Journal of Service Science 2013 Volume 6, Number 1

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1 Journal of Servce Scence 13 Volume 6, Number 1 On Applyng Sx Sgma To Improvng The Relatonshp Qualty Of Ftness And Health Clubs Kue-Me Cheng, Natonal Tawan Unversty of Physcal Educaton & Sport, Tawan, R.O.C. ABSTRACT Runnng a ftness and health club s a servce-ntensve busness. Although t s not an easy job to provde hgh qualty and satsfyng servces to customers, t s n fact the ultmate goal for most ftness and health clubs. For ths reason, provdng qualty servces and buldng a good relatonshp wth customers has become an mportant ssue for operatng and managng a ftness and health club. Ths study adopts Sx Sgma and the performance evaluaton matrx as two major research tools. By mplementng the steps (defne, measure, analyze, mprove, and control) of Sx Sgma and through the nne performance boxes generated by the mportance-satsfacton matrx (wth mportance as the horzontal axs and satsfacton as the vertcal axs) of Importance-Performance Analyss (IPA), ths study ams to specfcally dentfy the servces most requested by customers n an effort to provde hghly satsfyng servces and mprove relatonshp qualty. Keywords: 6-Sgma; Performance Evaluaton Matrx; Relatonshp Qualty I. INTRODUCTION W th the advancement of technology and nformaton, most ndustres n Tawan have transted from beng labor-ntensve to beng hgh-tech and captal-ntensve. As the economy grows and technology develops, machnes are replacng the labor force. As a result, the Tawanese are not only faced wth hgh pressure but also a lac of physcal exercse, whch n turn causes the emergence of lfestyle dseases. However, the Tawanese are payng more attenton to ther lesure lfestyle and startng to do lesure exercses n order to release stress and mprove ther health; consequently, lesure exercses have become a part of people s lfe. An ncreasng number of people are acqurng the habt of exercsng regularly, and the demand for lesure exercses and facltes s growng accordngly. In lght of ths, some foregn traders have brought Amercan-style gymnasums n Tawan n These gymnasums offer modern exercse space and facltes as well as a varety of courses wth flexble prcng plans, mang the Tawanese gradually accustomed to exercsng n ftness and health clubs and drvng the development of ths ndustry (Jang, ). Runnng a ftness and health club s a servce-ntensve busness. The servces are ntangble, nseparable, varable, and pershable. Although t s not an easy job to provde hgh qualty and satsfyng servce to customers, t s, n fact, the ultmate goal for most ftness and health clubs. For ths reason, provdng qualty servces and buldng a good relatonshp wth customers has become an mportant ssue for operatng and managng a ftness and health club. The bggest problem faced wth ftness and health clubs n Tawan s the hgh customer attrton rate. The attrton rate s usually as hgh as % to 4% and creates ncreased operatonal costs and reduces profts. Hence, n order to mprove the relatonshp qualty of ftness and health clubs and thereby retan customers and reduce attrton rates has become a major goal for the ftness and health ndustry (Tang, 3; Cheng, 3). Due to the ferce competton n the busness realm and rsng consumer awareness, more and more enterprses adopt Sx Sgma to mprove ther operatonal performance. By combnng the cost control and the statstcal analyss n Sx Sgma as well as specfyng nadequate management processes, enterprses have come up wth a scentfc and effcent method to respond to operatonal and management problems. Nevertheless, the qualty of servces tends to vary 13 The Clute Insttute Copyrght by author(s) Creatve Commons Lcense CC-BY 17

2 Journal of Servce Scence 13 Volume 6, Number 1 when nterfered by subtle factors. Therefore, t s qute challengng and dffcult to ntroduce Sx Sgma to the servce ndustry (Wu, 11). In spte of ths, many studes show t s possble to mprove the qualty performance of customzed servces wth Sx Sgma (Bolos, ) because ntroducng t to the servce ndustry allows servce provders to reduce the number of defects (e.g. customer complants or poor servce atttudes) n the process of provdng servces. Among all approaches to mplementng Sx Sgma, the DMAIC s the most frequently used method by the servce ndustry. Therefore, ths study adopts Sx Sgma to explore the relatonshp qualty of ftness and health clubs, hopng that the results may serve as a reference for mprovng the relatonshp qualty of ftness and health clubs. II. METHODOLOGY Many nternatonal enterprses n Europe and the Unted States have already been applyng Sx Sgma to mprovng customer satsfacton and mantanng ther leadng poston n the maret. A process mproved wth Sx Sgma has only three to four errors n every one mllon operatons, whch explans why t s a nearly perfect soluton for enterprses (Peter & Patrc, ). From the perspectve of management scence, Sx Sgma s regarded as a new type of management method whch helps to reduce the number of defects, errors, and costs durng the manufacturng process. Lee (3) also ponted out that the use of Sx Sgma allows an enterprse to understand customers needs, value the nput varable x s and output varable y s durng a busness process, and mprove the process based on data and facts, whch n turn create more potental benefts. Therefore, ths study adopts Sx Sgma and the performance evaluaton matrx as two major research tools. The mplementaton of Sx Sgma ncludes fve steps: defne, measure, analyze, mprove, and control. Defne means to dentfy customers needs and the thngs they want the most; measure means to collect data and calculate the chance of mang errors durng an operatonal process; analyze means to loo nto the data to see out the root cause of errors, mprove means to fnd out the best soluton and craft an acton plan for mplementng the soluton; and control means to sustan the mprovement and avod the recurrence of errors. Through the fve steps of Sx Sgma, an enterprse can specfcally determne the servces needed by customers and control and reduce defects n order to provde the best servces to customers (Lee & Wu, 3). The performance evaluaton matrx s proposed by Martlla & James (1977); ts major functon s to help enterprses to determne the mportance and performance of a product or servce, so that they can create mproved maretng strateges. Ths study adopts the concept of Hung et al. (3) and uses the nne performance boxes generated by the mportance-satsfacton matrx (wth mportance as the horzontal axs and satsfacton as the vertcal axs) of the IPA. The research of Matzler et al. (4) also shows that the use of IPA helps a manager to dentfy the type of servces whch can produce hgh customer satsfacton. III. RESULTS AND DISCUSSION As mentoned prevously, runnng a ftness and health club s a servce-ntensve busness, and to mantan hgh qualty and satsfacton ratngs s an mportance ssue to all ftness centers. Schbrowsy and Lapdus (1994) ponted out that for every customer lost, a company had to nvest n the exploraton of a new customer at an expense fve tmes that of mantanng exstng customers. Defne and Measure Ths study uses the steps for mplementng Sx Sgma and the placement of each servce on the performance evaluaton matrx to fnd out the relatonshp qualty of hgh customer-perceved mportance but low satsfacton. By dong so, ths study defnes a measurng ndex to measure the gap between customer-perceved mportance and satsfacton and proposes an objectve evaluaton method and process for ths ndex. To measure the gap between customer-perceved mportance and satsfacton of each relatonshp qualty, ths study defnes as follows: 1 (1) 1 18 Copyrght by author(s) Creatve Commons Lcense CC-BY 13 The Clute Insttute

3 Journal of Servce Scence 13 Volume 6, Number 1 1 and are respectvely the ratos of customer-perceved mportance. The customer rates satsfacton n the scale. The smaller the value, the closer the customer-perceved mportance s to the satsfacton. If the value equals, the customer-perceved mportance s consstent wth the satsfacton ratng. The concept of regon of acceptance n the performance evaluaton matrx allows the exstence of a gap between customer-perceved mportance and satsfacton; t does not requre both to be exactly the same. Ths study defnes the tolerance as and evaluates whether the gap between customer-perceved mportance and satsfacton s smaller than the tolerated gap, whch s. An mmedate response s requred f the result s statstcally sgnfcant. The hypothess s as follows: H : H : A () The value s the sum of gaps between satsfacton of the th tem, then 1 1 and. If w stands for the weght of mportance and w 1 and 1 w, = 1,...,. (3) Therefore, the hypotheses of model () are revsed as H : w for all 1,..., 1 H : 1 w for some 1,..., (4) A The statstcal test of model (4) can be computed wth Pearson s goodness-of-ft test (Desu, 3). T n n ˆ n n ˆ 1 1 n ˆ n n n1 n n n N N n n N n n n1 n n n n n (5) Its statstcal test s smlar to degree of freedom 1 of the ch square. When H s rejected at level, the regon of rejecton s defned as T T and formula (3), { 1 }. Furthermore, n accordance wth model () (1 ) 13 The Clute Insttute Copyrght by author(s) Creatve Commons Lcense CC-BY 19

4 Journal of Servce Scence 13 Volume 6, Number 1 w 1 1 w n n n 1 1 n n n n n w w (6) It s retreved from formula (6) that n n 1 nw 1 n 1 T nw 1 (7) 1 Based on formula (7), the regon of rejecton s defned as { T T 1 W}, of whch (1 ) W n w s the functon of w,, 1 w. Next ths study uses mathematcal programmng to dentfy the extreme value W ; the program s as follows: Max Value W n w 1 Constrant 1 w 1 ˆ W stands for the extreme value dentfed through mathematcal programmng. By nputtng the collected samples, ths study defnes the regon of rejecton as { T T 1 Wˆ }; of whch s the ntal value. (1 ) The measurng process defned n ths study s as follows: 1. Collect samples.. Select the value and use mathematcal programmng to calculate ˆ { T T 1 Wˆ } (1 ) W, then compute and compare ts result wth the sgnfcance level Determne f the relatonshp qualty meets the requrement through the followng methods: (a) If T( obs), then H s accepted, meanng that the mportance and the satsfacton of the relatonshp qualty meets the expected level. (b) If T( obs), then H s not accepted, then the mportance and the satsfacton of the relatonshp qualty fals to meet the expected level. The sgnfcance level can be a loose (.1 ), normal (.5 ), or strct (.1 ) type of level, t all depends on the condtons set at the begnnng of the experment. Next, ths study refers to the method proposed by 13 Copyrght by author(s) Creatve Commons Lcense CC-BY 13 The Clute Insttute

5 Journal of Servce Scence 13 Volume 6, Number 1 Huang et al. (3) and defnes the level of mportance and level of satsfacton ndces n the questonnare as follows: I X 1 R (Importance Index) S Y 1 R (Satsfacton Index) X, Y stands for the average score of an tem n a recovered sample, 1,,11 and R 1. Ths study uses the fve-pont Lert scale, so R When I, customers attach no mportance to the tem nvolved and the level of mportance s %. When I 1, customers attach much mportance to the tem nvolved so the level of mportance s 1%. When I.5, customers attach an average mportance to the tem nvolved, so the level of mportance s 5%. The level of satsfacton ndex s smlar to that of the level of customer-perceved mportance ndex, so these rules apply to t as well. Fg. 1: The Performance Evaluaton Matrx of Relatonshp Qualty The straght lne equaton s Ax By C and passes through the performance evaluaton matrx; ths study defnes D as the dstance between the coordnate ( IS, ) and the straght lne equaton. The pont of projecton of the coordnate ( IS, ) on the straght lne equaton s D B I ABS AC A S ABI BC, A B A B AI BS C A B, so the dstance D between the two ponts s as follows: 13 The Clute Insttute Copyrght by author(s) Creatve Commons Lcense CC-BY 131

6 Journal of Servce Scence 13 Volume 6, Number 1 As stated n Hung et al. (3), the straght lne equaton n ths study s y B 1, and C. The pont of projecton of, dstance between the two ponts s as follows: x. Therefore, A 1, ( IS I S ) on the straght lne s, I S. The D I S The Rotaton Matrx: When the rotaton matrx multples the coordnate, the coordnate wll be rotated counterclocwse by degree. ' I I cos sn ' S sn cos S The rotaton of the performance evaluaton matrx counterclocwse by degree produces a new performance evaluaton matrx. Although the evaluaton method s the same as the prevous one, t helps to dentfy the problems n need of an mmedate response more drectly. After rotatng Fg. 1 counterclocwse by 45 ( 45 ), ths study produces a new graph as shown n Fg.. Fg. : The Performance Evaluaton Matrx of Relatonshp Qualty after Rotaton Fg. 3 s the result of Fg. after the redefnton of the Cartesan coordnate system. After the performance evaluaton matrx s redefned, the coordnate of tems n the questonnare s I ' ', S, 1,,11. Hence t s defned that 13 Copyrght by author(s) Creatve Commons Lcense CC-BY 13 The Clute Insttute

7 Journal of Servce Scence 13 Volume 6, Number 1 D ' S ' ' Therefore, by nputtng the value D of each tem n order, ftness and health club operators can easly and rapdly dentfy the relatonshp qualty n need of mprovement. Analyze Fg. 3: The New Performance Evaluaton Matrx of Relatonshp Qualty After dentfyng the problems and the standard and method for measurng them, ths study follows the model proposed by Pyzde (1) and uses the cause and effect dagram shown n Fg. 4 as the analytcal tool for step three. Enterprse Image Relatonshp Involvement Brand Image Prce Image Instructon Methods Professonal Knowledge Servce Image Level of Interacton Admnstratve Capablty Injury Preventon Capablty Data Sharng Relatonshp Qualty Fg. 4: Cause and Effect Dagram of Relatonshp Qualty 13 The Clute Insttute Copyrght by author(s) Creatve Commons Lcense CC-BY 133

8 Journal of Servce Scence 13 Volume 6, Number 1 Based on the cause and effect dagram, ths study analyzes the followng factors that help to mprove the relatonshp qualty of ftness and health clubs through three dmensons: enterprse mage, relatonshp nvolvement, and professonal nowledge. Enterprse Image Consumers behavor s nfluenced by ther perceved mage of the ftness and health club they go to, meanng that consumers consume n accordance wth ther belef n and deas about the club. Once an mage of trust s developed n the consumers mnds, they wll consume agan (Kolter, ). The mage of a ftness and health club ncludes the servce mage (shaped by consumers percepton toward a specfc servce provded by the ftness and health club), the prce mage (shaped by the consumers percepton toward membershp and fees), and brand mage (shaped by the consumers atttude of the brand of the ftness and health club). By mprovng the enterprse mage, a ftness and health club can mprove ts relatonshp qualty (Waters & Paul, 197). Relatonshp Involvement Ftness and health clubs share nformaton between themselves and customers or among customers to create a hghly nvolved partnershp wth ts customers. If ftness and health club operators can tae the ntatve n sharng nformaton regardng tranng courses, sales promotons and actvtes, and consumers are wllng to express to the operators ther satsfacton or dssatsfacton toward courses, facltes or servces, the operators and the consumers wll be able to form a bengn nteracton, whch wll n turn ncrease customer satsfacton and produce a postve nfluence on the relatonshp qualty of ftness and health clubs. Professonal Knowledge Employees of a ftness and health club should have professonal nowledge regardng nstructon methods, sports njury preventon, and admnstratve management. If the customers recognze the level of employees professonal nowledge or ther ablty to provde servces, they tend to have a hgher level of satsfacton. Therefore, by mprovng employees nowledge about nstructon, njury preventon and admnstratve management, a ftness and health club s able to provde more professonal and satsfyng servces to ts consumers, whch n turn wll ncrease customer satsfacton and relatonshp qualty. Improve As stated above, ths study uses the cause and effect dagram to dentfy the factors nfluencng the relatonshp qualty of ftness and health clubs, whch are enterprse mage, relatonshp nvolvement, and professonal nowledge. It puts the three factors n the rows and related sectors of a ftness and health club n the columns of the correlaton coeffcent matrx to fnd out the correlaton between each factor and ts correspondng sector and determne mprovement plans for the correspondng sector. The analyss s as follows: Table 1: Correlaton Coeffcent Matrx Sector Factor Ftness Sector Membershp Affars Sector Maretng Sector Enterprse Image Relatonshp Involvement Professonal Knowledge Note: means drect correlaton Ftness Sector Enterprse Image Frst, ftness nstructors can enhance ther ablty n class management and communcaton, so that they can buld a good communcaton pattern, create a frendly classroom atmosphere, and mae the customers feel welcomed. Instructors should tae the ntatve n provdng necessary assstance and nstructon to customers so 134 Copyrght by author(s) Creatve Commons Lcense CC-BY 13 The Clute Insttute

9 Journal of Servce Scence 13 Volume 6, Number 1 that they can use the facltes comfortably. They should also clean the exercse rooms and chec f any faclty needs mantenance on a daly bass so as to provde a comfortable, clean and safe envronment for customers. Relatonshp Involvement Instructors can share wth the customers the latest, useful nformaton about health, sports products and actvtes through socal meda, bulletn boards or n person. They can also tae the ntatve n carng about the customers exercse status and share ther experence when the stuaton sees ft, so that they can create a bengn nteracton wth the customers. Professonal Knowledge Based on the courses they teach, nstructors should contnue to mprove themselves by acqurng the latest n professonal nowledge, nstructon methods and nformaton about njury preventon. By dong so, they are able to provde the customers wth the latest nformaton about sports njury preventon and best n professonal nstructon, whch n turn wll ncrease customer satsfacton toward teachng qualty. Member Affars Sector Enterprse Image Servce personnel n the member affars sector should mprove ther etquette. They should provde servces to customers n a sncere, thoughtful and polte manner and respond rapdly to customers needs or complants so as to mprove the ftness and health club s mage. Relatonshp Involvement Servce personnel n the member affars sector should tae steps to enhance customer relatonshp management. In addton to answerng customers questons actvely, they should tae the ntatve n provdng nformaton concernng customers rghts, such as change n course schedules, changes of openng hours, and annual sales promotons. Professonal Knowledge Servce personnel n the member affars sector should receve tranng n document management, and communcaton and admnstratve management so as to provde professonal and sncere servces to customers. In partcular, good documentaton and admnstratve management allows servce personnel to serve the customers n an effcent manner, whch n turn wll mprove customer satsfacton toward ftness and health clubs. Maretng Sector Enterprse Image Maretng personnel should help ftness and health clubs to produce reasonable prcng plans by gvng consderaton to ther proft-orented, quantty-orented, mage-orented and stablty-orented objectves as well as the factors of cost structure, maret demand, compettons, consumers, products, and maretng channels. By dong so, they can to mprove ther prcng strateges and enterprse mage. Relatonshp Involvement Maretng personnel should tae the ntatve n sharng nformaton regardng sales promotons through socal meda, company Web ste or telephone so as to ensure that customers can get the best deal thereby creatng a bengn nteracton and trustng relatonshp wth the customers. 13 The Clute Insttute Copyrght by author(s) Creatve Commons Lcense CC-BY 135

10 Journal of Servce Scence 13 Volume 6, Number 1 Professonal Knowledge Maretng personnel should enhance ther nowledge concernng products, marets and members. By dong so, they can mprove ther ablty to analyze and explan product features, customers needs, and maret characterstcs. They wll also be able to convey correct and comprehensve nformaton to consumers and answer customers questons wth confdence as well as address concerns about products, prces, and promotons. Control Ftness and health club operators mae mprovements based on the aforementoned strateges, and then evaluate the results wth the measurement methods proposed by ths study. If the results fal to meet the standard, the operators need to reexamne and revse the mprovement strateges untl the standard s met. If the results meet the standard, the operators need to mplement the step of control. Ths study establshes an mportance-satsfacton gap control mechansm n an effort to montor the relatonshp qualty of ftness and health clubs n an effectve manner. The test statstc T of the gap between the mportance and satsfacton levels obeys the ch square dstrbuton wth 1 degree of freedom, so the control lmt s as follows: UCL (1 ) Wˆ ( 1) CL.5 Wˆ ( 1) LCL Wˆ ( 1) Ftness and health club operators can montor the rs management performance wth the aforementoned upper control lmt, lower control lmt and center lne. If the performance falls outsde the control lmt, an mmedate examnaton and correcton s requred to ensure the relatonshp qualty of ftness and health clubs. IV. CONCLUSION AND SUGGESTIONS Concluson In the manufacturng ndustry, busness owners can elmnate poor qualty products through screenng and nspecton as an effort to reduce the defect rate. However, to ftness and health club operators, the process of provdng servces nvolves the partcpaton of customers. Therefore, whle provdng servces, ftness and health club operators need to gve consderaton to enterprse mage, customer relatonshp nvolvement and employees professonal nowledge to mprove customers trust and satsfacton and create good relatonshp qualty. Ths study adopts the qualty control mechansm and the performance evaluaton matrx of the DMAIC method n Sx Sgma to mprove the relatonshp qualty of ftness and health clubs. In the Sx Sgma qualty control mechansm, the frst step s defne, whch s to dentfy and examne defects serously affectng the relatonshp qualty; the second step s measure, whch s to examne defects durng the operatonal process; the thrd step s analyze, whch s to loo nto related data to see out the root cause of problems; the fourth step s mprove, whch s to remove the aforementoned defects durng the operatonal process; and the ffth step s control, whch s to examne the results of mprovements and sustan the results to avod the reoccurrence of defects. Furthermore, ths study adopts the concept of Hung et al. (3) and uses the nne performance boxes generated by the mportance-satsfacton matrx (wth mportance as the horzontal axs and satsfacton as the vertcal axs) of IPA to help ftness and health club managers to dentfy servces whch wll ensure hgh customer satsfacton. By ntroducng Sx Sgma and IPA nto the operaton and management of ftness and health clubs, managers can mprove relatonshp qualty n a consstent and effectve manner, create a compettve advantage, and ncrease operatonal performance. 136 Copyrght by author(s) Creatve Commons Lcense CC-BY 13 The Clute Insttute

11 Journal of Servce Scence 13 Volume 6, Number 1 Suggestons Suggeston to Management Practces Ths study adopts the Sx Sgma program to mprove the relatonshp qualty of ftness and health clubs. It s dscovered that enterprse mage, relatonshp nvolvement, and professonal nowledge are the three major factors that drectly mprove the relatonshp qualty of ftness and health clubs. Hence, ftness and health club operators should provde necessary on-the-job tranng to employees n order to mprove ther servce atttude, professonal slls and relatonshp qualty wth the customers. Suggeston for Future Studes Ths study adopts the Sx Sgma program to develop a measurement mechansm and to evaluate the relatonshp qualty of ftness and health clubs. It s suggested that future studes carry out expermental research on consumers of ftness and health clubs and specfcally dentfy factors and strateges to mprove the relatonshp qualty wth expermental data, the Sx Sgma qualty control mechansm, and the performance evaluaton matrx. AUTHOR INFORMATION Kue-Me Cheng, Ph.D., was born n Changhua, Tawan, R.O.C, on January 1, She receved the M. A. degree n health, physcal educaton and recreaton from Unversty of South Daota, USA, n 1997, and the DSM degree n sport management from Unted States Sports Academy, USA, n 4. In 4, she joned the faculty of Natonal Tawan Unversty of Physcal Educaton & Sport as an assocate professor n the department of sport management. Her areas of research nterest are consumer behavor, servce qualty and maretng strategy. E-mal: maycheng@yahoo.com.tw; ccme@ntupes.edu.tw REFERENCES 1. Bolos, J. (). Sx sgma meets the servce economy. Harvard Management, 7(1), Cheng, Y. S. (3). A Study on Busness Management of Clubs, unpublshed master s thess, Department of Busness Admnstraton, Natonal Tape Unversty. 3. Hung, Y. H., Huang, M. L., and Chen, K. S. (3). Servce qualty evaluaton by servce qualty performance matrx. Total Qualty Management, 14(1), Jang, H. L. (). A Study on Tawan s Ftness and Health Club Industry, unpublshed master s thess, Graduate Insttute Sport Coachng Scence, Chnese Culture Unversty, Tape Cty. 5. Lee, B. J. (3). The Applcaton of Sx-Sgma on Improvng Personal Factor Servce Qualty-The Case Study of Convenence Store, unpublshed master s thess, Department of Industral Management, Natonal Tawan Unversty of Scence and Technology. 6. Lee, H. H. & Wu, Q. Z. (3). Creatng compettve advantage wth the sx sgma-based organzatonal culture the case of Motorola. Qualty Control Journal. 7. Martlla, J. A., & James, J. C, (1977). Importance performance analyss. Journal of Maretng, 41, Pyzde, T. (1). The sx sgma. McGraw-Hll, New Yor, NY. 9. Tang, X. R. (3). An Exploratory Research of Health Club Membershp Retenton: The Case of Alexander Health Club, unpublshed master s thess, Graduate Insttute of Management, Natonal Tawan Unversty of Scence and Technology. 1. Wu, Z. F. (11). Applyng sx sgma to servce ndustres - the example of restaurant servce. Qualty Journal, 47(6), The Clute Insttute Copyrght by author(s) Creatve Commons Lcense CC-BY 137

12 Journal of Servce Scence 13 Volume 6, Number 1 NOTES 138 Copyrght by author(s) Creatve Commons Lcense CC-BY 13 The Clute Insttute