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Services are deeds, processes and performance.

Intangible, but may have a tangible component. Generally produced and consumed at the same time.

Service is an act or performance offered by one party to another . Although the process may be tied to a physical product, the performance is essentially intangible and does not result to any owner ship of any factor of production.
Services are economic activities that create value and provide benefits for customers at specific times, place.

Service is an activity that has an element of


intangibility associated with it and which involves the service providers interaction either with customers or with the property belonging to the customer. - Adrian Payne
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Philip Kotler ---service is any activity of benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything. Its production may or may not be tied to a physical product

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regardless of ththere is a services component to the offerings of all firms in some cases, a service is the principal purpose of the transaction, as in the rental of a car, a haircut, or legal services -- we refer to this as the core service in others, service is performed in support of the sale of a tangible product -- these are referred to as supplementary services

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1. There has been an increase in demand for the services of professionally qualified technicians with establishment of technical institutes. 2. Communication services like entertainment, education and the right to information by the public is more important.

3. Due to increasing standards in education there is an increasing demand for educational services. Primary, secondary, higher secondary schools, junior degree collgese are the institutes which are in great demand. As the number of students goes up the demand for private classes, tutions, etc. also increases.

4. Banking services have become necessary to meet financial requirements of the public and the national industrial sector.

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5. Personal care services are essential to develop potentiality of an individual for a perfect personality and positive image. 6. Electricity services are required for the benefit of society, industry and so on. 7. With the increasing amount of trade and business, done by road there has been a demand for transport services which benefits various automobile manufacturers. Large section of population prefer having their own vehicles, proving a good business propositions for automatic industry. 8. The tourism has geared itself to make the tourists enjoy the holiday seasons in the places of their choice and take them away from monotonous existence of cities. 9. Adequate hospital services are essential for the well being of the society.

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10. Hospitality services work on the strategies to satisfy the business class through their service in terms of comfort and satisfaction. The above activities have left the management scientists, professionals and socio-economic thinkers analyze and understand that managing services need attention, to stay in business.
11. As the natural resources are depleting and need for conservation is increasing we see the coming of service providers like pollution control agencies, etc. 12. The development in information technology has given rise to services like pager service PCOs, world wide web etc. Professional requirements need a change when technology develops and evolves.

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Defining and improving quality Communicating and testing new services Communicating and maintaining a consistent image Motivating and sustaining employee commitment Coordinating marketing, operations and human resource efforts Setting prices Standardization versus personalization

The services sector has been a major and vital force steadily driving growth in the Indian economy for more than a decade.

The services sector has been growing at a rate of 9.4% per annum in recent years. More than half of our GDP is accounted for from the services sector. This sector dominates with the best jobs, best talent and best incomes.

Affluence: - The increase in per capita income indicates the increase in service like pest-control, personal security, interior designer, etc. Leisure time: - People do get some time to travel and holiday and therefore there is a need for travel agencies, resorts, hotels, and entertainment. There are others who would like to utilize this time to improve their career prospects and therefore there is a need for adult education/distance learning/part time courses. Life expectancy: - The health programmed have significantly contributed to an increase in life expectancy given rise to services like old age homes, nursing homes, health care, etc.

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Working wives: - As more and more women have started working, the need for day care for children has increased, and so is the care with packed food and home delivery. Product complexity: - A large no. of products are now being purchased in households which can be serviced only by specialized products like water purifies, micro wave ovens, home computers, etc. which give rise to the need for services like after sales service agents for durables, maintenance service providers, etc.

Life complexity: - As the daily routine gets busier, individuals find it difficult to manage things on their own. Their leads to an obvious need for tax consultants, legal advisors, property advisers, etc.
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Resource shortage and ecology: - As the natural resources are reducing and need for conservation is increasing, we have seen the coming up of service providers like pollution control agencies, car, pools, water management, etc.
New products: - the development in information technology has given rise to services like PCOs, Pager service providers, Web Shoppe, etc

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Factors Influencing the Growth of Service Sector


Demographic Changes- Insurance, Banking
Social changes- Hotel, Tourism Economic changes- Retailing Technological changes- IT services Political changes and legal changes - NGO

Policy changes - Hospitality

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Services can be classified on the basis of tangibility like following

-A pure tangible good -A tangible good with accompanying services -A major service accompanying minor goods and services -A pure service

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Pure tangible goods Tangible good Accompanied service

Wheat ,sugar, soap, cosmetic etc. Computer, cars air conditioners, machinery-after sales service Beauty saloon providing cosmetics Child care centers providing baby food.

Major service accompanying minor goods & service

Pure service

Surgery, consultancy teaching

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Intangibility Heterogeneity Inseparability

Perishability

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A service is generally not able to be recognized by any of the five senses, that is, it cannot be seen, touched, smelled, heard, or tasted.
No impulse purchase. No one measure the features and quality of the services. There is no concept of ownership, possession or acquisition for the customer after the service transaction.
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Services cannot be inventoried Services cannot be patented Services cannot be readily displayed or communicated Pricing is difficult

Use of tangible clues.

assist customer in making service evaluation. ( insurance advt. in media) ( ICICI bank --- strong ATM network.)

Use of personal source of information. ( due to lack of objective means of evaluation customer looks to wards friends , family ) offering incentive to existing customers for roping in new customers) Creation of strong organizational brand. ( results in loyalty i.e. Maruti , Sony) In separatibility 1.Service provider physical connection to service being provided. 2.Customers involvement in the service process. 3.Involvement of other customer in the service process.

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Of same quality Goods & services Another difference- un ability to control the service quality before it reaches the customer. Service offered by one employee may differ from the other

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Service delivery and customer satisfaction depend on employee actions Service quality depends on many uncontrollable factors There is no sure knowledge that the service delivered matches what was planned and promoted

Customization. .

Standardization.

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Services are generally created or supplied simultaneously. They are inseparable. For e.g., the entertainment industry, health experts and other professionals create and offer their service at the same given time. Services and their providers are associated closely and thus, not separable.

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Customers participate in and affect the transaction Customers affect each other Employees affect the service outcome Decentralization may be essential Mass production is difficult

Emphasis on selection ,training public contact personnel. Consumer management. ( reservation in restaurant) Use of multi site locations (ATM , McDonald's..)

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Services cannot be stored, inventoried (saved), resold or returned. A bad haircut cannot be returned or resold to another customer.

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It is difficult to synchronize supply and demand with services Services cannot be returned or resold

Creative pricing- (early bird incentive , happy hours ) Demand strategy (reservation system, complimentary system, development of non peak demand) Supply strategy. - Part time utilization ,advance preparation of expansion,

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T R O E U R I S A R K E T
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A G L A B E L I N G C U
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O D

A T H E L T H C A
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Q D Q S

O O T O H U N B P
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W O P Q K T B A
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M C R K

W E F N P
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Q O G I G I S
O G T

W I

H A T
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O O K O N
N O I O I C

M B

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M M U

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