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where Service is evaluated Chapter 4
The Service Encounter where Service is evaluated Chapter 4
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Moment of Truth a moment in time, when the customer is
關鍵時刻 Jan Carlzon SAS CEO, Scandinavian Airlines System a moment in time, when the customer is evaluating the service forming an opinion of its quality An airline passenger a series of encounters Searching flights, buying tickets, boarding pass, checking luggage, …
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Role of Technology in the Service Encounter
Technology Technology Technology Customer Server Customer Server Customer Server A. Technology-Free Service Encounter B. Technology-Assisted Service Encounter C. Technology-Facilitated Service Encounter Technology Technology Customer Server Customer Server D. Technology-Mediated Service Encounter E. Technology-Generated Service Encounter 4-3
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Technology-free service encounter
High touch service Customer is in physical proximity to and interact with a human service provider Personal care: 老人照護 Professional service: Law, Consulting, physical therapy
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Technology-assisted service encounter
Only the service provider has access to the technology to facilitate the delivery of face-to-face service Dentist: full mouth x-ray exam Airlines: check-in counter Technology-facilitated service encounter Both customer and service provider have access the same technology (co-location required) Professional Athlete: coach & athlete
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Technology-mediated service encounter
Both customer and service provider have access the same technology (without co-location) Express package service: package tracking system Technology-generated service encounter The human service provider is replaced entirely Customer self service ATM, check-out counter
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Emma’s out of town business trip
Please find how many self-service for the day Ex 4.1, p. 93 Driving forces for self-service Cost saving Customization Accuracy Convenience Speed
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Evolution of Self-Service
Service Industry Human Contact Machine Assisted Internet Facilitated Banking Teller ATM Online banking Grocery Checkout clerk Self-checkout station Online order/ pickup Airlines Ticket agent Check-in kiosk Print boarding pass Restaurants Wait person Vending machine Online order/ delivery Movie theater Ticket sale Kiosk ticketing Pay-for-view Book store Information clerk Stock-availability terminal Online shopping Education Teacher Computer tutorial Distance learning Gambling Poker dealer Computer poker Online poker 4-8
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Unskilled service job Highly skilled Intellectual Creative
is bound to be replaced by self-service technology Highly skilled Healthcare Intellectual Professional Creative entertainment
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The Service Encounter Triad
Organization Customer Contact Personnel Efficiency Versus Satisfaction Autonomy Service Delivery - Culture - Empowerment - Control Systems - Supporting Technology - Performance Evaluation - Selection - Training - Ethical Climate - Expectations - Attitudes - Coproduction - Perceived Control - Role of Scripts - Outcome - Failure Recovery 4-10
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Balance the need for control of three parties
create a beneficial service encounter Service organization Interest in delivering as efficient as possible Contact personnel Interest in control customers’ behavior Make their work more manageable and less stressful Customer Attempt to gain control to derive the most benefit
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Encounter dominated by service organization
To be efficient, to be cost leadership Standardize service delivery SOP Limit discretion of contact personnel everything go “by the book” Limit choices for customers McDonald’s Structural organization and environment Teaching customers what not to expect
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Contact personnel dominated encounter
Service providers’ perceived expertise Physician Financial advisors Contact personnel in an autonomous positions Patients, sometimes, are not even considered as “customers”
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Customer dominated encounter
Customers completely control over a limited standardized service Self-serve gasoline station Online brokerage 股票、債劵、基金 Efficiency: the site is easy to navigate System availability: site does not crash Fulfillment: order arrive quickly Privacy: credit card is protected
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The Service Encounter Triad
Organization Customer Contact Personnel Efficiency Versus Satisfaction Autonomy Service Delivery - Culture - Empowerment - Control Systems - Supporting Technology - Performance Evaluation - Selection - Training - Ethical Climate - Expectations - Attitudes - Coproduction - Perceived Control - Role of Scripts - Outcome - Failure Recovery 4-15
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The service organization
The service organization establishes the environment for the service encounter Culture Empowerment Control system Customer relationship management
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Culture Shared pattern of beliefs and expectation among organization’s members Service Master: hospitals housekeeping provider Service to the Master “to honor God in all we do”
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Choice of language to communicate value
Disney Show business terms used to remind employees that Disney is in the entertainment business Employee is “cast member” Federal express “absolutely positively overnight” Communicate by many extraordinary employee feats to safeguard the service guarantee Benefit from share set of values Contact personnel is empowered Without traditional supervision
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Empowerment (賦權) Trust unconditionally Inverted T organization
Delegation (授權) Trust unconditionally to evaluate choices and competently execute creative decision Inverted T organization Contact personnel is trained motivated supplied with timely, computer-based information Enable to manage the service encounter at the point of delivery
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Organizational Control
System Objective Employee Challenge Management Key Issues Belief Contribute Uncertainty about purpose Communicate core values and mission Identify core values Boundary Compliance Pressure or temptation Specify and enforce rules Risks to be avoided Diagnostic Achieve Lack of focus Build and support clear targets Critical performance variables Interactive Create Lack of opportunity or fear of risk taking Open organizational dialogue to encourage learning Strategic Uncertainties 4-20
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Customer relationship management
Information system to manage interaction between customer and contact personnel Match customers need with product offering Remind customer of service requirement Segment customers Lead management Enable marketing departments to identify and target their best customers Customer service Crowd-sourcing
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The Service Encounter Triad
Organization Customer Contact Personnel Efficiency Versus Satisfaction Autonomy Service Delivery - Culture - Empowerment - Control Systems - Supporting Technology - Performance Evaluation - Selection - Training - Ethical Climate - Expectations - Attitudes - Coproduction - Perceived Control - Role of Scripts - Outcome - Failure Recovery 4-22
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Contact personnel Personality attributes of contact personnel
Flexibility, tolerance for ambiguity Monitor and change behavior on the basis of situational cue Empathy for customers
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Selection Abstract questioning Open-ended questions
Useful interview techniques Abstract questioning Open-ended questions “From your past work experience, what type of customer was most difficult for you to deal with and why?” Applicant’s ability to relate service situation to information, experience & knowledge Willingness to adapt Take notice of details
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Discover applicant is able to learn as well as fast
Interview preparation will enable to discuss extensively No assurance that past event experiences will transfer to future job
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Situational vignette 頁 114, (p.99) Reveal applicant’s
Instincts Interpersonal capabilities Common sense Judgement “think on their feet” Good communication skills IS NOT Genuine desire to serve Empathic nature
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Role playing Participation in a simulated situation
Used in the final phase of recruitment Way to observe applicants under stress Allow more realistic responses (實境秀) Difficult to compare applicants directly
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Contact personnel Training Provide skills required to perform the jobs
Technical skills are in detail Use cash register Enforce safety requirements Customer interaction skills just mentioned simple comments To be pleasant and smile
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Unrealistic customer expectations
Expectation can not be met by the service delivery system Unreasonable demands: “I want to carry all my luggage on board.” Abusive or hostile attitude 韓航副總裁『堅果返航』 Inappropriate behavior Intoxicated Unanticipated demand Special demand with medical or language difficulties Demands contrary to policies 機車教授 vs 怪獸家長
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Service failure Unavailable service Slow performance
Unable to meet customers need Communication burden on the contact personnel Opportunity for innovation and flexibility in the recovery process Unavailable service “why is the ATM out of order?” Slow performance “why hasn’t our plane arrived?” Unacceptable service “my seat doesn’t recline.”
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Use scripts to train contact personnel
Prevent from bad situation become worse Increase customer satisfaction Decrease personnel’s stress and frustration
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Contact personnel Create an ethical climate Contact personnel’ job is
not only advance their firm but also act appropriately for the society Serving multiple conflicting demands
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Examples of Unethical Behaviors
Misrepresenting the Nature of the Service Customer Manipulation General Honesty and Integrity • Promising a nonsmoking room when none is available • Using bait-and-switch tactics • Creating a false need for service • Misrepresenting the credentials of the service provider • Exaggerating the benefits of a specific service offering • Giving away a guaranteed reservation • Performing unnecessary services • Padding a bill with hidden charges • Hiding damage to customer possessions • Making it difficult to invoke a service guarantee • Treating customers unfairly or rudely • Being unresponsive to customer requests • Failing to follow stated company policies • Stealing customer credit card information • Sharing customer information with third parties 4-33
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Management should promote
Formal control Enforcement of ethical codes Punishment for ethical violation Informal control Discussion of ethics Internalization of a code of ethics, ethical climate Service quality & job satisfaction
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The Service Encounter Triad
Organization Customer Contact Personnel Efficiency Versus Satisfaction Autonomy Service Delivery - Culture - Empowerment - Control Systems - Supporting Technology - Performance Evaluation - Selection - Training - Ethical Climate - Expectations - Attitudes - Coproduction - Perceived Control - Role of Scripts - Outcome - Failure Recovery 4-35
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The customer Every purchase Emotional involvement
an important event for the customer a routine for the service provider Emotional involvement Minor Gasoline at self-serve station Over night stay at budget hotel Personal & dramatic 婚紗攝影
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The customer Expectation & Attitudes Economizing customer
Maximize value for their expenditure of time, effort, & money Loss economizing customers is a early sign of competitive threats
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Ethical customer Customer feel a moral obligation to patronize socially responsible firm Company develop a reputation for community service to create such loyal customer base Ronald McDonald House program Affordable accommodation for family of hospitalized child
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Personalizing customer
Want interpersonal gratification Neighborhood family restaurant Greet customers on a first name basis Convenience customer Not interested in the shopping experience Might be willing to pay extra for personalized, or hassle-free service Home delivery of grocery
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Customers attitude range between
Self-sever and Full service to engage with service provider
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The customer The role of script in coproduction
Customer as a partial employee Diners in a restaurant Assembly their salad Carry their meal to a table Bus their own table Customer learn a set of behavior for the situation A script defined by the social norms 健康檢查流程
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Service Encounter Success Factors
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Create a customer service orientation
Happy employee leads Happy customers leads Better service quality
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Customer perceived better service when branch employee report
More enthusiastic service emphasis Branch manager emphasizes service as personnel perform their roles Active effort to retain all customer accounts Not just those large-account holders The branch is staffed with sufficient, well trained tellers
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Customer Satisfaction Employee Satisfaction
Satisfaction Dualism Higher Customer Satisfaction Employee Satisfaction More repeat purchases ↔ More familiarity with customer needs and ways of meeting them Stronger tendency to complain about service errors Greater opportunity for recovery from errors Lower costs Higher productivity Better results Improved quality of service 4-45
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Service Profit Chain 4-46
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Internal quality drive employee satisfaction
USAA, a financial service company Telephone service representative Information system show complete customer info When customer give member number Job related training in a resemble college campus setting
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Employee satisfaction drive retention and productivity
Employee turnover is the loss of productivity Southwest airlines high employee retention The most profitable airlines
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Employee retention and productivity drives service value
Southwest airlines Frequent departures On-time arrival Friendly employees Very low fare although does not assign seats, reservation not integrated with other airlines
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Service value drives customer satisfaction
Quality & productivity improvement yield high service quality and lower cost Customer satisfaction drive customer loyalty Xerox found Very satisfied customers were 6 times more likely to repurchase
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Customer loyalty drive profitability and growth
5% increase in customer loyalty Produce a profit increase from 25 to 85%
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Mini case 4.1 Amy’s Ice Cream 4.2 Enterprise Rent-A-Car
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