1. Assessment of service delivery process Chap. 6
Service Quality
Assessment
of service delivery process
Chap. 6

2. Defining Service Quality
Moment of truth
Customer contact
Perceived quality
Expectation

3. Perceived Service Quality
Word of
mouth
Personal
needs
Past
experience
Service Quality
Dimensions
Reliability
Responsiveness
Assurance
Empathy
Tangibles
Service Quality Assessment
1. Expectations exceeded
ES<PS (Quality surprise)
2. Expectations met
ES~PS (Satisfactory quality)
3. Expectations not met
ES>PS (Unacceptable quality)
Expected
service
Perceived
service
6-3

4. Dimension of service quality
Customer used to judge service quality
Reliability
The ability to perform the promised service
Service is accomplished
On time
In the same manner
Without errors
Every time
Back office
Billing accuracy, book keeping

5. Responsiveness
Willingness to help customers and to provide prompt service
Keeping customers waiting for no apparent reason
Ability to recover service failure quickly

6. Assurance Knowledge and courtesy of employees
Ability to convey trust and confidence
Competence to perform the service
Politeness and respect for the customer
Effective communication
Customer’s best interests at heart

7. Empathy Caring, individualized attention
Approachability
Sensitivity
Effort to understand the customers’ needs
Airline agent try the best to find a flight for missing connection customer

8. Tangibles
The appearance of physical facility, equipment, personnel, and communication materials.
Tidiness of physical surrounding
Noise

10. Gaps in service quality
Gap between
Expected service
Perceived service

12. Gap #1: marketing research gap
Customer expectation
Management perception
Management’s lack of full understanding
How customers formulate their expectation
Advertising
Past experience
with us
with competitors
Personal needs

13. Gap #2: service design gap
Management perceived customer expectation
Service standard
Lack of management commitment
Inability to formulate target level of service quality
Goals
Standardize service delivery tasks

14. Gap #3: conformance gap Lack of team work Poor employee selection
Service standard
Service delivery
Lack of team work
Poor employee selection
Inadequate training
Inappropriate job design

15. Gap #4: communication gap
Service delivery
Customer perception
Exaggerated promises
Lack of information provided to contact personnel

16. Gap #5: satisfaction gap
Customer perceived
Customer expected
Consequence of all 4 steps

17. Measuring Service Quality
Challenge
No physical feature
Objectively
Many psychological features
Ambiance
Easy to use
Subjectively

18. ServQual Multiple item scale Measure 5 dimensions of service quality
Two parts instruments
Compute the difference between the ratings
Perceived
Expected
Many varieties of modified scales

19. Walk-through Audit Walk-through audit Operation or process oriented
Customer satisfaction survey
Marketing oriented
Overall customer satisfaction
Walk-through audit
Operation or process oriented
Systematic evaluation of a customer’s view of the service operation
From the beginning to the end of the service experience
Examine verbal, environmental, and sensory cues of a pleasant experience

20. Questions for a restaurant walk-through audit
Maintenance items
Person-to-person service
Waiting
Table and place setting
Ambiance
Food presentation
Check presentation
Promotion and suggestive selling
Tipping

21. WtA for Helsinki Museum

22. Designing a Walk-through Audit
Flowchart of customer interactions with the service system
Helsinki Museum
Ticketing, Information, …
Questions of customer observations
“sign give clear info”
Likert scale
Comments
Unanticipated observation

23. Poll all customer segments
Administrated in
Mail
Telephone interview
In person
Poll all customer segments

24. walk-through audit as diagnostic instrument
Manager see facility daily
Overlook gradual deterioration
Peeling paint or worn rugs
Employee is less sensible than customers in quality deterioration

26. Quality Service by Design
Quality can NOT inspected into
Incorporation of quality in the service package
ex: Budget hotels
Supporting facility
Building material is maintenance-free
磁磚脫落
Automatic underground sprinkler system
Decentralized heating & air condition
Confined failure to one room only

27. Facilitating goods Information Furnishing is durable and easy to clean
Bedside tables are supported from the wall to facilitate carpet cleaning
Disposal plastic cups are used instead of glass
環保形象?
Information
Online computer track billing, reservation, registration
Speedy check-in
Anticipate needs: non-smoking rooms
Quick check-out

28. Explicit service Implicit service Room has same appearance
Maids are trained to make up room in a standard manner
Implicit service
Employee with pleasant appearance and good interpersonal skill
Training in SOP
Recruit

30. Taguchi methods “Robust design” of products
Proper function under adverse condition
手機不小心掉落30次，還不致損壞
Robust design of manufacturing process
Manufacturing
Original: products should be kept in refrigerator to be fresh
Robust: can be stored under room temperature
Computer automatically notify maids once customer check-out

31. Quality is best by focusing on a specified goal

32. Poka-Yoke (Failsafing)防呆
Low-cost, in-process, quality control mechanism
Achieve high quality without costly inspection

34. Service provider errors
McDonald French fry scoop
Consistent serving
Bank’s teller
Enter customer’s eye color
Ensure eye contacts

35. Customers’ errors Physical designs Preparation failure
Carry-on luggage size limit
Height Bar at amusement park
Tray return stands near exit
Physical designs
instead of discretion
can prevent most mistakes

36. Quality functional deployment
品質機能展開
Framework translate
customer’s desire and taste into
identifiable and measurable conformance specification
House of quality

37. House of Quality
6-37

38. House of Quality 增加
工程規格欄
6-38

39. Achieving Service Quality
Quality inspection intervention is impossible
intangible and
consumed simultaneously with production
Educate employee’s sense of
Cost of quality
Statistical process control
Service guarantee

40. Cost of quality Costly “Buyer beware” has become obsolete
Automobile recall for defects
Toyota 2012
recall 6 million vehicles worldwide
estimate cost $589 million
Malpractice litigation
Huge settlement
Defensive medicine
Loss to everyone since no improvement in quality

41. Hotel could be sued for negligent to protect customers
Juran’s Cost of quality
Internal failure cost
Defect discovered before shipping
External failure cost
Defect discovered after shipping
Detection cost
Inspection
Prevention cost
training

42. Costs of Service Quality (Bank Example)
Failure costs Detection costs Prevention costs
External failure: Process control Quality planning
Loss of future business Peer review Training program
Negative word-of-mouth Supervision Quality audits
Liability insurance Customer comment card Data acquisition and analysis
Legal judgments Inspection Recruitment and selection
Interest penalties Supplier evaluation
Internal failure:
Scrapped forms
Rework
Recovery:
Expedite disruption
Labor and materials
6-42

43. Statistical process control
99.7% of the normal distribution falls within 3 standard deviations from the mean
Control Charts

44. Unconditional Service Guarantee
隔夜送達、否則免費
Unconditional
Satisfaction is unconditional, without exceptions
下雨、颱風延誤；免費。
Easy to understand and communicate
Know exactly what to expect
早上 10 點沒送到；免費。
Meaningful
Important to customer in financial as well as in service

45. Service guarantee Easy to invoke Easy to collect Marketing appeal
Hassle-free to invoke for dissatisfied customers
No need to fill a form; signature maybe
Easy to collect
Resolved at the spot
Domino’s pizza delivered within 30 minutes, or $3 off
Service guarantee
Marketing appeal
Operations innovation
Fedex

46. Unconditional Service Guarantee: Management View
Focuses on customers (British Airways)
Sets clear standards (FedEx)
Guarantees feedback (Manpower)
Promotes an understanding of the service delivery system (Bug Killer)
Builds customer loyalty by making expectations explicit
6-46

47. Stages in Quality Development Summary

48. Service Recovery Customer Feedback and Word-of-Mouth
The average business hears only 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 were resolved and 95% would stay if the problem were resolved quickly.
A dissatisfied customer will tell between 10 and 20 other people about the problem.
A customer who has had a problem resolved by a company will tell about 5 people about the situation.

49. Service Recovery Framework
6-49

50. Club Med: an all-inclusive resort
Pre-recovery phase
With dark cloud forming in the sky
Outdoors activities will be cancelled
Alternative activities planned
Immediate recovery phase
Organized group games
Putting a stage show
“the Club Med magic”

51. Follow-up phase Give away complementary service Free lunch
Discount for return visits

52. Approaches to service recovery
Case-by-case approach
Address each customer’s complaint individually
Inexpensive
Easy to implement
Persistent and aggressive complainer always receive satisfactory response
Reasonable do not
Unfairness

53. Systematic-response approach
Protocol to handle customer’s complaints
Reliable
Response guideline need continuously update
Early intervention approach
Intervention before customers affected
Shipment being held up due to truck breakdown
Notify customer immediately

54. Substitute service recovery
Overbook hotel
Send customers to competitors
might lose customers

55. Complaints handling policy
Every complaint is treated as a gift
We welcome complaints
Encourage customers to complain
Make easy to complain
Handle complaints fast …

56. Mini cases Case 6.2 The complaint letter
Local case: negative response over the Internet(?)
Case 6.3 The Helsinki Museum of Art and Design