Servilogy or etymologically, the study of service, is the term used in this work to mean and address here the question of service: principles, concepts, approaches, methods, and instruments from its original foundation in human action as Von Mises1 points out:
Human action is purposeful behavior … Action is will put into operation and transformed into an agency, is aiming at ends and goals, is the ego´s meaningful response to stimuli and to the conditions of its environment, is a person´s conscious adjustment to the state of the universe that determines his life. (Von Mises 1998)
From this anthropocentric conception, Servilogy, based on the axiom of reasoned human action, deals with its contexts capable of causing certain intentional and influenced actions, which differentiate it from Praxeology (study of the logical structure of action “praxis” as such) and other perspectives of simple physical effort or work. The force and factors that drive a human being in a certain way and “by acting, one chooses, determines, and tries to reach an end.”2
In this context, the service turns out to be the masterpiece of human action and the central theoretical foundation of the servitization construct: an imperative of social welfare and of the appropriate income of the entrepreneurial effort.
Fundamentals of Service
From the service perspective as a reasoned and deliberated organizational action, of impact and advantage for the business activity, what principles, concepts, and approaches should be considered in the creation and development of a servitization strategy?
The outcomes of the research communities3 in the field of services activity have integrated pioneering, interdisciplinary, and systematic concepts and approaches, and shaped a solid conceptual structure that has evolved into what today has been called Service Science.4 These postulates make up the foundations that support this servitization proposal.
What Is Service?
The act, performance, or activity of co-creating value. This concept sets distinctive qualities with its collateralities in the scope and performance of organizations: Inherence, intangibility, interactivity, and purpose. That is, of an essentially imperceptible and inseparable nature, it creates or develops interaction between entity or entities (relationship) with a reciprocal intention or spirit.
These qualities5 are contained in an activity, act, operation, process, performance, or experience of particular characteristics that contribute to the identification, conceptualization, and differentiation of a service proposal:
(a) User participation.6 User involvement impacts the conception, provision, and management of the service. It is the raison d’être of a service. It is an experience that the user lives in the service encounter and environment where it is a leading part of the interaction and the outcome. This user experience shapes its perception and impresses in a positive, negative, or neutral way the provision of the service and, in general, the performance of the system. The difference or gap between the service proposal and its fulfillment determines or not the user’s satisfaction and, consequently, the success of the undertaking or business.
(b) Intangibility. The immaterial nature of the service of not being physically perceived places it in the field of ideas and experiences with considerable implications for its provision, management, and marketing: design, valuation, differentiation, promotion, patenting, and sampling. It is the central differentiator between a consumer goods company and a service company. The act of selling intangible poses new challenges.
(c) Heterogeneity. The heterogeneous nature of the service or a mixture of various intervening factors is related not only to the service itself but to the human factor that makes it depend on who, how, when, and where it is provided. Its impact on delivery and management permeates quality (excellence), user satisfaction, and organizational performance.
(d) Simultaneity (Inseparability). The interaction of the service is inseparable. The action of provision and use or utilization is simultaneous. In other words, they are experiences whose quality of being memorable requires from the provider a dynamic performance capability of zero defects.
(e) Perishability. The simultaneity between provision and use gives the service a perishable character that results in the impossibility of its conservation, storage, or inventory. This implies a company strategic challenge in managing the capacity variability and demand.
(f) Absence of property. The service (intangible), unlike a product (tangible), only gives the right to access a specific use of it or receive a specific benefit. In other words, it does not involve the transfer of property; it is only conceived in the memorable part of the lived experience. The business challenge and success of the service proposal lie in the strategic understanding of the customer experience as a key differentiating factor and in the management of integrating and sharing resources with and between users.
These service natural conditions, strategically considered, serve to the service criticality to adjust and give stability to the company’s capacity in the demand-supply relationship in a dynamic environment:
• Service is an intangible and nontransferable personal experience.
• The service is simultaneously provided and used.
• Service capacity is a perishable commodity.
• The service natural cyclical variation creates active (peaks) and passive (empty) periods.
It should be noted that it may be ambitious to assume that there is a definition that covers all aspects of service, and consequently, a generally accepted concept that should be equally applicable to all kinds of service organizations. However, the term service is polysemic in nature and gives it “unilaterality or uniformity” aspects that significantly affect the delivery process and must be previously considered. In this sense, each service must be evaluated by applying certain criteria. Roger Schmenner in the “Service Process Matrix”7 proposes two dimensions that are pertinent to consider for this purpose: the effort degree of intensity and the degree of interaction and personalization. This aspect will be dealt with in greater breadth and depth later in the section’s service taxonomy: The service ecosystem.
The Service Scope
The service space is shaped and based on three pillars:
1. The personal, volunteering, or altruistic service conceived as “the action of freely giving and accepting to satisfy human needs, which results in the common benefit.”8
This person-to-person or face-to-face service encounter not only means the interaction between two people but also involves a more complex context with essential implications for the design of the service proposal. It involves the absolute or relative proportion of the physical-emotional interference, of interpersonal interaction, and intensity of the required information.
Personal service is the source where genuine and innovative behavior and performance are nurtured, which makes possible the differentiating culture of prestige, growth, and social and entrepreneurial benefits.9
On this pillar, the scaffolding of what is known today as the service ecosystem is configured and the details of which the reader will know while reading it.
2. The public or collaborative service is defined here as the activities reserved, provided and delegated by the public administration as required by law to respond to the performance of society. Likewise, collaborative interaction between citizens, communities, and “nongovernmental organizations” with a social spirit that contributes to the welfare state, the cost of which is borne by the taxpayers. It should be clarified that the private companies by delegation that participate in the public service do not receive an economic compensation higher (profitability) than the amount invested or its provision cost and maintenance. This service, as it is a matter of public interest, will always be supervised by the state.
The public service is exemplified by well-known services such as health, order and security, legal issues, education, transportation, drinking water supply, military, and so on.
In this context, a service proposal to meet the needs and expectations of this collaborative sector requires the common and particular considerations of this activity. Here, the personal attitude and contribution and the social marketing focus are remarkable.
3. Private or exchange service. The one provided for profit or valuable consideration by delegated private or public companies and corporations for the purpose of satisfying particular needs and expectations.
The Customer Service and Service Management, as it is generally known, is inherent to the organization, company, or business. Its offer and provision constitute a form or strategy of identification and prestige in the market, as well as utility and business growth. In this environment, customer service is a two-way action by targeting the external customer (user) and the internal customer (employee) with decisive implications for their management, delivery, and compliance.
The research community of the emerging Science of Service conceptualizes it as the action of value co-creation. That is, the interaction that serves the purpose of creating shared value as the basis for satisfying the user’s expectant need and the opportunity to develop an individual, effective, consistent, profitable, and long-term relationship that ensures the sustainability of the company.
The servitization construct is founded on this pillar.
The Service Modality
The service is bimodal or dual, that is, it is manifested and delivered under two modalities:
1. Face-to-face, physical, or traditional. It corresponds to the physical space and interaction of value co-creation where the moment of truth occurs: the user’s encounter with the service. The management of this encounter, by considering their own and unique aspects, impacts its result with the collateral implications.
This people interaction, in person or by phone, has an altruistic and collaborative exchange or consideration purpose, as well as its management as the act of infusing, directing, and coordinating the actions of people and resources to provide answers or agile and timely solutions to users. They have been mainly the scope and study objective of the Service Management discipline, today known as the Service Science, until the advent of the Internet.
2. Virtual. It refers to the online, digital, or electronic service offered and provided through the network, using information and communication technologies (ICT). This modality significantly broadens the horizon of the service and contributes to scaling the level of quality and its management. The Information Technology Infrastructure Library or ITIL, its acronym in English, as well as known technological developments (ISO/IEC 20000, COBIT, Smart Service Management, among others.) offer detailed descriptions of an extensive set of management procedures designed not only to help organizations achieve quality and efficiency in their operations (ERP, CRM) but to expand the range of services offered through the Internet such as Business to Business (B2B for its acronym in English), Business to Consumer (B2C), Client to Client, Peer Network (C2C, P2P), and so forth.
The Service Systematic and Transversal
The service has its own way of working. The service itself is systemic due to its integrating nature of resources that together contribute to a common purpose. The service system or work system supports the value-creation process. In this environment, it forms what is known as a service system or service package10 and is defined as the integration, configuration, and dynamic alignment of resources of various kinds (human, financial, technological, infrastructure, information, etc.) with the purpose of creating shared value.
The co-creation of value emerges from the interaction of many parts that can be formalized, analyzed, and designed despite its complexity.11
The relationship between the system parts is such that each part operation affects the system as an all. In this context, problem-solving must be seen in an integrated way, making use of systemic thinking. In the service realm, this turns out to be a critical factor to consider.
Likewise, the service has an original quality as an entity and reasoned act that gives it a universal character by being present in all areas and disciplines of all human-social activity: transversality. Considered as a person soft skill, it constitutes a potential factor for the company to expand its resource base. This dynamic capability will be developed in detail in Chapter 4.
The service system is configured by four stages or overlapping phases that interact, create value, and facilitate innovation in the different contexts of the service. These are as follows:
1. Service design. The process of creation and development, comprehensive and effective, of the service proposal. It is the holistic vision of the value-creation interaction in the user experience. The business outcomes are based on the knowledge and human and social behavior of the users.
On what factors is a service devised and tailor-made?12
(a) User. Focused on and from the user’s perspective. The results of qualitative research, the market audit, the database techniques, and business analytics allow for the inquiry and knowledge of the user/customer, undoubtedly, facilitate the strategic business decision-making, and are decisive in the effective design of a service value proposition.
The concept of the user profile, focused on the knowledge and understanding of the user’s needs and expectations, is the central focus of attention in the design of any type of distinctive and effective service proposal. However, this concept of user profile is still standard and is served by the concept of market segmentation, although it leads to the final conception of the individual user, overcoming personalization and giving rise to the future singularization (customization) of the proposal of service.
(b) Co-creation. Identify and integrate all the actors involved in the service design. These are all the groups and factors of interest in the service: customers, employees, suppliers, referents, and influencers.
(c) Composition. Sections in sequence, the phases, and processes that make up the service experience. Diagrams, maps, or work-flows are valid and valuable application tools for this activity.
(d) Tangibility. It incorporates experiences that make perception, understanding, and trust in service possible.
(e) Holistic character. It incorporates all points of contact and perspectives from the user experience and their interactions to generate outcomes.
2. Engineering and architecture of service. It is the application of the knowledge generated by science for the value creation and the construction of the capacity to provide the service: personnel (with mentality and culture), operations (processes, procedures, mechanisms, diagrams, maps), architecture (physical infrastructure and technology), and marketing (image and communication management). It translates the user needs and expectations into the language of the company.
It is the strategic vision of the service space, purpose, and competitive environment that originates from a user with identified and unsatisfied needs that is executed through an implementation process. This strategic process has evolved from being transactional in nature to being relational based on user experience.
3. Service delivery. It is the integral and specific process of interaction, provision, and assurance of the appropriate service use.
What elements to consider in an encounter and service delivery?
(a) The actors and associates. All those involved in the service provision (customers, employees, suppliers, referents, and influencers).
(b) The external environment (physical) where the user receives the service and the internal environment (culture) influenced by the beliefs and values of the organizational actors that give meaning to the activity and guide their behavior in it.
(c) The process. The set of successive tasks, activities, or operations carried out for the delivery of the service.
(d) The value promise. The organizational method or the characteristic and differentiating formula that the company uses to deliver the service and that has the value for the user/customer when satisfying their expectations.
(e) Image and communication management. Dimensions that contribute to the user perception of quality and give transcendence to the service.
4. Compliance management. It is the management of the process of delivery, reception, measurement of the evolution, the achievement of the purpose, and the result of the performance of the service in accordance with its design. Later, in chapter 3 of this proposal, the critical phases of this strategic process are detailed, and advanced measurement schemes and instruments are presented, aligned with the user, the process management and the business, such as quality (excellence), user interaction, experience, satisfaction, relationship, and trust.
The Service Ecosystem
What Is It?
Taken from biology, the term ecosystem generally refers to a community of actors (individuals, organizations, and institutions) that interact and affect each other through their activities based on their purposes and environments involved.13
In the evolution of the service concept from the encounter/interaction and the ambit where it takes place, the service ecosystem is the set of entities that act in domain-specific roles as providers and users of services of available services that enable community interaction and co-creation and the appropriate architecture for engineering, delivery, and governance.
It is also considered as “a relatively autonomous and self-adjusting system of actors that integrate resources connected by shared institutional arrangements and the creation of mutual value through the exchange of services.”14
Also, as “collaboration agreements through which companies combine their individual offerings into a coherent customer-oriented solution.”15
The service ecosystem in its bimodal nature (face-to-face/virtual) is made up of the set of integrated services into the three pillars described above in what is called the service scope: personal or voluntary, public or collaborative, and private or exchange. Its structure is particularly distinguished by its bimodality, the autonomy of the entities, the services, and the engineering and architecture that integrate it.
Figure 1.1 The service ecosystem Taxonomy of Services
The user perception impacts on the service conception. This ability of the individual to interpret his or her environment through the stimuli that he or she captures through the sensory organs influences the creation and design of the service proposal. In this context, its validity, distinctive character, and value ensure its usefulness and acceptance, and require its conceptual consideration.
From the scope of servitization, the service can be considered from three typological perspectives: One, from the role of the service in society as the manifestations previously expressed as pillars of the service in personal, public, and private. A second internal and proprietary one referred to the very concept of service and developed in Roger Schmenner’s “Service Process Matrix,”16 which focuses on the degree of intensity of effort and the degree of interaction and personalization. And a third figure of general acceptance is related to economic activity, represented by International Standard Industrial Classification of all economic activities (ISIC), Rev. 4,17 and the international classification of products and services used for the registration of trademarks and patents (The Nice Classification (NCL)).18
It is to be observed from the general classification of economic activity by sectors in the 19th century that the service activity or tertiary sector has been approached from many perspectives without even integrating, due to the heterogeneity of activities and ambiguity of the concept, a theory general capable of defining a taxonomy of services.
On this occasion and from its economic perspective, the service ecosystem takes shape and reference from the “systematic classification of all economic activities whose purpose is to establish their harmonized coding at the global level (ISIC), considering that each country has, in generally, an industrial classification of its own, in the most appropriate way to respond to its individual circumstances and the degree of development of its economy.”19
In this context, the Nice Classification established by the Nice Agreement (1957) for the registration of trademarks and patents serves with the ISIC as a valid reference to the subject and purpose of this work.
International Standard Industrial Classification of All Economic Activities (ISIC)
It is a classification of all economic activities by production processes that classify statistical units based on their main economic activity. Its purpose is to provide a set of activity categories that can be used for the collection, analysis, and presentation of statistics according to those activities and for the purposes of economic analysis, decision-making, and policy development. The categories in this classification are usually appropriate to each country as they vary from country to country and from region to region.
The following table illustrates the general structure of the economic activities of products and services contained in the ISIC 21 sections. The section of manufacturing is highlighted in bold by its particular attention in this work.
Table 1.1 General structure of the classification of economic activities
Section | Divisions | Description |
A | 01–03 | Agriculture, forestry, and fishing |
B | 05–09 | Mining and quarrying |
C | 10–33 | Manufacturing |
D | 35 | Electricity, gas, steam, and air-conditioning supply |
E | 36–39 | Water supply; sewerage, waste management, and remediation activities |
F | 41–43 | Construction |
G | 45–47 | Wholesale and retail trade; repair of motor vehicles and motorcycles |
H | 49–53 | Transportation and storage |
I | 55–56 | Accommodation and food service activities |
J | 58–63 | Information and communication |
K | 64–66 | Financial and insurance activities |
L | 68 | Real estate activities |
M | 69–75 | Professional, scientific, and technical activities |
N | 77–82 | Administrative and support service activities |
O | 84 | Public administration and defense; compulsory social security |
P | 85 | Education |
Q | 86–88 | Human health and social work activities |
R | 90–93 | Arts, entertainment and recreation |
S | 94–96 | Other service activities |
T | 97–98 | Activities of households as employers; undifferentiated goods- and services-producing activities of households for own use |
U | 99 | Activities of extraterritorial organizations and bodies |
Source: UN. 2009. International Standard Industrial Classification of All Economic Activities (ISIC), Rev.4, Statistical Papers (Ser. M), New York, NY: UN.
This classification also offers a detailed structure of these categories with two aggregations that make up a decision tree that serves not only its purpose of data collection, analysis, and presentation of statistics but also for commercial registration or certification to accredit its quality or comply with their tax and labor duties.
Likewise, it is a valid reference in the servitization process for the identification and location of a business opportunity in its specific economic sector, while contributing to the appropriate analysis in its context of innovation and sustainability.
Table 1.2 shows the section “C” of manufacturing industries of the detailed structure of the ISIC classification with an example of relevance and timeliness, the health industry.
The Healthcare Industry
Fortuitous or not, the coronavirus pandemic (COVID-19) phenomenon broke into the bowels of society, assaulted its welfare state, and disrupted the way of life, forcing it to protect and reconfigure it. This tragedy is promoting a new order of things and in the subject that concerns us, the productive activities of companies and businesses with greater severity to the health industries.
In this context, the pharmaceutical industry serves as a model to illustrate the process of locating and identifying service opportunities in a productive activity of an entity in the economic sector, using, as indicated before, the detailed ISIC scheme and its theoretical conception of vertical/horizontal integration or multiple activities.
Section C: Manufacturing Industries (Sector)
It covers the physical or chemical transformation of materials, substances, or components into new products. The transformed materials, substances, or components are raw materials from the primary sector (agriculture, livestock, forestry, fishing, and mining and quarrying), as well as products from other manufacturing activities.
An economic entity, according to the ISIC concept, can be made up of one or several activities; then it must be classified according to the highest proportion of value added by the units that compose it, following the descending method.
The top-down method follows a hierarchical principle. The classification of a unit at the most detailed level of the classification must be consistent with its classification at the most aggregated levels.
Table 1.2 Classification of economic activities of the pharmaceutical industry according to ISIC
Division | Group | Class | Description |
21 | Manufacture of pharmaceuticals, medicinal chemicals, and botanicals products. This division includes the manufacture of basic pharmaceutical products and pharmaceutical preparations. The manufacture of medicinal chemicals and botanicals is also included. | ||
210 | Manufacture of pharmaceuticals, medicinal chemicals, and botanicals for pharmaceutical | ||
2100 | This class includes: • Manufacture of active medicinal substances that are used for their pharmacological properties in the manufacture of medicines: antibiotics, basic vitamins, salicylic, O-acetylsalicylic acids, etc. • Processing of blood • Manufacture of medicaments • Antisera and other blood fractions • Vaccines • Diverse medicaments, including homeopathic preparations • Manufacture of chemical contraceptive products for external use and hormonal contraceptive medicaments • Manufacture of preparations for medical diagnosis preparations, including pregnancy tests • Manufacture of radioactive in-vivo diagnostic substances • Manufacture of biotech pharmaceuticals | ||
This class also includes: • Manufacture of chemically pure sugars • Processing of glands and manufacture of extracts of glands, etc. • Manufacture of medical impregnated wadding, gauze, bandages, dressings, etc. • Preparation of botanical products (grinding, grading, milling) for pharmaceutical use This class excludes: • Manufacture of herbal infusions (mint, vervain, chamomile, etc.); see 1079 • Manufacture of dental fillings and dental cements, see class 3250 • Manufacture of bone reconstruction cements, see class 3250 • Wholesale of pharmaceutical, see class 4649 • Retail sale of pharmaceutical, see class 4772 • Research and development for pharmaceutical and biotech pharmaceutical, see class 7210 • Packaging of Pharmaceutical, see class 8292 |
Source: UN. 2009. International Standard Industrial Classification of All Economic Activities (ISIC), Rev.4, Statistical Papers (Ser. M), New York, NY: UN.
Vertical integration (vertical and horizontal in the concept of this work) occurs when the same activity gives rise to end products with different characteristics. It can be understood that these are activities carried out simultaneously using the same factors of production, although it might be unlikely to separate these activities into different processes, assign them to different units, or generally provide separate data on them. In this case, the criteria based on the imputation of added value or similar methods could not be applied to them. In this regard, there is no uniformly valid criterion to identify the activity that best represents the set that encompasses this horizontal integration; so the best criterion of auxiliary, mixed, multiple, independent, derived, or related activities is commonly adopted and referred to them and integrates into classes considered related or that may seem similar, to another division or section, observed in the table.
The Nice Classification (NCL)
It is an international classification of products and services that applies specifically to the registration of trademarks and patents. It is mandatory not only for registering trademarks at the national level in the States party to the Nice Agreement but also for the international registration of trademarks.
“It is a classification, consisting of an alphabetical list of 34 classes of goods, adopted under the Nice Agreement and subsequently expanded to cover 11 classes of services and the corresponding alphabetical list of those services.”20
The following table in accordance with the ISIC classification shows class 5 corresponding to pharmaceutical products contained in the Nice Classification and for the purposes of this work, which offer a vision of the possibilities of productive activities from another perspective.
These typologies show the magnitude of the spectrum of pure products (manufacturing) and services associated with products that make up the service ecosystem. At the same time, they articulate the different phases of the chain of production and services activities, and of analytical tools to identify possible and feasible opportunities to add value to the current main business model or by resorting to activities in related alternative chains.
Table 1.3 Classification of pharmaceutical products (class 5) according to the Nice Classification
Class | Products (Description) |
5 | Pharmaceuticals, medical and veterinary preparations; sanitary preparations for medical purposes; dietetic food and substances adapted for medical or veterinary use, food for babies; dietary supplements for human beings and animals; plasters, materials for dressings; material for stopping teeth, dental wax; disinfectants; preparations for destroying vermin; fungicides, herbicides. This Class includes, in particular: • sanitary preparations for personal hygiene, other than toiletries • diapers for babies and for incontinence • deodorants, other than for human beings or for animals • medicated shampoos, soaps, lotions, and dentifrices • dietary supplements intended to supplement a normal diet or to have health benefits • meal replacements and dietetic food and beverages adapted for medical or veterinary use This Class does not include, in particular: • ingredients for use in the manufacture of pharmaceuticals, for example, vitamins, preservatives, and antioxidants (Cl. 1) • sanitary preparations being nonmedicated toiletries ( Cl. 3) • deodorants for human beings or for animals ( Cl. 3) • support bandages and orthopedic bandages ( Cl. 10) • meal replacements and dietetic food and beverages not specified as being for medical or veterinary use, which should be classified in the appropriate food or beverage classes, for example, low-fat potato crisps (Cl. 29), high-protein cereal bars (Cl. 30), and isotonic beverages (Cl. 32). |
Source: The Nice Classification / www.wipo.int/classifications/nice/en
The Service Business Model
A service business model is a theoretical scheme that clearly defines what value proposition is offered to a market, which user it is aimed at, how it is implemented, how it is delivered, how it corresponds to the proposal, how it is measured, and how profit is.
This structure has been studied from the manufacturing organizations to know the properties of the service activities and how they are distinguished from the traditional manufacturing ones. As a result of this search, two well-known systematic conceptual schemes emerge: the service profit chain, inserted in the strategic service vision.21
(a) The service value chain postulates that the profit and growth of any organization or business result from customer loyalty, generated by customer satisfaction, which is a function of the value delivered to the customer.
Similarly, customer value is the result of employee loyalty and productivity, a function of employee satisfaction, directly related to internal quality or value created by employees. Today, the widespread use by the management of this service pathway as a proven via of success in delivering the expected results to users allows it to consider as a driver of profitability and company growth.
(b) The strategic vision of the service is a systematic way of thinking about the service strategy of a business to carry out the components of the service value chain. In the context of a servitization strategy, the aforementioned scheme would serve as a reference to a five-phase format that fits the proposal of this work, and it is detailed below: 1) users and places, 2) the service proposal, 3) the operational strategy, 4) the delivery system, and 5) the compliance management. This corresponds to the theoretical scheme of the business model and serves as guidance for its application to organizations or service businesses activities.
1. Users and places. To whom and where the service proposal addressed. To precise the places and possible users with potential willingness to acquire the service, some questions are suggested:
• User profile. Qualities that identify and distinguish the users.
• Scope. The differentiated homogeneous groups to which the service proposal is directed.
• Need and expectation. Gaps, solutions, and expectations that the service proposal undertakes to fulfill.
• Share. The competition, company(s), or institution (s) that offer(s) a similar or analogous service in the market.
• Capability. The operational capability used to compete and serve the needs, solutions, and expectations of
the user.
• Excellence. The level of quality of the service offered satisfies or resolves the user’s shortcomings, expectations, concerns, or difficulties.
2. The service proposal. The document that describes in detail the concept, qualities, and differentiating elements that make up the service to be provided. This is the fundamental information for the service design. Likewise, and together with the information of the target market, they establish the differentiating element of the service and define its positioning in the market. This is the image that the brand of a service or product occupies in the mind of the user. Positioning that it is built from the perception formed by the user of the service individually and with respect to the competition.
In section “C” on the service, systematicity, and transversality, described earlier in this chapter, you will find the answers to the following questions about this basic and integrating element of the strategic vision of a service:
• Constituent. All the components, properties, or qualities that give a specific and differentiating shape to the service and the value proposition.
• User perception. The perception that the user has of each attribute of the service.
• Service perception. The perception, image, or idea that the service projects on the user or market: quality and value for the customer.
• Work and resources. The necessary capabilities and resources to successfully carry out the service proposal.
3. The operational strategy. The process of management and successful achievement of the action of providing or supplying the service.
• Factors. Key operating factors that guarantee service compliance.
• Points of attention. The key point(s) of operation(s) and/or contact(s) where greater attention and vigor are required in the correct and satisfactory fulfillment of the service.
• Resources placement. Determination of the element, situation, or phase of the process where the placement of resources of any kind is required.
• Efficiency. Determine in the process what is going to be controlled, establish measurement units, set measurement standards, procedures and processes, and establish preventive and corrective actions.
• Positioning. Establish the conditions, behavior, and expected achievements to meet the objectives and outperform the competition.
4. The delivery system. The set of interrelated activities that make it possible for the user to get the requested service on time, in the right place and with satisfaction. The delivery system is an integrated element that is established in support of the strategy and its identity is configured by answering the following questions:
• Key points. Identifies the point of contact or interaction with the greatest attention, interest, or performance in the service provision process based on the attributes (time, cost, etc.) specified in the proposal to the user.
• Capacity. The space, skills, and necessary resources to provide the service.
• Excellence assurance. The delivery, fulfillment, and measurement of the service in correspondence with the value proposition and the user needs and expectations.
• Differentiation. The attribute(s) that make the service a unique proposition in the market.
• Entry barriers. Identification of the factors that place limits or difficulties on the entry of new similar service proposals: investment, differentiation, communication, technological innovation, and so on.
5. The compliance management. The faithful fulfillment assurance of the value promise is a key indicator of success in a service business model. This phase closes the process cycle and is developed later in the third part of this publication.
The Activity/Performance as a Service Model (APAAS)
To the principles and approaches of the service business model, described so far and considered essentially based on its face-to-face modality, it should be added as an information in the context of the service ecosystem. The virtual service business models, conceived as abstractions of the information technology services of a company, are aimed at developing solutions as services and used as applications for their design.
In addition to the management models of information technology services such as ITIL for its acronym in English, models or tools are available for the implementation of structured services in the cloud and that operate as they would in a physical structure. Some of these, they are known as Infrastructure as a service (IaaS), Platform as a service (PaaS), and Software as a service (SaaS).
Application Exercise
Purpose
The following exercise seeks to integrate in a practical way the knowledge, methods, and tools indicated in this chapter on the service value chain. It also attempts to strengthen the possible learning and its subsequent use in academic, business, and entrepreneurial contexts.
Identify, analyze, and design a service business opportunity of your interest or select a productive activity from the categories (23) of manufacturing industries contained in the International Standard Industrial Classification of all economic activities (ISIC) of the United Nations.
Apply the content developed in the aforementioned chapter, noting:
• The ecosystem of the corresponding service
• The fundamentals of the applied service
• The business model with the components of the service design
Outcome
Design project of a service value proposition.
Final Acknowledgment
By completing this application exercise, the reader will have appropriated the knowledge developed in Chapter 1 and acquired effective skills for putting it into practice in real business contexts.