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Chapter 14 - 1
Overview of Chapter 14
Integrating service quality and productivity strategies What is service quality? The Gaps Modela conceptual tool to identify and correct service quality problems Measuring and improving service quality Defining and measuring productivity Improving service productivity
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User-based:
Value-based:
Tangibles: Appearance of physical elements Reliability: Dependable and accurate performance Responsiveness: Promptness; helpfulness Assurance: Competence, courtesy, credibility, security Empathy: Easy access, good communication, understanding of customer
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Poor quality
Perceived performance ratings < expectations
Good quality
Perceived performance ratings > expectations
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Source:Shohreh A. Kaynama (2000), A Conceptual Model to Measure Service Quality of Online Companies: E-qual, in Developments in Marketing Science, Harlan E. Spotts and H. Lee Meadows, eds., Proceedings of the Academy of Marketing Science, Vol. 22, pp. 4651. For more information pertaining to online service quality see A. Parasuraman, Vlerie A. Zeithaml, and Arvind Malhotra (2005), E-S-QUAL: A Multiple-Item Scale for Assessing Electronic Service Quality. Journal of Service Research, Vol. 7. issue 3. pp. 213234.
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Services high in credence characteristics may cause consumers to use process factors and tangible cues as proxies to evaluate qualityhalo effect
Process factors: Customers feelings
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The Gaps ModelA Conceptual Tool to Identify and Correct Service Quality Problems
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CUSTOMER MANAGEMENT
4. Internal Communications Gap 4. Advertising and sales promises 6. Interpretation Gap Customer interpretation of communications
Prescriptions for Closing the Seven Service Quality Gaps (1) (Table 14.3)
1. Knowledge gap: Learn what customers expect
Understand customer expectations Improve communication between frontline staff and management Turn information and insights into action
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(Table 14.3)
Prescriptions for Closing the Seven Service Quality Gaps (3) (Table 14.3)
5. Perceptions gap: Educate customers to see reality of service quality delivered
Keep customers informed during service delivery and debrief after delivery Provide physical evidence
6. Interpretation gap: Pretest communications to make sure message is clear and unambiguous
Present communication materials to a sample of customers in advance of publication
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Ongoing surveys of account holders to determine satisfaction in terms of broader relationship issues Customer advisory panels offer feedback/advice on performance Employee surveys and panels to determine:
Perceptions of the quality of service delivered to customers on specific dimensions Barriers to better service Suggestions for improvement
Slide 2007 by Christopher Lovelock and Jochen Wirtz Services Marketing 6/E Chapter 14 - 20
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Late deliveryright day Late Deliverywrong day Tracing request unanswered Complaints reopened Missing proofs of delivery Invoice adjustments Missed pickups Lost packages Damaged packages Aircraft delays (minutes) Overcharged (packages missing label) Abandoned calls
XXX,XXX
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Month
Slide 2007 by Christopher Lovelock and Jochen Wirtz Services Marketing 6/E Chapter 14 - 23
Pareto Chart
Separating the trivial from the important. Often, a majority of problems is caused by a minority of causes (i.e. the 80/20 rule)
Blueprinting
Visualization of service delivery, identifying points where failures are most likely to occur
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Six Sigma
Statistically, only 3.4 defects per million opportunities (1/294,000) Has evolved from defect-reduction approach to an overall businessimprovement approach
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Customers
Customers
Delayed check-in Gate agents Aircraft late to procedure gate cannot process fast enough Mechanical Acceptance of late Failures passengers Late/unavailable Late pushback airline crew
Backstage Personnel
Information
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15.3% 15.4%
23.1%
Blueprinting
Depicts sequence of front-stage interactions experienced by customers plus supporting backstage activities Used to identify potential fall pointswhere failures are most likely to appear Shows how failures at one point may have a ripple effect later Managers can identify points which need urgent attention
Important first step in preventing service quality problems
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Process Design/Redesign
Identify specific or broad problems Define goal/change vision Clarify scope and customer requirements Measure performance to requirements Gather process efficiency data Identify best practices Assess process design Refine requirements
Develop ideas to measure root Design new process causes Implement new process, structures, and systems Test solutions Measure results Establish measures to maintain performance Correct problems as needed Establish measures and reviews to maintain performance Correct problems as needed
Control
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Service Reliability
B C
Large Cost, Small Improvement
Investment
Assumption: Customers are equally (or even more) satisfied with the service recovery provided than with a service that is delivered as planned. Chapter 14 - 32
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Firms that consistently deliver outcomes desired by customers can command higher prices; loyal customers are more profitable Measures with customers as denominator include:
Profitability by customer Capital employed per customer Shareholder equity per customer
Slide 2007 by Christopher Lovelock and Jochen Wirtz Services Marketing 6/E Chapter 14 - 36
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How to transform inputs into outputs efficiently? Will improving productivity hurt quality? Will improving quality hurt productivity? Are employees or technology the key to productivity? Can customers contribute to higher productivity?
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Although improving productivity can be approached incrementally, major gains often require redesigning entire processes
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Slide 2007 by Christopher Lovelock and Jochen Wirtz
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Services Marketing 6/E
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Long Waiting Times May Indicate Need for Service Process Redesign (Fig 14.8)
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Front-stage productivity enhancements are especially visible in high contact services Some improvements only require passive acceptance, while others require customers to change behavior Must consider impacts on customers and address customer resistance to changes Better to conduct market research first if changes are substantial See Service Perspectives 14.1: Managing Customers Reluctance to Change
Slide 2007 by Christopher Lovelock and Jochen Wirtz Services Marketing 6/E Chapter 14 - 43
The GAPS model is a tool to diagnose problems in service design and delivery. Service gap is the most critical and can only be closed if the other six gaps are closed Both soft and hard measures used to measure service quality
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Measuring productivity in services is difficultthere is a need to determine when service reliability becomes uneconomical Efficiency, productivity, and effectiveness need to be distinguished when measuring service quality
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