Service Management - A New Model for Hotel Management

Author: Jai Candampilly (Australia)
Publisher:
Publish Date: 2006-06-01
Features:
3. The "ownership" of service products
Due to the characteristics of non-storability and intangibility, service products cannot be "owned" by anyone, whether the supplier or the consumer. Fundamentally, there is no issue of "ownership" with service products. If people purchase physical goods, they own the goods they buy. However, in the process of providing services, there is no corresponding transfer of ownership. When consumers purchase service products, they are actually buying the right to enjoy a particular service product at a specific time. Consumers cannot take away the service product they purchase and use it at a time they deem appropriate. Examples include meal vouchers for New Year's Eve celebrations, theater tickets for a specific performance, and scheduled meeting times with accountants—all of which are instances where consumers have the right to enjoy a service product at a particular time. In the true sense, consumers do not "own" the service product. Non-storability and intangibility prevent consumers from truly obtaining "ownership" of service products. This fact may create practical problems for both service product suppliers and consumers.
For service product suppliers, there is the issue of obtaining product patents. Service products cannot be "owned" like physical products and thus cannot be protected by patents, making them always vulnerable to imitation by competitors. For consumers, the lack of "ownership" reinforces the insecurity they feel when purchasing service products. After the transaction is completed, consumers do not actually "own" anything. In the process of marketing service products, managers must be aware of this strong sense of insecurity in consumers.
"This is Lord Melbourne's"
In the classic British television comedy Fawlty Towers, the foolish hotel manager Basil Fawlty (played by John Cleese) mistakes a new guest who has never been seen before for a British lord. To curry favor with this supposed "Lord Melbourne," Basil rudely asks the guest comfortably seated at the window table to move to another table, as it is in a prime location with a great view outside. "This is Lord Melbourne's," Basil lies, and continues to "explain" that Lord Melbourne "always" sits at this table when he visits Fawlty Towers. The guests forced to move tables are, of course, very unhappy. They believe the table at least belonged to "them" at that moment, not "Lord Melbourne's"! The so-called "Lord Melbourne" is actually a fraud who attempts to deceive many residents of the town, including stealing money and coins from Basil himself. Upon discovering the deception of the "Lord Melbourne," Basil feels extremely embarrassed and angry.
What makes this story interesting is the concept of the "ownership" of the table. The seated guests believe the table belongs to "them," while Basil claims it belongs to "Lord Melbourne." In reality, neither of them is correct. The table has always belonged to "Basil." Regardless, the table is not a product provided by the hotel. In the true sense, the guests do not "own" the table when they sit down to eat at the restaurant. They are merely purchasing a service (and, of course, the food). Both the service and the food are non-storable and disappear quickly. The guests do not gain ownership of the physical item (such as the table)—at least they have no right to call it their own, take it away, and use it freely. In any true sense, these items do not belong to "them."
The non-storability and intangibility of service products make them impossible to "own." Fundamentally, there is no issue of "ownership" with service products. P36-37