What are the broad advantages and disadvantages of each proposal?
> Re-read the case example on the Harley Owners Group (H.O.G.). Why does Harley-Davidson put so much effort into promoting this club?
> Re-read the case example ‘Revenge of the taxi driver’. What do you think are the problems of platform services such as this rating both providers and users of a service?
> Calculate your lifetime value for three service organizations that you use – for example, supermarket, clothing retailer, music download website, bar or bank. What are the problems in assessing lifetime values?
> Re-read the case example on The Prison Service. Why is it valuable to consider all the stakeholders in this particular example?
> If you search online under the single word ‘relationships’, you will be bombarded with advice on personal relationships. Also, the language used by authors to describe customer relationships often echoes the language of personal relationships. Are custom
> Earlier in the chapter, we explored the case example of the Japanese hairdressers, QBNET. The service concept for QBNET is essentially simple and no-frills barbering service. The QBNET service has been phenomenally successful in Southeast Asia, and latte
> An IT Infrastructure Support Group services the IT infrastructure of several clients. In shaping a suitable service concept it is aware that, in effect, the group serves two distinct customer groups within its client base – the ‘end users’ who use the IT
> From the 1960s through to the late 1990s, ‘no loitering’ had been an important principle underlying McDonald’s operations. Founder Ray Kroc had ordered that pay telephones, jukeboxes, and vending machines were forbidden at McDonald’s restaurants. The goa
> Referring back to the case example on the Lap worth Museum of Geology, construct the service concept for the current (redesigned) museum. Despite being very successful, it is a fact that tourism and leisure attractions have a finite life. Visitor numbers
> How would you change the process to improve it?
> What advice would you give to Travis Bickley regarding the way the firm classifies its clients?
> Using the service concept template shown in Figure 4.3, map out the service concepts for the micro pub, the brewpub and the craft beer bar.
> On the basis of the current service concepts for each pub, as well as the financial data provided in Table 4.1, what recommendations should Marie make to the C&L executive board?
> How did the four perspectives of service operations strategy (top-down, bottom-up, outside-in, and inside-out) influence the eventual service strategy of Corks Nightclub?
> How could the university’s IT services have improved Elena’s customer experience?
> Working from Elena’s reactions, chart her ‘emotional journey’ during her customer experience.
> What recommendations would you make for improvement?
> Evaluate the quality of service provided by the NBSU.
> Is the adoption of key account management a good idea for P-Mecxx?
> What should be done to improve its relationships with its clients?
> Do you think that the current process can achieve a service that provides a one-week turnaround to its customers?
> What advice would you give to Khalid Ahmed?
> What is the purpose of benchmarking?
> How would you respond to this letter?
> Assess the value stream maps for the simple and complex installations. What improvements would you suggest to Alain?
> The acquisition of EAP and Equips 25 was intended to provide Fermat Numérique with several advantages in terms of strategic positioning. What were the possible disadvantages to the acquisition?
> What should be Alain’s priorities for strategic improvement?
> What are the objectives of the CES process?
> What should worse do to ensure the future viability of the partnership?
> Is the partnership really ‘unbalanced’ as David Crawley says?
> Why was the partnership between worse and Homer seen as successful by both parties?
> How would you characterize the challenges associated with change at Dixon, and how might these be overcome?
> What are the issues and implications for the chain?
> What conclusions could Julie draw from the data?
> Again, thinking about the music industry, where do ‘live performances’ fit on the scales?
> Specifically, how would you include the local population in the development of phase 2?
> The IHIP characteristics that we introduced in the chapter are used to distinguish service from goods-producing operations. We also made clear that they were controversial and that they could be viewed as spectra rather than simple yes/no distinctions. W
> Re-read the case example on the English National Opera. Consider the list of back-office departments in the case. (a) For each of the departments described, what aspects of their job do not involve directly ‘making’ something? (b) How would you categoriz
> An increasingly popular service models in business is that companies should earn revenues from subscribers rather than sell products or service as single ‘items’. What do you think are the advantages and disadvantages of this type of service?
> Rent the Runway (RTR), is a privately-owned service that rents out clothes, handbags and jewelery. It has a dry-cleaning warehouse that is the biggest in the world, processing 2,000 items per hour. It started renting out formal dresses for weddings and o
> Describe the customer experience and outcomes for a fast-food restaurant, a doctor’s surgery and an internet-based fashion-clothing retailer. Compare and contrast the services of these three organizations.
> The Earthy Construction Equipment Company sells its products (large earth-moving equipment) to building and mining customers around the world. The company’s CEO has read about the idea of the ‘experience economy’, but feels it only applies to consumer co
> How do you think that the big manufacturers of cars will respond to? (a) The general move from products to services. (b) Changes in vehicle technology?
> A supplier of branded kitchen appliances that sells to the domestic market is considering offering its equipment and tools not as products but as ‘a culinary lifestyle’. To help customers experience this lifestyle, it is considering establishing a networ
> Nespresso has been described as ‘Starbucks without the drive’. It supplies coffee machines that brew coffee from capsules, or pods, for home or professional use. The company is an autonomous globally managed business within the Nestlé Group. With corpora
> Consider three services: first, a business servicing heating, ventilation and air-conditioning facilities; second, an emergency plumbing service; and third, a disaster emergency charity. Again, using Figure 1.3, how does each service fit on the IHIP scal
> Why is phase 2 of the development looking more difficult? What could have been done to reduce potential problems?
> What problems does Peter Greenwood face?
> Although cost and revenue estimates of each proposal are not yet available, which one do you favor?
> In particular, what recommendations would you make about unbundling the complimentary meals service on long-haul economy?
> If you were Peter Greenwood, what would you say to the Board?
> Many services require their front-line staff to adopt very prescriptive dress standards. What factors should be taken into account when deciding on what is considered appropriate clothing and appearance for the following services: (a) Airline cabin crew
> ‘Happy employees mean happy customers’ is at the core of the service–profit chain. How do you think that idea applies to, (a) A performance of an opera at a grand opera house. (b) Heart surgery?
> Re-read the case example ‘Caring for your players’. What do you think are the main pressures on professional sportspeople that someone in a sports-related service, such as Sara at Scarlet’s, has to deal with?
> When services talk about ‘customer training’, what do you think that they see as the main advantages?
> Re-read the case example, ‘It’s not part of the job – Co-op’s “Safer Colleagues, Safer Communities” campaign’. In addition to technological solutions such as Smart Water, what else could such retailers do to protect their front-line staff from abuse?
> How would you position each stakeholder group on Dale’s power–interest grid?
> Beantown Housing Association is a social landlord charity that owns and manages around 6,000 properties in the south of the UK. Employing around 650 people, it is a quasi-government body that provides housing services in areas of social deprivation. A hi
> A problem in large service organizations is that knowledge is often ‘soloed’ in regions, or functional departments. Internal practice benchmarking can be difficult because experience is inaccessible to many employees. This situation can be a real headach
> Re-read the ‘Acuity and House Mark’ case example earlier in the chapter. The example refers to ‘benchmarking clubs’. The benefits of these clubs are mostly obvious, but what might be the ‘dis- benefits’? How would you counter these disbenefits?
> Viola Media, run by Violet Lesseps, had developed a specialization in videography for festivals, arts and outdoor events when it won a contract to provide videography support for the production of online Masters Degrees at a UK university. Violet knew th
> Haven is a charity providing refuge and safe houses for parents and children who have been subject to domestic abuse. The charity is based in the south-west of England. Most of the revenue funding for the charity comes from Haven’s 14 charity shops. One
> Select a process you are involved in, such as ‘being taught’, ‘cooking a meal’, ‘cleaning’, etc. What might be the benefits of benchmarking this process and with whom could you compare your performance? How would this lead to the benefits identified?
> What would be the impact of offering a guarantee on the service that you personally provide?
> Flodden is a leading international retailer selling clothing and accessories, with stores around the world. The countries from which it sources its products include Sri Lanka, Bangladesh, India and Vietnam. It was shocked when a British newspaper reporte
> Viz2XHealth was a business-to-business healthcare IT company based in Dubai, serving major hospitals in the Gulf States. Its system allowed health staff to access and interrogate multiple systems from one, user-friendly interface. But it had a problem. E
> How might public service guarantees (service guarantees issued by public, rather than private, organizations) need to differ from normal commercial ones?
> Who are the main stakeholders in the development of this service, and what is their interest in it?
> Where is the bottleneck (if any) in the process?
> Here is some price information on Marabel, Inc.: a. You have placed a limit order to sell at $68. What are you telling your broker? b. Given market prices, will your order be executed?
> What are some different components of the effective costs of buying or selling shares of stock?
> You are bearish on Telecom and decide to sell short 100 shares at the current market price of $50 per share. a. How much in cash or securities must you put into your brokerage account if the broker’s initial margin requirement is 50% of the value of the
> You are bullish on Telecom stock. The current market price is $50 per share, and you have $5,000 of your own to invest. You borrow an additional $5,000 from your broker at an interest rate of 8% per year and invest $10,000 in the stock. a. What will be
> Consider the following limit order book for Fin Trade stock. The last trade in the stock occurred at a price of $50 a. If a market buy order for 100 shares comes in, at what price will it be filled? b. At what price would the next market buy order be fi
> Old Economy Traders opened an account to short-sell 1,000 shares of Internet Dreams from the previous question. The initial margin requirement was 50%. (The margin account pays no interest.) A year later, the price of Internet Dreams has risen from $40 t
> Dée Trader opens a brokerage account and purchases 300 shares of Internet Dreams at $40 per share. She borrows $4,000 from her broker to help pay for the purchase. The interest rate on the loan is 8% a. What is the margin in Dee’s account when she first
> DRK, Inc., has just sold 100,000 shares in an initial public offering. The underwriter’s explicit fees were $60,000. The offering price for the shares was $40, but immediately upon issue, the share price jumped to $44. a. What is your best guess as to t
> Call one full-service broker and one discount broker and find out the transaction costs of implementing the following strategies: a. Buying 100 shares of IBM now and selling them six months from now. b. Investing an equivalent amount in six-month at-th
> Are the following statements true or false? If false, correct them. a. An investor who wishes to sell shares immediately should ask his or her broker to enter a limit order. b. The ask price is less than the bid price. c. An issue of additional shares
> Use the following scenario analysis for stocks X and Y to answer below the CFA Question: Assume that of your $10,000 portfolio, you invest $9,000 in stock X and $1,000 in stock Y. What is the expected return on your portfolio?
> Where would an illiquid security in a developing economy most likely trade? a. Broker markets. b. Electronic crossing networks. c. Electronic limit-order markets.
> Are the following statements true or false? If false, correct them. a. Market orders entail greater price uncertainty than limit orders. b. Market orders entail greater time-of-execution uncertainty than limit orders.
> What is the difference between an IPO (initial public offering) and an SEO (seasoned equity offering)?
> Why are corporations more apt to hold preferred stock than other potential investors?
> How does a municipal revenue bond differ from a general obligation bond? Which would you expect to have a lower yield to maturity?
> What is the LIBOR rate? The federal funds rate?
> Why are high-tax-bracket investors more inclined to invest in municipal bonds than are low-bracket investors?
> Describe alternative ways that an investor may add positions in international equity to his or her portfolio.
> Bonds of Zello Corporation with a par value of $1,000 sell for $960, mature in five years, and have a 7% annual coupon rate paid semiannually. a. Calculate the: Current yield. Yield to maturity. Horizon yield (also called realized compound return) for a
> a. Explain the likely impact on the offering yield of adding a call feature to a proposed bond issue. b. Explain the likely impact on the bond’s expected life of adding a call feature to a proposed bond issue. c. Cite one advantage and one disadvantage
> Use the following scenario analysis for stocks X and Y to answer below the CFA Question: What are the standard deviations of returns on stocks X and Y?
> A newly issued 20-year-maturity, zero-coupon bond is issued with a yield to maturity of 8% and face value $1,000. Find the imputed interest income in the first, second, and last years of the bond’s life.
> A convertible bond has the following features. What is its conversion premium?
> A 30-year maturity, 6% coupon bond paying coupons semiannually is callable in five years at a call price of $1,100. The bond currently sells at a yield to maturity of 5% (2.5% per half-year). a. What is the yield to call? b. What is the yield to call i
> On May 30, 2021, Janice Kerr is considering the newly issued 10-year AAA corporate bonds shown in the following exhibit: a. Suppose that market interest rates decline by 100 basis points (i.e., 1%). Contrast the effect of this decline on the price of eac
> Assume that two firms issue bonds with the following characteristics. Both bonds are issued at par. Ignoring credit quality, identify four features of these issues that might account for the lower coupon on the ABC debt. Explain.
> The following multiple-choice problems are based on questions that appeared in past CFA examinations. a. A bond with a call feature: attractive because the immediate receipt of principal plus premium produces a high return. Is more apt to be called whe
> Suppose that today’s date is April 15. A bond with a 10% coupon paid semiannually every January 15 and July 15 is quoted as selling at an ask price of 101.25. If you buy the bond from a dealer today, what price will you pay for it?
> Claire Pierce comments on her life circumstances and investment outlook: I must support my parents who live overseas on Pogo Island. The Pogo Island economy has grown rapidly over the past two years with minimal inflation, and consensus forecasts call fo
> A two-year bond with par value $1,000 making annual coupon payments of $100 is priced at $1,000. What is the yield to maturity of the bond? What will be the realized compound yield to maturity if the one-year interest rate next year turns out to be (a) 8
