Defining and Measuring Service Quality Chapter 12 Defining and Measuring Service Quality

Chapter Objectives Discuss the differences and the similarities between service quality and customer satisfaction. Identify the gaps that influence consumer perceptions of service quality and discuss factors that influence the size of each of the service quality gaps. Understand the basic concepts of the SERQUAL measurement scale and how “gap scores” are calculated. Describe the variety of customer and noncustomer research approaches a service firm can use to construct a service quality information system. © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Opening Vignette: Pimalai Resort and Spa Epitomizes the five dimensions of service quality Tangibles, reliability responsiveness, assurance, and empathy Has been recognized for: Environmental protection Providing an authentic local experience Giving back to the community Cultural commitment Ninety percent of the flora and fauna found on the resort are indigenous to the area Indigenous wildlife live in harmony within the resort Flying dragon lizards, monkeys, and monitor lizards © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

What Is Service Quality? Service quality: an attitude formed by a long-term, overall evaluation of the firm’s performance Customer satisfaction A short-term, transaction-specific measure The two concepts are intertwined but their relationship is unclear Does customer satisfaction lead to perceived service quality or Does service quality lead to customer satisfaction? © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Figure 12.1: Conceptual Model of Service Quality © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Diagnosing Failure Gaps in Service Quality Gap 1: The knowledge gap Influenced by the firm’s: Research orientation Upward communication Levels of management © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Diagnosing Failure Gaps in Service Quality (cont’d) Gap 2: The standards gap Influenced by: Perceptions of feasibility Management’s commitment to the delivery of service quality vs. cost reduction and short-term profits No culture for service quality Insufficient methods of measuring quality or converting those measurements into standards Difficulties in attempts to write specifications for particular employee behaviors © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Diagnosing Failure Gaps in Service Quality (cont’d) Gap 3: The delivery gap Influenced by: Willingness to perform Employee-job fit Role conflict Role ambiguity Dispersion of control Learned helplessness Inadequate support © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Diagnosing Failure Gaps in Service Quality (cont’d) Gap 4: The communications gap Influenced by the: Propensity of overpromising Amount of horizontal communication © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Measuring Service Quality: The SERVQUAL Measurement Scale A diagnostic tool that uncovers a firm’s broad weaknesses and strengths in the area of service quality Consists of two sections of questions The first section is comprised of 22 questions that ask respondents to record their expectations of excellent firms in the specific service industry The second section of questions is comprised of 22 matching questions that assess consumer perceptions of a particular company in that service industry © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Measuring Service Quality: The SERVQUAL Measurement Scale (cont’d) When the mean expectation score is subtracted from the mean perception score, a “gap score” is created Positive gap scores reflect situations where perceptions exceed expectations and customers are happy Negative gap scores exist where perceptions that are less than expectations reflect unsatisfactory situations and customer unhappiness When the gap score equals zero, customer perceptions have met customer expectations, and consumers are satisfied © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Measuring Service Quality: The SERVQUAL Measurement Scale (cont’d) A 44-item scale that measures customer expectations and perceptions regarding five service quality dimensions © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Measuring Service Quality: The SERVQUAL Measurement Scale (cont’d) The Tangibles Dimension Measuring Service Quality: The SERVQUAL Measurement Scale (cont’d) The Reliability Dimension The Responsiveness Dimension The Assurance Dimension The Empathy Dimension © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

SERVQUAL: The Tangibles Dimension Tangibles expectations E1: Excellent companies will have modern-looking equipment E2: The physical facilities at excellent companies will be visually appealing E3: Employees of excellent companies will be neat in appearance E4: Materials associated with the service (such as pamphlets or statements) will be visually appealing in an excellent company Tangibles perceptions P1: XYZ has modern-looking equipment P2: XYZ’s physical facilities are visually appealing P3: XYZ’s employees are neat in appearance P4: Materials associated with the service (such as pamphlets or statements) are visually at XYZ © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

SERVQUAL: The Reliability Dimension Reliability expectations E5: When excellent companies keep a promise to do something by a certain time, they will do so E6: When customers have a problem, excellent companies will show a sincere interest in solving it E7: Excellent companies will perform the service right the first time E8: Excellent companies will provide their services at the time they promise to do so E9: Excellent companies will insist on error-free records Reliability perceptions P5: When XYZ promises to do something by a certain time, it does so P6: When you have a problem, XYZ shows a sincere interest in solving it P7: XYZ performs the service right the first time P8: XYZ provides its services at the time it promises to do so P9: XYZ insists on error-free records © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

SERVQUAL: The Responsiveness Dimension Responsiveness expectations E10: Employees of excellent companies will tell customers exactly when services will be performed E11: Employees of excellent companies will give prompt service to customers E12: Employees of excellent companies will always be willing to help customers E13: Employees of excellent companies will never be too busy to respond to customer requests Responsiveness perceptions P10: Employees of XYZ tell you exactly when service will be performed P11: Employees of XYZ give you prompt service P12: Employees of XYZ are always willing to help you P13: Employees of XYZ are never too busy to respond to your requests © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

SERVQUAL: The Assurance Dimension Assurance expectations E14: The behavior of employees of excellent companies will instill confidence in customers E15: Customers of excellent companies will feel safe in their transactions E16: Employees of excellent companies will be consistently courteous with customers E17: Employees of excellent companies will have the knowledge to answer customer questions Assurance perceptions P14: The behavior of employees of XYZ instills confidence in customers P15: You feel safe in your transactions with XYZ P16: Employees of XYZ are consistently courteous with you P17: Employees of XYZ have the knowledge to answer your questions © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

SERVQUAL: The Empathy Dimension Empathy expectations E18: Excellent companies will give companies individual attention E19: Excellent companies will have operating hours convenient for all their customers E20: Excellent companies will have employees who give customers personal attention E21: Excellent companies will have the customer’s best interest at heart E22: The employees of excellent companies will understand the specific needs of their customers Empathy perceptions P18: XYZ gives you individual attention P19: XYZ has operating hours convenient to all its customers P20: XYZ has employees who give you personal attention P21: XYZ has your best interests at heart P22: Employees of XYZ understand your specific needs © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Criticisms of SERVQUAL Length of the questionnaire Expectation and perception questions seem redundant What’s the value of including the expectation section? The validity of the five dimensions The five proposed dimensions of service quality do not hold up under statistical scrutiny Measurement issues © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Figure 12.2: The Diagnostic Advantage of SERVQUAL Scores © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Figure 12.3: Relative Importance of SERVQUAL Dimensions as Reported by Consumers © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

SERVQUAL: Some Final Thoughts Contact personnel is important Process is as important as outcome Consumer perceptions are unpredictable Despite its critics, SERVQUAL remains an often-used instrument to assess service quality © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Service Quality Information Systems Solicitation of customer complaints Primary objectives of soliciting customer complaints: Identify unhappy customers Identify weaknesses in the firm’s service delivery system and take the correction actions necessary to minimize future occurrences of the same problem After-sales surveys A more proactive approach to assessing customer satisfaction than solicitation of complaints Attempts to contact every customer and take corrective action if a customer is less than satisfied with his or her purchase decision The survey is taken while the encounter is fresh on the customer’s mind © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Service Quality Information Systems (cont’d) Customer focus group interviews Participants are encouraged to express their views and comment on suggestions made by others in the group Other forms of research are generally necessary to confirm that the groups’ ideas reflect the feelings of the broader segment of consumers Mystery shopping Measures individual employee behavior Aids the firm in coaching, training, evaluating, and formally recognizing its employees © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Service Quality Information Systems (cont’d) Employee surveys Employee satisfaction with the firm directly corresponds to customer satisfaction Employee surveys should examine morale, attitudes, and perceived obstacles Total market service quality surveys Assesses the firm’s service quality and its competitors’ perceived service quality Provide a firm with information about needed improvements in the service delivery system and measure the progress the firm has been making in previously identified areas of need © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Service Quality Information Systems (cont’d) Listening Quality is defined by the customer Conformance to company specifications is not quality; conformance to customers’ specifications is Reliability The core of service quality Little else matters to a customer when a service is unreliable Basic service Deliver the basics first; the frills can come later © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Service Quality Information Systems (cont’d) Service design Design flaws can reduce the perception of quality Recovery Firms that do not respond effectively to customer complaints compound the service failure Surprising customers Exceeding customer expectations Fair play Customers expect to be treated fairly and will become resentful and mistrustful if treated otherwise © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Service Quality Information Systems (cont’d) Teamwork Service team building should not be left to chance Employee research Is as important to service improvement as customer research Servant leadership Leadership must serve the servers—inspiring, coaching, and enabling them to achieve © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.