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Service Encounter

Service Blueprint
Interaction with Customers
Service Quality
Service Recovery

The Service Encounter Triad


Service
Organization
Efficiency
versus
autonomy

Contact
Personnel

Efficiency
versus
satisfaction

Perceived
control

Customers

Service Organization
The service encounter occurs within the context of an
organizations culture as well as its physical surroundings.

Employee Selection Training


Control + Empowerment
Strategy + Culture

Design Control: Service Blueprint


departure

arrival

Interactive
line

dining

F
F

reservation

ordering

Line of
Visibility

serving
F

kitchen

cooking

Line of
Support

payment

front office

billing

back office

preparation

Failsafing (pokayokes)
Service failures are often caused by interruptions or negligence.
Task to be done
Treatment accorded to the customer
Tangible features of the service

Service Encounter = moments of truth


Every customer contact is an opportunity to satisfy the customer.
To improve customers perception of service quality.

Contact Personnel

Selection
1. Abstract Questioning
2. Situational Vignette
3. Role Playing

Training
Unrealistic customer expectations
Unexpected service failure

Example: Amys Ice Cream

What was your most rewarding past


experience and why?

What are you looking for in your next job?

What have you done in the past to irritate


a customer?

What flavor of ice cream best describes


your personality?

Managing Customer-Introduced Variability


A trade-off between cost and service quality (customer satisfaction)

Managing Customer-Introduced Variability

Difficult Interactions with Customers


Unrealistic customer expectations
1. Unreasonable demands
2. Demands against policies
3. Unacceptable treatment of employees
4. Drunkenness
5. Breaking of societal norms
6. Special-needs customers

Unexpected service failure


1. Unavailable service
2. Slow performance
3. Unacceptable service
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Satisfaction Mirror
More Repeat
Purchases
Stronger Tendency to
Complain about Service
Errors

More Familiarity with Customer


Needs and Ways of Meeting Them
Greater Opportunity for
Recovery from Errors

Higher Customer
Satisfaction
Lower Costs
Better Results

Higher Employee
Satisfaction
Higher
Productivity
Improved Quality
of Service

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Dimensions of Service Quality

Reliability: Perform promised service dependably


and accurately.

Responsiveness: Willingness to help customers


promptly.

Assurance: Ability to convey trust and confidence.

Empathy: Ability to be approachable.

Tangibles: Physical facilities and facilitating goods.

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SERVQUAL
Service Gap = Perceptions -

Expectations

Does this restaurant


provide fast service?
Word of
mouth

Personal
needs

Service Quality
Dimensions
Reliability
Responsiveness
Assurance
Empathy
Tangibles

Expected
service
Perceived
service

Is speed of service important?

Past
experience

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)

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THE SERVQUAL INSTRUMENT


EXPECTATIONS
This survey deals with your opinions of banks.
Please show the extent to which you think
banks should posses the following features.
Please circle a number that best shows your
expectations about institutions offering bank
services
Strongly
Strongly
Disagree
Agree
1
2
3
4
5
6
7

PERCEPTIONS
The following statements relate to your feelings
about the XYZ bank that you chose. Please
show the extent to which you believe XYZ has
the feature described in the statement. Please
circle a number that shows your perceptions
about XYZ bank
Strongly
Strongly
Disagree
Agree
1
2
3
4
5
6
7

(E)

(P)

Tangibles
E1. Excellent banking companies will
have modern looking equipment.

Tangibles
P1. XYZ bank has modern looking
equipment.

E2. The physical facilities at excellent


banks will be visually appealing.

P2. XYZ Banks physical facilities


are visually appealing.

E3. Employees at excellent banks will


be neat appearing.

P3. XYZ Banks reception desk


employees are neat appearing.

Gap Score
P-E

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A Service Recovery is satisfying a previously


dissatisfied customer and making them a loyal customer.
About 60% of the complainers would stay as customers if
their problem was resolved and 95% would stay if the problem
was resolved quickly.
A customer who has had a problem resolved by a company
will tell about 5 people about their situation.
A dissatisfied customer will tell between 10 and 20 other
people about their problem.

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Level of Customer Dissatisfaction


30
25
20
15
10
5
0

Average number of people told

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Classification of Service Failures


Server Errors

Customer Errors

Task:
Doing work incorrectly
Treatment:
Failure to listen to
customer
Tangible:
Failure to wear clean
uniform

Preparation:
Failure to bring
necessary materials
Encounter:
Failure to follow system
flow
Resolution:
Failure to signal service
failure

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The Customer is Not Always Right

Southwest managers tell employees they are


Southwest's No. 1 customer, that the paying
customer is not always right. Thinking the paying
customer is right all the time, Southwest executives
say, only undermines the trust between
management and employees.

"The theory goes that if we treat our employees well,


they'll treat the customer well," a Southwest
executive said. And that translates, most of the time
anyway, into profits.
Washington Post April 08, 2003

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Approaches to Service Recovery

Case-by-case addresses each customers 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.

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Service Guarantee: Customer View

Unconditional (L.L. Bean)

Easy to understand and


communicate (Bennigans)

Meaningful (Mobile phone service)

Easy to invoke (Internet shopping)

Easy to collect (Amazon)

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Service Guarantee: Management View


Service Guarantees As Design Drivers

Focuses on customers (British Airways)

Sets clear standards (FedEx)

Guarantees feedback (Proactive approach)

Promotes an understanding of the service delivery


system (Bug Killer)

Builds customer loyalty by making expectations


explicit

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Summary

The front-end and back-end of the encounter


are not created equal

Pay attention to norms and rituals

Training to anticipate possible situations.

Customers are the ultimate judges of a


services value.

Let the punishment fit the crime in service


recovery

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