Developing a Service Strategy 1

The development of a services strategy lies at the heart of the service provider organisation. Increasingly, services providers are finding themselves operating in very fluid market places that are subject to constant change. These changes are characterised by an increased demand for services, increasing costs for service organisations, difficulty in achieving a balance between the development of standardised or personalised services and the advent and use of technology. Given these market conditions, service organisations must take a structured approach to the development of strategy.

Marketing Plans For Services

Planning and strategy are linked concepts.  The major phases in planning consist of the following:

  • Understanding the strategic context. (Situation Analysis/Marketing Audit) and defining the organisational Direction (Mission; Goals; Objectives)
  • Situation review.
  • Marketing strategy formulation.
  • Plan development – Resource allocation
  • Plan implementation and monitoring.

Although the process is shown as individual steps, many of the steps are interrelated and the process is interactive. Also the degree to which each step should be emphasised in a given service firm will depend on the size and nature of the organisation.

Marketing Planning and Services

Effective marketing is greatly enhanced by a well thought through and developed marketing plan. Such a plan helps bring all the service firm’s marketing activities together in an integrated manner and helps create a positive future for the firm. However, particularly in services sector organisations, a number of problems create barriers to the development and implementation of marketing planning. These include the following:

  • Confusion between tactics and strategy.
  • Isolating the marketing function from operations.
  • Confusion between the marketing function and the marketing concept.
  • Organisstional barriers.
  • Lack of in-depth analysis.
  • Confusion between process and output.
  • Lack of knowledge and skills.
  • Lack of a systematic approach to marketing planning.
  • Failure to prioritise objectives.
  • Hostile corporate cultures.

When competing in the marketplace, a services firm has a broad range of alternatives available to it. However it first must create an economically viable service formula on which to build.

Competing for market share can take place in one or many markets at the same time and can involve expansion of both the services offered and the segments served.

Competing for markets is based on the premise that service formulas are often easy to copy and success, therefore, comes from rapid target market expansion.

A clearly defined strategy can also can simplify the nature of the task for the service provider. If they know what the organisation is supposed to be delivering, to whom it is to be delivered, how it is to be delivered and with what image defined, then the probabliity of success is increased. If a firm possesses a “strategic service vision,” that vision will guide the behavior of both the service provider and the consumers.

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