Chapter 06 Service Quality

Transcription

1 Chapter 06 Service Quality McGraw-Hill/Irwin Service Management: Operations, Strategy, and Information Technology, 6e Copyright 2008 by The McGraw-Hill Companies, Inc. All Rights Reserved.

2 Moments of Truth Each customer contact is called a moment of truth. You have the ability to either satisfy or dissatisfy them when you contact them. A service recovery is satisfying a previously dissatisfied customer and making them a loyal customer. 6-2

3 Perceived Service Quality Word of mouth Personal needs Past experience Service Quality Dimensions Reliability Responsiveness Assurance Empathy Tangibles Expected service Perceived service Service Quality Assessment 1. Expectations exceeded ES<PS (Quality surprise) 2. Expectations met ES~PS (Satisfactory quality) 3. Expectations not met ES>PS (Unacceptable quality) 6-3

4 Dimensions of Service Quality Reliability: Perform promised service dependably and accurately. Example: receive mail at same time each day. Responsiveness: Willingness to help customers promptly. Example: avoid keeping customers waiting for no apparent reason. 6-4

5 Dimensions of Service Quality Assurance: Ability to convey trust and confidence. Example: being polite and showing respect for customer. Empathy: Ability to be approachable. Example: being a good listener. Tangibles: Physical facilities and facilitating goods. Example: cleanliness. 6-5

6 Service Quality Gap Model Service Quality Gap Model Customer Perceptions Customer Satisfaction GAP 5 Customer Expectations Managing the Evidence Service Delivery Communication GAP 4 Conformance GAP 3 Conformance Service Standards Customer / Marketing Research GAP 1 Design GAP 2 Understanding the Customer Management Perceptions of Customer Expectations Service Design 6-6

7 Measuring Service Quality is challenge because customer satisfaction is determined by intangible factors. Contains many psychological fetures (ambiance of a restaurant) Has an impact on a person s future quality of life (healthcare) Multiple dimensions of service quality are captured in the SERVQUAL instrument...\servqual_forms.doc

8 Quality Service by Design Quality in the Service Package Budget Hotel example Poka-yoke (fail-safing) Height bar at amusement park Quality Function Deployment House of Quality 6-8

9 Classification of Service Failures Task: Server Errors Doing work incorrectly Treatment: Failure to listen to customer Tangible: Failure to wear clean uniform Customer Errors Preparation: Failure to bring necessary materials Encounter: Failure to follow system flow Resolution: Failure to signal service failure 6-9

10 House of Quality Relationships * Strong Medium Relative Service Elements Importance Customer Expectations Reliability Responsiveness Assurance Empathy Tangibles Comparison with Volvo Dealer Training O O Attitude Capacity Informatiion Equipment _ * * o o o o o O Weak Customer Perceptions o Village Volvo + Volvo Dealer o o + o o o Weighted score Improvement difficulty rank

11 Achieving Service Quality Cost of Quality (Juran) Statistical Process Control (Deming) Unconditional Service Guarantee 6-11

12 Costs of Service Quality (Bank Example) Failure costs Detection costs Prevention costs External failure: Process control Quality planning Loss of future business Peer review Training program Negative word-of-mouth Supervision Quality audits Liability insurance Customer comment card Data acquisition and analysis Legal judgments Inspection Recruitment and selection Interest penalties Supplier evaluation Internal failure: Scrapped forms Rework Recovery: Expedite disruption Labor and materials 6-12

13 Control Chart of Departure Delays Percentage of ontime flights expected Lower Control Limit UCL p 3 p(1 n p LCL p 3 p(1 n p 6-13

14 Unconditional Service Guarantee: Customer View Unconditional (L.L. Bean) Easy to understand and communicate (Bennigan s) Meaningful (Domino s Pizza) Easy to invoke (Cititravel) Easy to collect (Manpower) 6-14

15 Unconditional Service Guarantee: Management View Focuses on customers (British Airways) Sets clear standards (FedEx) Guarantees feedback (Manpower) Promotes an understanding of the service delivery system (Bug Killer) Builds customer loyalty by making expectations explicit 6-15

16 Customer Satisfaction All customers want to be satisfied. Customer loyalty is only due to the lack of a better alternative Giving customers some extra value will deligh them by exceeding their expectations and insure their return 6-16

17 Customer Feedback and Word-of-Mouth The average business only hears from 4% of their customers who are dissatisfied with their products or services. Of the 96% who do not bother to complain, 25% of them have serious problems. The 4% complainers are more likely to stay with the supplier than are the 96% non-complainers. About 60% of the complainers would stay as customers if their problem was resolved and 95% would stay if the problem was resolved quickly. A dissatisfied customer will tell between 10 and 20 other people about their problem. A customer who has had a problem resolved by a company will tell about 5 people about their situation. 6-17

18 Walk-Through-Audit Service delivery system should conform to customer expectations. Customer impression of service influenced by use of all senses. Service managers lose sensitivity due to familiarity. Need detailed service audit from a customer s perspective. 6-18

19 Service Recovery Framework Severity Of Failure Perceived Service Quality Psychological -empathy -apology Tangible -fair fix -value add Psychological -apology -show interest Patronag e Service Recovery Expectations Service Recovery Follow-up Service Recovery Loyalty Satisfaction Retention Customer Loyalty Service Guarantee Speed of Recovery Frontline Discretion Tangible -small token Service Failure Occurs Provider Aware of Failure Fair Restitutio n Pre-recovery Phase Immediate Recovery Phase Follow-up Phase 6-19

20 Approaches to Service Recovery Case-by-case addresses each customer s complaint individually but could lead to perception of unfairness. Systematic response uses a protocol to handle complaints but needs prior identification of critical failure points and continuous updating. Early intervention attempts to fix problem before the customer is affected. Substitute service allows rival firm to provide service but could lead to loss of customer. 6-20

21 Topics for Discussion How do the five dimensions of service quality differ from those of product quality? Why is measuring service quality so difficult? Illustrate the four components in the cost of quality for a service. Why do service firms hesitate to offer a service guarantee? How can recovery from a service failure be a blessing in disguise? 6-21