the marketing mix (product, place, promotion, and price), it is price that
usually receives the least attention, even though the pricing decision probably has the greatest
impact on a company’s profits.
“Price is distinguished from other marketing devices by the force and the speed of sales-effect, the
shortness of time it takes to change it, the elasticity of competitive reactions and cash flow
implications.”
Non-monetary costs
What it costs for a customer (other than money) to buy a product, including the time spend on
shopping and the risk taken in the assumption that the product will deliver expected or promised
benefit.
There are several types of non-monetary costs:
• Search costs: the effort to identify and select the desired service (e.g. time)
• (In)Convenience costs: arranging schedules, travelling time
• Time costs: length of time to be served
• Psychological costs: fear of not understanding (pension), fear of refusal (bank), fear of the
outcome (surgery): risk taking
Non-monetary costs play a role in the assessment of the quality of processes, the assessment of the
price/value relationship and hence in customer satisfaction. People are also willing to pay more if
they perceive a decrease in nonmonetary costs.
Pricing decisions
Pricing decisions can be made through a four-step process. These four steps include:
• pricing objectives
• pricing strategy
• pricing structure
• pricing levels/tactics
Pricing objectives: The pricing objectives should be in line with the overall business and marketing
strategy; e.g. acquiring market share, maximizing short-term profit, prevent competition from
entering the market, communicate brand positioning, stimulate sales of other company services
2
, Pricing strategy: The pricing strategy establishes a framework for pricing decisions and determines
the way in which prices will be set. Cost, competition and value as experienced by the consumer
should be taken into account
Pricing structure: The pricing structure takes into account a set of characteristics that will have an
effect on price levels and answers questions like : Which aspect of the service will be priced? What
will be included for that price? Will there be differentiation among different customers, payment
conditions?
Pricing levels/tactics: Promotions or other short term actions e.g. quantity discounts, lower prices in
off-peak hours.
3
Industry II
EXAM PREPARATIONS FOR Y1Q3
By: Jeffrey Engels
|
,TABLE OF CONTENT
Lectures & Training Sessions……………………………………………………………………………………………………p.2-p.18
Week 1……………………………………………………………………………………………………………………….…p.2-p.4
Week 2……………………………………………………………………………………………………………………….…p.5-p.8
Week 3……………………………………………………………………………………………………………………….p.9+p.10
Week 4………………………………………………………………………………………………………………………p.11-p.13
Week 5…………………………………………………………………………………………………………………..…p.14+p.15
Week 6……………………………………………………………………………………………………………………..p.16+p.17
Week 7………………………………………………………………………………………………………………………………p.18
Book Summaries……………………………………………………………………………………………………………………p.19-p.33
Chapter 4 - Service process design (p.64–68 + p.70-72)………………………..…………………..p.19+p.20
Chapter 7 - The role of facilities management in designing the service experience (p.141-
p.147)……………………………………………………………………………………………………………………………….p.21
Chapter 9 - Pricing Services……….……………………………………………………………………………...p.22-p.27
Chapter 10 - Capacity Management (p. 202 - p.213 +p.226-p.241)……………………….…..p.28-p.31
Chapter 17 - Managing services across national boundaries (p.422-p.423)……………............p.32
Chapter 18 - Servitization - or why services management is relevant for manufacturing
environments (p.430-p.432)…………… …..……………………………………………………………………………p.33
Practice test (based on the lectures)……………………………………………………………………………………………..p.34
Answers to the test……………………………………………………………………………………………………………….p.35+p.36
1
,Lectures & Training Sessions
Week 1
Price
Of the classical four Ps of the marketing mix (product, place, promotion, and price), it is price that
usually receives the least attention, even though the pricing decision probably has the greatest
impact on a company’s profits.
“Price is distinguished from other marketing devices by the force and the speed of sales-effect, the
shortness of time it takes to change it, the elasticity of competitive reactions and cash flow
implications.”
Non-monetary costs
What it costs for a customer (other than money) to buy a product, including the time spend on
shopping and the risk taken in the assumption that the product will deliver expected or promised
benefit.
There are several types of non-monetary costs:
• Search costs: the effort to identify and select the desired service (e.g. time)
• (In)Convenience costs: arranging schedules, travelling time
• Time costs: length of time to be served
• Psychological costs: fear of not understanding (pension), fear of refusal (bank), fear of the
outcome (surgery): risk taking
Non-monetary costs play a role in the assessment of the quality of processes, the assessment of the
price/value relationship and hence in customer satisfaction. People are also willing to pay more if
they perceive a decrease in nonmonetary costs.
Pricing decisions
Pricing decisions can be made through a four-step process. These four steps include:
• pricing objectives
• pricing strategy
• pricing structure
• pricing levels/tactics
Pricing objectives: The pricing objectives should be in line with the overall business and marketing
strategy; e.g. acquiring market share, maximizing short-term profit, prevent competition from
entering the market, communicate brand positioning, stimulate sales of other company services
2
, Pricing strategy: The pricing strategy establishes a framework for pricing decisions and determines
the way in which prices will be set. Cost, competition and value as experienced by the consumer
should be taken into account
Pricing structure: The pricing structure takes into account a set of characteristics that will have an
effect on price levels and answers questions like : Which aspect of the service will be priced? What
will be included for that price? Will there be differentiation among different customers, payment
conditions?
Pricing levels/tactics: Promotions or other short term actions e.g. quantity discounts, lower prices in
off-peak hours.
3
