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ce augmentation “augmented service offering”. The following figure and table depict the concept and examples of the augmented service offering. New service products are able to open new opportunities but their impacts on sales and profits are moderate (Goffin and Mitchell 2020). It is only the new service products that provide distinguished attributes and are difficult to copy can bring a petitive advantage. On the other hand, innovations in the service augmentation are perceived to have a big impact on sales and profits as well as the success of other products. Accordingly, service providers need to deliver the best service products within excellent service augmentation so as to create highquality services perceived by the customers. The ponents of services are further translated into the service characteristics. As mentioned in the introduction section, services have some characteristics quite distinct from those of physical products. Service characteristics, defined by Kotler (2020) and Goffin and Mitchell (2020), are summarised in table 2. 3. Issues in Managing Services Innovation Managing services innovation has the same purpose as the physical product innovation management, which is to create new and valuable services. There are several key issues intertwined with the services innovation. To begin, we derive the key issues from the service characteristics. level of contact. For instance, when going to a bank for sending money overseas, ourcolleague prefers to write and arrange the documents by herself and then submits them with the cheques directly to the cashier. Meanwhile, we prefer to go through the customer service desk, letting the associate write and prepare the receipts since we do not exactly know what to fill or tick in the papers. Another example is that in supermarket, people are inclined not to be close to the staff if not required. However, recent fact also shows that businesses are trying to get closer to their customers. For instance, when we bought a laptop from Dell’s web site, we just expected the pany to sell the notebook immediately。 so, it needs little customer contact in this case. Nevertheless, sometime upon purchasing the product, the pany sent s asking for the satisfaction level of using the laptop as well as quer