Creating a competitive advantage thru service design
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The document outlines the importance of service design in creating competitive advantages and highlights structural barriers to service innovation such as organizational silos and resource competition. It discusses common mistakes in service development and defines a human-centered approach to service design, emphasizing integration across strategic, system, and process decisions. Additionally, it introduces tools for service design and methods for measuring return on investment, including the service usability index and the triple bottom line framework.
Creating a competitive advantage thru service design
- 1. Creating a Competitive Advantage thru Service Design Andrew Leone, BS Engineering, MBA, MS Finance Summary of “Brand-Driven Innovation”
- 2. 2 Increasing Opportunity to Differentiate Service 79% Service represents ~70-80% of GDP for many developed countries (CIA World Fact Book)
- 3. 3 Structural Barriers to Service Innovation • Service organization silos that are designed to support operational efficiency rather than rapid change • Many competing agendas within the organization; all competing for the same resources • Lack of a consistent team or champion for the long period between idea generation and bringing ideas to market • Measures of success (and accountability) that are ill defined • The large scale of some service organizations, which make it hard for them to match the nimbleness of the marketspace • Change is expensive
- 4. 4 Common Service Mistakes • Even when companies talk about radical change, they tend to mean incremental service improvements that do not affect the marketplace in the same way a radical change would • Ideas get killed too soon for the wrong reasons • Ideas that are selected are based on operational viability or existing technology vs. real customer needs • Team developing the new service concept does not have a strong enough champion within the organization to get resources required • Design development is not carried out w/ due diligence • Lack of overarching goal might lead to a lack of focus or too narrow a focus; both detrimental
- 5. 5 Definition of Service Design Ex: iPod is part product (device), part database (iTunes), part inventory (music store) Aims to create services that are useful, useable, desirable, efficient and effective1 Human-centered approach focusing on customer experience and quality of service encounter as key value for success 2 Holistic approach that considers in an integrated way strategic, system, process, and touchpoint design decisions 3 Systematic and iterative process that integrates user-oriented, team-based interdisciplinary approaches and methods in learning cycles 4
- 6. 6 Service Design Tools Disciplines including: linguistics, marketing, organizational dev. process mgmt., cust., quality mgmt., etc. Benchmarking, critical incident technique, ecology map, ethnographical studies, shadowing, trend scouting Understanding (assessing) Heuristic evaluation, personas, pluralistic walkthrough Filtering (reducing) Affinity diagram, fishbone diagram, touchpoint analysis Thinking (framing) Experience prototyping, metaphors, social network mapping Explaining (rationalizing) Body-storming, ramdomizer, unfocus group Generating (exploring) Blue print, role script Realizing (building)
- 7. 7 Strategies for Practice Multidisciplinary teamwork Prototyping as a Vehicle for Teamwork Open design architecture Integration b/w functional and emotional benefits Practitioners must look at entire ecosystem v. isolated problems Prototypes should be transparent to all actors during the design process. (Glass box v. black box) Should allow for gradual improvements and change over time. Goal is to create highly adaptable solutions Good balance over all touchpoints and relate back to company’s brand and service
- 8. 8 Key: Experience Flows Across Touchpoints Art of matching customer expectations w/ consistent overall experience v. touchpoints in isolation Best way to ensure quality within complex service is to put the customers who are going to use the service, v. design object, at the center of the design process. Marketing Print Third party services Web Call center Mobile Employee agents Products
- 9. 9 Measuring Return on Investment Require both intangible qualitative measures as well as tangible quantitative measures Gross Value Added (GVA) 78% Triple Bottom Line Service Usability Index Economic measure used to estimate value of service produced Measures the quality of a service in concrete terms, enabling organizations to take actions to improve designs Organizational success should be measured as sum of economic, environmental and social effects
- 10. 10 Triple Bottom Line Example: ride share Economic Environmental Social Profits Market share # cars taken off road User driving reduction Expand mobility options and customer connectivity Reduce congestion & pollution Lower owner spend on transportation # members w/o a car Emission reductions Re-think cultural norm Creates sense of community Company Customer
- 11. 11 Service Usability Index Understanding design quality enough to make improvements that release value Proposition: Do people understand the value proposition of the service? Rates quality of a service thru in-depth user interviews and assigns score between 0 ~ 10 Experience: Do people feel good about the service? Usability: Can people easily use the service? Accessibility: Is the service universally usable for everyone? SU Index
- 12. 12 Recommended Reading Lockwood, T. (2009). Design Thinking: Integrating Innovation, Customer Experience, and Brand Value. New York, New York: Allworth Press.