5 stars Luxury Hotel: enjoy our sevice Sir!

"If you go to a 5 stars Hotel you think you will enjoy your staying not only for the facilities, but also for the service that you will receive. You can expect at least a professional service."

Some time ago, we talked about importance of social interactions in this era, the era of branding. Using such a privilege then, I describe my history as follows.

Last week I've been in Crete, Greece for the premier international conference on information systems: CoopIS'10. The conference was held in the Aldemar Knossos Royal Hotel, which is a 5 stars Luxury Hotel, according to its own marketing ad.
The place is nice to enjoy outside your room, maybe for that reason they don't have internet available in the rooms, just to keep you relaxing enough on the spaces and activities out. Unfortunately, it was the last week of the summer season, so the weather was not good and the service neither.
In the first day of my staying I asked for an orange juice for my lunch in the Hotel's main restaurant and surprisingly the waiter gave me a box on the table. The same kind of orange juice in a box with straw that I can buy in the mini-market of the neighborhood! I got really surprised, no speeches.
The third day I had lunch at the same restaurant and again I asked for an orange juice. And yes, I got again a box on the table, but even worst the waiter opened it with his hands to fill my glass (see picture below). Unbelievable. In a 5 stars Luxury Hotel you would never expect that.
I'm not blaming the waiter, but the mangers that are in charge of teaching employees to deliver a loyal service to the customers and visitors. They should understand what customers expect from a 5 stars Hotel to satisfy them, delivering a service of excellence: bringing excellence to the customers, it pursues customer loyalty as reward.





The staying in the Hotel was decent, but not for a 5 stars Luxury Hotel as they say. I also knew other not so nice experiences from colleagues during the same week there. I'd not mention the story about the convention that was started after our conference finished.

To finish my history, I should say that, thank God, I got safe at the Heraklion airport after a taxi driver took me from the Hotel going at 160 Km/h.
So, unfortunately I'd rate the hotel with 3 stars and the taxi driver with 0 star.
Enjoy the service Sir!

---
Ricardo Seguel.

Insight: Smartphones are pushing Service Innovation in Bank industry

Smartphones have enriched user exeprience combining high innovative hardware and software (touchscreen and user interfaces). However, that's not been enough. Smartphones have also added services as a new component, bringing service inside (geared by application and content ecosystems).
According to Gartner, Smartphone sales have grown 27% in the last Q2 while mobile phones have declined 6%; see Figure 1. In the smartphone's OS battle market share, Symbian (51%) and Microsoft (9%) have dropped year-by-year and RIM and Apple have grown. However, Android is slowly growing with only 2%.

Figure 1: Table with Smartphone sales Q2'09 from Gartner.

This trend is pushing manufacturers to improve devices and focus on services as vital component. Also, operators will request lower prices because consumers want a cheaper service: "... the price of wireless service is far more important that the network or the phone." (NYT)

This scenario is bringing new opportunities to explore in several industries. Smartphones are pushing Service Innovation; see Figure 2. This the case where technology pushes business.

Figure 2: Smartphones are pushing service innovation

In the last post, we analyzed how banks could innovate offering services more than products in the downturn, looking forward the upturn.
Banks should take advantage of this smartphone's scenario bringing browser-based or application-based services (Apple's iPhone application store, Google's Android application store, other). Potential market is enormous given that mobile banking adoption has not exceeded 10% in Europe and 5% in USA in 2008 (Forrester).
Banks should change consumer needs since more than 40% of people don't see value in using mobile banking (Forrester). Therefore, Banks should incite consumers to use other services more than check a balance, for example, offering contactless mobile payments: "With the new generation of mobile devices, the smartphone, BlackBerry, iPhone, gPhone, technology fillers are driving mobile payments. Once contactless chips are installed in most phones, this model will grow rapidly" (Accenture) see Figure 3.

Figure 3: Contactless mobile payments

Customers behavior by accessing mobile banking is predominant at home: 31% of people access financial accounts at home, 25% while running errands, 15% while commuting, 11% at work, 9% on vacation, and 8% in business travel (InformationWeek).
Banks should consider the growing smartphone market and customers behavior to be prepared for the new age of social banking and the emerging models such as financial social networks, microfinance and personal finance management (Gartner).

Indeed, every new designed mobile service must take in account that customer trust is very important for banks (Gartner): "There is evidence that a lack of customer trust in banks may hurt larger banks more than smaller banks ... However, this is an industry issue that all institutions must address".

Banks taking this competitive advantages brought by smartphones will emerge strong in the upturn and will be positioned stronger in the next decade.

Service Innovation is a need in the economic downturn

Indeed, innovation is a need everytime. That is the discourse since more than 25 years ago. According to Rosabeth Moss Kanter (Change Masters, 1983) "innovation refers to the process of bringing any new, problem-solving idea into use."

However, in the economic downturn is needed even more. Financial sector and Automotive industry have suffered a painful crisis worldwide with many companies going to bankruptcy.

What should they learn about Service Innovation? (What to do?)

First of all, Banks are well known as rigid cathedrals where innovation is difficult to get flourished. Entrepreneurial innovators (R. Moss Kanter, 1983) are needed in any company to boost innovation inside. However, on this time where service industry is becoming more and more important worldwide, companies need T-shaped people to lead innovation inside.
Banks should pursue consumer loyalty bringing them a valuable service experience. Gartner Inc. says that "Banks should be ready for the emergence of the social-banking services model".
Secondly, in this crisis Banks should learn from the most innovative organizations of the world: Team Obama, Google, Hulu, Apple, Cisco Systems, etc. (see list here), realizing that innovation is important and technology brings lots of opportunities and competitive advantages.

On the other hand, Automotive industry has to change the dominant logic of goods to services.
Adding services to their products, they make new value propositions for consumers (see Figure 1) and co-create value between manufacturers and providers.

An example could be CaaS: Car a a Service (another discussion post in Spanish), which is an innovative idea where manufacturers sell the transportation service to consumers by subscriptions.

Figure 1. Car manufacturers should pursue consumer loyalty.

Moreover, this industry has to learn much more from other successful business models like Dell in which "its direct way of working delivers industry-leading value to customers";
or Amazon in which "growth is core for its business strategy, and that has had a significant impact on the way they use technology: growth through more categories, a larger selection, more services, more buying customers, more sellers, more merchants, more developers, increasing the different access methods, and expanding delivery mechanisms."
These two successful companies lead innovation, pursuing innovation everytime.

Therefore, Financial sector and Automotive industry have to engage Disruptive Innovation: "a phase starts where leaders ask which parts of their business model are weak (and perhaps unsustainable) and that, in turn, can lead to restructuring and reinvention".


What are the benefits to invest in innovation plans during the crisis? (Why do it?)

According to Nielsen:

"Companies that continue to invest in their new product innovations during challenging economic times emerge from recessions with much higher growth rates than companies who cut back."
..."growth rates that are two or three times higher (five to 10 times higher in some cases) than the growth rates of companies that cut back on innovation during a recession."

On the other hand, governments should do four things "for the long term so their countries can emerge from this crisis as winners: inject capital, think global, focus on public programs, and support talent" since "while many businesses simply won't be able to afford further investment in innovation, governments should recognize that innovation systems".


Which methodology could they use? (How to do it?)

Broadeep has designed the Services life-cycle which allows continuous service innovation and service improvement (see Figure 2). This has four essential phases: Strategic Design and Planning of Services, Engineering and Development of Services, Execution and Monitoring of Services, and Controlling and Diagnosis of Services. These phases have four strong relations: Service Alignment, Process Management, Service Government and Service Redesign; which define either a method or an approach for consistently using the output of one phase as an input of the other.

Figure 2: Service life-cycle as a basis of
Continuous Service Innovation and Service Improvement.

SSME Workshop at ECOWS09

Everybody are invited to the SSME workshop hosted in ECOWS09 taking place in Eindhoven, The Netherlands in November 9th 2009. This Workshop is organized by SSMEnetUK.

Workshop Programme:

The workshop will be held on November 9, 2009, a day before ECOWS09. We are pleased to announce that Kris Singh, President of Service Research & Innovation Institute and Strategic Programs, and Director of Service Science Research IBM Almaden Research Center, will address the keynote speech for the workshop. The preliminary workshop programme is given below.

9.00am Coffee and Registration
10.00am Welcome and Introduction
10.05am Keynote Speech
10.50am Session 1: Parallel Presentation Sessions
12.30pm Lunch, Poster Presentations and Networking
2.00pm Invited Talk
2.45pm Session 2: Parallel Presentation Sessions
4.30pm Coffee break
5.00pm Session 3: The Way Forward: Roadmap and Action Plan
6.00pm Close

More information here.

HBR: Four common flaws in Strategic Planning

From HBR there is a very interesting post about four common flags in strategic planning:

• "Skipping Rigorous Analysis
  Many managers believe their business experience and knowledge base alone equips them with all the information they need to conduct effective strategic planning. This belief is almost always untrue and serves only to undermine the kind of critical thinking from which truly creative strategies are born.

• Believing Strategy Can Be Built in a Day
  Yet many executive teams earnestly believe that effective strategies can be identified, explored, and agreed upon during abbreviated offsite meetings where the main driver of the agenda is the timing of snack breaks.

• Failing to Link Strategic Planning with Strategic Execution
  According to a recent survey by the Conference Board, execution overall and strategy execution in particular hold the first and second positions when it comes to "top issues" in executive's minds. It's no wonder — executing strategy requires the work of the entire organization, whereas strategic planning only requires the top team. But part of a top team's challenge in execution often stems from the failure to link their work with ongoing strategy execution.

• Dodging Strategy Review Meetings
  Strategic plans quickly become obsolete when there is no activity in place to keep them alive. Worse, managers sometimes feel freed from execution accountability when reviews are continually rescheduled or dropped from the calendar altogether."

These common flags are very important to be considered and avoided in the Strategic Design and Planning of Services phase in the service life-cycle. However, these are also relevant in the complete cycle.