and/or customer-provided information. In other words, customers
and their resources are always involved in some way in their own
service process.
An example of a supermarket grocery shopping process will help to
make these concepts more concrete. For illustrative purposes,
assume that the “transformation” process starts when customers
arrive at the supermarket and ends when they complete their
shopping. Inputs to the process include customers, their shopping
lists, and payment method. The shopping process, in brief, involves
finding the desired items, placing them in a cart (resource), and
checking out. Other resources are the store itself, products on the
shelves (or in the freezer, refrigerator, behind the counter),
employees, information (e.g., signs indicating what types of products
are in each aisle), and various technologies (e.g., for checkout). The
outputs (or “service products”) are the bagged and purchased
groceries and (hopefully) satisfied customers.
But the in-store grocery shopping process is not immune to the
changes happening in the increasingly dynamic business
environment for services. In fact, the industry is undergoing the type
of paradigm shift mentioned above. Traditional supermarkets are
facing escalating competition due to the proliferation of store
formats (convenience store to super-store) and from online delivery
channels. Grocery services delivered through an online channel are
now being offered by brick-and-mortar chains as well as online-only
players such as Amazon Fresh and Peapod. More recently, online
firms such as Blue Apron, Plated, and Hello Fresh have started
delivering fresh ingredients to conveniently prepare meals at home,
providing the exact amount of ingredients needed with no waste. In
addition, changes to in-store processes are altering the way in which
the service providers and customers co-create value; the
introduction of new technologies—customer-operated scanners, self-
service checkout, digital kiosks—allow (or, in some cases, require)
customers to perform tasks previously done by store employees.
However, the ever-evolving example of the self-service checkout
should serve as a cautionary tale of the challenges firms encounter
when changing the way services are delivered. In fact, a good