UCR Starbucks Coffee Company Transformation and Renewal Essay Starbucks Coffee Company: Transformation and Renewal Create a 3 to 4-page (800 – 1200 word)

UCR Starbucks Coffee Company Transformation and Renewal Essay Starbucks Coffee Company: Transformation and Renewal

Create a 3 to 4-page (800 – 1200 word) essay responding the following questions based on the Starbucks case:

Include an introduction with brief background and previewing what will be covered and a conclusion briefly summarizing major assessments.
What were the most important factors behind Starbucks decline in 2007 and 2008? How much of this did Schultz see in 2007? In 2008? Which factors were less obvious?
What were the most important aspects of Starbucks transformation? Why did these matter to the survival and transformation of the company? How generalizable are such initiatives in the broader context of business turnarounds?
Include examples to support your assessments with at least one from a company other than Starbucks.

Use of course theory: use at least 3 citations and 2 references, one of them being the textbook. Clearly apply services marketing concepts from chapter 1 -13 of the textbook.

Length: Essay from introduction to conclusion is 3 to 4-pages (800 – 1200 words).

WRITING CLARITY, MECHANICS

Writing: use APA formatting. Source all references with in-text citations and a references page. Write clearly and free from major construction or writing mechanics error

RUBRIC

Introduction/Conclusion covered = 5%
CONTENT: Thorough coverage of all 3 topics = 60% (20% each)
USE OF COURSE CONCEPT/References = 20%
Length/depth – met length requirements = 5%
WRITING = 10% Figure III Organizing framework for services marketing
Part III focuses on managing the interface between customers and the service
organization. It covers the additional 3 Ps (Process, Physical environment, and People)
that are unique to services marketing. It consists of the following four chapters:
Chapter 8 begins with design of an effective service delivery process, specifying how
operating and delivery systems link together to create the promised value proposition.
Very often, customers are actively involved in service creation, especially if acting as
co-producers, and the process becomes their experience.
Chapter 9 relates to process management with a focus on widely fluctuating demands
and how to balance the level and timing of customer demand against available
productive capacity. Well-managed demand and capacity leads to smooth processes
with less waiting time for customers. Marketing strategies for managing demand
involve smoothing demand fluctuations and inventorying demand through reservation
systems and formalized queuing. Understanding customer motivations in different
segments is also important for successful demand management.
Chapter 10 focuses on the physical environment also known as the servicescape. It
needs to be engineered to create the right impression and to facilitate the effective
delivery of service processes. The servicescape needs to be managed carefully as it
can have a profound impact on customers’ impressions, guide their behavior throughout
the service process, and provide tangible clues of a firm’s service quality and
positioning.
Chapter 11 introduces people as a defining element of many services. Many services
require direct interaction between customers and contact personnel. The nature of these
interactions strongly influence how customers perceive service quality. Hence, service
firms devote a significant amount of effort to recruiting, training, and motivating their
employees. Satisfied and engaged employees who perform well are often a source of
competitive advantage for a firm.
Well done is better than well said.
Benjamin Franklin,
one of the Founding Fathers of the United States,
1706–1790
Ultimately, only one thing really matters in service encounters — the customer’s
perceptions of what occurred.
Richard B. Chase and Sriram Dasu,
Professors at University of Southern California
The new frontier of competitive advantage is the customer interface. Making yours a
winner will require the right people and, increasingly, the right machines — on the front
lines.
Jeffrey Rayport and Bernard Jaworski
(Professor at Harvard Business School, founder
and chairman of Marketspace LLC and Professor at
Claremont Graduate University, respectively)
By the end of this chapter, the reader should be able to:
LO 1 Know the difference between a service experience and a service
process.
LO 2 Tell the difference between flowcharting and blueprinting.
LO 3 Develop a blueprint for a service process with all the typical
design elements in place.
LO 4 Understand how to use fail-proofing to design fail points out of
service processes.
LO 5 Know how to set service standards and performance targets for
customer service processes.
LO 6 Appreciate the importance of consumer perceptions and emotions
in service process design.
LO 7 Explain the necessity for service process redesign.
LO 8 Understand how service process redesign can help improve both
service quality and productivity.
LO 9 Understand the levels of customer participation in service
processes.
LO 10 Be familiar with the concept of service customers as “co-creators”
and the implications of this perspective.
LO 11 Understand the factors that lead customers to accept or reject new
self-service technologies (SSTs).
LO 12 Know how to manage customers’ reluctance to change their
behaviors in service processes, including the adoption of SSTs.
Things were not going smoothly at Family Medicine Faculty Practice (FMFP), a small
practice within a hospital system. Its patients were often placed on hold for long times
when they called; there was a lack of available and convenient appointment slots; the
waiting room was frequently crowded with lengthy delays before patients could see
their doctors.
Dr. Schwartz, the medical director, and Dr. Bryan, the assistant medical director,
decided to change this situation and engaged Coleman Associates, a consulting firm that
specializes in redesigning processes. Over the course of four days, a Coleman
Associates team worked closely with the clinic’s staff on-site, shoulder-to-shoulder,
and radically redesigned work processes. It was an amazing transformation; the
redesign started on a Monday afternoon, and by Friday morning the Faculty Practice
was operating in a whole new way!
FMFP had altogether 12 staff, of which nine were support staff and three were
physicians. The clinic was considered lean with only three support staff per physician,
which is much lower than the national average of 4.8. As a central part of the redesign,
staff were reorganized into three Patient Care Teams. Each Patient Care Team consisted
of a clinician, a medical assistant, and a receptionist who acted like a one-stop shop for
all the patients in their care. The Patient Care Teams took care of all tasks related to
their patients, including walk-ins, collection of co-payments, filing of medical charts,
confirming the next day’s appointments, checking insurance eligibility, and any other
patient transactions.
The three Patient Care Teams shared three “back-office” staff which had the following
redesigned roles: a medical records staffer, a phone attendant, and a flowmaster not
specifically assigned to any of the three teams. The medical records staff was in charge
of getting medical charts 24 hours in advance of clinic sessions and filing lab results in
charts on a real-time basis so that no work was left to accumulate. If a patient phoned
FMFP for an appointment, the call would be answered by the phone attendant. The
flowmaster was in charge of moving patients from the front waiting room into the exam
rooms, and out as smoothly and as fast as possible. The flowmaster communicated with
each Patient Care Team’s medical assistant to get an accurate estimate of the wait time
for each patient. Basically, the flowmaster solved any flow problems occurring in the
clinic to keep the visit cycle time within 45 minutes for 90% of all visits.
After the redesign, the phone attendant picked up calls and passed it to the relevant
Patient Care Team receptionist. In future, they had further plans for direct lines to each
Patient Care Team to eliminate the traffic to the phone attendant. The receptionists
would be given wireless phones so that patient calls could still be picked up even as
they filed medical charts from visits already completed. Patient Care Team
receptionists filed charts immediately after visits, thus reducing the incidence of lost
charts.
During the booking of appointments, if a patient had a question the receptionist could
not answer, she would communicate directly, via walkie-talkie, with the Patient Care
Team’s medical assistant to get an immediate answer so that work was handled on a
real-time basis and not stacked up to be dealt with later.
New tools and equipment helped to stretch FMFP’s available resources. For example,
digital floor scales were placed in every exam room to weigh adult patients quickly and
privately, so there was no need for an extra stop at a vitals station. In fact, all work was
done in the exam room reflecting the redesign principle: “Organize our work around the
patient, not the patient around our work.”
As staff gained more experience working together every day in their Patient Care
Teams, they also became stronger and more adept in handling variations in patient flow.
Stacks of paper seemingly melted during the week when work was redesigned.
FMFP’s staff worked harder than ever, but they were also thrilled with the results and
all the compliments they received from delighted patients about the new service
processes.
LO 1
Know the difference between a service experience and a service process
From the customer’s perspective, services are experiences. From the organization’s
perspective, services are processes that have to be designed and managed to create the
desired customer experience. This makes processes the architecture of services.
Processes describe the method and sequence in which service operating systems work,
specify how they link together to create the value proposition promised to the
customers. Badly designed processes are likely to annoy customers because they often
result in slow, frustrating, and poor quality service delivery. Similarly, poor processes
make it difficult for frontline employees to do their jobs well, thus resulting in low
productivity, and increasing the risk of service failures. In this chapter, we discuss how
we can design and improve service processes so that they deliver the promised value
proposition.
LO 2
Tell the difference between flowcharting and blueprinting.
The first step in designing or analyzing any process is documenting or describing it.
Flowcharting and blueprinting are two key tools used for documenting and redesigning
existing service processes and for designing new ones. How do we distinguish between
flowcharting and blueprinting in a service context? A flowchart describes an existing
process, often in a fairly simple form. Specifically, flowcharting is a technique for
displaying the nature and sequence of the different steps involved when a customer
“flows” through the service process. It is an easy way to quickly understand the total
customer service experience. By flowcharting the sequence of encounters customers
have with a service organization, we can gain valuable insights into the nature of an
existing service. Figures 8.2 and 8.3 display two simple flowcharts that demonstrate
what is involved in each of the featured services.
Blueprinting is a more complex form of flowcharting and specifies in detail how a
service process is constructed, including what is visible to the customer and all that
goes on in the back-office. It’s no easy task to create a service, especially one that must
be delivered in real time with customers present in the service factory. To design
services that are both satisfying for customers and operationally efficient, marketers
and operations specialists need to work together, and a blueprint can provide a common
perspective and language for the various departments involved.
Perhaps you’re wondering where the term blueprinting comes from and why we use it
here. The design for a new building or a ship is usually captured on architectural
drawings called blueprints as reproductions have traditionally been printed on special
paper on which all the drawings and annotations appear in blue. These blueprints show
what the product should look like and they detail the specifications to which it should
conform. In contrast to the physical architecture of a building or a piece of equipment,
service processes have a largely intangible structure. That makes them all the more
difficult to visualize. The same is also true of processes such as logistics, industrial
engineering, decision theory, and computer systems analysis, each of which employs
blueprint-like techniques to describe processes involving flows, sequences,
relationships, and dependencies.
Figure 8.1 Chapter overview – designing and managing service processes
Figure 8.2 Simple flowchart for delivery of motel service
Figure 8.3 Simple flowchart for delivery of health insurance service
Service blueprints map customer, employee, and service system interactions.
Importantly, they show the full customer journey from service initiation to final delivery
of the desired benefit, which can include many steps and service employees from
different departments. For example, in the context of a cable service, it may involve a
sales agent, an installation team, a call center employee to do the scheduling, and the
back-office officers to set up the billing and payment; all are equally responsible for a
trouble-free installation1. Blueprints show the key customer actions, how customers and
employees from different departments interact (called the line of interaction), the frontstage actions by those service employees, and how these are supported by back-stage
activities and systems. By showing interrelationships among employee roles,
operational processes, supplies, information technology, and customer interactions,
blueprints can help bring together marketing, operations, and human resource
management within a firm. Together, they can then develop better service processes,
including defining service scripts and roles to guide interactions between staff and
customers (as discussed in Chapter 2); designing fail points and excessive customer
waits out of processes; and finally, setting the service standards and targets for service
delivery teams.
LO 3
Develop a blueprint for a service process with all the typical design elements in
place.
How should you get started on developing a service blueprint? First, you need to
identify all the key activities involved in creating and delivering the service in
question, and then specify the linkages between these activities. Initially, it’s best to
keep activities relatively aggregated in order to define the “big picture”. This can be
done by first developing a simple flowchart documenting the process from the
customer’s perspective. You can then refine any given activity by drilling down to
obtain a higher level of detail. In an airline context for instance, the passenger activity
of “boards aircraft” actually represents a series of actions and can be broken down into
such steps as “wait for seat rows to be announced, give agent boarding pass for
verification, walk down jetway, enter aircraft, let flight attendant verify boarding pass,
find a seat, stow carry-on bag, sit down” (Figure 8.4).
Next, the more details can be added. Typical service blueprints have the following
design characteristics that help to see how a blueprint should be developed2:
• Front-stage activities map the overall customer experience, the desired inputs and
outputs, and the sequence in which delivery of that output should take place.
• Physical evidence of front-stage activities is what the customer can see and use to
assess service quality.
• Line of visibility is a key characteristic of service blueprinting that distinguishes
between what customers experience “front-stage” and the activities of employees and
support processes “back-stage” where customers can’t see them, between the two
lines of what is called the line of visibility. When a firm clearly understands the line
of visibility, it is able to better manage physical and other evidence for front-stage
activities to give customers the desired experience and quality signals. Some firms
are too focused on operations and neglect the customer’s purely front-stage
perspective. Accounting firms, for instance, often have detailed documented
procedures and standards for how to conduct an audit, but may lack clear standards
for hosting a meeting with clients, or for how staff members should answer the
telephone.
• Back-stage activities that must be performed to support a particular front-stage step.
Figure 8.4 Baggage collection is one of the last steps in an air travel service process
• Support processes and supplies — Many support processes involve a lot of
information. The information needed at each step in the blueprint is usually provided
by information systems. For example, without the right information at the frontline
staff’s fingertips, processes such as banking, online broking, or even borrowing a
book from your university library could not be completed and the service process
could break down. Supplies required to be made available for both front-stage and
back-stage steps are also necessary for many services. For example, restaurants need
to have the supplies of the right fresh produce and wines; and car rental firms of
vehicles, global positioning systems (GPSs) and child seats. Supplies are essential to
delivering high quality core services.
• Potential fail points — Blueprinting gives managers the chance to identify potential
fail points in the process. Fail points are where there is a risk of things going wrong,
resulting in diminished service quality. When managers are aware of these fail
points, they are better able to design them out of a process (such as using poka-yokes,
as discussed later in this chapter) and have backup plans (such as for service
recovery, as discussed in Chapter 13) for failures that are not preventable (e.g.,
departure delays due to bad weather).
• Identifying customer waits — Blueprints can also pinpoint stages in the process at
which customers commonly have to wait (Figure 8.5), and where there are points of
potentially excessive waits. These can then either be designed out of the process, or
if that is not always possible, firms can implement strategies to make waits less
unpleasant for customers (see the strategies discussed in Chapter 9 “Managing
Demand and Capacity”).
• Service standards and targets should be established for each activity to reflect
customer expectations. They include specific times set for the completion of each
task and the acceptable wait between each customer activity. Developing service
blueprints gives marketing and operational personnel detailed process knowledge
that can then be used to develop standards. The final service blueprint should contain
key service standards for each front-stage activity, including the estimated time for
the completion of a task and maximum customer wait times in between tasks.
Standards should then be used to set targets for service delivery teams to ensure that
service processes perform well against customer expectations.
Figure 8.5 Long waiting lines indicate operational problems that need to be addressed
To illustrate how the blueprinting of a high-contact, people-processing service can be
done, we examine the dinner experience for two at Chez Jean, an upscale restaurant that
enhances its core food service with a variety of other supplementary services (Figure
8.6). A rule of thumb in full-service restaurants is that the cost of purchasing the food
ingredients represents about 20–30% of the price of the meal. The balance can be seen
as the fees that customers are willing to pay for a great dining experience that includes
“renting” tables and chairs in a pleasant setting, the food preparation services of expert
chefs and their kitchen equipment, and serving staff to wait on them in the dining room.
Most service processes can be divided into three main steps:
1. Pre-process stage where the preliminaries occur, such as making a reservation,
parking the car, getting seated and being presented with the menu.
2. In-process stage where the main purpose of the service encounter is
accomplished, such as enjoying the food and drinks in a restaurant.
3. Post-process stage where the activities necessary for the closing of the encounter
happens, such as getting the check and paying for dinner.
It is important to differentiate these stages as customers tend to have different
objectives and sensitivities in these stages. For example, research in the context of
restaurants found that people are more upset about a delay during the pre-process or
post-process stages than the in-process stage3. Also, the pre- and post-process stages
typically are not the core of the service and customers want efficiency and convenience
in those stages (e.g., a convenient way to get a reservation, and getting the check and
payment done quickly when one wants to leave the restaurant), whereas the in-process
stage has to d…
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