Q: Explain the role and purposes of a business analysis in the process of new service product development.
A: The essential role of a business analysis is to test the feasibility and viability of any proposed new service product development. Its purposes include
- to estimate market potential, size and likely demand
- to estimate the costs likely to be entailed in establishing and marketing the new venture
- to plan and cost the means of service delivery
- to assess the intensity, nature and costs of competition
- to estimate sales and revenue
- to calculate the likely return or payback over time
- to assess “fit” with organizational aims and resources
- to estimate the level and cost of capital investment required
Q: Distinguish between core, facilitating and supporting services.
A: In answering this question it is important that students can demonstrate their comprehension of what characterizes each of these three elements that constitute a service product strategy.
For instance, McDonald’s core service is the provision of a varied menu of fast food items that can be consumed on the premises or taken away. Their facilitating services include the means by which orders (including their drive-through service), are taken and fulfilled, tables and bins are cleared, and the provision of parking. Their supporting and value-adding services may include adjacent play areas for children, the provision of newspapers and magazines, and facilities for children’s birthday party celebrations.
Q: In what ways can the development of new services benefit by reference to the characteristics of services?
A: Main findings and recommendations are summarized below. e.g.:
To minimize the risks associated with Intangibility and Heterogeneity:
- Look for new service ideas that are synergistic with existing expertise and facilities
- Blueprint the proposed new service offering thoroughly
- Invest in pre-launch research and testing
- Look for opportunities to standardize the service delivery system
To accommodate implications of Inseparability:
- Involve the customer in the planning and development process
- Involve front and backstage staff in the planning and development process
- Ensure that all staff are thoroughly briefed and prepared
Q: What is the role of service branding?
A: The role of a service brand is multi-dimensional and includes
- Distinctive and memorable identification of the service business
- Competitive differentiation and positioning
- Symbolization of what the business stands for and offers
- Suggestion of service benefits
- Evocation of associated attributes – g. trust, confidence, security, exclusivity
- Market awareness building