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Customer Service

Management Course Handbook V2.0

Dr. Wolfgang Messner

[email protected]

Managing customer service operations effectively and efficiently provides a significant source

of competitive advantage for organizations. This course emphasizes the philosophy, strategy,

and style of management that service organizations can use to gain competitive advantage,

including the utilization of technology and outsourced resp. offshored services.

mailto:[email protected]

Customer Service Management

© Dr. Wolfgang Messner. All rights reserved. 1

Customer Service

Management Course Handbook V2.0

1. About the Course The course on Customer Service Management emphasizes the

philosophy, strategy, and style of management that service

organizations can use to gain competitive advantage, including the

utilization of technology and outsourced resp. offshored services. It

is designed to provide skills and knowledge to enable you to

identify, design, and implement operating improvements; it

provides concepts, frameworks, tools, and techniques that enable to

craft a service strategy just as well as to diagnose a situation on the

ground, identify challenges and opportunities, and then establish a

go-forward plan. It also provides entrepreneurially inclined

students with the foundation to open their own services businesses.

The approach to the topics has been designed to be rigorous and

practical using content-driven lectures, examples, and case studies.

2. Course Objectives The aims of this course are to help you:

To be able to design service processes and to use analytical

tools to diagnose and assess service quality.

To align service culture with strategic choices and to devise

strategies to deliver more value to clients.

To understand the role information technology plays in service

delivery and for turning a service encounter into a sales

opportunity.

To use customer data and insight to start automated and

meaningful customer dialogues.

To appreciate the chances and challenges that outsourcing and

offshoring carries for the professional services firm.

Introduction

Managing customer

service operations

effectively and

efficiently provides a

significant source of

competitive advantage.

Organizations focused

on their customers

consistently outperform

their competition. These

companies carefully

segment their

customers, develop a

specific value offering

for their target

customers, and deliver

an outstanding

customer experience.



3. Cases Discussed Alamo Drafthouse, DHL, Hard Rock Café, Harrah’s Entertainment/Caesars, Legal industry,

McDonald’s, Ritu Kumar, Starbucks.

Further examples from Europe, USA, and India are provided during the lectures.

4. Evaluation This is a graduate-level course and as such contains graduate-level work. This includes active

participation in class discussions and activities; high-quality written work is expected. Much of a

manager’s success depends on communication excellence and therefore effective communication will

constitute a significant portion of a student’s grade. Written work should be clear, logical,

grammatically correct, spell-checked, persuasive, supported by examples, and backed up by citations

for any data, ideas or other content used. It should always represent your best effort. To do well on

the writing assignments, you will need to incorporate and apply the course readings – and use the

library and the Internet for further research.

Your final grade in this course will be based on the following weighting:

Individual paper 50%

Knowledge quizzes 40%

Classroom participation 10%

Common sense warning: Just as ethics and integrity are important in management practice, academic

integrity is important in this course. Ignorance is not an excuse for violation!

Individual paper

This is an individual paper. You are expected to identify a company with a services component located

in India and explain its services strategy in a paper. For example:

Royal Orchid Hotels, Intercontinental Hotels, Hilton Hotels etc. or a small and independently run

hotel or restaurant that you are familiar with

Café Coffee Day, Starbucks, McDonalds

A cinema or multiplex

A professional services company like Infosys, Wipro, Capgemini, Accenture, Ernst & Young

A car dealership or repair shop

An online retailer like amazon.in, snapdeals.com, flipkart.com

A tourist attraction like Mysore Palace, Mysore Zoo

A hospital, an airport, a car rental company

These are ideas only; identify a company that you are interested in! Use the Internet, visit the company,

read analyst reports about the company – do some research around it. You are now expected to write a

case study about the service strategy of this company.



There is no set structure for this paper, but I expect it to have the following elements:

Heading. This should both create appetite for reading the paper as well as aptly summarizes its

contents.

Executive Summary. This is, as the name suggests, a summary containing all the important aspects

of the company and its services strategy, so that a busy manager can get a flavor of what your paper

is about and decide whether or not to read it. It is also referred to as an abstract, but not to be

confused with the introduction.

Introduction. This sets the scene for your paper. Why has the paper been written? Why has the

company been selected?

Main part. Structure the main part of the text with some subheadings (look at the sample case

studies, see below). Make your writing more accessible with using a few high-quality figures or

tables.

References. List all the references used.

Questions. See note below.

Author. Some three to five lines about YOU as the author of the paper

Solutions to the Questions. See note below.

The main part of the paper is strictly limited to 3,000 words (not including references, the questions,

figures, and tables). A template will be made available during class.

At the end of the paper, suggest two questions (not more and not less) on your paper. Again, look at

the two sample case studies. At least one of your two questions should make use of a quality

framework discussed in the course (e.g. service winners, Porter’s Five/Six Forces, Strategic Service

Vision framework, SERVQAL – the choice is yours!). Do not suggest a SWOT analysis (this is for

undergraduate work only and, by the way, extremely difficult to get right).

Finally, provide short and crisp sample answers to the two questions. If you ask your readers to use

Porter’s Five/Six Forces to assess the industry environment, show the result of the analysis.

A few more hints:

Please make sure your paper makes sense as a standalone reading.

Don’t use figures and tables for their own sake. A pretty and colorful chart says nothing; instead, for

example, pick out interesting rations and show a graph how they have been behaving over time.

Make sure you use the right kind of graphic for the job (for example, pie charts don’t work for time

series). Flashy diagrams do not substitute for clear thinking. The best diagrams are simple and

black-and-white, avoid using color!

The main part of the paper should not mention any frameworks; frameworks help you to write a

good main part, but they should not be obvious. You can show me that you know how to use

frameworks in the two questions.

Depending on your chosen company, you may even want to start work on your paper with the two

questions – rather than the writing the main part first. You may want to use the information from

the solutions to the questions as input for the main part.



While your paper is to be submitted as individual work, nothing stops you to team up with your

fellow students. Maybe choose a company from a similar industry (e.g. Pizza Hut and McDonalds),

analyze the industry environment together, work together, and help each other. You will be faster

and have a better result! And then submit independently.

If you are a bit unsure of what is expected, read the following two case studies distributed as part of

your course pack:

The Alamo Drafthouse

United Commercial and El Banco

The deadline for your paper is:

Friday, 18th July, 03:00 p.m.

Late submissions (even by 2 minutes) will be downgraded by 50%. Plan your work accordingly!

Hand-in a hardcopy (black-and-white only!) to Ms. Deepa Jaganath, sign the submission sheet, and

send a softcopy via email to me ([email protected]) with the following attachments in a

single zip file:

Your paper as a pdf

Your paper as a Word document

Your figures and tables as a PowerPoint document

The naming convention for the zip file is: StudentNo_Firstname_Lastname_CompanyName.zip

The marking scheme for your paper will be as follows:

Research: 10% / Referencing: 10%

You should base your paper on recent material from reputed newspapers, business magazines,

journals, and books. You should cite a respectable range of at least 6 (the more the better, probably

max. 15) separate references from at least 3 different sources. As a guideline, at least half of your

references should not be older than 3 years. All sources have to be cited properly and referenced

using APA 5th edition. I strongly recommend you to use the Word functionality for references!

Knowledge & understanding: 10%

Show me that your understanding of customer service management is comprehensive in breadth

and depth, current, and relevant. Show me that you can extrapolate and inter-relate theory and

practice.

Academic underpinning: 10%

For a very good mark, I want to see clear evidence that you have deployed the full range of theory

and frameworks to analyze the service strategy of your chosen company. But do not reproduce

theory! Theory must be applied to the company and used to draw insightful conclusions based on

factual evidence. If your analysis has little support from theory and frameworks, you will get lower

marks. If you only repeat theory and frameworks (but don’t relate them to the company and its

service strategy), you will get very low grades.




Adding value: 20%

Ask yourself, as a reader, would you want to read and engage with this case study? Is it a thought-

leadership publication standard?

Presentation: 20% / Writing mechanism: 20%

Your are expected to submit work that follows a clear and logical structure, is written in correct

English and easy for the reader to follow. Professional lay-out is important. Appropriate use of

figures and tables will enhance your grade. Persistent poor spelling and other avoidable errors will

be penalized. The expectation is that your paper can be “published in a book” as submitted by you.

Avoid jargon! There are no extra marks for using terms such as “globalization,” “core

competencies,” or “paradigm” just to show that you are attending business school. Write simply and

concisely! Avoid the use of unnecessary technical terms – and if you really must use them, use them

correctly!

Avoid adjectives like “huge,” “massive,” or “disastrous.” Instead, use actual figures or percentages –

it makes your paper more considered and credible. Of course, you will need to quote the source of

your data.

Knowledge Quizzes

There will be at least 3 knowledge quizzes during the duration of the course. The quizzes will not be

announced and are closed-book exams of about 15-20 minutes duration.

The quizzes may include objective (true/false or multiple choice) questions and/or subjective (short

answer and essay) questions. The quiz covers the content of the last few lectures and background

reading.

Only students present will get credit for the exercise; this will be determined by those who have signed

the roll for the day. Typically, quizzes cannot be made up if you are absent on this day.

The quiz with the lowest mark will be dropped and not taken into account for calculating your mark.

Classroom Participation

This course covers a significant amount of content and much of the learning comes from in-class

exercises and discussion. Therefore, you are expected to attend all sessions, complete all assigned

readings, and come prepared to participate. For some sessions, there will be a small case study to

prepare for discussion or an activity to be completed.

Attendance will be taken and participation will be evaluated at each class session. Excessive absences

above 20 per cent of class contact hours will result in a lower grade. Please notify me (via email to

[email protected]) prior to the start of class if you will not be in attendance.

Classroom participation will be graded more on quality than on quantity, so contributions should be

relevant, concise and aimed at moving the discussion forward and driving toward insight and

understanding. Here are the behaviors that count:

Asking questions




Answering questions

Making comments

Sharing relevant experiences

Here are the value-added behaviors – the ones that put your contributions over the top:

Responding to something another student says (including answering a question asked by a student)

Constructively disagreeing with something in the text or said in class by me or another student

And these are behaviors to avoid:

Not listening

Pretending to be listening while texting or cruising online

Speaking without being recognized

Making fun or otherwise berating something said by another person.

My Judgment for Excellence

The intention is to encourage motivated and able participants to aspire for and achieve something

extraordinary in this course. For instance, you could write a paper of very high quality with high

probability of publication in a journal of repute. In such a case, the overall grade for the course will be

decided by the grade of this excellent work alone, irrespective of the grades obtained in any/all other

components. Needless to add, I would exercise very high standards of evaluation here, and also share

such information with the rest of the class appropriately. Post grading in the course, the possibility of

such work(s) being appropriately taken forward in collaboration with me would also exist as an option

for you.

5. Disability Accommodation Statement Any individual who qualifies for reasonable accommodations with respect to disabilities should please

contact me immediately.

6. Session Details I will be using both the lecture-discussion and the problem introduction-solution methods to teach this

course. The following content will be covered:

Topic 1 Introduction

Content Role of Services in the economy. Experience economy and experience

engineering. Service package. Career options in services. Introduction to project

assignment.

Examples: Apple Stores, Niketown.

Readings 1) (Fitzsimmons & Fitzsimmons, 2011) – Ch 1, 2

2) (Pine & Gilmore, 1998) [included in course pack]



Topic 2 Service Strategy

Content Strategic service vision. Competitive strategies. Strategic analysis of the industry

environment (Porter’s 5+1 forces). Market position map. Winning customers in

the marketplace.

Case study: Legal industry

Examples: Southwest Airlines

Readings 1) (Fitzsimmons & Fitzsimmons, 2011) – Ch 3

2) (Grant, 2010) – Ch 3 [included in course pack] or (Haberberg & Rieple, 2008)

3) (Heskett & Sasser, The Service Profit Chain. How Leading Companies Link

Profit and Growth to Loyalty, Satisfaction, and Value, 1997)

4) (Economist-1, 2011) and (Economist-2, 2011) – for case study on legal

industry [included in course pack]

Topic 3 Service Strategy: Case Alamo Drafthouse

Content Strategic service vision. Industry analysis for entertainment industry US;

comparison with entertainment industry in India.

Case study: Alamo Drafthouse

Readings 1) (Fitzsimmons & Fitzsimmons, 2011), p 61-63 – for case study on Alamo

Drafthouse [included in course pack]

2) (Fitzsimmons & Fitzsimmons, 2011), p 61-63 – for an alternative case study

on United Commercial Bank and El Banco [included in course pack]

Topic 4 Role of Information in Services

Content Customer migration path. Data about the customer. Data privacy and limits in

use of customer information. Data architecture. Data models. Technology in

service encounters. Competitive role of information technology.

Case study: Hard Rock Café

Readings 1) Case study on Hard Rock Café [included in course pack]

2) (Fitzsimmons & Fitzsimmons, 2011) – Ch 5

3) (Messner, 2004) [included in course pack]

Topic 5 Components of CRM Applications

Content Definition of CRM. CRM landscape and system overview. CRM readiness

check. Contact center. Data warehousing.

Case study: Ritu Kumar

Examples: Hard Rock Café, Dresdner Bank, Deutsche Bank 24, McKinsey

Readings 1) Case study on Ritu Kumar [included in course pack]

2) (Gilson & Khandelwal, 2005) [included in course pack]


4) (Shainesh & Sheth, 2006) – Ch 5, 7, 9



Topic 6 Value from Services

Content Value dichotomy. Sources of customer value. Contribution of marketing to

value delivery. Service profit chain. Moments of truth in customer service.

Readings 1) (Beaujean, Davidson, & Madge, 2006) [included in course pack]

2) (Golub, et al., 2000) [included in course pack]

3) (Heskett, Jones, Loveman, Sasser, & Schlesinger, 2008) [included in course

pack]

4) (Sirdeshmukh, Singh, & Sabol, 2002) [included in course pack]

5) (Lanning & Michael, 1988) [included in course pack]

Topic 7 Service Quality

Content Service recovery. Gaps in service quality. Measuring service quality

(SERVQUAL). Designing for service quality. Walk-through audit.

Case Study: McDonald’s

Readings 1) Case study on McDonald’s [included in course pack]

2) (Fitzsimmons & Fitzsimmons, 2011) – Ch 6

3) (Parasuraman, Zeithaml, & Berry, 1988) [included in course pack]

4) (Perez, 2010) [included in course pack]

5) (Reichheld, 2003) [included in course pack]

Topic 8 Process Improvements

Content Method for business process (re-)engineering (BPR). Chain link logic. Quality

tools for process analysis and problem solving.

Readings n.a.

Topic 9 Statistics for Customer Service

Content Building questionnaires. Frequency distributions. Summary statistics.

Correlation analysis. Lab exercises.

Readings Service questionnaire [included in the course pack]

Topic 10 Using the Service Encounter for Marketing

Content Outbound marketing (campaign management). Inbound marketing. Dialogue

marketing.

Case: Logitech

Readings 1) (Kalyanam & Zweben, 2005) [included in course pack]


Topic 11 The Quest for Customer Focus

Content Concentrating on customer relationships. Loyalty cards. Opportunity based

customer segmentation. Involving employees in customer service.

Case: Harrah’s Entertainment/Caesars

Readings 1) (Fournier, Dobscha, & Mick, 1998) [included in course pack]

2) (Loveman, 2003) for the case study on Harrah’s [included in course pack]

3) (Smith, 2005) for the case study on Harrah’s [included in course pack]



Topic 12 Managing Service Operations

Content Managing capacity and demand. Yield management. Waiting lines.

Example: Disney Park

Readings 1) (Fitzsimmons & Fitzsimmons, 2011) – Ch 11, 12

Topic 13 Service Supply Relationships

Content The professional services firm. Service supply relationships. Outsourcing.

Offshoring. Status of India’s ITES Industry. Charge-out rates and margins.

Industrialization of service delivery.

Readings 1) (Fitzsimmons & Fitzsimmons, 2011) – Ch 13


7. Readings This course requires you to work continually throughout its duration and it also entails a fair amount

of background reading, writing, and discussion.

Main Text Book

Fitzsimmons, J. A., & Fitzsimmons, M. J. (2011). Service Management. Operations, Strategy, Information

Technology. Boston: McGraw-Hill.

Note: The main text book covers roughly 30% of the course content. Hence, reading and studying from

the main text book alone is not sufficient. You do not necessarily have to purchase the text book (there

are copies in the library); the course pack – together with the lecture slides and your class notes –

should have sufficient material.

Course Pack and Readings

Beaujean, M., Davidson, J., & Madge, S. (2006, Feb). The 'Moment of Truth' in Customer Service.

McKinsey Quarterly, pp. 63-73.

Economist-1. (2011, May 05). A Less Gilded Future. The Economist, pp. 69-70.

Economist-2. (2011, Aug 13). Bargain Briefs. The Economist, p. 56.

Fitzsimmons, J. A., & Fitzsimmons, M. J. (2011). Service Management. Operations, Strategy, Information

Technology. Boston: McGraw-Hill.

Fournier, S., Dobscha, S., & Mick, D. D. (1998, Jan-Feb). Preventing the Premature Death of Relationship

Marketing. Harvard Business Review, 42-51.

Gilson, K., & Khandelwal, D. (2005). Getting more from Call Centers. McKinsey on Operations, published

by The McKinsey Quarterly.



Golub, H., Henry, J., Forbis, J. L., Mehta, N. T., Lanning, M. J., Michaels, E. G., et al. (2000, Jun).

Delivering Value to Customers. McKinsey Quarterly.

Grant, R. M. (2010). Contemporary Strategy Analysis (7th ed.). Wiley.

Haberberg, A., & Rieple, A. (2008). Strategic Management. Theory and Application. New York: Oxford

University Press.

Heskett, J. L., & Sasser, W. E. (1997). The Service Profit Chain. How Leading Companies Link Profit and

Growth to Loyalty, Satisfaction, and Value. New York: Free Press.

Heskett, J. L., Jones, T. O., Loveman, G. W., Sasser, W. E., & Schlesinger, L. A. (2008, Jul-Aug). Putting

the Service-Profit Chain to Work. Harvard Business Review.

Kalyanam, K., & Zweben, M. (2005, Nov). The Perfect Message at the Perfect Moment. Harvard Business

Review, 112-120.

Lanning, M. J., & Michael, E. (1988). A Business is a Value Delivery System. McKinsey Quarterly.

Loveman, G. (2003, May). Diamonds in the Data Mine. Harvard Business Review, 109-113.

Messner, W. (2004). The Beauty and Importance of Quality Customer Information. The Marketing

Review(4), 279-290.

Messner, W. (2005). Customer Relationship Management Technology. Business Information Review,

22(4), 253-262.

Messner, W. (2008, Dec). Enhancing Marketing Performance through Inbound Customer Marketing.

(A. G. Mulky, Ed.) IIMB Management Review, 430-432.

Messner, W. (2011). Offshoring to India - Realising Savings and Capturing Value. Journal of Indian

Business Research, 3(1), 63-68.

Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1988). SERVQUAL: A Multi-item Scale for measuring

Consumer Perceptions of Service Quality. Journal of Retailing, 64(1), 12-40.

Perez, J. (2010). Walk-through Audit. Sweetwater Brewing Company.

Pine, J., & Gilmore, J. (1998, Jul). Welcome to the Experience Economy. Harvard Business Review, 97-105.

Reichheld, F. (2003). The Number One You Need to Grow. Harvard Business Review.

Shainesh, G., & Sheth, J. N. (2006). Customer Relationship Management. A Strategic Perspective. New Delhi:

Macmillan India.



Sirdeshmukh, D., Singh, J., & Sabol, B. (2002, Jan). Consumer Trust, Value, and Loyalty in Relational

Exchanges. Journal of Marketing, 66, 15-37.

Smith, J. S. (2005, Apr 8). Customer Research. Why Harvard Lost out to Vegas. Financial Times, p. 10.

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