Executive Summary
The main purpose of this paper is to critically evaluate the value created concepts within Xiamen Airlines company. This concept will be considered with the help of service marketing triangle to assess people, processes, and physical evidence that are involved in creating and delivering added value to customers.
In this respect, it is necessary to identify how Xiamen Airlines adapts its organizational framework for created values for customers and meeting their needs. The data collection will help to define the main peculiarities of the company’s organization, including their objectives and mission. In addition, secondary data collection will contribute to defining the effectiveness of the CRM strategies implemented for values created for customers, including processes, people, and physical evidence as well as Marketing Strategies Triangle.
The findings explain the advantages of the training programs introduction and the role the interior and exterior facilities in creating and delivering values. In the end of the paper, recommendations and conclusions will be provided to understand the importance of the introduced strategies and approaches aimed at improving added values.
Background
Added Value
The process of creating customer value is now perceived as the key method for gaining competitive advantage (Christopher, Payne, and Ballantyne, 2002, p. 102). Nevertheless, despite the increased attention to this phenomenon of strategic management and development, there is no particular agreement among managers and theorists concerning what aspects and concepts are included into the notion of ‘customer value’.
Christopher, Payne, and Ballantyne (2002) believe that this concept is made up of the following chief components: determination of company’s potential for creating the value, understanding what values a company provides to customers, and assessing which value can be created and delivered to customers in future for sustaining a competition.
In order to avoid service marketing myopia, businesses should be more concerned with customers’ needs and preferences. Managers should be aware of the aspects and features customer pay attention to while buying a particular product or services and these features are constantly changing in the course of time (Baker, 2006, p. 130). Hence, this area of marketing should be taken into deepest consideration because of it influences the formation of global perspectives.
Services and Services Marketing
Today, service marketing is acquiring great significance in the developed economies due to increase of competitive advantages and promotion of the globalization and integration processes (Bruhn and Georgi, 2006, p. 6). The leading international companies have taken the course on improving service marketing industry, placing an emphasis on customer satisfactions, customer services, and service quality (Hoffman et al. 1999, p. 16).
In this respect, the global business perspectives are closely associated with customer relationship management, or CRM, that is oriented on meeting customers’ needs, introducing innovative technologies and strategies, implementing programs, and making a shift to a customer-centered strategy.
Xiamen Airlines
Xiamen Airlines company was founded in 1984. It is considered to be the first Chinese airlines that are carried out on a commercial basis (Xiamen Airlines, 2008). This corporate strive to capture the leading positions in innovating and meeting the highest management standards.
Being specialized predominantly in cargo transport and domestic passenger flights, the company aims to promote service marketing strategies and reform its positions and attitudes to customers. Xiamen managers believe that hospital services should take into account event the least important minutiae to satisfy their customer’s needs – from birthday parties to passengers to special programs on holidays (Xiamen Airlines, 2008).
It is also worth saying that Xiamen International Airport greatly contributes to meeting the above-established goals and objectives. Particularly, the company provides great exterior and interior facilities, including domestic and international transport services, as well as other commercial properties, such as domestic books, health care products, information services, and suchlike (Business Scope, 1996).
In whole, the company’s philosophy is narrowed to “creating a top-class airport service enterprise, implementing ‘customers-first’ operating guidelines, providing the company’s clients with unmatched services and generating the best returns for the company shareholders” (Company Profile, 1996).
Introduction
Aims
The aim is to critically analyze the application of the value creation and delivering concepts within the Xiamen Airlines through the concept of People and Service Marketing Triangle.
Objectives
- To review and critically evaluate the literary sources concerning creating and delivering added value to customers.
- To critically evaluate the theoretical frameworks that are specifically connected to Service Marketing Triangle;
- To analyze the process of value creating and delivering as implemented in Xiamen Airlines, focusing on People, Process, and Physical Evidence.
- Once all previous research have been conducted, it will be imperative to assess the effectiveness of values creation strategies in delivering added value to customers with regard to existing models and with regard to the ones provided by Xiamen Airlines.
Methodology
The research design will be aimed at critically evaluating the main aspects of added values trough such the concepts of People, Process, and Physical Evidence and the basic elements of the Service Marketing Triangle.
Research Design
For a more advanced and detailed research, a case study approach is preferable to introduce as it significantly improve the finale results, making them more valid and reliable. According to Gerring (2007), case study research design relies on number of cases involved, number and characteristics of variables the case exploit, and origin of locations (p. 27).
In this respect, the following methodology seeks to discuss company’s organizational structure, its philosophy, employee programs as well as how it influences the effectiveness of the customer services and relationships (Dibb and Simkin, 2001, p. 7).
Secondary Data
Secondary data will provide us with all necessary information on major theories and concepts implemented within Xiamen Airlines service management. While discussing theoretical material on creating and delivering added value, it will be possible to better understand the main advantages and disadvantages of polices implemented within the company as well as the way the affect the overall situation in the sphere of service marketing.
Assessment of the essentials of the service marketing triangle will provide a more explicit picture on the service framework implemented by the company concerned. Beside the Internet sources will also be used to find more empirical information and statistic connected with customer rate and needs.
Findings and Analysis
It is obvious that services companies should introduce specific training programs and create a favorable climate for their staff in order to educate and update their knowledge on the recent changes in the sphere (Kapoor, n.d., p. 41).
More importantly, services industry should direct efforts and resources for putting together people, strategies, and technology for generating an improved level of customer services and satisfaction. In this respect, considering service marketing triangle and Marketing Mix strategies incorporating such elements as People, Process, and Physical Evidence to understand how these elements contribute to adding and delivering value to customers.
Concept Analysis
Concept of ‘People’ in terms of Providing Quality Services
It should be stressed that external elements of the marketing mix is sometimes difficult to control due to constant reshaping the target market. Therefore, before working specific strategies in the field of quality service management, it is necessary to understand the major challenges of external environment, which is less predictable than the internal one. Many organizations, and Xiamen Airlines, assemble specialists to gather and assess the environmental information and scan the situation at the target marketing.
When it comes to analyzing the concept of people, one the elements the Services Marketing Mix, one should take into consideration such concepts as employees’ competence, reliability, courtesy, communication, security, credibility, and understanding the basic customers’ needs and tangibles (Baron, Harris, and Hilton, 2009, p. 190).
In other words, the main task of the service sphere is to fill in the gap between customer experience and expectations. Due to the fact that customer can also be considered as producers of services, they also influence on altering and creating programs directed at improving organizational performance.
Hence, according to Baron, Harris, and Hilton (2009), the basic function of customers involves not only attracting clients but also maintaining and developing long-lasting relationships (p. 192). This conception is encaged within the concept of customer loyalty that also touches upon such issues as competitive advantage and reduction of customer defection.
Taking into consideration all aspects of the element concerned, all the participants of the marketing triangle – customers, employees, and managerial – are all involved in forming, creating, and delivering value to customers who, in their turn, make their contribute to creating better values.
Explaining the Concept of ‘Process’
Though services industry is more connected with delivering intangible products, these products are directly dependent on the material culture established within an organization. Nevertheless, all tangible objects and material cultures are aimed at providing high-quality services. All these explanations are attached to the concept of process, being integral element of the services marketing mix.
Being an element of the marketing strategies mix, process refers to the methods and techniques with the help of which services are provided. Hence, this component deals directly with customer services and product management before, during and after the product consumption (Lancaster and Massingham, 2010, p. 510).
It should also be stressed that “elements of process differ according to, for example, the particular service product, the need and wants of customers and competitor and cost considerations”( Lancaster and Massingham, 2010, p. 510). In this respect, the decisions made toward the improvement of the chain of production and delivering services within the organizations are also of great importance for managers.
The Concept of ‘Physical Evidence’
There is a close connection between the concept of physical evidence and physical environment that is designed specifically for providing higher quality services. Due to the fact that Xiamen Airlines are mostly focused on providing services to customers, they should develop more person-oriented strategies where all elements of equipment enhance customers’ comfortable conditions.
In this respect, introducing greater possibilities through building effective exterior and interior facilities is another method for adding and delivering value to customers. This notion is included into the concept of physical evidence. To enlarge on this issue, physical infrastructure of airline industry and other services industry includes decoration, furnishing, lighting, passenger seats. These are the main elements of the co-called ‘servicescape’ (McCabe, 2008, p. 131).
Physical evidence can be considered as one of the orientation concepts contributing to customer’s needs and expectations (Bowie and Buttle, 2008, p. 15). Everything from facility design to employment dress and guarantee point out company’s philosophy and goals that are directed at attractive a wider target audience.
With regard to the above-presented, physical evidence within the services marketing mix stems directly from the intangible nature of the services. In this respect, the need for physical evidence is also explain within the context of promotion. From marketing viewpoint, promotion should develop a message and kind of presentations that makes a particular service more ‘tangible’ (Ennew and Waite, 2006, p. 179).
Interestingly, the more successful forms of promotion will be for tangible items, the more chances to attract customers. Hence, Xiamen International Airport has introduced a number of Shopping and Dining services enabling the passengers to visit duty-free shops providing a great range of tobacco products, cosmetics, perfumes and international brand-name luggage, watches, and specific local product (Business Scope 1996).
In order to enhance interaction between the service providers and the customers a focus should also be made on telecommunication technologies that guarantee remote service control if it is impossible to establish face-to-face communication immediately.
This is especially significant when we are talking about Xiamen Airlines services, particularly about communication on the plane board. A valuable contribution will be the establishment of connection between the flight attendant and the passengers via specific devices established near the passenger seats.
The Value Creating Strategies of Xiamen Airlines
Job and workplace design
Xiamen Airlines realizes that the success of the company’s service directly depends on the availability and quality of services being provided. It should be stressed that a customer also influences each single stage of marketing planning process.
So, before considering the development of marketing relations, including customer care, it is also imperative to define the connection between quality and customer care as well as between customer services and customer care. Realizing the competitiveness of leading international airlines companies, Xiamen Airlines realizes that one wrong step can derail their smooth transition to an advanced level of services.
The company’s managerial staff also realizes that a ‘services recovery’ process is quite sophisticates the lost reputation is not that easy to restore. One of such strategies, the company does its best at meeting the growing customers’ demand in better qualities and responsiveness of the staff. While establishing new routes and supporting tourism and hospitality, the company hopes to attract more clients (Routes Asia, 2011).
Managing cultural diversity
Despite the fact that Xiamen Airlines specializes predominantly in domestic passenger flights and cargo transportations, cultural diversity issues are also taken into careful consideration.
Due to the fact that company strives to meet the international standards of quality, the managers introduce cultural issues to human resources management strategies. They realize that Xiamen’s hospitality market is still in short demand due to absence of effective activities and philosophies aimed at improving cross-cultural communication (Company Profile, 1996).
In order to ensure great performance of the service staff and make it more culture-oriented, the Xiamen government plans to introduce advanced procedures and technologies while dealing with passengers during the flight. Such an introduction will play a significant role in motivating the personnel and making customers continue using Xiamen services.
Conclusion
Each company striving to enter the international area and sustain a competitive advantage should get ride of stereotypes concerning existing marketing concepts because each particular organization should develop its unique plan of penetration. Despite that, the concept of quality, availability, and hospitality will remain common for the entire field of service industry irrespective of specialization. Managers should realize all challenges that will have to meet while being involved in service-customer relationships.
In the case with Xiamen Airlines, a critical analysis of service marketing has revealed that a particular emphasis should be made on strengthening the Services Marketing Mix Triangle incorporating all goals and strategies of creating and delivering values to customers. Taking closer consideration to People, Process, and Physical Evidence, Xiamen managers will be able to meet the ongoing demands of their clientele and improve the service sphere in terms of quality and availability.
In addition, the company should focus on current trends on globalization and internalization to consider the main difficulties in cross-cultural communication. Finally, much attention should be paid to the improvement of exterior and interior facilities because services are under direct influence of material products creating the necessary environment.
Reference List
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