Wednesday, July 16, 2014

8 differences between high contact and low contact services


8 Differences : 
High & Low Contact Services


HIGH CONTACT
LOW CONTACT
Location
CUSTOMER -CENTRIC LOCATION Needs to be located close and convenient for the customers
WORK-CENTRIC LOCATION : Needs to be where factors of production like land, labor and materials are close and cheap. It should be close and convenient to the employees and suppliers.
Facility Layout
CUSTOMER -CENTRIC LAYOUT :It should be based on how the customers behave : how they like to approach, enter, wait, be served and leave. It should be also easy for the employees to serve the customers. It needs to presentable. The rhythm will be dictated by the customers' arrival and pace.
WORK-CENTRIC LAYOUT : This layout should enable the work to get done easily. Generally the customer will not be present when such work is done and hence the rhythm of work can be scheduled in batches.

Quality Control
      CUSTOMER-DEFINED QUALITY METRICS : Since the customer is present, the quality cannot be measured against industry standards, but  against customers'  expectations. These standards are subjective and hence variable. Therefore the main standard is whether the customer is satisfied. This may mean you need to change the people and the processes as the customers change.  
STANDARD METRICS : Because the customer is not present, the standards can be more objective, You can benchmark yourself against industry standards. You can correct defects and rework is possible.
Capacity
NEED MORE IDLE CAPACITY : Excess capacity is required to handle peaks in
demand
NEED LESS IDLE CAPACITY : Can be planned for the average demand
Front Line Worker Skills
HUMAN AND DOMAIN SKILLS : Must be able to interact well with customers and use judgment in decision  making
ONLY DOMAIN SKILLS : Technical Skills
Rhytham
and Schedule
CUSTOMER PRESENCE MAKES SCHEDULING DIFFICULT : Essentially depends on the customer who is present on the premises and forces his pace and schedule on the service.
CUSTOMER ABSENCE MAKES SCHEDULING EASY : The customer is concerned mainly with the end date and is not present on the premises hence the rhythm can be set to a schedule.
Service Process
      DRIVEN BY CUSTOMER :Driven by the customer and consists mainly of the  front-end  activity. Service may change during delivery in response to customer.
DRIVEN BY INTERNAL CRITERIA AND SCHEDULE : Driven by batching and internal criteria. Not much interference from the customer.
Service Offer
      MORE RANGE : More variations may be needed  
LESS RANGE : Fixed, less extensive

It is clear that the "cost to serve" per person is higher in high contact service.
High contact service is effective (satisfying) but not efficient
High contact service needs "broad band" providers and deft handlng
High contact service difficult to scale up

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