Page 23 - Design for Six Sigma for Service (Six SIGMA Operational Methods)

Six Sigma in Service Organizations 7

c. Social and ethical reasons (for example, environmentally friendly
brands)
d. Psychological awe (Many first-in-market products or services not
only may provide unique functions but also give customers a
tremendous psychological thrill; for example, the first copy
machine really impressed customers)
e. Psychological effects of competition
3. Service and convenience benefit
a. Availability (ease with which the product or service can be accessed)
b. Ease of obtaining correctional service in case of product problem
or failure
The liabilities include the following categories:

1. Economical liabilities
a. Price
b. Acquisition cost (such as transportation cost, shipping cost, time
and effort spent to obtain the service)
c. Usage cost (additional cost to use the product or service in addition
to the purchasing price, such as installation)
d. Maintenance costs
e. Ownership costs
f. Disposal costs
2. Psychological liabilities
a. Uncertainty about product or service dependability
b. Self-esteem liability of using unknown brand product
c. Psychological liability of low-performance product or service
3. Service and convenience liability
a. Liability due to lack of service
b. Liability due to poor service
c. Liability due to poor availability (such as delivery time, distance to
shop)

Even for nonprofit service organizations, it is not desirable to lose money. In
addition, it is a natural goal for all service organizations to maximize customer
value. Who doesn’t want their customers to be satisfied?

Clearly, higher customer value means higher revenue, and profitability is
key for business success. Therefore, business success has to be achieved by
the two following success factors:
• Maximize customer value
• Minimize cost