Service Management Essay Example

an essential dimension of strategic customer focus (Denney et al., 2009). According to the literature review, using the service triangle helps integrate business strategy, culture, and infrastructure for competitive success within the organization.The text emphasizes the importance of the customer in shaping an organization's operations. The customer is positioned at the center of a triangle, symbolizing their influence on purchasing behavior. At the top of the triangle is the business strategy, which outlines how to attract and retain customers through a customized value package rooted in a unique value proposition. The "people" element encompasses frontline service staff and reflects organizational culture. In a service-oriented culture, individuals view personal success as linked to company success and exhibit respect, cooperation, and focus on adding value when interacting with each other. This shift promotes internal contribution rather than competition among departments. An organization's culture can be either a strong competitive advantage or an obstacle.Ultimately, the sentiments of employees will be reflected in how customers perceive the organization. The "systems" aspect of the triangle is responsible for the entire infrastructure of the organization, including relationships between departments, physical facilities, information systems, procedures, rules, and regulations. All of these elements should be designed with customer-friendliness in mind to ensure an exceptional customer experience at every interaction. This involves understanding what customers want and providing value that meets their needs and enhances their lives. The customer value model helps identify and define this value for effective delivery. Through modern customer research methods, organizations can gain insight into customers' true values from their perspective. Engaging in dialogue with customers allows for identification of crucial elements that make the service experience meaningful. A

typical customer value model for a hospital stay is shown on the left sidebar. Additionally, having a mindset focused on improving customer experience is vital in service management. Organizations should help everyone understand the service experience from the client's point of view (Mangan, Lalwani & Butcher, 2008). The traditional industrial model of management has failed to consider the customer's perspective effectively.Within an organization, employees often prioritize their own departments and procedures, while customers perceive the service experience as a sequence of interconnected events. This perspective acknowledges that moments of truth are part of a broader chain of experiences or cycle of service (Dalrymple & Parsons, 2000). To develop a competitive business strategy centered on customers, it is crucial to determine the type of value package to provide. Different businesses encounter diverse challenges and opportunities when designing their value package. For example, certain service companies offer simple value packages that require minimal skill or knowledge. Fast food establishments frequently provide convenient, low-priced meals without many additional features, resulting in low customer expectations (Dalrymple & Parsons, 2000). Conversely, more complex value propositions present greater challenges and choices for cultivating customer preference (Dalrymple & Parsons, 2000). In terms of service management, organizational leaders must decide on the appropriate level of strategic value delivery for their business and concentrate on effective competition within that level. DHL has positioned itself as a premium service provider in order to achieve profitability and success through higher prices for reliable services, customized solutions, and efficient record management. Consequently, their core products like Document Express and Worldwide Parcel Express have become commodities as more suppliers are capable of meeting customer demands.DHL sets itself apart

from competitors by understanding the needs of key customers and offering superior services at the same cost through infrastructure improvements. They also employ a focused differentiation strategy by targeting midmarket and smaller businesses to provide high service benefits. Moreover, DHL has embraced acquisitions and integration strategies, collaborating with over 100 organizations such as Airborne Inc.

In terms of expansion in the United States, DHL concentrates on enhancing its overall network, including the ground network. This enables them to attract customers seeking cost reduction by opting for land transportation instead of air shipping. To meet the increasing demand for a ground network and capture small and medium-sized business clients, DHL invests in developing and improving its infrastructure. Additionally, they emphasize the significance of customer-centered elements within companies and their impact on productivity and customer satisfaction.

By focusing on the customer market, service concept, and delivery system, firms can generate value throughout the service experience resulting in improved satisfaction and loyalty.This paper focuses on implementing a strategic service vision effectively within DHL, as there is limited literature on this topic. The process involves developing a concept service model, conducting market segmentation, and upgrading the system service plan. It also highlights that DHL's competitive advantages are well-suited for the mature and highly competitive adult industry. In order to maintain these advantages, organizations in this industry need to prioritize adaptability, speed, flexibility, growth, and market disruption. DHL excels in express carrier services and possesses all of these competitive advantages (Denney et al., 2009). The concept of service refers to how customers perceive the total package of goods and services offered by an organization. DHL redefined its approach to the service concept

by considering the varying importance of different core and peripheral service components. To better understand customer preferences, a two-step approach was implemented (Cook, 2012). Additionally, there are multiple reasons why DHL maintains a global focus on parcel and expedited delivery. This strategy allows them to leverage their own strategic capabilities as well as those of other organizations.DHL can obtain physical resources such as vehicles, planes, ships, and facilities at a low cost, ensuring resource availability and allowing for expansion. However, DHL faces obstacles in entering the U.S. market due to limited ground transport capacity. Establishing their own system requires substantial financial resources and expertise. To overcome this challenge, DHL acquired Airborne which already has an established ground-based system. This acquisition saves costs and time while improving financial resources and providing investment opportunities for global expansion and infrastructure enhancement. This diversification strategy also brings economies of scale that competitors are already benefiting from with higher profit margins. By consolidating related activities worldwide, DHL can achieve economies of scale surpassing competitors' profit rates while facilitating knowledge transfer between organizations to enhance customer satisfaction and gain competitive advantage within the carrier industry. The use of ICT has significantly impacted DHL by revolutionizing how retail businesses are organized, conducted, and connected with other organizations (Denney et al., 2009). Through creating competitive qualities and capabilities, DHL has improved profitability and reduced costsThe DHL Online service management harnesses the power of the internet to enhance supply chain management. This allows for fast, convenient, flexible, and real-time information exchange. By incorporating DHL service management, retailers can facilitate collaborative production planning, transportation management, customer relationship management, and new product development to meet evolving

customer needs. These advancements have led to more retailers using the internet for purchasing, transportation logistics,internal inventory control activities ,customer support ,and supplier relationships. Moreover, the use of the internet has improved communication and relationships among organizations in terms of strategic partnerships, information sharing,multiple learning experiences,and increased transparency in supply chain management processes. In conclusion and as a recommendation,it is advisable to engage in service management not just because it seems like a good idea,but because there is a need for business improvement or results.Service management is the most effective approach that can lead to various benefits such as lower cost customer support,fewer disastrous rollouts,happier customers,better product data,and the introduction of a more sophisticated service (Mangan,Lalwani & Butcher ,2008).Viewing service management as a different perspective of the entire supply chain and business from the customer's point of view is crucial. Understanding our business in terms of the services it provides enhances our ability to effectively deliver them. To make improvements, we should have a well-designed plan and implement a continual service improvement program. Suggestions should be considered and prioritized based on their alignment with objectives. It is important for senior managers to take into consideration context, strategy, and customer needs when designing improvements, rather than relying solely on management. Frontline managers contribute their knowledge of improving operational processes and procedures, while external consultants bring valuable experience, expertise, and ideas from outside perspectives including theoretical best proactive content.

In summary, service management facilitates delivering value to customers without taking ownership of specific costs or risks. Adopting a service management approach can significantly impact business operations and staff mindset by shifting focus towards prioritizing what we deliver to

customers instead of isolated thinking about resources and actions. Service management provides a comprehensive view of the production network and business that takes into account the customer's perspective.DHL is often hailed as a prime example of service management improvement, recognizing the significance of delivering services that align with customer needs and objectives. Additionally, DHL adeptly handles the costs and risks associated with providing these services (Bove & Johnson et al., Cook et al., Dalrymple et al., Parsons et al., Denney et al., United States, Booz Allen Hamilton, Iteris Inc.).

The Federal Highway Administration in Washington, D.C. published "The DHL International business pocket book" (1996) by the DHL International (U.K.) as a reference (Federal Highway Administration).

Ennew and Binks' study on small businesses and their banks in the UK examines how service quality and characteristics impact customer retention, which was published in the British Journal of Management (Ennew & Binks).

Gronroos authored "Service management and marketing: A customer relationship management approach" in Chichester (Gronroos).

In an article published in the Journal of the Academy of Marketing Science, Gwinner, Gremler, and Bitner delve into relational benefits within service industries from customers' perspective (Gwinner et al.).

Hennig-Thurau and Klee emphasize the importance of customer satisfaction and relationship quality for retaining customers, referencing Lewis' article from 1999 (Hennig-Thurau & Klee; Lewis).

Lewis also provides further insight into this topic through his book titled "Service level management for enterprise networks" (Lewis).Furthermore, there are several publications that discuss various aspects of logistics and supply chain management. One such book is "Global logistics and supply chain management" written by Mangan, Lalwani, and Butcher in 2008. This book explores how these fields contribute to achieving customer satisfaction.

In addition to

this, the journal article titled "The commitment trust theory of relationship marketing" by Morgan and Hunt in 1994 emphasizes the importance of commitment and trust in relationship marketing.

Moreover, the Organisation for Economic Co-operation and Development (OECD) released a book called "Budgeting for results: Perspectives on public expenditure management" in 1995. This publication delves into the significance of budgeting in public expenditure management.