Journal of Service Research 000(00) 1-21 ª The Author(s) 2011 Multilevel Service Design: Reprints and permission: sagepub.com/journalsPermissions.nav From Customer Value Constellation DOI: 10.1177/1094670511401901 to Service Experience Blueprinting http://jsr.sagepub.com

Lia Patrı´cio1, Raymond P. Fisk2, Joa˜o Falca˜o e Cunha1, and Larry Constantine3

Abstract The proliferation of complex service systems raises new challenges for service design and requires new methods. Multilevel Service Design (MSD) is presented as a new interdisciplinary method for designing complex service systems. MSD synthesizes contributions from new service development, interaction design, and the emerging field of service design. MSD enables integrated development of service offerings at three hierarchical levels: (a) Designing the firm’s service concept with the customer value constellation of service offerings for the value constellation experience; (b) Designing the firm’s service system, comprising its architecture and navigation, for the service experience; and (c) Designing each service encounter with the Service Experience Blueprint for the service encounter experience. Applications of the MSD method are described for designing a new retail grocery service and for redesigning a bank service. MSD contributes an interdisciplinary service design method that accommodates the cocreative nature of customer experiences and enables experience integration from the design of the service concept through the design of the service system and service encounter.

Keywords service system design, customer experience, value constellation, blueprint, technology-enabled multi-interface services

Introduction cocreate value (Maglio et al. 2009). For example, customers can cocreate value by combining service offerings from multi- The rapid evolution of service systems raises new challenges ple firms, such as credit and insurance in the case of a home for service design. Consensus is emerging across service fields purchase. This constellation of service offerings can be viewed that further research is needed to address these challenges in as a system of service systems. At the firm level, each of these marketing (Bitner and Brown 2006; Brown, Fisk, and Bitner service offerings is enabled by a firm’s service system compris- 1994; Hauser, Tellis, and Griffin 2006), operations management ing multiple service interfaces such as physical stores, the tele- (Johnson et al. 2000; Menor, Tatikonda, and Sampson 2002; phone, or the Internet. At each service encounter, the customer Stuart and Tax 2004), innovation management (Karniouchina, interacts with a concrete service interface, which is a service Victorino, and Verma 2006), interaction design (Constantine subsystem that integrates the physical environment, people, andLockwood2002),design(Evenson2008),andservice and process. Designing these complex service systems requires science (Ostrom et al. 2010). Some areas need particular a holistic systems thinking approach (Jackson 2003; Norman attention, such as the growing complexity of service systems, 2011), which focuses on designing the system components and the emergence of multichannel services, customer cocreation the networks of relationships that make the whole service offer- of service experiences, and the need for interdisciplinary ing more than the sum of its parts. This holistic perspective methods. Together these trends have led to the emergence of complements traditional reductionist approaches that do not service design as a new field (Mager 2009) that takes a more address the interactions between the parts of the service system holistic view of the service system. This section describes the new service challenges that motivated the development of the Multilevel Service Design (MSD) method. 1 University of Porto, Porto, Portugal 2 Texas State University–San Marcos, San Marcos, TX, USA 3 University of Madeira, Funchal, Portugal Complex Service Systems Corresponding Author: Service offerings today are enabled by complex service sys- Lia Patrı´cio, Department of Industrial Engineering and Management, School of tems, which are configurations of people, technologies, and Engineering, University of Porto, R. Roberto Frias, 4200 – 465 Porto, Portugal other resources that interact with other service systems to Email: [email protected]

Downloaded from jsr.sagepub.com at Politecnico di Milano on October 17, 2016 2 Journal of Service Research 000(00) and may lead to optimizing one part in isolation without development (Karniouchina, Victorino, and Verma 2006; considering overall system performance. Different service sys- Meyer and Schwager 2007; Roth and Menor 2003), but tech- tem levels should be integrated into service design, but service nology infusion and the increasing complexity of service sys- design approaches have typically only focused on one system tems require other competences such as computer science, level at a time. engineering, social sciences, and the arts (Fisk and Grove 2008). Service innovation efforts have been hampered by their Multi-Interface Services isolation in different academic disciplines and a lack of unify- ing models and languages. These problems have been major Technology trends have enabled the emergence of multi- forces driving the emergence of IBM’s Service Science, Man- interface service systems through which companies manage agement and Engineering (SSME) initiative, which encourages relationships with their customers (Rayport and Jaworski integrating work from different fields to develop the new com- 2004). Multi-interface services are called multichannel ser- petencies required in the service-led economy (Chesbrough and vices in many research studies. Designing these service sys- Spohrer 2006). The creation of integrative methods, tools, and tems involves defining the mix of service offerings and languages that unify these different perspectives is crucial for interfaces, the tangible evidence, the service processes, peo- the development of the service design field. The Service Expe- ple’s roles in the processes (whether service representatives rience Blueprint (SEB) method (Patrı´cio, Fisk, and Cunha or customers), and the technology solutions that provide crucial 2008) represented a first step toward such unification by join- support to the entire system. Multi-interface services are con- ing management and technology perspectives for the integrated sidered technology-driven service innovations (Johnson et al. design of technology enabled multi-interface services. How- 2000), but many firms have introduced online services without ever, the SEB method focuses only on multi-interface integra- understanding customer experience needs or taking an overall tion. Service system design needs to evolve to more holistic view of the firm’s multi-interface offering. The result is fre- methods that integrate the design of the different service sys- quently a collection of incoherent service fragments that fail tem levels from the definition of the overall service concept to provide satisfying service experiences to customers (Patrı´cio, to the design of each concrete interface. Fisk, and Cunha 2008). In this context, researchers studying This article presents MSD as a new interdisciplinary method new service development have stressed the need to address for integrative design of complex service systems. MSD new issues related to multichannel service design (Hill et al. synthesizes contributions from different fields, allowing inte- 2002; Menor, Tatikonda, and Sampson 2002; Neslin et al. 2006; grated design of the service offering at three hierarchical levels: Sousa and Voss 2006), such as the trade-off of efficiency versus the firm’s service concept, the firm’s service system, and the personalization, the definition of the offline/online mix, resource service encounter. The next section analyzes research from dif- allocation across channels and multichannel coordination. ferent fields that provided the foundation for the development of the MSD method. The second section presents the MSD Design for the Customer Experience method, defining its core design process, concepts, and models. In the new service-centered paradigm, value is no longer The third and fourth sections describe applications of the MSD embedded in tangible offerings but is cocreated with customers method to designing a new retail grocery service and redesign- through relational exchanges in interaction experiences ing a banking service. Finally, the last section presents the con- (Normann 2001; Vargo and Lusch 2004). Instead of delivering tributions and managerial implications of MSD. preproduced offerings, firms can only offer value propositions, which customers then transform into value through use (Gupta Service System Design as an Emerging Field and Vajic 2000; Normann and Ramı´rez 1993). In this context, customer experiences can be viewed as internal and subjective Service design is an emerging field (Mager 2009) whose meth- responses to any contact with a company (Meyer and Schwager ods are still being developed and are often borrowed from 2007) and are increasingly important to differentiating and add- related areas. Service design has been traditionally viewed as ing value to a firm’s offerings (Pine and Gilmore 1998). Recent a specific stage of the new service development process research has advocated a more holistic view of the customer expe- (Edvardsson et al. 2000). However, the new service design rience (Gentile, Spiller, and Noci 2007; Verhoef et al. 2008) and field has adopted a broader approach, involving understanding some approaches have been proposed for managing customer users and their context, understanding service providers and experiences (Bardon et al. 2002; Berry, Carbone, and Haeckel social practices, and translating this understanding into the 2002). However, further research on service experience design development of evidence and service systems interaction is still needed (Stuart and Tax 2004; Zomerdijk and Voss 2009). (Evenson 2008). When designing complex systems, thinking with models helps bridge the gap between problem and solution (Dubberly, Evenson, and Robinson 2008). Models synthesize The Need for Interdisciplinary Methods the understanding of users’ needs and possible solutions in Interdisciplinary service innovation research has been called ways that help different stakeholders explore new ideas. for in academe and industry. The integration of marketing and Service systems can be modeled and designed at different operations perspectives has been a concern of new service levels. The network of service offerings provided by different

Downloaded from jsr.sagepub.com at Politecnico di Milano on October 17, 2016 Patrı´cio 3 firms can be viewed as a system of systems. The firm’s configura- system. In the Servuction framework (Langeard et al. 1981), tion of people, technologies, and other resources can be viewed as the service system comprises the internal organizational sys- the service system at the organizational level. This service system tem, the physical environment, the contact personnel, and the can be decomposed into several subsystems, such as each service customers. The Service Theater framework (Fisk, Grove, and channel. When modeling customer needs, Human Activity John 2008) views service experiences as theatrical. In service Modeling (Constantine 2008) provides a hierarchical view of user theater, service systems comprise both the frontstage, where activity, decomposed into tasks and operations, such as applying the service interaction occurs in view of customers, and the for a mortgage loan and interacting with a sales representative backstage, where internal support processes are hidden from to get advice on that loan. Service design involves different com- customers. These frameworks have been further developed and ponents, such as the definition of the service concept, the service integrated with representations of the service delivery system system, and the service process (Edvardsson et al. 2000). for both high-contact and low-contact services (Lovelock and Although these components do not represent hierarchical levels, Wirtz 2006). However, these frameworks do not offer an inte- the service concept and the service system concept can be adapted grated view of the multi-interface system and are not connected for designing the different levels of service systems. with higher and lower levels of service design. Glusko orga- nizes service systems into seven design contexts (Glusko 2010): (a) person-to-person service; (b) technology enhanced Service Concept and Value Constellation Models person-to-person service; (c) self-service; (d) multichannel ser- The service concept defines the benefits a service offers custom- vice; (e) multiple device service; (f) computational service; and ers (Edvardsson et al. 2000). The flower of service metaphor has (g) location-based and context aware service. These seven con- been widely used to represent the service concept (Lovelock texts can all be present in the multichannel service system, and 1994), comprising the core and supplementary services; but this the computational, backstage component is an integral part of is an internal view from within the firm. Services are increasingly the service provided through any of the other channels. How- created by value networks, so it is important to adopt systems ever, this classification framework does not offer a method for thinking for service design (Norman 2009), defining the firm’s integrated design of the seven contexts. service concept within the context of its value-creating system. When designing technology-enabled multi-interface At this strategic level, Normann and Ramirez (1993) developed services, Usage Centered Design’s Navigation Architecture the concept of a value constellation, which represents the network (Constantine 2008) can also be useful. This system’s naviga- of actors and their relationships that jointly create an offering. tion architecture specifies how the overall user interface breaks This value constellation can be viewed as a system of service down into interaction contexts, how they are grouped, how they systems. According to Normann (2001), a firm can upframe its are presented to the users, and how users navigate them. This perspective by understanding the firm’s offering as an input model can help design the overall structure of the multi- into creating customer value while also considering the inputs interface service system, but so far, it has only been applied offered by other firms. This perspective widens the service design to technology system contexts. In designing experience- space, enabling companies to creatively design frame-breaking centric services, the customer journey and touchpoints are two systemic solutions that change the whole value-creating system. important design process concepts (Zomerdijk and Voss 2009). This approach opens new forms of service logic innovation Touchpoints occur whenever a customer interacts with the ser- (Michel, Brown, and Gallan 2008), such as changing customer vice provider across multiple channels and, therefore, are sim- roles in value cocreation, changing the firm’s processes of value ilar to service encounters (Bitner, Ostrom, and Meuter 2000). integration, or repositioning the firm in the value constellation. The customer journey refers to a series of touchpoints, involv- The Apple iPad, with its access to thousands of apps via iTunes, ing all activities and events related to the delivery of the service is a good example of how firms can reconfigure value constella- from the customer’s perspective. This view helps in under- tions to enable customers to cocreate experiences in innovative standing the service experience across multiple contacts but ways. Normann’s value constellation framework provides an does not offer an overall view of the service system structure or insightful approach for positioning the firm’s service concept in an integrated approach to the different levels of service design. the value-creating system. However, this high-level approach has not been used in service design. There is no systematic process, yet, for positioning the service concept in the value constellation Service Encounter Models before moving to more concrete levels of service system design. When drilling down to the design of each service encounter or touchpoint, Service Blueprinting (Shostack 1984) provides a diagrammatic tool for designing the service provision. Service Service System Models Blueprinting started as a process for mapping all the key activ- The firm’s service system can be viewed as an integrated whole ities involved in service delivery and production, specifying the that enables customers to cocreate their service experiences linkages between these activities. Service Blueprinting has according to the positioning of the service concept in the value evolved to include other aspects of service delivery, such as the constellation. Several frameworks have been developed in the distinction between frontstage and backstage and the physical service management field to represent the firm’s service evidence. Service Blueprinting’s customer focus and visual

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Understanding the Designing the customer experience service offering

Designing the Value Constellation Customer Value service concept Experience Constellation

Service System Designing the Service Experience Architecture and service system Navigation

Designing the Service Encounter Service Experience Service encounter Experience Blueprint

Figure 1. General model of multilevel service design. representation of the service delivery are considered strong aids The Multilevel Service Design (MSD) Method for service innovation (Bitner, Ostrom, and Morgan 2008). MSD was developed according to a design research approach From software engineering, UML Activity Diagrams can also (Forlizzi, Zimmerman, and Evenson 2008) for creating new support interaction design for a concrete interface. An activity service design methods. According to this approach, the criteria diagram is a flowchart that depicts the actions taken over time for evaluating new design methods should be process detail, by the different actors (Booch, Rumbaugh, and Jacobson invention, relevance, and extensibility. In this section, the pro- 1999). Activity Diagrams resemble Service Blueprints in that cess detail of the MSD method is described so that the design they represent the flow of events in the service provision over process can be replicated. The following sections with the time. However, Activity Diagrams are structured around the industry applications demonstrate MSD’s invention and rele- software system and lack all other elements of service design, vance by providing new insights that are not offered by existing such as the line of visibility or the tangible evidence. service design methods. The application of MSD to two differ- More recently, the Service Experience Blueprint method ent service industries of retailing and banking suggests that (Patrı´cio, Cunha, and Fisk 2009; Patrı´cio, Fisk, and Cunha MSD can be extended to many other service contexts. The 2008) integrated the design logics of Service Blueprinting and MSD method unites the contributions of different fields and Activity Diagrams. This method uses the Service Experience designs the service offering through the different levels of cus- Blueprint diagram to design service encounters in a way that tomer experience (see Figure 1). This method recognizes that enhances multi-interface service experiences. The Service Expe- organizations cannot design customer experiences, but service rience Blueprint method involves studying customer service tasks systems can be designed for the customer experience. and customer experience requirements independently of the ser- vice interface used, such as getting personal advice for a mortgage loan. The results are used to analyze which interface is best suited to provide the desired experience for each task and to enable The MSD Process designing service interface links that guide the customer across According to the Analysis-Synthesis Bridge Model (Dubberly, interfaces whenever such flexibility enhances the service experi- Evenson, and Robinson 2008), the design process starts with ence. Service Experience Blueprint represents a first step toward observation and investigation of the current situation. Next, an interdisciplinary method for integrated design of the multi- modeling forms a bridge between problem and solution, by interface service system. However, the Service Experience Blue- helping interpret and systematize the understanding of the print focuses on lower levels of multi-interface integration and existing situation and explore new potential solutions. Finally, offers no support for designing the service concept. Service through an iterative process, idealized solutions are materia- design is an emerging field and, despite many useful contributions lized into prototypes and ultimately finished forms. The MSD from multiple areas, further work is needed to create a new inter- method follows this approach, studying the customer experi- disciplinary method that accommodates the cocreative nature of ence and creating a set of interrelated models that bridge under- customer experience through hierarchical levels of service standing the customer experience and designing the service design. The next section presents the MSD method, which offering (see Figure 2). The MSD process involves four steps, addresses the challenges posed by this new service context. as shown in Table 1.

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Understanding the Designing the Customer experience Service offering

Real estate Personal broker recommen- Real Value Constellation Experience dations estate Designing service buying a Customer Value the Service House Mortgage House Registration house office Real estate Info loan purchase information Constellation Concept service Insurance Bank mortgage service

Designing the Service Service Experience Inf o Loan … System Contract search applic.

Service System Service System Architecture Navigation

Designing Service Encounter Experience Service the Service Select Analyze … Login Experience loan info loan info Encounter Blueprint

Figure 2. Component models of multilevel service design.

MSD requires the formation of a multidisciplinary team, observation, in-depth interviews, focus groups, usability which includes the manager of the business area and repre- testing, or walkthroughs (Preece, Rogers, and Sharp 2002). sentatives from marketing, information systems, and opera- The qualitative study in MSD enables mapping the overall tions. The MSD models help the team analyze and discuss customer activity, service activities, and service tasks, the existing solution, revealing problems in the customer which are related to the different levels of the customer experience and potential areas for service innovation. These experience (see Figure 2). MSD also enables a better under- models are also used to generate and select possible service standing of the desired experience at these different levels. design concepts and solutions, comparing and evaluating The qualitative study can be supplemented with quantitative different alternatives. For a more detailed analysis of the methods to evaluate specific features or to make a global correspondence between customer experience and design assessment of the customer experience at a given level. This solutions, Goal Oriented Analysis (Mylopoulos, Chung, and understanding provides the basis for designing the service Yu 1999) can evaluate how different design alternatives offering at its different levels. contribute to the desired customer experience. Goal Oriented Analysis has been previously used in the SEB method for multi-interface service design (Patrı´cio, Cunha, Step 2: Designing the Service Concept and Fisk 2009). The interrelated MSD models allow for tra- ceability and integration between these different levels of Step 2 adopts the Edvardsson et al. (2000) definition of the ser- service design as high-level decisions provide guidance for vice concept as the benefits that the service is expected to offer the lower levels. The next subsections present the steps, to the customer. Instead of viewing the service concept as the concepts, and models of MSD in detail. bundle of core and supplementary services internally offered by the firm (Lovelock 1994), MSD defines the service concept as the firm’s positioning in the customer value constellation Step 1: Studying the Customer Experience (CVC) including the services offered and the links and partner- Step 1 starts with an in-depth study of the customer experi- ships established with other organizations in the network to ence at its different levels. MSD uses qualitative methods enhance the firm’s value proposition (see Figure 2). Therefore, (StraussandCorbin1998)togetarichanddetailedunder- MSD focuses on the firm’s value proposition but defines the standing of the different levels of the customer experience. value proposition in the broader context of the value network This stage involves data collection techniques such as within which it is embedded.

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Table 1. MSD Steps

MSD Steps Retail Application Bank Application

Step 1: Study the three levels of Study the three levels of grocery management Study the three levels of buying a car customer experience experience experience Qualitative study Observation and interviews with 31 customers Observation and interviews with 26 bank customers Quantitative study Survey with 505 customers Survey with 420 bank customers

Step 2: Design the service concept Design the new retail service concept Define the bank loan service concept Understand the value constella- Map the value constellation experience for buying Map the value constellation experience for tion experience groceries buying a car Design the service concept with Design a new grocery management service concept in Design the mortgage service concept in the the customer value constellation the customer value constellation for buying groceries customer value constellation for buying a car

Step 3: Design the service system Design the retail service system for the new service Redesign the bank service system for loans Understand the service Map the service experience for the new grocery Map the service experience for the mortgage experience management service service Design the service system Design the SSA for the new grocery management service Design the SSA for the mortgage service architecture Design the service system Design the SSN for the new grocery management Design the SSN for the mortgage service navigation service

Step 4: Design the service encounter Design the retail service encounters Design the bank loan service encounters Understand the service encounter Map the experience for each service encounter of the Map the experience for each service encoun- experience new grocery management service ter of the loan service Design the service encounters Design the grocery management service encounters Design the loan service encounters with the with the service experience with the SEB SEB blueprint

Understanding the Value Constellation Experience (VCE). Designing customers use their services, opening new possibilities for the service concept starts with understanding the value con- service innovation. stellation experience. The value constellation experience is cocreated through the interactions between the customer and Designing the service concept through the Customer Value all service organizations that enable a given customer activ- Constellation (CVC). In MSD, the CVC model enables designing ity, such as buying a house. In-depth studies with customers the service concept. The CVC represents the set of service in Step 1 enable the decomposition of the different activities offerings and respective interrelationships that enable custom- that form the value constellation experience and the identi- ers to cocreate their value constellation experience for a given fication of the most important experience factors. As shown customer activity. The MSD method adds the word customer to in Figure 2, the value constellation experience for buying a the value constellation and puts the customer activity that is house can be decomposed into several service activities: (a) being supported at the center of the value network. Based on searching for a house, which may be done through a real understanding the value constellation experience and its estate broker; (b) obtaining a mortgage loan, which may decomposition, the MSD analyzes existing service offerings be provided by a bank or loan company; (c) purchasing the that respond to those needs, which builds the CVC (see Figure house, which may be done with the services of a title regis- 2). The bank’s mortgage loan, the real estate broker service, tration firm; and (d) decorating the house, which may be and the decoration service are each part of the CVC that sup- done with assistance from many service firms. Although ports the house purchase activity. The concept of CVC recog- experience research has adopted a holistic approach, it has nizes that value is cocreated with a network of organizations only addressed the customer experience at the firm level. beyond the firm’s boundaries. By broadening the design space MSD’s broader view is crucial for understanding customer beyond the firm’s boundaries with the CVC, the firm can ana- experience beyond the narrower view of the service firm. lyze its current service offering and explore new alternatives For a bank, it is important to understand that loan experi- for repositioning its service concept to enhance its contribution ences are but one component of buying a house. It is crucial to the value constellation experience. For example, knowing to identify the additional components necessary to enhance that house search is an important part of the house purchase the value constellation experience. This view helps service value constellation experience, the bank can partner with infor- providers understand the broader context within which mation services, such as newspapers, to develop a new real

Downloaded from jsr.sagepub.com at Politecnico di Milano on October 17, 2016 Patrı´cio 7 estate online service that helps customers find their house and Based on the understanding of the service experience, the top also offer information about the bank’s mortgage. The design row of the SSA depicts the service activity (such as a mortgage of the service concept guides the subsequent levels of service loan) decomposed into its service tasks (such as information design, as it defines the firm’s positioning that needs to be sup- search, decision advice, application, waiting for bank decision, ported by the service system and each service encounter. contracting, and post-contracting). The left column of the SSA depicts the actors involved in the service experience in three groups: the customer, the frontstage service interfaces, and the Step 3: Designing the Firm’s Service System backstage support people and IT systems. Based on this analy- In Step 3, the firm designs its service system to enhance the sis, the body of the matrix defines the mix of alternative service service experience, according to the firm’s positioning in the interfaces and backstage processes that support each task in the CVC. The MSD method adopts the Maglio et al. (2009) concept service experience. According to the desired service experience of service system as a configuration of people, technologies, and and the bank’s decisions, tasks such as information gathering other resources. For example, to support its previously defined may be available in all interfaces, whereas tasks such as advice mortgage service concept, the bank needs to design the service may only be available at the physical interface or the telephone. system for the desired mortgage service experience and define This integrated view of the SSA can identify breakdowns in the the mix of service interfaces that enable the mortgage process, existing service system or to explore new possible solutions. the support processes, and their interconnections. Whereas the SSA provides a static view, the SSN offers a dynamic view of the service system. Based on the matrix devel- Understanding the service experience. The service experience oped in the SSA, the SSN maps the alternative paths customers is cocreated through all interactions between a customer and a may take across different service encounters forming the ser- firm’s service system to accomplish a given service activity vice experience (see Figure 2). Each path represents one possi- and includes all the different service encounters with the firm ble customer journey across different touchpoints or service across different service interfaces. The service experience can encounters. The SSN view enables better identification and be seen as the result of the customer journey and is the level design of service interface links that enable customers to traditionally addressed by customer experience research. In smoothly move from one interface to another in the service MSD, in-depth studies with customers enable the decomposi- experience. Often, customers like to search for mortgage infor- tion of the mortgage loan experience to all the moments of con- mation on the Internet but need personal advice before making tact between the customer and the loan company necessary to a decision. To enhance the service experience, the bank can receive and use the mortgage, such as searching for information change the SSA (adding chat advice functionalities to the Inter- online or getting advice in the physical branch. Understanding net service) and/or can change the SSN (designing service this level is important for designing the service system because interface links that guide customers from the Internet service it reveals how different service encounters form the customer to telephone or physical branch advice whenever needed). By journey, the paths and service interfaces customers use, and the offering customers an interface mix and alternative customer factors that enable or inhibit the desired service experience. journeys, the SSA and SSN accommodate the interactive and This analysis is important to reveal breakdowns in the multi- cocreative nature of services. The SSA and SSN provide struc- interface service experience, which highlights opportunities for ture and navigation views of the service system that guide the improvements in the firm’s service system. design of each service encounter. Designing the service system through the Service System Architecture (SSA) and the Service System Navigation (SSN). Based on understanding the service experience, the Step 4: Designing the Service Encounter firm’s service system is designed to enable customers to follow In Step 4, service encounters are defined as the moments of inter- multiple patterns of navigation across service interfaces action between the customer and the firm and may take place in through the SSA and SSN. This includes three components. multiple interfaces, such as the Internet or a physical store (Bitner, First, for each service task, the service system should offer Ostrom, and Meuter 2000). Service encounters are also called an interface mix that enables customers to choose their pre- touchpoints in the service design field (Zomerdijk and Voss ferred service interface. Second, the service system should 2009). At this level, service designers need to define the interac- enable customers to smoothly navigate across service inter- tion setting, interaction process, and the role of each participant. faces through the different tasks of the service activity. Third, instead of replicating every offering in every service interface, Understanding the Service Encounter Experience (SEE). The the service system should enhance the service experience while service encounter experience is cocreated through customer contributing to efficient resource allocation among interfaces. interactions at a given service interface for a service task, such The MSD method employs two models for the design pro- as getting mortgage information on the Internet. This concrete cess at the system level (see Figure 2): SSA and SSN. The SSA interface level has typically been the focus of interaction defines the structure of the service system, providing an inte- design. In MSD, in-depth studies with customers enable map- grated view of the multi-interface offering and support pro- ping the process customers use to cocreate their experiences for cesses across the different tasks of the service experience. each service encounter or touchpoint and identifies important

Downloaded from jsr.sagepub.com at Politecnico di Milano on October 17, 2016 8 Journal of Service Research 000(00) experience factors. For example, the Internet service encounter Step 1: Studying the Levels of Home Grocery for mortgage information is studied in detail: how the customer Management Experience logs in, finds, selects, and analyzes mortgage information. It is also important to understand factors that enable a desired ser- Following the steps of the MSD method, the project started vice encounter experience, such as ease of use or usefulness with a qualitative study to get an in-depth understanding of the of a service interface. different levels of the customer experience. Following a quali- tative approach, the sample was defined according to the theo- Designing the service encounter with the Service Experience retical relevance of cases (Strauss and Corbin 1998). Frequent Blueprint (SEB) diagram. The MSD method uses the SEB dia- and infrequent users of the online and physical retail stores gram (Patrı´cio, Fisk, and Cunha 2008) to design each concrete from two Portuguese metropolitan areas were divided into 20 service encounter, such as loan information gathering on the female and 11 male customers. The study included data collec- Internet (see Figure 2). Based on the detailed understanding tion techniques such as individual and focus group interviews, of the service encounter experience, the SEB maps the actions supplemented with observation through walkthroughs and of the different participants in the service encounter, both front- usability testing of the online service (Preece, Rogers, and stage and backstage. The SEB diagram depicts lines of interac- Sharp 2002). These interviews were organized into four parts. tion, lines of visibility, fail points, waiting points, and service In the first part, customers were invited to talk about their value interface links. The service interface link represents a point constellation experiences for home grocery management. This in the service encounter where the customer should be guided discussion identified the main activities involved, the different to another interface to enhance the service experience. Again, services used, and the drivers for creating the desired experi- SEB is used to map the existing service encounter but is also ence. Customers were then invited to talk about their service used to explore other design alternatives that may enhance the experience with the retail firm across different service encoun- service encounter experience. For example, when customers ters and different grocery purchase tasks. Then, with the sup- gather mortgage information on the Internet, this service can port of online computer access, customers were invited to explicitly offer the option to receive advice from other service explain how they used the retailer’s online service as they interfaces. SEB offers a detailed view that enables designing walked through specific service encounters, to get a detailed the concrete service interface without losing the multi- understanding of different service encounter experiences. interface perspective. Finally, customers were invited to make suggestions for service With this multilevel perspective, MSD offers a holistic improvements. All interviews were video recorded and tran- view, from the service concept level to the multi-interface ser- scribed literally. Data analysis followed qualitative analysis vice system level and to each service encounter. The different guidelines for the development of categories in an iterative pro- levels of MSD provide different views of the service offering cess (Charmaz 2006). that can be used by different members of the design team and The qualitative stage was supplemented with a quantitative different decision makers. Whereas software engineers may be study that evaluated the multi-interface aspect of the retail ser- more interested in detailed SEB models to identify the use vice experience (for a detailed presentation of the quantitative cases for their information systems, business managers are study see Patrı´cio and Fisk 2011). Following a scale develop- more interested in viewing the SSA and SSN to make more ment approach (Churchill 1979), the service experience factors structural decisions. With these sets of models, team members identified in the qualitative study were used to develop a survey can concentrate on their preferred design level while also questionnaire. After pretesting with 86 customers, the survey understanding how their decisions impact the other design lev- was administered by phone to a sample of 505 retail customers els. The next two sections demonstrate how MSD can be who used both the online service and the physical store. Fol- applied to very different service contexts, which includes both lowing scale development procedures, data analysis involved the design of a new service (European retailer) and the redesign exploratory factor analysis, confirmatory factor analysis, and of an existing service (Portuguese bank). structural equation modeling to purify and validate the scale (Hair et al. 2006). This quantitative study enabled identification of the most important factors at the retail service experience Application of MSD to Designing a New Retail level and of areas for improvement. Together, the results of the Service qualitative and quantitative studies of the customer experience The European retailer has a multi-interface service system with were used as input for designing the retail service offering at its large retail stores, an online shopping service, and a call center different levels. support service. The project objectives were to redesign the existing service to improve the customer experience and to develop new service offerings that enhance value creation for Step 2: Designing a New Retail Service Concept the customer and the firm. The project team involved the man- Understanding the Value Constellation Experience (VCE) for agement of the retail service, the management of the different grocery management. The value constellation experience for service interfaces, the marketing department, and the informa- managing groceries was defined as being cocreated through tion systems department. the interactions with all service organizations associated with

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Value constellation experience for managing home groceries

Stock Need Store Product Grocery list Purchase Transport control recognition selection selection

Retail service experience

Information Product Delivery search selection Picking Checkout option Delivery selection

Product search and selection service encounter experience

Login Analyze Search for Add Internet productin products product to cart … service formation

Figure 3. Decomposition of customer activities for the different levels of the customer experience for managing home groceries.

service experience fit into the value constellation experience and which customer activities were not covered by the existing wholesaling retailer service offering. In this case, the retailer provided the product selection, purchase, and delivery activities of the value Specialty Other constellation experience for home groceries. Customers per- stores large stores Medium formed other activities, such as controlling their grocery stock stores and making lists, for which no services were available. This Product information Managing presented opportunities to innovate by developing new services services home grocery not offered by the existing network of service providers.

Designing the new retail service concept through the Customer Retailer Retailer large stores Value Constellation (CVC). Based on the results of the customer home delivery service experience study and the work with the multidisciplinary team, Retailer a new grocery service concept was designed. The understand- online ing of the value constellation experience and the respective net- service work of services were used to map the existing CVC (see Retailer’s existing service concept Figure 4). The overall activity of home grocery management is at the center of the CVC, surrounded by the services that Figure 4. Retailer’s service concept positioning in the Customer enable the value constellation experience. The CVC was then Value Constellation for managing home groceries. used to explore new service innovation possibilities, such as (a) adding new services that were now being provided by other managing home groceries. The study showed that this value service providers in the CVC; (b) establishing new links with constellation experience involved not only grocery purchases other service providers in the CVC to create integrated service but also other activities associated with home groceries, such offerings; or (c) offering new services to support home grocery as stock control and making grocery lists (see Figure 3). These activities previously undertaken by the customer. results enabled mapping the customer activities and identifying Through the work of the multidisciplinary team, this per- the services related to grocery management. This high level spective enabled creating a new service concept that offers perspective allowed for a better understanding of how the retail an integrated solution not only for grocery buying but also for

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Online service Wholesaling 8,31 fulfillment

Specialty Other Online service stores large 8,14 efficiency stores Medium stores Product Muli-interface information Managing 7,66 integraon services home grocery

Store personal Grocery 7,53 management contact Retailer support service 0246810 home delivery service Retailer Figure 6. Assessment of multi-interface experience factors—retail Drive large stores service (construct means of summated scales 0–10). through Retailer service online service physical store factors (ease of use and organization of services- New retail service concept cape, depth and breadth of product and services available, and personal contact), online service factors (ease of use, depth and Figure 5. Retailer’s new grocery buying service concept and recon- breadth of products and services available, and order fulfill- figuration of the Customer Value Constellation for managing home ment), and multi-interface integration (integration and consis- groceries. tency among service interfaces). The qualitative study was supplemented with a quantitative study focused on the multi- interface service experience. As shown in Appendix A, the the value constellation experience for managing home gro- scale dimensions identified for the multi-interface service ceries (see Figure 5). With this new service concept, the retailer experience were (a) personal contact at the physical store, (b) offers a full service that supports new activities previously efficiency of the online service, (c) fulfillment of the online ser- undertaken by the customer, offering customers a shopping vice, and (d) multi-interface service integration. The results of plan that can comprise both online and physical store purchases the quantitative study provided inputs for the design of the with home delivery, or pick-up at a drive-through at the store. firm’s service system. As depicted in Figure 6, integration of By broadening the design space beyond the existing boundaries the multi-interface offering was a low performing factor, which of the firm, innovative ways to cocreate value with customers indicated this area needed improvement. were found by reconfiguring the firm’s offerings in the CVC.

Designing the retailer service system through the SSA and Step 3: Designing the Service System for the New Retail SSN. At the middle level, the MSD method enabled designing Service Concept the retailer service system to support the new service concept. Understanding the retail service experience. At the middle Building upon the study of the service experience and the work level, the retail service experience was defined as being cocre- with the multidisciplinary team, the existing SSA was devel- ated through all the service encounters between the customer oped for the existing service (see Figure 7). The SSA depicts and the retail firm for managing groceries. The qualitative the different tasks of the retail service experience on the top study showed how the existing retailer service experience row, involving product selection, checkout process, picking the could be decomposed into a set of service encounter experi- items, and order delivery. The body of the matrix shows that ences for specific service tasks, such as selecting products or almost all service tasks are offered in both the Internet and the checking out (see Figure 3). Detailed analysis of the qualitative physical store interfaces. The retailer service system was then data also revealed typical customer journeys across service redesigned to reflect the new service concept previously interfaces: customers made large online purchases periodically, defined and to enhance the service experience according to the to compensate for the home delivery charge. The online service study results (see Figure 8). To support the new home grocery allowed customers to define lists and retrieve their last order. management service concept, the retailer SSA was extended Many customers deleted or added new products to these online with new service tasks such as service registration, shopping lists according to their needs each time they purchased. Cus- plan, and shopping trigger. To respond to customer experience tomers also went to smaller physical stores to replenish perish- needs for flexibility and multi-interface integration, the body of able grocery products at least weekly (often from a competing the matrix shows that the new service is mostly offered online retail chain). to reduce the customer burden, but the retailer also offers home The qualitative study also allowed for the identification of delivery and drive-through pick-up at the physical store to service experience factors. These were categorized into increase multi-interface integration.

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Existing retail service experience

Product Selecon Checkout Process Picking Order Delivery

Customer Customer

Internet Interface

Telephone Interface

Physical store Service Interfaces

Delivery Team

Picker Backstage support

Backend systems

Figure 7. Service system architecture for existing retail service.

New retail service experience

Service Shopping Shopping Plan Purchase Picking Order Delivery Registraon Trigger

Customer Customer

Internet interface

Delivery Team

Physical store Service Interfaces

Telephone Interface

Picker Backstage support Backend systems

Figure 8. Service system architecture for new retail service.

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New retail service experience

Service Shopping Shopping Plan Purchase Picking Order Delivery Registraon Trigger

Sign up for Select dates Confirm products, Pick-up order Receive delivery the service and products dates and payment Customer Customer

Present service Present service Present order Order informaon opons e-mail confirmaon Internet interface

Make delivery Delivery Team

Transmit order informaon Telephone Interface Service Interfaces Order pick-up

Physical store

Pick Products Picker

Service Register user Raise order Save Order Pick Keep Order

Backstage support registraon opons trigger Products Record

Backend systems

Figure 9. Service system navigation for new retail service.

The SSN enables mapping possible customer journeys they identified concrete problems at the retail store or the across service interfaces and explicitly designing the necessary online service. One of the most frequently mentioned issues links between service interfaces to assure a smooth experience was customer difficulty in finding products from the thousands across service encounters. As shown in Figure 9, the customer available. These findings pointed out the need to improve the can register online for the service (with a better delivery rate) search capabilities of the online service to enhance the existing and make a shopping plan with several possible lists according service encounter experience. The study also showed that time to personal shopping preferences. For example, the customer taken to create a list was a barrier to online service adoption. can have a monthly purchase list and a weekly fresh and dairy Customers used these lists but also enjoyed flexibility in their products list. According to the shopping plan, the service sys- choices. These results provided important clues for designing tem can send a trigger e-mail message with the chosen list of the service encounters of the new service offering. more products several days before the planned purchase. The customer may then place the order online and choose home Designing the retail service encounters through Service delivery or in-store pickup. With the SSA and SSN, the Experience Blueprint (SEB). The service encounter level of multi-interface service system was designed in an integrated MSD operationalizes the different touchpoints of the service way, taking advantage of interface synergies to enhance the system previously depicted in the SSA and SSN with the service experience and support the firm’s service concept. SEB diagram. Figure 10 shows the SEB for the two first steps of the SSN (registration and shopping plan) for the new Step 4: Designing the Service Encounters for the New service. When the customer enters the online service, the new Retail Service home grocery management service is presented with informa- Understanding the retail service encounter experiences. The tion about benefits and reduced delivery price. If this new service encounter experience was defined as being cocreated service is selected, an online form appears with the type of through each interaction with the retailer for a specific grocery purchases for the customer’s shopping plan, providing the service task, such as searching for product information online. opportunity to create different shopping lists. To reduce the The study of the service encounter experience provided the burden of creating lists the service encounter was designed detailed information necessary, both in terms of the operations to offer suggestions according to customer’s previous pur- of each service encounter and the experience factors. Usability chase patterns, allowing the customer to add or delete prod- tests and walkthroughs were especially relevant at this level, as ucts and schedule orders.

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Figure 10. Service experience blueprint for registration and shopping plan interaction experience.

Based on the customer’s registered shopping plan, a ser- products: loans and credit cards. This was a rich opportunity for vice link was created between the registration service developing and testing the MSD method in another context, encounter and the order service encounter. The system then involving the redesign of an existing service offering with a sends a trigger e-mail message on the defined date. This trig- focus on the multi-interface service experience without chang- ger includes the product list previously defined by the cus- ing the service concept. tomer for that type of order. Since the study showed that customers like flexibility in product choice and order sched- ule, other options were added. First, the trigger message con- Step 1: Studying the Levels of Bank Loan Customer tains other product suggestions according to customer Experience preferences to enable the customer to increase the variety of products selected. Second, the customer has the option The first step of the MSD method, like the retail application, to make, change, cancel, or ask to be reminded later, which involved the study of different levels of customer experience adds to flexibility. Finally, taking advantage of multi- for bank loans. This study followed the same research design interface synergies, the customer can ask for home delivery, as the retail service study. The qualitative study involved or pick-up at a store drive-through service. With the multile- in-depth individual interviews with 26 multi-interface bank vel approach of MSD method, each service encounter was customers, comprising 18 men and 8 women in two Portuguese designed to enable customers to interactively cocreate their cities. Loans are considered a more personal matter, so only retail service and value constellation experiences. individual interviews were collected (12 were tape recorded and 14 video recorded). The latter involved both interview and walkthroughs via computers with online service access. Application of MSD to Redesigning a Banking Following the MSD method, these interviews and walk- throughs covered different levels of customer experience: value Service constellation experience within which loans are embedded, The Portuguese bank is a multi-interface service system, loan service experience and service encounter experiences. which offers Internet, physical branch, and telephone inter- These data were transcribed literally and analyzed following a faces. Previous research found that customers used a mix qualitative approach. To supplement the qualitative findings, a of service interfaces in a complementary way (Patrı´cio, Fisk, quantitative study was developed to assess the multi-interface and Cunha 2003, 2008), but the bank’s interfaces were not aspect of the service experience, following the same research well integrated. Therefore, the bank decided to adopt an inte- design as the retail service study. The survey questionnaire was grated approach to designing its multi-interface service sys- developed, pretested with 92 customers and administered to a tem, starting with two service experiences for two financial sample of 420 multi-interface bank customers.

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Value constellation experience for buying a car

Car Need Car Car Car Car Information Car loan recognition selection purchase registration insurance search

Loan service experience

Information Decision Loan Bank Contracting Post search advice application decision contracting

Information search service encounter experience

Login Select loan Analyze … Internet info loan info service

Figure 11. Decomposition of customer activities for the different levels of the customer experience for buying a car.

and insuring the car. These results helped understand the con-

Personal text within which the bank loan is used and showed that the recommendations loan is not an end in itself but instrumental in the car buying Car information services process. This analysis pointed out the need for designing the Buying Registration a car loan service concept to facilitate and speed the loan application office service Car process, so customers could more easily get what they really insurance service wanted: buying a car.

Car dealer service Bank car Designing the bank loan service concept through the Customer loan Value Constellation (CVC). Designing the loan service concept started with the development of the existing CVC for buying a car. This work was based on the study results, the analysis of existing service offerings, and the work of the multidisciplinary Bank loan service concept team. As shown in Figure 12, a network of service offerings sus- tains the car purchase activity because loans are only one part of Figure 12. Bank’s loan service concept positioning in the customer the CVC. To enhance its service concept positioning, besides the value constellation for buying a car. loan the bank developed partnerships with car dealers and insur- ance companies to facilitate the car purchase. The bank project Step 2: Designing the Bank Loan Service Concept focused on redesigning the service system and did not involve Understanding the Value Constellation Experience (VCE) for the redefinition of the service concept. However, this high level buying a car. For the bank case, the loan application and usage analysis helped understand how the loan service concept was might be part of many value constellation experiences, such as integrated with the CVC for buying a car, providing guidance for buying a car, a vacation trip, or solving a personal problem. As designing the service system and service encounter levels. an example, the value constellation experience for buying a car is presented. As shown in Figure 11, the qualitative results Step 3: Redesigning the Bank Service System for Loans enabled mapping the different service activities involved in the Understanding the loan service experience. The loan service value constellation experience, such as searching for informa- experience was defined as being cocreated through all the ser- tion, selecting the car, getting a loan, purchasing, registering, vice encounters between the customer and the bank for

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the Internet or at the branch or they can telephone to ask that Online service application forms be mailed. With the SSA and SSN, the bank 8,7 efficiency service system was redesigned to enhance the multi-interface loan service experience and better support the contribution of Online service 8,58 the loan service concept positioning in the CVC. fulfillment

Store personal Step 4: Designing Each Service Encounter Experience for 8,25 contact Bank Loans Understanding the loan service encounter experience. The ser- Muli-interface 8,24 integraon vice encounter experience was defined as being cocreated through each moment of contact between the customer and the 0246810bank through a specific service interface, such as gathering loan information on the online banking service. The customer Figure 13. Assessment of multi-interface experience factors—bank experience study, especially the walkthroughs, pointed out service (construct means of summated scales 0–10). problems specifically related to implementing the new service system and the different service encounter experiences. For applying for and using the bank loan. The qualitative study example, the studies revealed that customers did not know that allowed for the decomposition of the loan experience into ser- it was possible to follow up an Internet inquiry with telephone vice tasks (as shown in Figure 11) and the identification of ser- or bank branch advice. Moreover, even if they knew, the Inter- vice experience factors, such as multi-interface integration. For net interface did not provide any clue on how to do it. This example, the bank’s Internet service offering for loans mainly understanding provided insights into designing service inter- covered general information. Customers were forced to visit face links between these touchpoints. the physical branch for advice, to provide documentation, and to sign the loan contract. These breakdowns in the loan experi- Designing the loan service encounters. After designing the ser- ence led most customers to go directly to the physical branch, vice system, the design drilled down to each service encounter as where they had access to a complete service offering for their depicted in each cell of the SSA and SSN, using the SEB dia- needs in spite of the inconvenience. As shown in Figure 13, the gram. Figure 16 shows the SEB for the loan information service quantitative study corroborated the qualitative results. Multi- encounter in Internet banking. Building upon the understanding interface integration was a low performing factor, which of the service encounter experience, this online service encoun- indicated this area needed improvement. ter was redesigned to offer the information requested but also to explicitly show two options for obtaining personal advice: sche- duling a meeting at the physical branch or telephone advice. Designing the service system for bank loans. Building upon the If the customer selects one of the advice options, the back- previous steps, the bank service system was redesigned through end system retrieves additional customer information, selects the SSA and SSN. The analysis of the existing SSA revealed the appropriate advisor in the physical branch or the call center, two important breakdowns in the loan service experience for and sends a trigger with the meeting request to a selected customers who started using the Internet: (a) they could not employee. Then the employee can call the customer with much undertake all the loan service tasks in this interface because better preparation for providing good personal contact service. it did not offer personal advice and (b) they could not complete With the SEB and the multilevel MSD approach, the bank the contract online. To improve the loan experience, the SSA found ways to improve the service encounter experience for the was changed to offer more channel options for advice and loan information touchpoint in the Internet, while also enhancing the applications. In this case, telephone advice was added and tele- service experience across the multi-interface service system. phone and online loan applications were designed so that cus- tomers could complete these pre-contractual service tasks without having to visit the physical branch. These new options MSD Contributions to Service Design are depicted in Figure 14 in white ovals. The MSD method enables integrated design of the service offer- The loan service experience was also enhanced through ing at its different levels, contributing to the design of complex changes in the SSN, by linking the different touchpoints. In this service systems. Its multilevel approach also provides a holistic case, the bank decided that no advice would be offered on the view, highlighting new levels of the customer experience. Internet; but the service experience was enhanced by smoothly Finally, MSD synthesizes the contributions of different fields guiding the customer from the Internet to advice on the tele- into an interdisciplinary service design method. phone or at the physical branch (see Figure 15). In this new SSN, customers can now gather information from the Internet service, but when advice is needed, the service navigation is designed so Contribution to Designing Complex Service Systems customers can call for telephone advice or schedule a meeting at The MSD method contributes a holistic set of interrelated mod- the branch. After the advice stage, they can apply for a loan on els and concepts that integrate the different levels of service

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Loan service experience

Decision Bank Post Information Application Contracting advice decision contracting

Customer Customer

Internet interface

Telephone Interface Service Interfaces

Physical store

Internal support Backstage support Backend system

Figure 14. Service system architecture for bank loans.

Information Decision advice Loan application

Ask for Ask for advice Apply for loan information

Customer Customer

Show information Online application and advice options Internet interface

Telephone advice Send application by mail

Telephone Interface Service Interfaces

Advice at Register application Physical store Physical branch at physical branch

Retrieve Send advice Register information request application

Backend system Backstage support

Figure 15. Service system navigation for bank loans (partial view). system design down through the different levels of the cus- design the firm service concept. The MSD method extends tomer experience. At the highest level, the MSD method adapts Lovelock’s service concept (1994), recognizing that the service the value constellation model (Normann and Ramı´rez 1993) to offering can be created in collaboration with other partners in

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[no schedule] [telephone Select advice] telephone F advice [schedule meeng] W Select Login to Select loan Choose schedule service info advice opon meeng

Customer

Line of interaction frontstage Present loan Send login Present Retrieve Send Inform customer Info and advice meeng informaon Service opons Loan info he/she will be opons request contacted Internet banking Line of visibility F F Validate Send loan Retrieve Select Send schedule Login info addional appropriate request with info customer info advisor customer info

backstage Backend system

Acon W Waing point Beginning of process Service interface link Customer F Fail point End of decision process

Figure 16. Service experience blueprint for Internet banking loan information. the CVC. The MSD method opens the design space for new influence the service encounter experience and contribute to forms of service innovation that go beyond the boundaries of the service experience as a whole. MSD builds upon the inter- the existing service offering. This systems thinking approach disciplinary and multi-interface SEB method, integrating SEB to the service concept contributes to a stronger focus on rela- with SSA and SSN at the service system design level, and the tionships, networks, and value creation (Lusch, Vargo, and CVC at the service concept level. The MSD method offers a Tanniru 2009). holistic systems thinking perspective on service design, At the middle level, the MSD method designs the firm ser- enabling design teams to understand how high-level system vice system through the development of the SSA and SSN decisions trace to low-level service interactions, enabling the models. These models help visualize how the service system development of an integrated solution to enhance the customer elements (customer, service interfaces, backstage components, experience at its different levels. and IT systems) are integrated to cocreate value throughout the different service encounters of the service experience. The SSA Contribution to Designing for the Customer Experience offers a structure view, allowing for better management of the The MSD contributes a multilevel understanding of customer interface mix to enhance the service experience while better experience. At the higher level, MSD presents the new concept allocating resources among channels. The SSN offers a of value constellation experience, recognizing that experiences dynamic view, recognizing there are many possible journeys may be formed through interactions with multiple services that customers may follow. By analyzing the different naviga- from multiple organizations that go beyond the firm’s offer- tion paths and designing the service interface links, MSD ings. This perspective helps contextualize the firm’s service allows the modularity and flexibility needed to design the concept into the larger context of the value constellation expe- service system for customers to cocreate their service experi- rience and opens new forms of service innovation. This new ences in unique ways. The MSD method at the service system concept also opens new ground for experience research, as cus- level, therefore, addresses the new challenges of multichannel tomer experience has not yet been studied beyond the firm’s service design. boundaries. The service experience concept adopted in MSD At the service encounter level, the MSD method uses the provides a comprehensive view of customer experience at the SEB model (Patrı´cio, Fisk, and Cunha 2008) for a detailed firm level, taking into account the different service encounters design of the concrete interaction between the customer and across multiple service interfaces. The MSD method, therefore, a specific service interface. At this level, MSD enables the responds to the call for more holistic approaches to customer analysis of how different elements of the service encounter experience research (Verhoef et al. 2008). At the service

Downloaded from jsr.sagepub.com at Politecnico di Milano on October 17, 2016 18 Journal of Service Research 000(00) encounter subsystem level, even though the analysis of the cus- constellation experience components and drivers. Additionally, tomer interaction experience has been studied in interaction further empirical studies besides banking and retailing can bring design and service research, the MSD method better contextua- important insights. lizes this level of customer experience with the other experi- The MSD method designs the service offering for the differ- ence levels. The MSD method helps designers understand ent levels of the customer experience, taking into account the how the different levels of customer experience are interrelated different interactions with multiple firms for a given overall and can contribute to service design. activity, such as buying a car. However, the MSD method concentrates on the customer-firm interaction. The growth Contribution to the Development of Interdisciplinary of social networking has raised the importance of customer- Service Design Methods to-customer interactions, so research is needed to understand how greater customer-to-customer interaction may change Service design requires interdisciplinary efforts to develop value cocreation and which methods are needed to design complex service systems. The MSD method offers an integra- services in this new context. tive blend of concepts and models from service management MSD is a comprehensive method for designing service offer- (Service Concept, Value Constellation, Service Encounters, and ings at different levels, but it designs one service at a time. Service Blueprinting), interaction design (Usage-Centered Although some firms may be focused on one service offering, Design and Human Activity Modeling), software engineering such as retailing, other service firms may offer complex bundles (Activity Diagrams), and service design (touchpoints and of services, such as banking. In such cases, firms must simultane- customer journey). MSD creates a design method, a design lan- ously position themselves into different CVCs and build an inte- guage, and design tools that different members of multidisci- grated multiservice system that provides their different offerings. plinary teams can use to communicate and explore new ideas Further research is needed to understand how the different SSAs in the development process. Moreover, by explicitly addressing form the overall service enterprise architecture as a whole. the role of technology and information systems in services, the MSD takes service design to a higher level by positioning MSD method systematizes customer and business requirements the firm’s service concept in the CVC. However, a network into a technical language that interaction designers and software of service providers can offer even more complex services, engineers can use to develop the technology systems that pro- such as cities. New methods should be developed for designing vide crucial service systems support. MSD represents a signifi- the overall value constellation at this system of service systems cant departure from existing design methods. The MSD method level. Customers are also involved in many value constellations takes a more interactive and holistic perspective on designing throughout the many activities of their lives. Together these service systems, which contributes to developing an interdi- CVCs form a service ecosystem. As concern for service sus- sciplinary service design field. tainability increases, it is important to incorporate these issues in service design. Although some research has been done on service design for sustainability (Manzini 2009), further work Conclusion and Future Work is needed to develop methods and tools that incorporate sustain- The MSD method offers a systemic view of service design lev- ability issues throughout the different levels of service design. els and a flexible approach that accommodates the cocreative Finally, the MSD method brings breadth and depth to design- nature of customer experiences. Building upon concepts and ing complex service systems. The integration of interdisciplin- techniques from different fields, MSD extends the conceptual ary contributions provides a robust design method that can be service frameworks and operationalizes them into a unified ser- communicated across disciplines. MSD provides an in-depth vice system design method. Applications of the MSD method approach through the three levels of customer experience and to retailing and banking demonstrate that it can be effectively service design. We hope MSD stimulates further interdisciplin- applied in different service innovation contexts, which opens ary design research and fosters new service innovations. new insights into developing new services. The MSD method raises questions that deserve further Authors’ Note research. Three levels of customer experience design are The authors thank the editor and three anonymous reviewers for their addressed by the MSD method. However, since interaction many insightful comments during the revision process. design and service research have traditionally focused specifi- cally on the service encounter experience at just one service Declaration of Conflicting Interests interface, these new customer experience levels need further The author(s) declared no potential conflicts of interests with respect exploration. Extant research has developed conceptual frame- to the authorship and/or publication of this article. works for a holistic view of the service experience at the firm level (Verhoef et al. 2008). The MSD applications provide insights into Funding its drivers, but a more holistic view of the service experience still The author(s) disclosed receipt of the following financial support for needs empirical study. At a higher level, the MSD method iden- the research and/or authorship of this article: This research project was tifies the value constellation experience concept, but further work partially supported by AdI—Ageˆncia de Inovac¸a˜o—IDEIA Program is needed to develop a richer conceptualization of value (Grant number 13 05 04 FDR 00022).

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MIT Press. ——— (2009), ‘‘Systems Thinking: A Poduct is More than a Prod- uct,’’ Interactions, 16 (5), 52-54. Bios Normann, Richard (2001), Reframing Business: When the Map Lia Patrı´cio is an assistant professor of the Department of Industrial Changes the Landscape. Chichester, UK: John Wiley & Sons. Engineering and Management at the University of Porto. Previously,

Downloaded from jsr.sagepub.com at Politecnico di Milano on October 17, 2016 Patrı´cio 21 she worked in the banking industry. She holds a PhD in Industrial Joa˜o Falca˜o e Cunha is a lecturer and researcher at the School of Management and Engineering, an MBA, and a degree in Economics Engineering of the University of Porto. He holds a PhD in Computing from the University of Porto. She has published in the Journal of Ser- Science from Imperial College (1989), a MSc in Operations Research vice Research, Requirements Engineering Journal, and others. Her from Cranfield University (1984), and a first degree in Electrical Engi- current research focuses on new interdisciplinary methods for service neering from University of Porto (1983). His research interests include system design, service experience design, service design for sustain- decision support systems, graphical user interfaces, object-oriented ability, and social networks. modeling, and service engineering and management. He coordinates the Industrial Engineering and Management and the Service Engineer- Raymond P. Fisk (BS, MBA, and PhD from Arizona State Univer- ing and Management master programs and is the Academic Director sity) is a professor and chair of the Department of Marketing at Texas of the IBM Center for Advanced Studies in Portugal. State University–San Marcos. He has published in the Journal of Mar- keting, Journal of Retailing, Journal of the Academy of Marketing Sci- Larry Constantine, IDSA, is a professor at the University of Madeira ence, Journal of Service Research, European Journal of Marketing, and Institute Fellow at the Madeira Interactive Technologies Institute Service Industries Journal, International Journal of Service Industry where he teaches in the dual-degree programs operated jointly with Management, Journal of Health Care Marketing, Journal of Market- Carnegie-Mellon University. A pioneer of modern software engineer- ing Education, and others. His books include Interactive Services ing theory and practice, he is an award-winning interaction designer Marketing, 3rd ed., Services Marketing Self-Portraits: Introspections, specializing in enhancing user performance in safety-critical Reflections and Glimpses from the Experts, Marketing Theory: Distin- applications as well as an award-winning author with 20 books and guished Contributions, and Services Marketing: An Annotated more than 200 papers published. He is the recipient of the 2009 Bibliography. Stevens Award for his contributions to design and design methods and a Fellow of the Association for Computing Machinery.

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