SERVICE MANAGEMENT

UNDERSTANDING service
management in public sector

This presentation has been modified from its

original version

LEARNING
OUTCOMES
At the end of the session, students should be able to:
Acquire an understanding on the concept of Public Service
Explain the importance of Public Service Sector

PUBLIC SERVICE
Employment within a governmental
system, especially within the civil
service.
A service performed for the benefit
of the public, especially by a
nonprofit organization.
The business of supplying an
essential commodity, such as water
or electricity, or a service, such as
communications or transportation, to
the public.
(American Heritage Dictionary,2011)

Continue..
Public services is a term usually used to
mean services provided by government
to its citizens, either directly (through the
public sector) or by financing private
provision of services
(www.wordiq.com)

3 important Public services to citizens:

i.
Welfare
ii. Healthcare
iii. Education

SIZE & ROLE OF SERVICE SECTOR

Government Service
Construction
Engineering
Architecture
Education
Franchise
ICT Industry
Oil & Gas Industry
Healthcare
Green Technology
Banking
Lodging
Restaurants, catering, insurance, news &
entertainment
Transportation
(Public Bank Review, 2008)

MALAYSIA: SHARE OF SERVICES

Source: PEMANDU,2013

Source: http://www.ezfx.com.sg/2014

MALAYSIA: SHARE OF SERVICES TO GDP

Measures and Incentives to Foster The Growth of

Service Sector

1) Administrative Measures
Empowering the Ministry of International Trade and
Industry (MITI)
Strengthening the role of Malaysia External Trade
Development Corporation (MATRADE)
Establishment of National Professional Service Export
Council (NASPEC).
Establishment of Small and Medium Industries
Development Corporation (SMIDEC)
Liberalisation of service sector.
Service Sector Blueprint March 2015

Service Sector Blueprint Recommendations

Cont
2) Financial Measures:
Provide fiscal and tax incentives (eg: tax exemption,
investment allowance, infrastructure allowance,
industrial building allowance, etc)
R&D grants
Intellectual Property protection
Competitive telecommunication tariffs.

WHY MANAGING PUBLIC SERVICE IS

IMPORTANT?
What is the scenario of todays economy?
What is the direction of the government in
the development of the country?

10th

SCENARIO 1:
MSIAN PLAN & NEW ECONOMIC MODEL

The 10th Malaysia Plan (RMK 10)

outline that GDP share of services in
2015 is 61% with annual growth of
7.2%
The services sector targets under the
Industrial Master Plan (IMP3) (20062020) are :

Non government services to grow

at an average annual rate of 7.5%
Construction services at 5.7%, and
Total investment requirement of
RM687.7 billion or RM45.8 billion per
annum

SCENARIO 2: VISION 2020

IMPORTANCE OF PUBLIC SERVICE

Quality of life of the Malaysian citizen is the
ultimate aim of government service
Government service is mediator to facilitate the
engine of economic growth (private sector)

The Marketing Function

To target the types of customers whom the firm
is able to serve and create ongoing relationships
with them.
This can be achieved by delivering a carefully
defined service product package in return for a
price that offers value to customers and profits
to the firm.
Customers will recognize this package as being
one of quality that delivers solutions to their
needs and is better than that offered by other
competing firms

 Marketing can be viewed as:

A strategic and competitive thrust pursued by top management
A set of functional activities performed by line managers
A customer-driven orientation for the entire organization

Marketing is the only function to bring operating revenues

into a business; all other functions are cost centers
The 8Ps of services marketing mix are needed to create
viable strategies for meeting customer needs profitably in a
competitive marketplace
The marketing mix concepts recognises that results are
derived from a combination of variables over which the
marketer has control. Selection of, and concentration on, a
particular combination brings about a collective effect (D.M.
Reid, 2007)

8Ps of Service Marketing Mix

The marketing mix for any service industry is
discussed as 8Ps. They are,

8Ps of Service Management (Lovelock

et al., 2009)
Service Variables

Description

Product

The core output produced by the firm

Place, cyberspace, time

Location and time for service distribution

Process

A particular methods of operations, or series of actions,

typically involving steps in a defined sequence

Productivity & Quality

How efficiently service inputs are transformed into outputs

that add value for customers

People

A individual as well as group that may be part of the service

experience

Promotion & Education

Form of communication that provide information and advice

to encourage customers to take action

Physical evidence

Tangible cues that provide evidence of service quality

Price & other user

outlays

Expenditure of money, time & effort that customers incur in

purchasing and consuming service

Marketing Mix for Tourism

Components of Tourism
Tourism has many components
comprising
1. Travel experience
2. Accommodations
3. Food
4. Beverage services
5. Shops
6. Entertainment
7. Aesthetics and
8. Special events
Let us look at the 8 Ps in
detail.

1. Product
Product in Tourism is basically the experience
and hospitality provided by the service provider.
In general the experience has to be expressed in
such a way that the tourists see a value in them.
2. Process
The process in Tourism include, (a) trip planning
and anticipation, (b) travel to the site/area,
(c)recollection, (d) trip planning packages.
The trip planning packages that service provider
should provide include; maps on attractions
enroute and on site, information regarding
lodging, food, quality souvenirs and mementoes

3. Place and Time Location and Accessibility

The place and time in tourism is providing directions and
maps, providing estimates of travel time and distances
from different market areas, recommending direct and
scenic travel routes, identifying attractions and support
facilities along different travel routes, and informing
potential customers of alternative travel methods to the
area such as airlines and railroads.
4. Productivity and Quality
This is similar to other service industries. The quality is
assessed by time taken for a service, the promptness of
the service, reliability and so on.

5. Promotion and Education

Like other services, the promotion should address, the
accurate and timely information helping to decide
whether to visit target audience, the image to be
created for the organization, objectives, budget,
timing of campaign, media to be selected, and
evaluation methods.
6. People
People is the centre for Tourism. It is more a human
intensive sector
For hospitality and guest relations it is very important
to focus on people
It also plays a vital role in quality control, personal
selling, and employee morale

7. Price and other user costs

The price of the tourism services depend on
business and target market objectives, cost of
producing, delivering and promoting the product,
willingness of the target, prices charged by
competitors offering similar product/service to
the same target markets, availability and prices of
substitute products/services, and economic
climate.
The possibility of stimulating high profit
products/services by offering related services at
or below cost.
8. Physical Evidence
In Tourism the physical evidence is basically
depends on travel experience, stay, and comfort.
Here, the core product is bed in case of stay.

Marketing Functions
Evaluate and select market segments
Research customer needs and
preferences in each segment
Monitor competitors, identifying their
strengths and weaknesses, quality levels
and strategies
Design the core product, tailoring its
characteristics to the needs of the
chosen market segments
Set prices that reflect costs, competitive
strategies and consumer sensitivity to
different price levels

Marketing Functions
Tailor location and the
scheduling of service
availability to customers
needs and preferences.
Develop communications
strategies, using
appropriate media to
transmit messages
Develop performance
standards
Create programs for
rewarding and reinforcing
customer loyalty.

Operation Function
Dominant function in most
service organization
This function creates and
delivers the service product
Responsible for operating
equipment and backstage
procedures and other
customers facilities
Direct the work of large
numbers of employees
Take primary responsibility for
the technological
infrastructure do research
and development to design
and introduce innovative
delivery systems

Human Resources Function

Involves all managerial decisions
and actions that affect the nature
of the relationship between the
organization and its employees
its human resources (Lovelock, C
et al, 2004)
In many service organization,
both the quality and commitment
of the labor force have become a
major source of competitive
advantage.
A strong commitment by top
management to human resource
management is a feature of many
successful service firm.

Human Resources Function

Ensure that the right number of people and mix of
competencies are available to meet the firms long term
strategic requirements recruitment, training, career
development & promotion
Its tasks associated with arranging people, facilities, and
technology to create/support services produced by
organization.
Create and maintain desired attitudes and behavior of
employees through reward systems
Empowerment of service employees employee influence
through pay rate, working conditions, career progression,
employment security and the design & implementation of
work tasks.

Interdependence of Three Management Functions

Marketing, operations and
human resources
management - these are all
interrelated in planning and
implementing marketing
strategies.

Marketing function in
service organizations
depends on the procedure,
personnel and facilities
managed by the operations
function.

Interdependence of Three Management

Functions
Operations managers acknowledge that
marketing specialist can provide useful
inputs to service design.
People are needed for operational
tasks, for performing variety marketing
tasks and for administrative support.
Skills and training should be provided,
desired attitude and behavior must be
created, understanding of organization
goals must be ensured.

Interdependence of Three Management

Functions
If employees understand and support the goals of their
organization, have the skills and competent to succeed
in their job and recognize the importance of creating
and maintaining customer satisfaction, the marketing
and operational functions will be substantially easier to
manage.

SUMMARY

Concept of public service

Size & role of service sector
Importance of public service management
Unique characteristic of service and its implication to public
service management
8Ps of Service Marketing
Integration the marketing, the operation and human resource
function: The Trinity Approach