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Service Quality
2Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Learning ObjectivesDescribe the five dimensions of service quality.Use the service quality gap model to diagnose quality problems for a service firm.Illustrate how Taguchi methods and poka-yoke methods are applied to service design.Perform service quality function deployment.Construct a statistical process control chart.Develop unconditional service guarantees.Plan for service recovery.
3Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Moments of TruthEach customer contact is called a moment of truth.
You have the ability to either satisfy or dissatisfy them when you contact them.
A service recovery is satisfying a previously dissatisfied customer and making them a loyal customer.
4Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Dimensions of Service Quality (1)
Reliability: Perform promised service dependably and accurately. Example: receive mail at same time each day.Responsiveness: Willingness to help customers promptly. Example: avoid keeping customers waiting for no apparent reason.
5Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Dimensions of Service Quality (2)
Assurance: Ability to convey trust and confidence. Example: being polite and showing respect for customer.Empathy: Ability to be approachable. Example: being a good listener.Tangibles: Physical facilities and facilitating goods. Example: cleanliness.
6Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Perceived Service Quality
Word of mouth
Personal needs
Past experience
Expectedservice
Perceivedservice
Service Quality Dimensions
ReliabilityResponsiveness
AssuranceEmpathyTangibles
Service Quality Assessment1. Expectations exceeded
ES<PS (Quality surprise)2. Expectations met
ES~PS (Satisfactory quality)3. Expectations not met
ES>PS (Unacceptable quality)
7Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Gaps in Service QualityWord -of-mouthcommunications Personal needs Past experience
Expected service
External communications to consumers
Perceived service
Service delivery (includingpre- and post-contacts)
Translation of perceptions intoservice quality specifications
Management perceptions of consumer expectations
GAP 5
GAP 3
GAP 2
GAP 1 GAP 4
Provider
Customer
8Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Quality Service by Design
Quality in the Service Package
Taguchi Methods (Robustness)
Poka-yoke (fail-safing)
Quality Function Deployment
9Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
House of Quality
Im p orta nce
Relative
1 2 3 4 5 C u s to m e r E x p e c ta t io n s
R e lia b il it y
R e s p o n s i ve n e s s A s s u ra n c e
E m p a th y
T a n g i b le s
C o m p a ris o n w ith V o l vo D e a le r
W e ig h te d s c o re
Im p ro ve m e n t d i ffic u lty ra n k
O O O W e a k
M e d iu m
* S t ro n g
9
9
9
Trai
ning
Atti
tude
Cap
acity
Info
rmat
iion
Equ
ipm
ent
8
7
7 6 6
5 5
5
5
4
4
3 3
3
3
2
2 2
2
+
_
+
C u s to m e r P e rc e p t io n s
o
+ +
+
o
o o
o
+
o o
o
o o
o V il la g e V o l vo
+ V o l vo D e a le r
S e r vic e E le m e n ts
R e l a t io n s h i p s
1 2 7 8 2 6 3 1 0 2 6 5
1
* *
10Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Classification of Service FailuresServer Errors
Task:Doing work incorrectly
Treatment:Failure to listen to customer
Tangible:Failure to clean facilities
Customer ErrorsPreparation:
Failure to bring necessary materials
Encounter:Failure to follow instructions
Resolution:Failure to learn from experience
11Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Achieving Service Quality
Cost of Quality (Juran)
Service Process Control
Statistical Process Control (Deming)
Unconditional Service Guarantee
12Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Costs of Service QualityFailure costs Detection costs Prevention costs
External failure: Process control Quality planningCustomer complaints Peer review Training programWarranty charges Supervision Quality auditsLiability insurance Customer comment card Data acquisition and analysisLegal judgments Inspection Preventive maintenanceLoss of repeat service Supplier evaluation
Recruitment and selectionInternal failure:
ScrapRework
Recovery:ExpediteLabour and materials
13Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Service Process Control
Resources
Identify reasonfor
nonconformance
Establish measure of performance
Monitorconformance torequirements
Take corrective
action
Service concept
Customer input
Customer output
Service process
14Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Control Chart of Departure Delays
60
70
80
90
100Pe
rcen
tage
of f
ligh
ts o
n ti
me
expected
Lower Control Limit
1998 1999
npppUCL −
+=1(3
npppLCL −
−=1(3
15Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Unconditional Service Guarantee: Customer View
Unconditional Easy to understand and communicate Meaningful Easy to invoke Easy to collect
16Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Unconditional Service Guarantee: Management View
Focuses on customers Sets clear standards Guarantees feedback Promotes an understanding of the service delivery system Builds customer loyalty
17Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Customer Satisfaction
All customers want to be satisfied.
Customer loyalty is only due to the lack of a better alternative
Giving customers some extra value will delight them by exceeding their expectations and insure their return
18Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Expressing Dissatisfaction
Dissatisfactionoccurs
Action
No Action
Public Action
Private Action
Seek redress directly from the firm
Take legal action
Complaint to business, private,or governmental agencies
Stop buying the product or boycott the seller
Warn friends about the productand /or seller
19Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Customer Feedback and Word-of-MouthThe average business only hears 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 problems was resolved and 95% would stay if the problem was resolved quickly.
A dissatisfied customer will tell between 10 and 20 other people about their problem.
A customer who has had a problem resolved by a company will tell about 5 people about their situation.
20Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Number of People Told Based on Level of Dissatisfaction
Average Number of People Told
0
5
10
15
20
25
30
Slight diss Annoyed Very annoyed Ext annoyed Abs furious
21Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Action Taken Based on Level of Dissatisfaction
0
20
40
60
80
100
Slightlydiss
Annoyed Veryannoyed
Extannoyed
Absfurlous
Tell friends
Complain
Make a fuses
Not use again
Dissuade others
Complain against
22Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Approaches to Service RecoveryCase-by-case addresses each customer’s complaint individually but could lead to perception of unfairness.Systematic response uses a protocol to handle complaints but needs prior identification of critical failure points and continuous updating.Early intervention attempts to fix problem before the customer is affected.Substitute service allows rival firm to provide
service but could lead to loss of customer.
23Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Making Customers into ChampionsEasy
Walking wounded ChampionsCould complain but don’t; Active in providingnot happy but repurchase British Airways with
information on qualityof its services; loyal
Remain Loyal
DefectMissing in action Detractors
Defected; Defected;non-complaining vocally critical
Not EasyDon’t Complain Complain
Propensity to Contact British Airways
How
eas
y cu
stom
ers f
eel i
t is t
o co
ntac
t Bri
tish
Air
way
s
24Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Topics for DiscussionHow do the five dimensions of service quality differ from those of product quality?Why is measuring service quality so difficult?Illustrate the four components in the cost of quality for a service.Why do service firms hesitate to offer a service guarantee?How can recovery from a service failure be a blessing in disguise?
25Presented by J D Owens
Lincoln Business School
University of Lincoln
Service Quality
Further Reading
• Bicheno, J and Catherwood, P (2005). Six Sigma and the Quality Tool Box. Picsie Books. ISBN 978-0954-12442-7.
– Thomas-Foster, S (2007). Managing Quality: Integrating the Supply Chain, 3rd Edition. Prentice Hall. ISBN 0-13-220644-7.
– Verma, R & Boyer, K K (2010). Operations & Supply Chain Management: World Class Theory and Practice. South-Western Cengage Learning. ISBN 978-0-32-483487-1.
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