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LEAD Innovation Blog

Read our latest articles on innovation management and innovation in a wide range of industries.

Date: 24-Jul-2019
Posted by: Julian Eberling
Category: Service Design

3 examples that reveal the potential of service design

 

Service Design ensures a better customer experience. This method can be used to improve existing services or develop entirely new ones. Read this blog post to find out how it works and how it's helping startups transform entire industries.

Design Thinking is not only applicable to products. This innovation method can also be used to develop new services. After all, services that are geared to the needs of customers are more successful on the market than those that primarily follow the internal processes of the provider.

A study by Bain & Company shows that there is still a lot of room for improvement in the customer experience: While 80 percent of the interviewed companies stated that they offer a perfect customer experience, only 8 percent of the interviewed customers were of the opinion that they would get one. Many companies apparently don't manage to take the perspective of their target group. Service Design is a method, in order to create exactly this. In general, there are two ways to service design innovations:

1) Strategic innovation management and the resulting roadmap result in search fields that concern a service rather than a product. This can be, for example, a call center or an app that improves the user experience. The redesign of the checkout area would also be a service design innovation.

2) A company analyses a service that it or another company has been offering on the market for some time. If this service has potential for improvement, the company tries to develop a service design innovation.

Template Service Design

 

The three phases of service design projects

Regardless of which of the two paths a company has chosen: Every service design project follows a cycle that can be roughly divided into three phases:

1) The starting point is the target group and its problems or needs, which the company analyses very precisely. If a company wants to develop a service that replaces an existing one, it takes a close look at the Customer Journey. When inventing a new service, on the other hand, the company has to be more broad in its analysis.

2) Based on the analysis, the company develops ideas, concepts and prototypes and tests them as early as possible on the customer's premises. The company uses the findings to further improve its invention.

3) With the launch of the new service, the cycle begins anew at the same time: the company analyses the customer's experience and tries to improve it further.

 

There are many very successful service design innovations. Some of them have changed entire industries:

1) McDonald's satisfies the desire to eat easily and quickly

In the 1940s, Dick and Mac McDonald were able to see what annoyed visitors to the drive-in bars, which were extremely popular in the USA at the time: These were mainly overflowing menus and long waiting times. They developed a concept that avoided these two weaknesses: the food on offer concentrated on the bestsellers Hamburger and Pommes. At the same time, they optimized the processes and the premises of their restaurant so that only 30 seconds passed between ordering and handing over the food. The film "The Founder" shows this process very impressively. The brothers sketch their restaurant with chalk on a tennis court and imitate the individual work steps in order to further improve them. The biggest fast-food chain still has this urge to continually optimize the customer experience. In 2003, for example, the company began equipping restaurants with self-service terminals. This innovation not only increased customer convenience, but also enabled the company to take more orders.

 

2) It takes away the passenger's fear of the unknown

Anyone who has ever used a taxi in a foreign city knows these fears: How much will the trip cost? Does the taxi driver have a license at all or have I been caught by a fraudster? Does the driver take the fastest route? Can I reach my destination at all? How can I express my dissatisfaction with the driver's unfriendliness and unkempt appearance? The two founders of Uber, Travis Kalanick and Garrett Camp, could not ask themselves all these questions on a winter evening in Paris in 2008. Because they didn't get a taxi at all. The two decided to develop an app with which they could order a car at the push of a button. The current app answers all the questions mentioned at the beginning. However, Uber is constantly working on it to improve the driving experience even further: Passengers can use a chat function to contact the driver directly without revealing their telephone number. Uber plans to launch flying taxis as early as 2020. In this way, the company wants to further improve the customer experience: Passengers can easily fly over red traffic lights or traffic jams and reach their destination faster.

 

3) Lime offers the solution for the last mile

In many cities, cycle paths and the public transport network are so well developed that you can reach your destination faster than by car. Especially if you include the search for a parking space. However, cycling in cities is not everyone's cup of tea. When using subways, suburban trains, trams and buses, the user still has the last mile to overcome in order to reach his actual destination. The US mobility service provider Lime has solved this problem with a transport solution "from door to door": with an app, the user can find and unlock e-scooters and park them directly at their destination after the journey. Another advantage: while the driver of his own means of transport has to take care of it even when he doesn't need it, this obligation is not applicable to borrowed vehicles: On their way through the city, owners of e-scooters have to drag the scooter along in the subway, while customers of rental systems usually find the means of transport directly at the stations and can leave it there again. Transport solutions such as those offered by Lime have quickly taken city dwellers into their hearts: In Vienna alone, there are currently six different providers on the market. Since the first providers started in September 2018 with around 600 e-scooters, the number of e-scooters has increased tenfold by April 2019. Together with Uber, Lime is also working on further improving the mobility experience for urban road users: The two companies are even officially cooperating: Lime's e-scooters can also be booked via the Uber app.

 

How to reduce pain points for ambulance patients

There are many other companies that have grown through service design innovations - such as Booking.com, AirBnB or Car2Go and DriveNow. There seem to be many pain points for consumers, and it pays to eliminate them with one solution. LEAD Innovation is currently supporting the hospital of the Barmherzigen Brüder Wien in a service design project. The aim is to take the fright out of waiting in the ambulance and make it as pleasant as possible for the patient. This should enable a relaxed encounter between patients and hospital staff. Patentable concepts will be provided by the LEAD User Method. It involves not only patients and their relatives as well as health care experts, but also people who have to wait elsewhere for the provision of a service (airport, train station, authorities, ...) in the process. This ensures that the perspective and expertise of those who are ultimately confronted with the waiting situation is included in the development of innovations.

 

Conclusion: 3 examples that reveal the potential of service design

Every company claims to be customer-oriented and to offer a good customer experience. In this respect, however, the image of oneself and that of others often diverges greatly. In order to align an existing or new service with the needs of the customer, lip service is not enough. Rather, only the right methodology delivers really good results. Just how much power target group-oriented service design innovations can unfold can be seen in many examples of now very large and powerful corporations that once started out as small startups.

Template Service Design

Julian Eberling

Born in Vienna. Since 2018 "Certified Service Design Thinker" he has been pursuing his passion as Innovation Manager at LEAD Innovation.

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