The Value of Service Design for Businesses

Inge Keizer
Jul 25, 2017 · 4 min read

To generate revenue and make a profit, companies are told to choose a distinct business model shaped by the company’s underlying value creation strategy. Three well-known strategies coined by Michael Treacy and Fred Wiersema are: customer intimacy (delivering what customers want and focusing on a long-term customer relationship), product leadership (creating the best products and services in the market), and operations excellence (providing high quality products or services at competitive prices and ease of purchase).

The three strategies — including combinations of those — are valid as a guiding principle how to create an attractive value proposition that is distinctive from competitors and other players in the market. But what they lack in general is the connection with the purpose (the ‘why’ according to Simon Sinek) and, in relation to that, customer centricity (or better said: human centricity). Even the strategy ‘customer intimacy’ requires a fundamental employee alignment to truly understand the customer’s context, to empathise with the customer’s need, and to deliver accordingly.

But why is it important to become customer centric? Research by Deloitte shows that customer-centric companies are 60% more profitable than companies that do not have this focus. Deloitte:

‘Few organisations have the necessary organisational culture to deliver truly customer-centric customer experiences. Often, a well-intentioned strategy is diluted by operational constraints (whether real or perceived) and a loss of focus, resulting in little more than lip-service being paid to the concept of customer-centricity. Too many organisations focus on trying to deliver ‘world class’ service — rather than giving customers what they actually want, which in most cases is a quick and easy process to follow, that is right first time.’

From product orientation to service experience

Focus on customer service as a service circle around products is common sense for quite some time. For companies in different industries, customer service is seen as an additional, transaction-related assistance a company needs to offer, mostly in relation to the customer’s purchase journey (explaining the relevance of a product, solving problems when using a product, etc.).

But the shift from a product-oriented, producer-driven economy to a customer-centric service economy requires that companies redefine their production processes and start thinking about service experiences. This shift from products (output) to solutions (outcome) also demands a switch from using push to pull strategies. Moreover, it requires to listen, adapt and change.

So customer centricity is more than delivering the best customer support. Being customer centric means creating a culture of really putting customers first. It goes beyond having a customer focus. The whole organisation needs to have the same mind-set regarding the customer. All processes need to start and end with customer understanding and satisfaction. And last but not least, each and every employee, from the decision maker to the marketing, customer service or the logistic officer need to design, develop and distribute with the end-user of the product in mind (and at the table). PWC concluded after a CEO survey in 2013:

‘Companies with the strongest customer-centered DNA have CEOs who double as the chief customer officer, in spirit if not in title.’

The value of service design

That’s where service design comes into play. Mat Hunter, former Chief Design Officer at the Design Council explains:

‘Service design is the shaping of service experiences so that they really work for people. Removing the lumps and bumps that make them frustrating, and then adding some magic to make them compelling’. In other words: ‘Service design is all about making the service you deliver, useful, usable, efficient, effective and desirable’ (UK Design Council).

Or like The Copenhagen Institute of Interaction Design states: ‘Service design focuses on the creation of well thought through experiences using a combination of intangible and tangible mediums. It provides numerous benefits to the end user experience when applied to sectors such as retail, banking, transportation and healthcare. As a practice it generally results in the design of systems and processes aimed at providing a holistic service to the user’.

Realizing that products have transformed into service ecosystems, these ecosystems require continuous attention and fine-tuning at every touchpoint in order to create valuable experiences.

The backbone of service design is the understanding of customer behaviour and the goals and needs behind that behaviour. Without this fundament the whole ecosystem will fall apart. To design and build upon this fundament demands close collaboration and interaction between everyone involved: business and design, front and back office, company and customer. Together they can conceptualise and bring to life services that are (perceived as) valuable. Involving the customer as a co-creator in this value-creating process is key.

A holistic customer experience

I’d like to conclude with the following: when an organisation embraces service design, cross-disciplinary teams are being created, bringing together designers and many other professionals (such as marketing, sales, process, product and business specialists) inside the organisation to analyse, empathise, ideate and design every little interaction between customers and the entire organisation. That is why service design is becoming increasingly important within marketing departments, often being the central pivot when talking about customers and their interactions with the representatives of the organisation and its printed and digital touchpoints. But whoever is ‘in the lead’, the ambition is to cut across organisational silos, step over the organisation’s departmental structure and their deep rooted cultural differences to create a holistic customer experience. The strategy how to let customers genuinely experience the company’s customer-centric belief and the behaviour upon that belief at every contact moment with the customer, is what makes service design valuable for businesses.

#servicedesign

Inge Keizer

Written by

conceptual thinker | strategist | believes in interconnection | inspires organisations to become human-centric | founder @ SDDBCN Service Design Days

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