Service Quality

Indira Gandhi International Airport named world's second best airport for service quality June 5, 2014 | PTI NEW DELHI: For the third year in a row, Indira Gandhi International Airport here has been adjudged the second best airport in the world for its service quality among the airports handling 25-40 million passengers per annum (MPPA). Mumbai's Chhatrapati Shivaji International Airport was placed at the fifth position in this category by the Airport Council International (ACI). ACI is a global body of airports which represents their...

TRAI seeks public views on relaxing service quality norms May 21, 2014 | PTI NEW DELHI: Telecom regulator TRAI has sought public opinion on relaxing fixed line and mobile phone service quality norms on issues like fault repair, false billing, response from customer care and other consumer grievances. Telecom Regulatory Authority of India (TRAI) can impose a penalty up to Rs 10 lakh per violation if a telecom operator fails to meet quality of service (QoS) standards laid down by it for fixed lines and mobile phones. In their feedback to TRAI,...

Bharti Airtel does a ‘quality’ check to beat competition blues April 8, 2014 | ET Bureau NEW DELHI: Sharad Jaiswal, vice-president at Bharti Airtel-owned retail stores segment, was recently at an outlet that sells SIM cards and other services. Dressed in a red Airtel T-shirt as trainees do, he spoke to customers and realised one of the most common problems — they dislike the 24-hour wait to get new connections activated. For the 38-year-old executive, who has been with India's largest mobile phone operator for two years, it was a...

China’s health care system is ailing, and the prognosis for a cure in the near future is not good. Underlying some of China’s most basic health care challenges is the “wide but shallow distribution of health insurance,” says Burns. Recent reforms have extended health care to 95% of the population — most of whom have never had insurance before — a development that has caused serious strains on the delivery system. Now that consumers have access, “everyone wants to go to the major academic health centers, which means there are enormous lines starting early in the morning to get in and see a specialist,” says Burns, who toured several health care facilities during his teaching week. Not everyone gets through the line, however, and people who do get in don’t always get the results they want.

Service Quality Customers form perceptions of quality during the service transaction - how effectively and efficiently the service was delivered and the speed and convenience of completing the transaction Customers evaluate support activities that occur after the transaction, that is post-sale services

Definitions of Service Quality Service quality can be defined according to both the what and how a product or service is delivered. Gronroos distinguishes between“technical quality” and “functional quality”.

Definitions of Service Quality ■ Technical Quality is concerned with the outcome of the delivered product or service. Customers use service quality attributes such as reliability, competence, performance, durability, etc. to evaluate technical quality. ■Functional Quality has more to do with how the technical quality is transferred to the consumer. Service quality attributes such as responsiveness and access would be important in helping the customer judge the functional quality of the service encounter.

Mapping Service Quality Parasuraman and his colleagues found that service quality is a measure between service perceptions as well as expectations Service quality stems from a comparison of what a consumer feels a service firm should offer (desires or wants) versus their perception of what the service firm actually does offer Ensuring good service quality involves meeting or exceeding consumers’ expectations

Measuring service quality ( Parasuraman, Zeithaml & Berry) Reliability Responsiveness Service Quality Assurance Empathy Tangibles

Service Quality Dimensions Reliability: Delivering on Promises Responsiveness: Being Willing to Help Assurance: Inspiring Trust and Confidence Empathy: Treating Customers as Individuals Tangibles: Representing the Service Physically

How Customers Judge the Five Dimensions of Service Quality

Activity What do the five dimensions of service quality mean in the context of : (a) a hotel (b) a bank?

The Gaps Model of Service Quality Consumer Past experience Expected service Perceived service Service delivery (including pre- and post-contacts) External communications to consumers Translations of perceptions into service quality specifications Management perceptions of consumer expectations GAP 5 GAP 3 GAP 2 GAP 1 GAP 4 Personal needs Word-of-mouth communications Marketer

The Customer Gap Expected Service Customer Gap Perceived Service

Customer expectations Reasons for Customer Gap Customer expectations Not knowing what customers expect Not selecting the right service standards and designs Not delivering to service standards Not matching performance to promised Customer perceptions

Provider Gaps To close the Customer Gap – the provider gaps need to be closed These gaps occur within the organization providing the service

Provider Gaps Not knowing what customers expect Not selecting the right service standards and designs Not delivering to service standards Not matching performance to promised

Provider Gaps The Listening Gap The Service design and standards gap The service performance gap The communication gap

IKEA “Putting customers in the ‘wish mode’ is an innovative approach that proved successful for IKEA, the world’s largest furniture retailer, when it opened its Chicago retail outlet. In this approach, nine groups of a dozen customers each were asked to dream up their idea shopping experience. They were told to pretend that all IKEA stores had been destroyed and new ones had to be designed from scratch. How would the store look? What would the shopping experience be like? Jason Magidson, who helped IKEA create the process, reported that customers responded with statements like the following: “I never feel disoriented because I always know exactly where I am in relation to every department”, “If I am buying one item, all of the other items that go with it are nearby”, ‘Shopping is a pleasant, relaxing experience.’

Even though they were not technical experts, customers were asked to actually draw up a design for a store that would satisfy their needs. What is significant about IKEA’s approach is not just that the company asked customers what they expected but that they subsequently incorporated these expectations into the service design for the store. Designers created a multistory octagonal building with an atrium (the central area in a building lighted from above) in the centre that formed a home base for shoppers, addressing their concern about being able to find items easily. In keeping with another customer expectation, items were grouped together with related products. When shoppers were tired or hungry, they could go to the cafeteria-style restaurant on the upper floor that served Swedish food. IKEA’s customers were so satisfied with the store (85% rated it as “excellent” or “very good”) that they returned more and spent about an hour longer than they did in other IKEA stores.  

The company’s supplier network is carefully chosen and managed to ensure quality and consistency. Despite the fact that the company has stores in more than 20 countries, it keeps standards, designs, and approaches very consistent everywhere. Servicescapes – the indoor and outdoor physical environments – are unique and customer focused. IKEA is also well known for its strong employee culture and careful hiring and training. Further, it has an innovative service concept that involves customers in the delivery, assembly and creation of its products. To accomplish this service, the company educates its customers thoroughly with its script-like catalogs.”

Provider Gap 1 It is the difference between customer expectations of service and company’s understanding of those expectations

Customer’s expectations Company’s perceptions of customer expectations Reasons for provider gap I Customer’s expectations Inadequate marketing research orientation Lack of upward communication Insufficient relationship focus Inadequate service recovery Company’s perceptions of customer expectations

What may be done…. Marketing Research to capture information about customer expectations Management needs to be in close contact with frontline employees Relationship marketing Appropriate service recovery strategies

Provider Gap 2 It is the difference between company understanding of customer expectations and development of customer-driven service design and standards

Translation of perceptions into service quality specifications Reasons for provider gap 2 Poor service design Absence of customer-defined service standards Inappropriate physical evidence and servicescape Management perceptions of customer expectations

What may be done……. Clearly design services using tools such as service blueprinting Develop customer-defined service standards Utilize strategies for effectively designing physical evidence and the servicescape to meet customer expectations

Provider Gap 3 It is the discrepancy between development of customer-driven service standards and actual service performance by company employees

Customer-driven service designs and standards Reasons for provider gap 3 Customer-driven service designs and standards Poor human resource policies Failure to match supply and demand Customer not fulfilling their roles Problems with service intermediaries Service delivery

What may be done …… Issues related to the company’s human resource function need to be addressed Understanding customer roles and how customers can themselves influence service delivery and outcomes A firm must develop ways to either control or motivate these intermediaries to meet company goals

Provider Gap 4 It is the difference between service delivery and the service provider’s external communications

External communications to consumers Reasons for provider gap 4 Lack of integration of marketing communications Inadequate management of customer expectations Over promising Inadequate horizontal communications Service delivery

What may be done…… Effective co-ordination of actual service delivery with external communications Manage all communications to customers so that inflated promises do not lead to higher expectations

PROCESS MODEL FOR CONTINUOUS MEASUREMENT AND IMPROVEMENT OF SERVICE QUALITY DO YOUR CUSTOMERS PERCEIVE YOUR OFFERINGS AS MEETING OR EXCEEDING THEIR EXPECTATIONS? YES CONTINUE TO MONITOR CUSTOMERS’ EXPECTATIONS AND PERCEPTIONS NO DO YOU HAVE AN ACCURATE UNDERSTANDING OF CUSTOMERS’ EXPECTATIONS? NO TAKE CORRECTIVE ACTION YES ARE THERE SPECIFIC STANDARDS IN PLACE TO MEET CUSTOMERS’ EXPECTATIONS? NO TAKE CORRECTIVE ACTION YES DO YOUR OFFERINGS MEET OR EXCEED THE STANDARDS? NO TAKE CORRECTIVE ACTION YES NO IS THE INFORMATION COMMUNICATED TO CUSTOMERS ABOUT YOUR OFFERINGS ACCURATE? TAKE CORRECTIVE ACTION YES 35

SERVQUAL A gap analysis research instrument Created by Parasuraman, Zeithamel, and Berry Introduced in 1988 The marketing research team of Parasuraman, Zeithamel, and Berry created this service quality measuring tool in 1988 Has been used in a wide range of studies including fields such as health care, banking, appliance repair, and many other professions Five Gaps include Customer expectations vs. managerial perceptions Manager’s expectations of quality vs. quality specs Communication with customer at point of service or sale Service delivery vs. communication Perceived services vs. expected services SERVQUAL is not a measurement to compare and rank separate companies but only to provide a measure for managers to determine actions needed in their own services

Servqual Data - How Useful is it? We can compare the expectations and perceptions of different customer groups We can assess the expectations and perceptions of internal customers

Servqual Instrument There are 22 items which can be rated i.e. modern looking equipment, prompt service, understanding of needs, etc. These items are broken up into 5 dimensions: Tangibles (Items 1-4) Reliability (Items 5-9) Responsiveness (Items 10-13) Assurance (Items 14-17) Empathy (Items 18-22) Tangibles: appearance of physical facilities, equipment, personnel, and communication materials Reliability: ability to perform the promised service dependably and accurately Responsiveness: willingness to help customers and provide prompt service Assurance: knowledge and courtesy of employees and their ability to convey trust and confidence Empathy: the caring, individualized attention the firm provides its customers Reliability is the most important dimension Tangibles is the least important dimension There is a shared importance between Reliability and Responsiveness

Servqual Instrument Perceptions and Expectations are given a rating for certain dimensions Ratings scale 1 (Strongly Disagree) to 7 (Strongly Agree) Average expectation rating is then subtracted from the average perception rating Average ratings should usually be taken from a sample size of at least 50 participants