Ccrucial Service Marketing Aspects of Process, People, and Resource Allocation - Case Study Example

Service management Table of Contents Introduction 3 Service Process 4 Service People 6 Resource Allocation 8 Conclusion 10 References 12 Bibliography13 Introduction The present dynamics of the business environment has rendered a situation of intensive competition among the market players with regards to the saturation of markets and presence of large number of competitors. The extent of competition is even more severe in the Western nations including US and Western Europe that have been the traditional markets. In order to remain sustainable in the market and generate long term profitability it is very essential to ensure organizational and process efficiency so as to ensure that there is a distinctive edge in the product or service offering (Lawrence & Edwards, 2000, p.222). The aspect of services marketing involves greater challenge considering the intangible nature of the offering. Efficient service management includes not only handling the regular aspects of the product mix but to also effectively manage the aspects of People, Process and Physical Evidence that are the most critical aspects of service marketing (Jack, 2005, p.177). In order to remain sustainable and profitable in the market it is very essential to create a distinction in these aspects in order to emerge as a formidable player in the market. Business organizations are spending huge amounts of monetary as well as human resources to analyse the gaps in the service delivery and consequently formulate a service mix that seeks to create a favourable distinctive image of the brand in the minds of the target market audience (Ellwood, 2002, p.44-45). The present study would analyse the crucial service marketing aspects of process, people and resource allocation in case of Virgin Trains so as to have a batter and practical understanding of the importance of these aspects in ensuring profitability and long term sustainability in a service oriented organization in the turbulent and competitive business environment. Service Process Process is a very important part of the service delivery mechanism for any business organization. It signifies the actual manner and the entire back end operations that are in place right from a sales call to the final closure of a deal. Virgin Trains is one of the most popular rail companies in UK offering customers with a service of train travel from one destination to another across UK. The company in association and collaboration with players like Alstom and Bombardier provides excellent rail travel options to link various places across UK in a fast and convenient manner. Led by the legendary Richard Branson, the UK based group draws its competitive edge owning to its excellent service delivery mechanism that offers customers with a volley of services with high quality in the delivery (Virgin Rail Group, n.d.). The service delivery process at Alstom is highly innovative and backed by superior technology that gives fast, reliable and convenient support to the consumers. Innovations in technological aspects include presence of a bi directional mechanism for signalling that enables trains to move in either direction using a single tract without chances of collision. In addition to this the service process also involves use of a Public Performance Measure that is a tool that helps keep control over the timings of the train. This tool helps keep an efficiency level on the arrival time and delay of the trains ensuring that customers arrive at their destination on time. Other technological aspects include presence of a block based joint that helps generate additional safety in the running of trains. The company in 2008 also introduced the Virgin High frequency communication device system that helps in improving the communications part of the company with regards to transfer of information in a fast and accurate method. The company also has created ease for customers by having an online portal that helps customers to book their tickets from the web directly. Customers have flexible and multiple payment options that help them generate convenience for the customers. All these sites have been protected by Secure Payment Gateways that would help prevent malpractices’ or fraudulent transactions that can cause inconvenience to the consumers. Due to these operational technological innovations, Virgin Rails has been consistently been rated as one of the top performers in the industry in the UK markets. The company has received numerous accolades from various organizations with regards to the use of high end technology and upgraded systems to help boost customer satisfaction (Virgin Trains-a, 2012). The aspect shows that an effective management of process part of a service delivery can help generate considerable advantage for the organization. This is because the process part of the service mix normally forms the basis of the other aspects of the service mix. Hence an efficient process can not only help in reducing cost but can also provide much greater and long term benefits that also include a favourable brand positioning and more importantly a distinction for the brand and service in the market that would help offer sustainable edge in a competitive market environment (Johnston & Clark, 2007, p.218). The limitation of service process includes the aspect of high cost involved in undertaking technological innovations. This puts a lot of strain on the monetary resources of the company. Furthermore a new technology also involves convincing employees’ and training them that again takes up resources. Finally, changeover to new processes also consumes time and cause unnecessary delays and other hurdles that may affect the normal service delivery of the company. Service People People are another critical part of the service mix of an organization as they are the ultimate individuals who deliver the service to the end customers. People also form the medium of direct contact with the customers and hence it becomes very important to ensure the presence of a skilled and motivated workforce that can help improve the quality of the service being delivered by the organization. People or the human resources of an organization act as carriers of the organization’s aims and visions and form the focal point in the entire process of service delivery mechanism. Hence an effective management of human resources imparts surmount importance to an organization willing to generate a competitive edge in the market (Verma, 2008, p.100). The people management style at Virgin Trains is highly reflective and draws considerable similarities with the style of the working of the CEO of the company, Mr. Richard Branson. The company has a culture of fostering innovation in the organization. The company expects all its employees to imbibe this aspect and show this in their day to day routine activities. Employee motivation is one of the key focus areas of the top management at Virgin Trains. Performance and innovation is the key to success in the organization and appraisal is very critical of these aspects. Various reward systems are also in place for the employee that includes performance bonus, employee stock options as well as promotions within the organization so as to ensure motivation and job satisfaction among the employees (ESE Courses, n.d.). In addition to employee motivation policies Virgin rails also has various career development programs that can help bring about better practices with regards to handling and servicing customers. This includes training and development sessions for employees so as to help them improve their learning curve and also inculcate the best practices in the employees. Specific stress is provided on the aspect of Customer Relationship Management practices as the company believes in not only attracting new customers but also retaining the existing customers. This is largely because of the fact that it is easier and more profitable to keep an existing customer than to attract a customer (Barlow, 2009, p.42). Moreover in case of the present day era of internet and social networking word of mouth has become an integral aspect that defines the positioning of a product or service in the minds of the target market audience. In addition to this there is a dedicated customer grievance cell that regularly handles various issues or complaints of the consumers. This is very important as it is one of the few crucial parameters that define the service quality of a particular organization. Finally, employees are also being continuously monitored through a performance appraisal system that ensures that the employees perform as per the expectations of the company. Human resources are the most valuable and important resources of an organization. Human resources are the ultimate individuals who deliver the service to the customers. This ensures a necessity for business organization to ensure that workers are motivated. A motivated employee largely takes up his tasks as responsibilities and hence this way it shows that an effective management can lead to generation of considerable advantage. The example of Google can be analysed in this regard. The company puts considerable emphasis of the aspect of human resource development and ultimately generates competitive advantage out of this aspect showing the importance of service people and their role in ensuring competitive advantage for an organization. One of the major limitations in the area of resource people involves the aspect of turnovers in the company. This leads to loss of quality manpower as well as the costs involved in training and hiring a new employee. High turnovers if not managed in a proper manner can lead to discrepancies in service delivery that can further lead to dissatisfaction from the customers. Also employee satisfaction and motivation are major factors that decide on the level of service being offered sa a satisfied employee has more chances of being motivated which is very essential for ensuring customer satisfaction. Hence effective steps like fair appraisal need to be ensured so as to make the organization a success story. Resource Allocation Resources are a very crucial component of any business process as it determines the efficiency of all other processes. According to a research resource allocation must follow principles of equity, objectivity, economy, simplicity and stability. These principles should be followed while allocating resources as it would imply better achievement of strategic goals with regards to an excellent service delivery (Prowle, 2000, p.69). Virgin Rail group always believes in its core policy of generating innovations in service delivery pattern. The company draws its inspiration from its CEO who believes that innovations ad differentiations are the key parameters that form the competitive edge for Virgin Trains in the markets. Hence the company has a policy of pursuing and providing adequate financial resources towards research and development that can help in generating a distinctive edge by helping provide customers with a service delivery package that is unmatched by any of its competitors in the market. Virgin Trains also ensures that the staff members are adequately compensated for their efforts. Various incentive and reward programs including stock options are also present so as to motivate employees about their job responsibilities. In addition to this the company has also spent considerable resources towards modernising and installing equipments that allow fast and efficient travel along with comforts to the passengers. The company believes in continuous spending on research and development as they feel that customer safety and security are the prime concerns for the company. Virgin Trains has also spent considerable resources in collaboration with players like Alstom and Bombardier in the area of research towards making luxurious and well equipped modern coaches to ensure passenger safety, security as well as a high level of comfort for the passengers. It has fitted its coaches with ultra modern technologies like high frequency communication and radio links along with tracking devices that ensures that trains arrive and depart strictly on time. All these aspects require considerable spending of monetary resources that has been well supported by the top management. The company also ensures that adequate staff members are always present in every section and department to ensure that customer service is not compromised at any cost. The analysis therefore reveals that the company is committed towards creating innovations and does not hesitate to spent monetary resources towards betterment of the service delivery mix in order to ensure that customers are fully satisfied with the service offering offered by the company. Critiques have sometimes questioned the move behind excessive monetary spending especially during periods of economic crisis as it puts further strain on the profit margins of the company. However the company through its carefully crafted strategies has proved the critiques wrong by showing that an effective spending on research activities can only reap profits for the organization. Managing finance is another crucial aspect that defines the success or failure of an organization. Proper financial management is important as it helps in ensuring financial viability of an organization. Resource allocation should be done in a manner that there is just the adequate number of resources being allocated for a purpose. This is also important because all the other components of a service delivery including people and process are very much dependent upon the effective management of the financial resources. Financial management can help a company take over competitors when they attack the company using various tactics like predatory pricing and other aspects. The limitations in this regard normally include the availability of funds especially in a recessionary market environment where credit is unavailable for business organizations. Hence resource allocation must be done with careful planning and adequate forecasting without which the company may run in doldrums. Conclusion The analysis of the three people, process and resources largely indicates the manner in which an effective management of these three crucial aspects can help determine the success or failure of the organization. These factors are quite significant as these determine the ultimate image of a brand or a service offered in the minds of the target market audience. The analysis of these aspects in the context of Virgin Trains reflects the same findings. The analysis reveals a formidable image of the brand in the minds of the target market audience that can be traced from the multiple awards and recognitions of the company from various credible sources. Also the analysis reveals an excellent leadership of the CEO whose vision is to innovate the service offering in a manner that tends to bring about a distinctive identity of the brand in the minds of the target market audience. However the need of the hour is to also find and apply a control and monitoring mechanism that can help in generating greater efficiency within the organization. This control mechanism would help in helping the company strategies so as to critically evaluate the strategies and also analyse their effectiveness towards the extent of achievement of the goals set by the organization. Creation of SMART goals that can be measured and quantified and also a Balanced Scorecard Method can help generate considerable advantage for the organization that can not only help in critically evaluating the strategies but also finding loopholes but also generate sustainable competitive edge in the market (Lopper, 2007, p.97). References Barlow, J. (2009). A Complaint Is a Gift: Recovering Customer Loyalty When Things Go Wrong: Easyread Large Edition. ReadHowYouWant.com. Ellwood, I. (2002). The essential brand book: over 100 techniques to increase brand value. Kogan Page Publishers. ESE Courses. (No date). Virgin Group. [Pdf]. Available at: http://esecourses.com/cfincase.pdf. [Accessed on February 15, 2012]. Jack, K. (2005). Video demystified: a handbook for the digital engineer. Newnes. Johnston, R. & Clark, G. (2007). Service Operations Management: Improving Service Delivery, 2/E. Pearson Education India. Lawrence, P.A. & Edwards, V. (2000). Management in Western Europe. Palgrave Macmillan. Lopper, J. (2007). Personal Development 40 Best Articles. Lulu.com. Prowle, M. (2000). The changing public sector: a practical management guide. Gower Publishing, Ltd. Verma, H.V. (2008). Services Marketing: Text And Cases. Pearson Education India. Virgin Rail Group. (No date). Our Work. [Online]. Available at: http://www.virginrailgroup.co.uk/eng/our-work.html. [Accessed on February 15, 2012]. Virgin Trains-a. (2012). About us. [Online]. Available at: http://www.virgintrains.co.uk/about/. [Accessed on February 15, 2012]. Bibliography Harris, D. (2006). 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