Proper service management is a major concern to many organizations. Most organizations often aim at providing high quality services to consumers in order to gain competitive advantage over their competitors. For an organization to provide high quality services, it must formulate and implement appropriate competitive service strategies such as cost leadership, service differentiation and customer focus. These competitive strategies are also referred to as generic strategies by Michael Porter. Cost leadership is where an organization strives at providing goods and services at the lowest cost in the industry whereas differentiation concerns creation or provision of goods and services that are unique, distinctive and have exceptional features. On the other hand, customer focus is where an organization concentrates on a particular segment of the market.
An example of a service that utilizes overall cost leadership is sale of personal computers by Dell Inc. Dell is a computer company that manufactures, distributes and sells both personal and business computers. In the recent past, Dell has focused more on sale of personal computers that are cheap and affordable. The sales services provided by Dell Inc. are highly personalized and tailored towards ensuring that customers get the highest quality services at the points of sale. For example, the sales personnel of the company are often trained on customer care strategies and provision of high-quality after-sale services. In addition to producing cheap computers, Dell has also embarked on providing customized services in order to reduce cost of provision of services. For instance, personalized services enable the company to ensure maximum customer satisfaction, hence reduced sales returns from customers and law suits. In my view, Dell has focused more on delivering high-quality computers to the consumers at the lowest possible cost. This has enabled the company to become the lowest-cost service provider in the personal computers industry. Dell also offers sales discount to customers in order to maximize sales as well as to increase its market share by attracting customers who are sensitive to price and quality of services. In my opinion, Dell has achieved overall cost leadership through provision of highly personalized sales services.
With respect to differentiation strategy, Apple Inc. takes the lead by providing consumers with high-quality personal computers with unique features and high-performance capabilities. Apple Inc. is also renowned for manufacturing innovative personal computers, tablets and iPads. This has resulted into high reputation of the company amongst customers because most consumers regard its products and services to have high quality and performance, thus able to offer value to consumers. A market analysis by Yost (2009) between June and December 2008 revealed that most users of personal computers and tablets regard sales and repairs and maintenance services of Apple Inc. to be different, unique and better than those of its rivals. In my view, this explains the dominance of tablets and iPads from Apple Inc. in the global consumer electronics markets.
Lastly, an example of a service that adequately utilizes customer focus as a competitive service strategy is provision of beverages by Seattle’s Best Coffee. Seattle’s Best Coffee is a beverages company that specializes in sale of high-quality coffee in various retail and wholesale outlets. The company is headquartered in Seattle, Washington, D.C., and has numerous retail outlets in major cities across the world. Seattle’s’ Best Coffee has focused in providing high-quality specialty coffee to customers. The company mainly focuses on middle-class or working-class and lower-class customers unlike other coffeehouses such as Starbucks that target upper-class customers. Through successful adoption of customer focus strategy, Seattle’s Best Coffee has emerged to be the cheapest and most preferred coffeehouse amongst middle-class consumers, closely followed by Peet’s Coffee & Tea, Jittery Joe’s and Lavazza. In my view, Seattle’s Best Coffee has effectively utilized focus as a competitive service strategy to strengthen its position in the highly competitive beverage industry. The services provided by the company to customers are also highly personalized and customized to meet or exceed the expectations of consumers. Focus has also enabled Seattle’s Bes Coffee to enjoy a high degree of customer loyalty as well as build a strong corporate reputation and brand.