There are four central tasks facing managers in the service industry: * Managing quality* Managing productivity* Managing service staff* Achieving differentiation Managing service staffThe customer normally meets a wider spread of employees in the service sector. Each contact is a 'moment for truth,' so to speak in which it is decisively judged. In goods firms, marketing focuses mostly on external factors but, in services, it is mostly internal. Unless management meets the needs of employees, the organisation will not have staff who buys into the mission statement. The following are techniques to motivate employees:1. Employee-of-the-month awards2. Increase employees' visibility and proximity to customers by allowing them to see and hear how the customers respond to their work.3. Training and indoctrination to instil a sense of pride in the employees.4. Peer group control via commitment and team building to reinforce commitment.5 Appropriate environments such as equipment and systems to be able to satisfy the customer. Achieving differentiationIn achieving a differential advantage there are certain areas to take notice of: Integrating marketing and operationsIn services, managers are usually responsible for marketing and operations. Marketing thinking can often be forgotten by the problems of running a bank, hospital or a large IT company. Use time management systems to allocate time for marketing and operations and avoid trying to do both simultaneously. Product differentiationThere is no tangible product to compare in services and judgment is therefore purely subjective. The areas to concentrate on when servicing a client should be:The quality of serviceFriendly and courteousPunctualityBe right...

In Part 1 we covered intangibility and inseparability and the reason to highlight the service industry To recap, there are three reasons. Firstly the service industry is the strongest growth and more people are employed in services than in all other sectors put together. The second reason is the specialised nature of the market. Services have five important features that affect how they are managed and marketed. The services provided are of a specialised nature, these arise from the* intangibility of the offering,* inseparability of production and consumption,* heterogeneity - the difficulty of achieving standardization* perishable -nature of the service* ownership - the lack of full use only have the service for a limited time The third reason is some of today's service companies have developed new models of successful management practice. HeterogeneityHeterogeneity is the potential for high levels of variability in the quality and consistency of service. It's difficult to achieve a consistent level of service. For example, two visits to a restaurant may not be identical in performance. The difference will depend on the staff in charge. Unlike machines, people are not normally predictable and consistent in their attitudes and behaviour. This makes it difficult for service organisations to develop a consistent brand image.There are three ways of reducing the effects of heterogeneity; * Invest in the personal selection, motivation and training* Standardise the service such as McDonald's* Customise the service to suit the target such as an exclusive hotel PerishabilityServices cannot be saved. Hotel rooms not occupied, airline...

The service industry is the strongest growth and more people are employed in services than in all other sectors put together.Services have five important features that affect how they are managed and marketed. The services provided are of a specialized nature, these arise from the* intangibility of the offering,* inseparability of production and consumption,* heterogeneity - the difficulty of achieving standardization* perishable nature of the service.* ownership - the lack of full use only have the service for a limited time. Companies have developed new models of successful management practice. IntangibilityUnlike goods, services cannot be seen, touched, tasted or smelled. They are an experience or a process. This has a number of implications for the consumer and buyer.* Lack of physical qualities increases purchase risk - you can examine the shape, colour and features of a vehicle but you cannot do this with a haircut or an aeroplane ticket.* Quality of service can only be judged after it has been received - a repair on a vehicle.* Tangible clues gives the perception of the level of quality - appearance, staff and prices.* Lack of physical characteristics makes it difficult to display and differentiate the offering.* Impossible to patent services innovations - can be easily relocated by competitors. To deal with these problems the following strategy should be undertaken:* Stimulating personal influence sources as word-of-mouth. This includes encouraging customers to recommend the service to their friends.* Developing tangible cues that suggest high-quality service. These can include location, staff, equipment, advertising, and symbols...