Service Management and Marketing: Customer Management in Service Competition

Service Management and Marketing: Customer Management in Service Competition

Service Management and Marketing: Customer Management in Service Competition

Service Management and Marketing: Customer Management in Service Competition

Synopsis

"Professor Grönroos presents the most scholarly and provocative examination of services marketing. This book will challenge companies to rethink how they should manage their services in building their competitive strength and profitability. Grönroos continues as one of service marketing's most original and able thinkers."
- Philip Kotler , S. C. Johnson Distinguished Professor of International Marketing J.L. Kellogg School of Management, Northwestern University

"Christian Grönroos is a globally recognized expert on services management and marketing. His innovative thinking and writing in this book offer fresh insights on this timely topic."
- Stephen W. Brown , PhD, Carson Chair, Professor and Executive Director, Center for Services Leadership, W. P. Carey School of Business, Arizona State University

"After three decades of contributions to services, Grönroos keeps pioneering the field. In this new edition he recognizes the dramatic changes in the perception of service that are in the making. It is a creative book which does not just list various service issues but adds the author's personal touch to each of them."
- Professor Evert Gummesson , Stockholm University School of Business, Sweden

This fully updated third edition examines customer management in service competition and focuses on adopting a service logic in marketing. Christian Grönroos explains how to manage any organization as a service business, showing how to move closer to current and future customers. The service logic is all about customer focused management and service management, using current academic research and business practice to make organizations more successful.

Topics that have been updated for the new edition include:

  • Service and relationship perspectives
  • Service and relationship quality
  • Service management principles
  • Profitability and productivity in services
  • Integrated marketing communication
  • Relationship communication and branding in services
  • Internal marketing and service culture
  • Why and how to transform a product-manufacturing firm into a service business

Excerpt

This book is about the service perspective in business, i.e. how to adopt a service logic in management, regardless of whether the core of the offering is a service or a physical product. In most industries and on most markets today, firms cannot develop a sustainable business by offering a physical product or core service only, and not even by adding services to the core offering. And this goes for firms operating on business-to-consumer as well as on business-to-business markets. Instead, managers have to recognize the fact that customers in almost all situations do not consume or use a physical product or a core service, but the service that these can provide them with. This service can be described as value-creating support to their everyday activities and processes. Hence, physical products and services, and additional activities required to create this support, have to be blended into one service or service offering to the customers. For the firm to be competitive this service offering must not only support its customers’ activities and processes in a value-creating way, it must do so better than the offerings of the competitors. Firms compete with service offerings, not with single services or physical products. Service firms have always done so, but today this goes for all firms with few exceptions.

Every firm faces what can be labelled service competition. Service competition can be defined as a competitive situation where the firm’s core solution—the core of the offering, a service or a physical product—is a prerequisite only for a sustainable competitive advantage, but where the firm competes with a total service offering including a number of various types of services that support the core solution. This demands that a service perspective is taken, and when managing the firm that a service logic is adopted. If this is not done, the firm will not act in the way its customers are expecting. The firm’s logic and the customers’ logic will collide. Firms that manage to support their customers’ activities and processes more efficiently and effectively than their competitors do will survive. Firms that do not develop such total service offerings, but provide customers with physical products or core services only, will in the long run disappear from the market. The challenges are the same for firms operating on business-to-consumer and on business-to-business markets, and for firms in service industries and in what are traditionally called manufacturing industries. As a matter of fact, the biggest challenge of all is for traditional manufacturers to manage to transform themselves into service businesses and learn how to adopt a service logic in management.

As services are inherently relational, managing a business from a service perspective benefits from a relational approach to customer management. There are always latent relationships between a firm and its customers. In many cases these can be developed into active relationships, and these relationships can form a good base for developing long-term and successful business with customers. However, it is also important to realize that customers do not always appreciate a relational approach and do not always want to engage in a relationship with a firm. Moreover, it is not always a profitable strategy for a firm to attempt to develop relationships with its customers. However, latent relationships are always there to be used whenever both the firm and its customers consider it appropriate.

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