NDIS MyAgedCare value of digital self-service: Towards assessing the value of digital self-service options from a provider perspective
Due to rapid advances in information technology (IT) coupled with a continuous increase in labour costs and competition, digital self-service options will become more and more popular with NDIS and My Aged Care providers. Digital self-service options can be defined as service processes of value co-creation facilitating an increase in the co-production of a digital service through shifting tasks from the service provider to participants, families and clients. Most current models are performed in the form of workflows implemented in Self-Service Technologies that enable clients to produce a service independent of direct service employee involvement. Self-service options allow service providers to reduce costs of service delivery, while empowering clients to become partial employees.
Service beneficiaries, value is often conceptualised as perceived client satisfaction. However, for digital self-service options to be considered as being successful, they also have to create additional value for the service provider. Poorly designed self-service options can increase providers’ costs and thereby destroy provider value. Though, there is little known on how to assess value from a service provider perspective. Here, it is argued that value is in phenomenological experience and resides, not in an object, a product, or a possession but rather in the user experience.
How to assess the value-in-experience of digital self-service options from a service provider perspective?
Value determination of co-production processes: Theoretical Foundations
The involvement of participants, families and clients in digital self-service options implies a co-production of service. Co-production processes represent a special form of service processes, through which the operand (resources on which actions are performed to generate effects, e.g. goods) and operant (resources that act upon operand and/or other operant resources, e.g. knowledge and skills) resources of the clients are integrated with those of the service provider. The involvement in ‘co-production’ is optional and can vary from none at all to extensive co-production activities by the client or user. Co-production, therefore, has to be considered as a continuum, which relates to the degree to which the client is active in doing something to achieve the desired outcome. Shifting this degree in one direction or the other, decision makers aim to create additional value for their service organisations.
Value can be conceptualised in various ways, including net benefit and means-end. For this article, we draw upon these two value concepts, as compared to other conceptualisations (e.g. economic worth and utility), both types of value judgments are determined by the client based on use (or potential) experience, often termed the consumption experience. That being said, both concepts allow to assess the expected and perceived value-in-experience and thus can be seen as a concretisation of value-in-use or context. The conceptualisations apply equally to the provider perspective and should be considered simultaneously since value as evaluation of attributes is nested within value as the evaluation of outcomes.
Service efficiency from the service provider perspective
Service efficiency describes the relation between service outcome and input from the service provider perspective. It thus can be considered as synonymous with service productivity. In the context of value co-creation, service efficiency can be divided into low cost and speed of delivery. Potential cost reductions are seen as the primary reason for service providers to introduce self-service options. Decreasing cost of service delivery, a service organisation is able to increase service productivity at constant revenues from a given service. The service price paid by a client represents the firm’s outcome of the service process. Increasing speed of delivery positively influences service quality and satisfaction perceived by the client. As the latter also represents a separate construct category, it highlights the importance of client value to the service provider’s value assessment.
Therefore, to consider for value assessment from a provider perspective, and to construct value key-points and determination. The constructs listed below can be classified into eight primary categories:
- Speed of delivery
- Client empowerment
- Service quality
- Client characteristics
- Activity requirements
- Co-production intensity
We consider those identified constructs, which positively affect the provider’s or client’s perceived value, as benefits. In contrast, identified constructs that negatively affect value perception are considered as costs or sacrifices. As the service provider and client receive and deliver different kinds of benefits and sacrifices respectively, the provider part and client part of value are assessed separately in the beginning.
Speed of service delivery and perceived control have a strong influence on service quality perceptions. Service quality evaluations, in turn, are important predictors of perceived client value. A client’s perceived control can be seen as one dimension of client empowerment, from each of which clients can derive co-created value separately. Convenience is considered a possible benefit that can be realised by clients adopting self-service options and refers to the ability to get something done quickly or at any time of the day or week. Introducing the concept of co-production intensity, which is defined as clients’ subjective perception of the extent of effort and time invested in a specific process of coproducing a product or service. Co-production intensity negatively affects a client’s satisfaction with the service process. Further constructs to be considered include the complexity of the service tasks as well as the client’s characteristics, such as knowledge and skills, as these affect the value-in-context a client can derive from a certain channel. Also, the knowledge and skills of the service provider’s personnel involved in the service encounter, need to be considered.
Value assessment of digital self-service options
Clients value is an integral part of provider value. In its simplest form, both perspectives (provider and client) of value can be assessed as follows:
An entity’s non-monetary costs for activity-performance are calculated by the function, based on the activity’s requirements and the entity’s characteristics. The higher the discrepancy between the characteristics and requirements, the higher these costs. The monetary costs (e.g. costs for operand resources required for activity-performance) are indicated by and the service price. To allow for the measurement of the speed of delivery, a function is defined, which also takes into account Formalisation.
We make use of to measure the control dimension of client empowerment, represents the degree to which a client performs tasks within the service process and therefore to a certain extent the client’s control over the service process. Furthermore, we draw upon the concept of Service-Level- Agreements (SLAs), which are often defined in the context of digital services, and determine the level of convenience of a digital service. In this regard, we also consider the speed of service delivery. Service quality is assessed according to the SERVQUAL instrument please see Google Slideshow for more info. and therefore is influenced by the reliability (or probability) of delivering the demanded service successfully. We define reliability as which compares the activity’s requirements with the actor’s characteristics.
Taking all these considerations into account, by means of multiplying and summating all the benefits and costs respectively, the expected value-in-experience of a service client as well as the perceived value-in-experience of a client can be assessed as illustrated in Equation (5). In case of the considered constructs, such as the client’s characteristics, calculated costs, the speed of service delivery and service quality, represent expected and normative values. To assess, a service organisation has to determine these constructs, for instance, by making use of market research instruments and client surveys after an actual client experience. Nonetheless, in both cases, the client’s value-in- experience is estimated or determined.
A part of the service provider’s value-in-experience can be assessed as illustrated in Equation (6). As the cost and time dimensions of service efficiency are already considered in the denominator of Equation (6) and Equation (5) respectively, we do not explicitly take this construct into account. Also, the provider’s and client’s characteristics are indirectly included in our definition of monetary and non-monetary costs. Thus, in Equation (6), we only explicitly account for the price that has to be paid for the service process and non-economical factor. The latter represents the fact, that there are services which are provided for non-economic reasons and no value-in-exchange, such as services provided by non-profit organisations or services provided to internal clients. Can be used to measure cost improvements (compared to personal service delivery channels, e.g. a reduction in labor, facilities and equipment) achieved through the introduction of the digital self-service option.
Strategies and self-service categories to increase a service provider’s value
We identify a number of strategies and self-service option categories for increasing the expected and perceived value below. In order to increase their value, NDIS and My Aged Care providers are able to design and implement different kinds of self-service options. With regard to the categories of self-service options that can be seen as strategies for value increase.
- I. Manual self-service options
- II. Digital self-service options
- III.On-site self-service options
- IV. Simple self-service options
- V. Free self-service options
- VI. Precious self-service options
Manual self-service options (e.g. traditional supermarkets) require the client to perform most of the process activities manually. Service providers introducing manual self-service options, aim to reduce their total costs by increasing the clients’ co-production intensity. However, as this also increases the clients’ total costs, Strategy (I) only increases the service provider’s value in conjunction with either one or all of the Strategies (II), (III) and (IV). Enabling the service client to perform all tasks within the service process by himself, increases the factor of client empowerment.
Increasing the local and timely availability as well as the speed of service delivery to its maximum, this requires the service to be digital. Hence, the service provider needs to design and implement a digital self-service option (e.g. an online shop), as technology provides a greater local and timely availability as well as faster task processing. Within digital self-service options, the majority of the process activities are performed by IT.
Another strategy refers to the increase of those dimensions of service quality that need to be considered in personal service interactions. For instance, the service provider can decide to offer the relevant SSTs in his facilities to provide personnel supporting clients using these service channels as well as a positive services-cape (on-site self-service options, e.g. ticket machines at subway stations). Besides these factors, also reliability contributes to an increase of the overall service quality. To increase reliability, service providers can either simplify the process activities, in terms of reducing their requirements posed to the client performing them or otherwise train the clients, so the operant resources (e.g. knowledge and skills) they are able to provide for task- performance match or even exceed the activities’ requirements. Such a strategy would refer to simple self-service options (Strategy (IV), e.g. websites answering frequently asked questions).
Furthermore, a service provider can vary the price that has to be paid by clients for producing the demanded service. Reducing the price to zero would make the self-service option free for clients, in terms that there is no direct value-in-exchange (Strategy (V), e.g. self-service options offered to internal clients). However, this only increases value, in case this would not lead to any additional effort (costs) for the service provider. A service provider could also increase the price for the service to a maximum in order to increase its part of the overall value and design and implement a kind of precious self-service option (Strategy (VI), e.g. experience gift vouchers for do-it-yourself experiences). Nevertheless, as this would increase the costs for the service client, such a strategy also requires support from either one or all of the Strategies (II), (III) and (IV).