OPSM 405 Service Management Class 5: Introduction to Service Quality Chapter 8 Koç University Zeynep Aksin

Defining Service Quality  Specifications –Company: Standard operating procedures –Customer: Personal expectations  Misalignment of company and customer specifications can lead to dissatisfaction, even if the service is delivered as designed

Customer assesment of service quality: The SERVQUAL model Dimensions of service quality tangibles reliability responsiveness competence courtesy credibility security access communication understanding the customer Perceived service quality expected service perceived service word of mouthpersonal needspast experience external communication

The customer gap Expected service Perceived service

Search-experience-credence properties Most goods Most services ClothingJewelryFurnitureHousesAutomobilesRestaurantMealsVacationHaircutsChild careTV repairLegalservicesRoot canalAuto repairMedicaldiagnosis

Stages in consumer decision making  Need recognition: customer has a need to fulfill or problem to solve  Information search: customer seeks out information to satisfy need  Evaluation of alternatives: selects a subset of alternatives and evaluates them  Purchase: chooses brand and buys  Purchase outcome: customer evaluates choice made and decides whether it meets expectations

Information search for services  Typically personal sources are used: –mostly due to experience type qualities of services –Also because many services are local –Not much advertising  Postpurchase information seeking is more common  More perceived risk in purchasing services

Evaluation of alternatives for services  A much smaller evoked set typically –Competing services not displayed together as in supermarkets for example –Firms offering the exact same service in same locality is less common –Difficulty of obtaining sufficient purchasing information  An important contender is self-service

Service purchase and consumption  Mood and emotion matters –Mood and emotions may influence customer behavior –Mood and emotion bias the way customers judge service encounters –Moods and emotion may affect the way information is absorbed and retrieved

Postpurchase evaluation for services  Dissatisfaction may be attributed to ones self more; service customers complain less  Innovations diffuse less –Intangible so features can’t be displayed –They are typically unique to buyer so hard to generalize –Can’t test on a limited basis-can’t be sampled –New service may require behavior change which is hard to do  Service consumers tend to be more brand loyal

Customer assesment of service quality Dimensions of service quality tangibles reliability responsiveness competence courtesy credibility security access communication understanding the customer Perceived service quality expected service perceived service word of mouthpersonal needspast experience external communication

Customer expectation levels High Low Ideal expectations: everyone says this restaurant is the best in town and I want to go there for my anniversary Normative should expectations: it is expensive but it should be good Experience based norms: Most times this restaurant is quite good Acceptable expectations: I expect the restaurant to be adequate Minimum tolerable expectations: I expect terrible service since the price is very low

Zone of tolerance Desired service Adequate service Zone of tolerance

Two important facts  Different customers have different zones of tolerance  Zones of tolerance differ by importance attributed to service dimension

Important questions to contemplate  Should providers underpromise?  Should companies try to delight?  Do customer expectation escalate?

Customer perceptions  Interaction quality+physical environment quality+outcome quality => service quality  Service quality+product quality+price => customer satisfaction  Perceived service quality is a component of customer satisfaction

The five dimensions of service quality  tangibles: how do I look?  reliability: am I keeping promises?  responsiveness: am I prompt and willing?  assurance: am I capable, polite, and credible?  empathy: do I care? Do I individualize?

Examples of five service quality dimensions ReliabilityResponsivenessAssuranceEmpathyTangibles Medical care Appointments on schedule; accurate diagnoses Accessible, no waiting, willingness to listen Knowledge, skills, credentials, reputation Acknowledge s patient as a person, remembers previous problems Waiting room, exam room, equipment, written materials AirlineFlights on time as announced in schedule Prompt and speedy system fro ticketing, in- flight bagagge handling Trusted name, good safety record, competent employees Understands and anticipates customer needs Aircraft, ticketing counters, baggage area, uniforms

Recall: service encounters as foundations of service quality  Series of episodes  Simple or complex  Affects consumer body, mind, emotions  Focus on consumer, service provider, physical evidence in designing

Sources of pleasure displeasure in service encounters  Recovery: how employees respond to service failure  Adaptability: employee response to customer needs and requests  Spontaneity: unprompted and unsolicited employee actions  Coping: employee response to problem customers

General service behaviors: Dos and Don’ts  Recovery: acknowledge problem, explain cause, apologize, compensate/upgrade, lay out options, take responsibility  Ignore customer, blame customer, leave customer to fend for herself, downgrade, act as if nothing is wrong

General service behaviors: Dos and Don’ts  Adaptability: recognize the seriosness of the need, acknowledge, anticipate, attempt to accommodate, adjust the system, explain rules and policies, take responsibility  Ignore, promise but fail to follow through, show unwillingness to try, embarrass the customer, laugh at the customer, avoid responsibility

General service behaviors: Dos and Don’ts  Spontaneity: take time, be attentive, anticiapte needs, listen, provide information, show empathy  Exhibit impatience, ignore, yell, laugh, or swear, steal from customers, discriminate

General service behaviors: Dos and Don’ts  Coping: listen, try to accommodate, explain, let go of the customer  Take customer dissatisfaction personally, let customer dissatisfaction affect others