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Premium member Presentation Transcript Chapter 15: Chapter 15 Organizing for Service LeadershipCustomer-Led versus Market-Oriented Philosophies of Management: Customer-Led versus Market-Oriented Philosophies of Management Firms may lose market leader position if listen too closely to current customers Service leadership requires curiosity, risk taking Customer-led businesses focus on understanding expressed desires of customers in currently served markets Market-oriented businesses commit to understand current/ latent customer desires plus competitors’ plans, capabilities Scan market more broadly, have longer-term focus Work closely with lead users (windows to future vs. anchors to past) Combine traditional research with experimentation, observation Conclusion: Pursue customer satisfaction, but set limits on being led by customers, especially during rapid changeThe Service Profit Chain (Fig. 15.1): The Service Profit Chain (Fig. 15.1) Loyalty Service Quality Productivity & Output Quality EMPLOYEES Capability Satisfaction Service Value CUSTOMERS Satisfaction Loyalty Revenue Growth Profitability Operating strategy and service delivery system Service concept Target Market Internal External Workplace design Job design Selection and development Rewards and recognition Information and communication Tools for serving customers Quality and productivity improvements yield higher service quality and lower costs Lifetime value Retention Repeat business ReferralCausal Links in the Service Profit Chain (Table 15.1): Causal Links in the Service Profit Chain (Table 15.1) Customer loyalty drives profitability and growth Customer satisfaction drives customer loyalty Value drives customer satisfaction Employee productivity and retention drive value Employee loyalty drives productivity Employee satisfaction drives loyalty and productivity Internal quality drives employee satisfaction Top management leadership underlies chain’s successIntegrating Three Functional Imperatives (recap from Chapter 1): Integrating Three Functional Imperatives (recap from Chapter 1) Customers Marketing Imperative Human Resources Imperative Operations ImperativeDefining Three Functional Imperatives: Defining Three Functional Imperatives Marketing Imperative Target “ right ” customers and build relationships Offer solutions that meet their needs Define quality package with competitive advantage Operations Imperative Create, deliver specified service to target customers Adhere to consistent quality standards Achieve high productivity to ensure acceptable costs Human Resource Imperative Recruit and retain the best employees for each job Train and motivate them to work well together Achieve both productivity and customer satisfactionReducing Intra-Organizational Tension: Reducing Intra-Organizational Tension Transfers and cross training Cross functional taskforces New tasks and new people Process management teams Gain-sharing programsThe Search for Synergy: A Top Management Perspective: The Search for Synergy: A Top Management Perspective What do we want? What can we do? What do our customers want? What do our employees, intermediaries, and other partners want?From Losers to Leaders: Moving Up the Service Performance Ladder: From Losers to Leaders: Moving Up the Service Performance Ladder Service Leaders Crème de la crème of their respective industries Names synonymous with outstanding service, customer delight Service Professionals Clear positioning strategy Sustained reputation for meeting customer expectations Service Non-entities Traditional operations mindset Rudimentary marketing, often emphasizing price discounts Service Losers Only survive because of lack of viable alternatives in marketplaceAchieving Service Leadership by Focusing on Role of Each Functional Area: Achieving Service Leadership by Focusing on Role of Each Functional Area Marketing: move from tactical to innovative and strategic Operations: move from reactive/cost oriented to focused, innovative, well coordinated with marketing and HR Human Resources: move from tight control of low-cost workers to quality of employees as strategic advantageLeadership for Change Management Involves Eight Stages: Leadership for Change Management Involves Eight Stages Create sense of urgency to develop impetus for change Put together strong team to direct process Create appropriate vision of where organization must go Communicate new vision broadly Empower employees to act on vision Produce sufficient short term results to create credibility Build momentum to tackle tougher problems Anchor new behaviors in the organizational culture Source: John KotterLeadership Qualities Needed in Service Organizations: Leadership Qualities Needed in Service Organizations Vision, charisma, persistence, high expectations, expertise, empathy, persuasiveness, integrity Ability to visualize quality of service as foundation for competing Believe in people who work for the firm, make good communications a priority Possess a natural enthusiasm for the business, teach it to others, pass on nuances, secrets, crafts of operating Cultivate leadership qualities of others in organization Use values to navigate firms through difficult timesTransformational Leadership May Require Changing Corporate Culture: Transformational Leadership May Require Changing Corporate Culture Corporate Culture: Shared perceptions regarding what is important Shared values about what is right and wrong Shared understanding about what works and what doesn’t Shared beliefs about why these things are important Shared styles of working and relating to others Climate for Service--Tangible working environment atop underlying culture. Influential factors include: Shared perceptions concerning practices, procedures and types of behaviors that get rewarded Clarity about mission and values, level of commitment to common purpose Flexibility: freedom to innovate, sense of responsibility, standards You do not have the permission to view this presentation. In order to view it, please contact the author of the presentation.