How to innovate in the service economy

February 14, 2017

Services are all around us. Some are intentional and thoughtfully designed. Others are clearly not. 

In the US, services account for 82 percent of the GDP and that number is expected to grow as companies increasingly position themselves on a product-service continuum. If you think about companies like Apple, Uber, Google and IBM, it’s becoming harder and harder to even distinguish their products from their services.     

While services themselves are nothing new, Service Design is an important field of practice that requires a shift in thinking from our traditional make-and-sell approaches to product development.

Here are the five shifts you will need to make to stay competitive in the service economy:

From product to services

 If you only think in terms of product, your company (and likely your industry) is ripe for disruption. Financial products. Insurance products. Medical products. These products are often part of larger, complex chain of events called services. If one part of this chain fails, the entire thing is broken from a customer perspective. This is a key factor as to why many of these industries are faltering in the face of startups that are re-thinking their approach in terms of the superior services they can provide to clients.

From touchpoints to end-to-end experiences

If you think only in terms of touchpoints, you’re missing the bigger picture. A company can have a positive rating at each touchpoint along the way, but will fail if they don’t think about the end-to-end experience as a whole. For example, think of your cable company. The person that you talked to on the phone was nice enough. So was the person who installed the box. The app kind of works most of the time. But the fact remains that you would switch cable companies in an instant if a better deal came along. In this example, your cable company is falling short on the larger service opportunity to create lasting, meaningful relationships with their customers.

From controlling to facilitating

If you’re not thinking about Service Design, you’re leaving your full service experience to chance — or possibly worse, expecting that you can control every aspect of the service encounter. The goal of Service Design is to stage an experience that is co-created in the moment between those delivering and those

Service Design is an approach to problem solving that thinks about the user relationship across channels over time.

receiving the service. We can’t — and frankly shouldn’t — look to control every factor. The companies that are intentional about facilitating a cohesive service experience today will have an edge on their competition.

From stage gates to ongoing relationships

If you’re using a stage-gate process, you probably could benefit from adding a few more gates after launch. Stage-gate processes often end with launch — and if we’re generous they end with a post-launch evaluation. But what happens to your customer after they purchase the product? How do you build on that product to create a reliable, viable and desirable experience? How is the product serviced and supported? How do you create opportunities to extend the relationship to other products in your portfolio? How do keep your competitive advantage when newer, cheaper products come on the market? How do you foster habits and loyal communities around your product? Service Design is an approach to problem solving that goes beyond the purchase, the stage gate, and the funnel to think about the relationship across channels over time.

From customer point of view to an ecosystem

If you’ve mapped the user experience, you’ve only done half your job. Service Design focuses not only on the people receiving the service experience, but also the people delivering the service. Taking a purposeful approach to mapping what happens behind the scenes will identify any roadblocks, information gaps and pain points in the delivery of the service, thereby uncovering opportunities that will have a significant impact on the experience for all people involved. This is truly human-centered design.

While Service Design requires a mind shift that many organizations may not be fully ready to embrace, it doesn’t have to be all or nothing. It can begin as simply as a workshop mapping the existing service experience (what service designers call a Service Blueprint). Once you have a 50,000-foot view of the end-to-end experience with a Service Blueprint, you can begin prioritizing the key moments that will have the most impact on the overall experience.

Often, the ultimate goal is not to fully redesign a company’s service experience. Instead, it’s about defining an approach to improve the service experience in a way that integrates seamlessly with existing systems and works toward a larger goal. It’s how we ultimately create service experiences that are actionable for our clients and authentic for their customers.