Service Management - Strategy and Leadership in Service Organizations (3rd Edition)

Author: Norman
Publisher:
Publish Date: 2006-06-01
Features: Most people believe that the service industry requires more labor compared to manufacturing—personnel management is the key to the success of service enterprises. However, although this may sometimes be true, it is wrong—or at least incomplete—to conclude that the service industry is more labor-intensive or people-intensive. In reality, many service enterprises are becoming capital-intensive. Besides airlines, which traditionally rely on a large amount of fixed assets and equipment, the security industry and banking are also increasingly dependent on advanced technology and equipment. Moreover, direct human interaction remains a crucial service element for these businesses. Additionally, in other service industries, the logic of the "critical moment" applies even when customers do not have face-to-face contact with service staff. For example, when dining at a renowned restaurant or traveling on a large jet aircraft, even though you may not see the chef or pilot, you can still genuinely feel their presence. Classifying service enterprises as "personality-intensive" rather than capital-intensive or labor-intensive may be more appropriate. Since customer perception of service quality depends on the performance of service staff in specific situations, most service enterprises are personality-intensive (regardless of whether they possess a large amount of capital and equipment). The performance of service staff determines the service quality and performance of the enterprise, so companies should grant them greater autonomy in decision-making. Even highly standardized service enterprises like McDonald's rely heavily on employee performance. When buying a car, you don’t care whether the workers on the assembly line smile at you or take pride in their work, nor do you care about their appearance or character; but when buying a hamburger from McDonald's "assembly line," all of these factors matter. The personal performance of employees significantly impacts the daily service quality of the enterprise, and the quality of service perceived by customers is immediately affected by how well each employee performs. Once employees lack enthusiasm or perform poorly in service, the consequences and negative effects become apparent quickly and are difficult to remedy. My research with colleagues, titled "Effective Service Enterprises Based on Social Innovation," is grounded in the concept of "personality-intensive enterprises." Designing suitable positions for employees, finding ways to unleash their intelligence, motivate them, help them quickly master job skills, and maintain their passion and enthusiasm for professional development—all of these fall under social innovation. Social innovation is a method that can both improve quality and reduce costs. In the following chapters, we will see some examples of social innovation that can help unleash employee potential.