LEARNING OBJECTIVES

What is Service Quality? Dimensions of Service Quality Gap Model Service & Statistical Process Control Unconditional Service Guarantee Walk-Through-Audit Service Recovery and Service Recovery Framework Current Trends in Service Quality Case Study on Gap Analysis
OSI 2

WHAT IS SERVICE QUALITY?

The totality of features and characteristics of a product or service that bear on its ability to satisfy stated or implied needs is called Quality. (Kotler) Customers also form perceptions of quality during the service transactions such as: i. How effectively service was delivered ii. How efficiently service was delivered iii. Speed & Convenience of completing service transaction iv. Support activities that occur after the transaction-Post Sale Services Example: Hotel Check-in and Check out Services being offered, McDonalds Services Being Offered
OSI 3

WHAT IS SERVICE QUALITY?

Service Quality can also be defined according to both the what and how a product or service is delivered. Gronroos distinguished between Technical quality and Functional quality. Technical Quality is concerned with the outcome of the delivered service. Customers use service quality dimensions/attributes such as reliability, competence, performance, durability, etc. to evaluate technical quality. Functional Quality is more to do with how the technical quality is transferred to the customer. Service quality attributes such as responsiveness and access would measure functional quality of the service transaction. 4
OSI

CONTINUUM OF SERVICES

Pre-sale Services

Transaction Services

Post-sale Services

Defining quality for Services is more difficult than for products because of the intangible, variable nature of service characteristics. Unlike product quality, customers frequently lack the necessary information to evaluate service quality. In assessing service quality, the services are viewed along a continuum ranging from pre-sale to post-sale activities. OSI 5

DIMENSIONS OF SERVICE QUALITY

Reliability perform promised service dependably and accurately Responsiveness - willingness/readiness to provide prompt service

Competence - possess knowledge and skill to perform the service

Access - approachability and ease of contact of service personnel Courtesy - politeness, consideration, and friendliness of service personnel
OSI 6

DIMENSIONS OF SERVICE QUALITY

Communication - keeping customers informed; listening to customers Credibility - trustworthy, believable, honest Security - freedom from danger, risk, or doubt Understanding / customers needs knowing customer knowing

Tangibles - physical evidence of service

OSI

SERVICE QUALITY GAP MODEL Service Quality Gap Model Customer Customer
Perceptions
Managing the Evidence
Customer Satisfaction GAP 5

Expectations
Understanding the Customer

Communication GAP 4

Customer / Marketing Research GAP 1

Service Delivery
Conformance GAP 3

Management Perceptions of Customer Expectations

Design GAP 2

Conformance

Service Standards
OSI

Service Design

GAPS IN SERVICE QUALITY

GAP 1: Managements Lack of understanding how customers formulate their expectations on the basis advertising, past experiences. GAP 2: Lack of managements commitment to service quality. GAP 3: Actual Delivery does not meet specifications set by management. GAP 4: Discrepancy between service delivery & external communication in the form of exaggerated promise.
OSI 9

QUALITY SERVICE BY DESIGN

Quality in the Service Package - Budget Hotel example Taguchi Methods (Robustness) - Notifying maids of rooms for cleaning Poka-yoke (Fool-proof) - Height bar at amusement park

Quality Function Deployment - House of Quality

OSI

10

CLASSIFICATION OF SERVICE FAILURES WITH POKA-YOKE OPPORTUNITIES

Server Errors
Task: 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

OSI

11

HOUSE OF QUALITY
Relationships

*
O O O

Strong Medium Weak

Informatiion

Equipment
5 2

Capacity

Training

Attitude

Customer Expectations Reliability Responsiveness Assurance Empathy Tangibles 9 7 6 4 2

Comparison with Volvo Dealer

Weighted score Improvement difficulty rank

Relati ve
Servic e Elements Im po rta nc e 8 3 5 2

Customer Perc eptions o Village Volvo

+ Volvo Dealer
1 2 3 4 5 + o o

5 9 9 7 3 6

+
o o o

+ +
3

+
o o o o o

_
127 82 4 5

63 102 1 3

65 2

OSI

12

COSTS OF SERVICE QUALITY (BANK EXAMPLE)

Failure costs
External failure:
Customer complaints Warranty charges Liability insurance Legal judgments Loss of future service Peer review Supervision Customer feedback card Inspection

Detection costs

Prevention costs
Quality planning Training program Quality audits Data acquisition & analysis Recruitment and selection

Internal failure:
Scrapped forms and reports Systems/Machines downtime
OSI 13

SERVICE PROCESS CONTROL

Customer input Service concept Customer output

Resources

Service process

Take corrective action Identify reason for nonconformance

Monitor conformance to requirements

Establish measure of performance

OSI

14

STATISTICAL PROCESS CONTROL (SPC)

SPC uses statistics & control charts to tell when to adjust process. Involves Creating standards (upper & lower limits) Measuring sample output (e.g. mean weight) Taking corrective action (if necessary)

OSI

15

PROCESS CONTROL CHART

Plot of Sample Data Over Time
80

Sample Value

60 40 20 0 1 5 9 13 Time 17 21

Sample Value UCL Average LCL

UCL p 3

p (1 p n
OSI

LCL p 3

p (1 p n
16

UNCONDITIONAL SERVICE GUARANTEE: CUSTOMER VIEW

Unconditional (L.L.Bean) Easy to understand and communicate (Bennigan) Meaningful (Dominos Pizza) Easy to invoke (Cititravel) Easy to collect (Manpower)

OSI

17

OSI

18

UNCONDITIONAL SERVICE GUARANTEE: MANAGEMENT VIEW

A Guarantee forces you to focus on customers A Guarantee sets clear Standards A Guarantee generates feedback A Guarantee forces you to demand why you fail A Guarantee builds customer loyalty

OSI

19

CUSTOMER SATISFACTION
All customers want to be satisfied. Customer loyalty is only due to lack of better alternatives.

Giving customers some extra value by exceeding their expectations will delight them and ensure their return.

OSI

20

CUSTOMER FEEDBACK AND WORDOF-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.

OSI

21

CUSTOMER FEEDBACK AND WORDOF-MOUTH

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.

OSI

22

WALK-THROUGH-AUDIT
Service delivery system should conform to customer expectations. Customer impression of service influenced by use of all senses. A walkthrough audit (WTA) is a customer-focused survey to uncover areas for improvement . Service managers lose sensitivity due to familiarity. Need detailed service audit from a customers perspective

OSI

23

SERVICE RECOVERY
Service Recovery - Doing whatever it takes to solve a customers problem and doing it quickly. Service failure to service delight empower employees. Understanding the difference between Customer Service & Service Recovery. Focus on Service Recovery by a) Acting quickly b) Taking responsibility c) Being empowered d) Compensating the customer Most customer problems are caused by bad systems, not bad people. 24 Key Customer Retention OSI

SERVICE RECOVERY FRAMEWORK

Pre-Recovery Phase

Immediate Recovery Phase

Follow-Up Phase

Pre-Recovery Phase presents customers expectations and includes service guarantee. Immediate Recovery Phase Training and empowerment of frontline employees. Follow-Up Phase Encouraging customers to return.
OSI 25

Severity Of Failure
Service Failure Occurs

Perceived Service Quality

Psychological -empathy -apology Provider Aware of Failure

Tangible -fair fix -value add

Fair Restitutio n

Psychological -apology -show interest

Patronag e

Service Recovery Expectations

Service Recovery

Follow-up Service Recovery

Loyalty Satisfactio n Retention

Customer Loyalty

Service Guarantee

Speed of Recovery

Frontline Discretion

Tangible -small token

Pre-recovery Phase

Immediate Recovery Phase

Follow-up Phase

Service Recovery Framework

OSI 26

APPROACHES TO SERVICE RECOVERY

Case-by-case approach Address each customers complaint individually. Systematic-response approach Using a protocol to handle customer complaints. Early Intervention approach Add another component to systematic response approach by attempting to intervene and fix service process problems before they affect the customer. Alternate approach Capitalize on rivals failure to win their customer by providing a substitute service recovery.
OSI 27

CURRENT TRENDS IN SERVICE QUALITY

Quality management is not dead it continues to evolve. Six Sigma Initiatives will be successful when they are managed as a project. Lean management will become more important to organizations seeking continuous improvement. Quality standards will move beyond the realm of work processes into job functions. Quality departments will undertake Strategic Quality Planning.

OSI

28

CASE STUDY: THE MUSEUM OF ART AND DESIGN

Private Museum Located in Helsinki, Finland. Built in the 20th century. Languages available - Finnish and Swedish. Basic Goal is to educate people about Design. Progression in the Exhibit Range. Variants such as Private Cafe and gift shop. Budget - Government Funding and Operating Revenues. Competitors, Design Forum- the University of Design Museum and the Finnish National Museum.
OSI 29

WALK-THROUGH AUDIT
Survey questionnaire to evaluate the service quality on customer perspective. Identifying gaps between managers and customers. Audit Conducted by students of Helsinki School Of Economics and Business Administration. To discover the misconceptions of Visitors. Questionnaire was circulated to visitors and Museum staff. Statistical analysis was used in order to find the gaps between museum personnel and visitors.
OSI 30

WTA GAP ANALYSIS

Categories
Awareness of Exhibits

Visitors perception

Management Perception

News papers, Magazines, Word of Magazines, Radio, Word of Mouth Mouth

Information
Experience

Less awareness of services and lack of Information

High awareness of services, Easy Information Source

1) Appreciation of Multi 1) Inconclusive about their dimensional aspects importance 2) Unsure about new Experiences 2) Same as Visitors

Visitor Habits
Facilities

1) Visited in groups of 2/3 2) Selective Exhibits gained attention

Favorable opinion

1) Visited alone 2) Every Exhibit gained equal attention

Less favorable

Language

No issues
OSI

No issues
31

RECOMMENDATIONS FOR CLOSING THE GAPS

Above Identified gaps are basically differences between Customer expectations and Managements perceptions of Customer Expectations. Awareness of Exhibits Wide Market Research and better communication with Visitors Identifying the correct promotional strategy will result in better turnaround of Visitors. Information Analyzing the issue by putting on Customer shoes, Communicating with loyal Customers. Better Interaction will result in improved service Quality. Increased Importance on Human guides compared to selfguided materials. OSI 32

RECOMMENDATIONS
Experience Introduction of new audio, visual aids Having more interactions and different kinds of demonstration processes on a trial basis Visitor Habits Automatic sensor system in identifying traffic at each Exhibits Analyzing the interests of visitors in both groups and singles Facilities Visitors are satisfied with the food value in cafe, gifts in Gift shops, cleanliness of restrooms etc. Language Visitors and Management agree due to the less frequency of non-native visitors It should be addressed by introducing universal languages such as English, Spanish in order to attract tourist population.
OSI

33

CONCLUSION
Improvement in service design and delivery helps achieve higher levels of service quality. For example, in service design, changes can be brought about in the design of service products and facilities. In service delivery, changes can be brought about in the service delivery processes and the environment in which the service delivery takes place. Various techniques can be used to make changes such as Quality function deployment (QFD) In order to ensure and increase the 'conformance quality' of services, various methods are available. Some of these include Setting standards and measuring; Statistical process control and Customer involvement. Key to Service Quality Customer Retention
OSI 34

BIBLIOGRAPHY
http://www.bus-ex.com/article/customer-service-recovery www.bia.ca/articles/FutureTrendsinQualityManagementl.html Service Management by James Fitzsimmons and Mona Fitzsimmons Wikipedia http://uwmktg301.blogspot.in/2010/02/service-recoveryservice-recovery-can.html

OSI

35

OSI

36