Customer participation in the delivery of Facilities Management (FM) services, ultimately determines the service they receive as well as the quality that is achieved. In last week’s post entitled Will Customers Help Themselves? I set out 2 frameworks that illustrate the different levels of Customer participation in the delivery of services as well as the three major roles played by Customers in the delivery of services.
This week’s post is a follow up in which I want to provide you with a simple model that will enable you to design the interactions required between your team and the Customer to ensure the appropriate level of participation. Designing service delivery in this way will enable you to make the best use of what are often scarce resources as well as focusing on appropriate areas of effectiveness and efficiency. This will lead you to be able to achieve greater levels of service excellence and improved Customer experiences.
A key characteristic distinguishing the delivery of services from goods is that the production and consumption of a service occur at the same time. Uniquely this means that Customer participation in the production process is unavoidable. Customer participation not only influences the productivity and service quality of service organisation but also influences their own satisfaction.
Conditions of Input Uncertainty
As we saw in the previous post, uncertainty around the Customer’s level of participation in the performance of a service will directly affect the ability of the service provider to fulfil the service need. Inadequate or late delivery of information can lead to the erosion of value and service dissatisfaction.
The process of extracting information from a Customer is fraught with uncertainty, inaccuracies and omissions. This is particularly so for services that are generally regarded as low value, low importance and in some cases even invisible. If you have ever witnessed incoming calls into a Facilities Management helpdesk you will know the difficulties of even the most technically astute agent in extracting basic information from the caller.
Input uncertainty refers to the service provider’s incomplete knowledge and understanding of what the Customer is likely to provide in terms of participation in the service delivery as well as how likely they are to comply with internal processes.
The variables in this input uncertainty occur on two continuums;
1. The diversity of Customer demand– this refers to the uniqueness of the Customer demands which often have to be customised due to a degree of complexity.
2. Customer willingness to participate– this refers to how far and how often the Customers wish to play an active part in the delivery of the service. Such participation can be high, moderate or low depending on desire, the level of knowledge, skills and understanding of their role.
1. Diversity of Demand
The diversity of demand refers to the uniqueness of Customers’ demands. This includes both the uniqueness of the Customer that is to be serviced as well as the uniqueness of the desired outcome of the service.
The wider the range of unique Customer demands, the greater the specific information not possessed by the service provider before the actual service encounter. This leads to higher input uncertainty faced by the service provider.
High diversity of demand refers to qualitative differences in demand, that introduce levels of complexity. For example, different problems associated with different air conditioning units that can be resolved by the same service but just in different quantities would still be viewed as low diversity, as this can be resolved with a degree of standardisation. However, issues associated with different problems in unique systems which require specialised and customised attention would be regarded as high levels of diversity.
Thus, the diversity dimension is related to the customisation/ standardisation distinction facing service providers to which they can respond with more or less customised service designs.
2. Customers’ Willingness to Participate
Customer’s disposition to participate refers to the extent the Customer tends to play an active role in supplying inputs to the service production process.
The more actions that Customers tend to contribute, the higher the input uncertainty because the service provider has incomplete information about what the Customer actually will do before the service encounter.
The disposition to participate is driven primarily by Customer motivation:
- Customers find doing it for themselves intrinsically attractive which means Customers prefer to be involved in serving themselves
- Customers may feel that their active involvement is necessary to guarantee quality
- Unique Customer competencies, that the Customer may need to supply, first hand, during service production.
Uncertainty is also increased when the Customer disposition to participate can be constrained by insufficient ability, competence, resources or role clarity (in terms of understanding their role in the service co-production) necessary to participate productively.
In part, the development of contact-centres or help-desks has been as a result of a desire to reduce the impact and variability of customer inputs and in an effort to achieve organisational efficiency. Technology is helping to blur the line between the physical presence of the Customer during a service event but undoubtedly input is still required from the Customer even if physical presence is not required.
The flipside to the pursuit of greater efficiency is that poorer service quality may be the resultant cost together with increases in Customer complaints, systems failures and service downtime.
Where however the method of contact appears important, is determining the division of labour between the front office and back office.
The front office is the team directly experienced by and visible to the Customer. This is often where the service is performed and is open to direct Customer scrutiny. In the FM context, this is also where your second-tier suppliers are also visible to the Customer. The primary focus of the front office’s is customisation and effectiveness and should be resourced accordingly.
The back office is the team from which the Customer is probably physically excluded. This is often the technical core of the FM organisation as well as the support services such as HR, IT, finance etc. The back office is often decoupled from the front offices allowed them to work without hindrance or interference. The primary focus of the back office is standardisation and efficiency and also should be resourced accordingly.
In the previous post, we identified as the customer as a productive resource in the service chain. So to this division of labour between the front and back office in the service providers organisation, we need to add the customer as a temporary employee.
This division of work creates interdependencies among the actions of the three parties. The character of these interdependencies can be more or less customised or standardised. The more customised the service, the more unique or highly differentiated the interdependencies between the actions of the divided service work. Correspondingly, the more standardised the service, the more repetitive and the less differentiated the actions and the interdependencies between the parties.
This delineation of interdependencies gives rise to the following Interdependency Matrix shown below.
The matrix uses the two variables we have mentioned;
- Diversity of demand and
- The customer’s disposition to participate.
Each quadrant emphasises relationships between the three participants, customers, front office and back office staff. The inter-dependencies between two of these three parties is highlighted in each of the quadrants.
These interdependencies give rise to specific scenarios aligned to the services delivered in these quadrants.
The matrix is exceptionally useful in filtering the desired behaviours from the resources primarily responsible for delivering the service. This ensures the correct focus on efficiency or effectiveness ultimately allowing for lean production to achieve cost efficiencies.
Quadrant 1 Sequential Standardised Service Design
In this quadrant where there is a high level of Customer willingness to participate in the delivery of the service and where there is a low diversity of demand or complexity. The bulk of the workload can, therefore, be placed on Customers if they have an adequate ability and are clear about their roles.
In this scenario, Customers would be expected to be more conscious and sensitive to prices as they forego any customisation and are providing most of the labour themselves. In this quadrant service providers should focus on mass-producing services or innovating to ensure that Customers are able to perform the service for themselves.
In this scenario, it is also unlikely that with the high degree of Customer participation and the simplicity of the services offered that there will not be a need to monitor service quality to any great degree.
In addition, this standardisation allows extensive decoupling of the front and back office to ensure the efficient delivery of service. The removal of what are generally more expensive resources in the Front of House team contributes to the efficient and cost-effective delivery of service.
In a typical Facilities Management example, these services can be highly automated and may include things like conference scheduling, boardroom bookings, utility management and service requests.
Quadrant 2 Reciprocal Service Design
In this quadrant Customers generally, have complex and unique problems. The Customer themselves or processes close to the Core business are often the focus of these services rather than the facilities assets.
In this scenario, the Customers are highly motivated to become closely involved with the delivery of the service. In many instances, the service cannot be delivered with out full and active participation of the Customer. The Customer is less likely to be price sensitive but will demand expertise to design customised solutions to their problems.
The high disposition to participate and diversity of demand means that often the Customer needs to provide information for adequate problem solving throughout service production, not just at the outset all the service process. This leads to interactive service production between mainly Customer and front-office employees.In the case of capital projects, this may run into years
Due to the expert nature of the services to be rendered the emphasis in the relationship here is between a Customer and the Customer facing team.
Typical services in a Facilities Management context would be property optimisation initiatives, major capital projects, major churn initiatives.
Quadrant 3 Sequential Customised Service Design
In this quadrant, we are dealing with services that have a high diversity of demand but this is accompanied by a low disposition or unwillingness for the Customer to participate in the delivery of that service.
There could be many reasons why a Customer has a low intrinsic motivation to participate in the service. This could be because the service is of a menial nature (but still necessarily complex or unique) or because the service is not regarded as either of a high value or close to Core business.
In an outsourced contract, many services are delivered because of a Customer’s low intrinsic motivation to participate in non-core activities due to lack of time, desire or expertise. In this scenario, the bulk of the workload is placed on in-house or outsourced service employees.
Due to the potentially complex nature of services in this quadrant, and the Customer’s lack of involvement, it falls upon the Front office employees to capture the Customers specifications and requirements. This despite the likelihood that these services will be performed by back-office employees or second-tier suppliers
This is where the separation of high and low contact functions allows for the specialisation of into personnel versus technical skills of the front and back office employees respectively.
Service providers need to ensure that there is excellent integration between the front and back office employees to ensure that specifications requirements and outcomes are communicated effectively to ensure service quality.
Typical Facilities Management examples of this might include typical property management tasks, soft services, gardening and pest control.
Quadrant 4 Pooled Service Design
This last quadrant represents low demand diversity and low Customer disposition to participate in the service production. Low disposition of Customers to participate can stem, for example, from their low need to monitor standardised services or their inability to perform large scale services.
This allows for allocating most of the work to efficient back-office operations composed of standardised interdependencies and decoupling from most front-office disturbances.
Here, division of work between back-office employees can result in advantages of specialisation because the repetitiveness of standardised operations creates a higher tolerance for interdependencies
Standardisation also can utilise economies of scale in the form of low-cost, mass service production for relatively price sensitive Customers with low demand diversity.
Typical Facilities Management examples of this might include planned and some reactive type maintenance and utility management.
Implications and Conclusions
The issues of Customer participation in service delivery raise highly relevant and complex questions for both management and operations. By understanding the levels of Customer participation in the wide spectrum of services involved in Facilities Management a service provider can begin to see what is required of its Customers and to design service experiences and interfaces accordingly.
Thinking of its Customers in these ways will lead to the service provider organisation researching what types of information and education it may need to share with its Customers and how it might develop appropriate approaches for training, service activation and participation. This may include potentially rewarding Customers for effective participation, through cost reduction and service improvement.
That Customers are potentially a major factor in determining their own satisfaction in their own service experience needs to be a foundational requirement of the relationship building process. Segmenting the services using the Interdisciplinary Matrix allows optimisation of front and back of house resources with the concomitant savings in cost as well as ensuring the correct focus on effectiveness and efficiencies.
In addition to the above, in a future post, I will illustrate how we can use the Interdependency Matrix to align innovation efforts in order to maximise profits and cost efficiencies.
I appreciate that this is a meaty subject which I have only scratched the surface on, but I would welcome your comments and responses to this week’s Question
Question: Could you use this model to design your service provision better and what benefits will this bring to your organisation or your Customer? Please leave your comments below.