Amy L. Ostroom is one of the leading academic researchers on the subject of services marketing. As PetSmart chair and Services Leadership Professor at Arizona State University in Tempe, Ariz., she has published papers in several journals. Besides teaching, she has helped both Fortune 500 companies and small start-ups improve their services through the services blueprinting technique.
She sat down for an interview with me at PTC Live Global 2013. Here are some excerpts:
Q. What issues are most challenging for services organizations today?
A. Services organizations are faced with continually trying to develop higher value services – figuring out how to create them and launch them effectively in ways that are satisfying to customers.
Q. When did companies start thinking about services as something they could sell instead of as something they had to do?
A. In the last 20 years companies started thinking of services as a way to compete effectively in the marketplace. We’ve seen a progression in 20 years. IBM from the beginning moved from making computers to providing high value services. We’re seeing that trend across industries. It’s a transition a lot of companies are interested in, and as academics we’re very interested.
Q. What is service blueprinting?
A. Service blueprinting is a technique that helps individuals within an organization understand their service offerings. It lets companies examine their service processes from the customers’ point of view. It leads to very customer-focused discussions about how to improve or design services.
Q. Who in the organization should champion the effort?
A. Because blueprinting can be used to look at any customer facing process—internal or external—service offerings often involve groups throughout the organization. The more senior the champion, the more likely you can get the right people in the room.
Q. What are the key steps?
A. We like to start at the very strategic level. Is the organization trying to develop a new service offering? Once we know the most strategic objective, we decide what process we can look at. We like to look end to end, from the time a customer is first thinking about an offering to how they experience it. Then we can identify fail points.
A utility might have a program for residents to sign up to reduce energy usage. We’d look at how they learn about it; how they sign you up for it; how they experience it over time. To deliver new, high value service offerings, we figure out what the customer experience will be and how to make that happen. Blueprinting can help have the necessary discussions to get that all down on paper.
Q. What leads companies to try services blueprinting?
A. Sometimes companies have falling satisfaction levels or retention rates aren’t what they want them to be. You can hold a whole lot of meetings and still not be clear where the problem is. Organizations might have numerous groups all contributing to it. With blueprinting you bring people into a room and talk it out, and you can see where the problems are.
Handoffs are a huge problem. Managers come in and discover they know only 20 percent of how a process works. They know how they touch the customers, but they don’t know what else happens to the customer. If we don’t know internally what’s happening, it’s not surprising customers have trouble.
As a customer I’ve had people say to me: “I don’t know how to transfer you there.” I think: “You do work there, don’t you?” That seems like a lot of work for me to do to find out. This happens because the services offerings are complex and it takes a lot of skills and resources to pull them off. If nobody’s talking to each other you may get a lot of small fixes that are sub-optimal.
Q. What are the benefits of services blueprinting?
A. It definitely helps organizations become more customer focused. You might see what kinds of customer education are needed.
You see all the things that might impact the customers’ perception about the company. You will identify fail points for the customer. Also you can map out processes and compare them to your competitors
You also get visibility into your employees. Having a better understanding of their role and how it impacts customers is helpful and it also cultivates employee buy-in. If multiple groups identify the same problem, all these folk have a hand in creating the new offering.