Introduction
Case studies
Quality ± why do
organisations still
continue to get it
wrong?
B.G. Dale
A. van der Wiele and
A.R.T. Williams
The authors
B.G. Dale is Professor, Manchester School of
Management, UMIST, UK.
A. van der Wiele is Associate Professor and
A.R.T. Williams is Professor, both at Rotterdam School of
Economics, Erasmus University, Rotterdam, The
Netherlands.
Keywords
Service quality, Quality, Business failure
Abstract
This paper explores, using five case histories, the reasons
why organisations and their management remain immune
to the need to improve the quality of their product and
service offerings. It is argued that the main reasons why a
less than positive attitude to quality exists include:
management are not familiar with the fundamentals of
quality management; the cash rich nature of the business
operation nullifies the need to make improvements; there
are no strong external change agents for improvement;
and competition is weak or non-existent. The paper
explores some potential countermeasures to this type of
situation.
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Managing Service Quality
Volume 11 . Number 4 . 2001 . pp. 241±248
# MCB University Press . ISSN 0960-4529
241
Quality has always been an issue in
commercial dealings between different
groupings and parties. The background to this
is neatly summarised by Morrison (1994)
along with the development of an identifiable
quality assurance movement. It was the
inroads made by the Japanese organisations
into the markets traditionally dominated by the
Americans and Europeans that first brought
quality and its management to the attention of
boardrooms in Western organisations. During
the last two decades considerable attention has
been focused on the issue of quality and much
literature has been produced outlining how
organisations should set about its
improvement. In this time the subject has seen
considerable development and the knowledge
underpinning it has become widespread.
However, despite this increase in knowledge,
the dissemination of material, and the
associated publicity there are still a number of
organisations and their managements who
appear to be immune to the quality events and
developments which have taken place over this
time frame. An inkling to the characteristics of
this type of organisation is provided by Dale et
al. (2000). In our experience these
organisations tend to make a number of
fundamental mistakes in the control,
management and improvement of their
product and service offerings. To those with a
good working knowledge of quality
management the way in which these
organisations treat their customers and the lack
of basic application of quality technology to
their business processes is staggering and
bordering on the unbelievable. These
organisations have no appreciation of the
importance of customer satisfaction, service
quality and service recovery, as outlined by
researchers such as GroÈnroos (1984), Heskett
et al. (1994) and Horovitz (1990), and the
impact on company profitability. The link
between quality and business performance as
portrayed by the ``Baldrige Index'' is missing in
this class of organisations (see NIST, 2000).
This paper opens by presenting five
summary case histories of instances to which
the authors have been subjected during the
last 12 months and which provide suitable
evidence that the organisations concerned
fail to operate by a quality management
ethos. These cases are based on personal
experiences and are presented as examples of
 Quality ± why do organisations still continue to get it wrong?
B.G. Dale, A. van der Wiele and A.R.T. Williams
organisations who do not care about quality.
The cases are presented in different styles
and degrees of detail to reflect the various
situations encountered as seen through the
eyes of the customer. The commonalities
underlying these respective cases are then
identified and discussed. Following this an
examination is conducted of the main causes
of the factors identified along with potential
countermeasures.
Case history 1: Transportyou
Transportyou is an organisation based in the
UK and which is dedicated to the
transportation of people along three major
routes of track, resulting in a maximum
journey of around 40km taking around one
hour. In this mode of transport they are in a
monopoly position, but are in competition
with bus travel and the motor car. The
following are examples of inadequate quality
behaviour evidenced in the last 12 months:
. Transportyou has a no-smoking policy on
their vehicles and 30 or so operating
stations. Despite this publicised and
clearly displayed policy, people smoke
openly on the stations and on a few
occasions on the vehicles. Four letters of
complaint have been written by one of the
authors to the company detailing this
non-compliance together with a request
that they should enforce the policy. The
standard reply is that the central control
room personnel, if they observe people
smoking on a station, issue a warning over
their passenger communication system.
Despite a minimum of eight journeys per
week by one of the authors and observing
people smoking on the stations and
considerable visible evidence of discarded
cigarette ends on platforms and
sometimes on the vehicles, no such
communication has ever been heard.
. Around 12 months ago Transportyou
installed new ticketing machines on all
their stations. For a period of
approximately three months the ticketing
machines malfunctioned. For example,
they would not take paper money and
deliver a ticket and it was often found that
the machines were out of service. The
problem is now less intense but still
occurs on an intermittent basis.
Transportyou has a policy that every
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Volume 11 . Number 4 . 2001 . 241±248
passenger must have a valid ticket on
boarding a vehicle and if their roving
inspectors find a passenger who does not
hold a ticket then they face a fine of £20.
As a consequence of the non-functioning
of the ticket machines long queues of
passengers frequently build up at a single
machine, which is in working order, other
passengers decide to take an alternative
mode of transport.
. The stations of Transportyou have
begun to fall into a state of neglect with
peeling paint, inadequate lighting and
leaking roofs. This is at odds with the
modern image of the vehicles used for
passenger transportation.
. It is six or so years since Transportyou
came into operational service. One of the
authors is a frequent traveller but he has
never been subjected to any form of
customer survey, neither does he know of
any such survey ever being undertaken.
This indicates that Transportyou is not
interested in hearing ``customer voices''.
The key questions which are posed to the
management of Transportyou are:
. Have you undertaken any form of
customer care training for your staff?
. What problem-solving methodologies do
you employ?
. What mechanisms do you have for the
staff who have daily contact with
customers to feed back their causes of
concern and ideas for improvement?
. Have you identified the critical processes
for your operations?
. Are you familiar with the basics of quality
management?
. Have you any idea of the lost opportunity
costs through your failure to deliver
services which satisfy customers?
. Are managers managing the hardware of
the organisation or are they managing the
service to customers?
Case history 2: Computer House
Computer House is a large chain of shops for
personal computers (PCs) and other
electronic devices. The prices of PCs are
changing at a rapid rate, so when deciding to
buy a new computer for home use every effort
is made through the advertisements of the PC
shops to find the one which has the lowest
 Quality ± why do organisations still continue to get it wrong?
B.G. Dale, A. van der Wiele and A.R.T. Williams
prices for comparable specification machines
within the range of interest.
The decision is taken by one of the authors
to buy a machine and printer from Computer
House late one Saturday afternoon and pay
NFL 4,750. On the following Monday
morning, Computer House as found to be
distributing folders advertising exactly the
same PC at a NFL 500 reduction in price. It
took the customer about two hours to
convince Computer House staff that they had
to pay back the NFL reduction. The
alternative is to bring back the PC and printer
within seven days and get the money
refunded, however, this would be a major
inconvenience for both parties.
In this case, the staff at Computer House
do not have any understanding of the way
customers perceive the rules of the
company; treated in this way they will not
retain customers.
The key questions which are posed to the
management of Computer House are:
. Is there any training for the employees
and branch managers in relation to
customer service?
. Are you aware of your actions on
customer retention?
. Have you considered the effects of your
discounting policies on customer buying
behaviour?
. Are you aware of customer service facts
such as: dissatisfied customers telling on
average ten other people about the bad
experience; customers are willing to pay
to receive better service, etc.?
Case history 3: Software Inc.
Software Inc. is a supporting department of a
university, focusing on giving support to
students and staff with problems related to
the use of PCs and software. The installation
of software on home computing equipment to
provide a link to the Internet seems to be easy
in the special disk provided by Software Inc.
In trying to install the software on the
computer it takes some time to understand
that the name of a server is needed. As a
relatively inexperienced user of the PC the
name of the server will not be known and it is
necessary to contact the help desk of Software
Inc. Despite this information it will be found
that the software cannot be installed because
``portal codes'' are needed which have to be
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Volume 11 . Number 4 . 2001 . 241±248
changed on the installation screens of the PC.
So, back again to the help desk of Software
Inc. to get the codes. In the meantime the
installation is still a number of days off
schedule. When an attempt is made to make
the connection it will be found that a personal
code/number is required. Back to the desk
again to find out the code. If sufficient energy
is put into all this searching for codes and
names the machine will eventually work!
For example, a very simple scanner had to
be connected to the PC. On the Internet site
of Software Inc. installation manuals were
found but not exactly for the type/number
purchased and so a manual was taken for a
comparable scanner. This did not work. After
contacting Software Inc., it became clear that
installation software could be downloaded
from the Internet. However, this did not
work. Contacting the help desk required an
explanation on what had been done and what
went wrong. This turned out to be far from
easy. For example, when the expert says turn
off the computer, there is some uncertainty on
what he/she means and to which switch the
instruction applies. The type of help from the
help desk is too general: try this and try that,
and if it does not work get an expert to look at
your PC and scanner. The scanner cost NFL
200 and it is expensive to seek advice from an
expert at approximately NFL 200 per hour.
So, an expert is sought within your own
network, who is willing to help. After
changing all kinds of installation screens and
trying all kinds of ideas, the conclusion is to
buy another scanner.
Technical experts assume too much
technology knowledge from the users. They
know what kind of codes and names are
necessary to implement the software they are
selling, however, this information is not given
out in advance. The experts ask questions
which are difficult to answer for the
inexperienced user. They expect too much
knowledge and give the users the feeling that
they are stupid.
The key questions to the management team
of Software Inc. are:
. Are you familiar with the service quality
determinants and the quality gap model?
. Have you considered undertaking any
form of customer satisfaction assessment?
. What is the degree of integration of your
services?
. What is your policy on customer support?
 Quality ± why do organisations still continue to get it wrong?
B.G. Dale, A. van der Wiele and A.R.T. Williams
. What kind of training has management
organised for employees in relation to
service quality?
. Have you considered applying some of the
quality tools and techniques as part of a
problem-solving methodology, to improve
the services provided to customers?
Case history 4: Car Dealers
Car Dealers is a major regional dealer for one
of the top branded German cars. Consider the
case of a new car purchase. The car is
selected, and at delivery minor defects are
identified (i.e. a small inside sideboard
around the backside window has to be
replaced) and the installation of the safety box
in the rear of the car. Car Dealers promises
that the defects will be corrected as soon as
possible. An appointment is made for the car
to be returned to the garage. However, to
travel from Car Dealers to the owner's place
of work is difficult because of the lack of
public transport. So, it takes some time to
arrange this appointment for the car to be
returned to have the faults rectified. Its
collection proved to be a frustrating event:
. while repairing the inside sideboard, the
mechanic has scratched the wooden panel
on the inside of the door; and
. while placing the safety box in the rear of
the car, the mechanic has cut the carpet
in such a way that is not a precise fit.
This is explained to the service desk and they
make excuses that these are just small
mistakes about which you should not bother
(i.e. the car does not drive any differently
because of a very small scratch). After making
clear that this is not acceptable, the manager
is asked to join the discussion to find a
solution. The explanation made by the
manager is that new staff have been appointed
and it is their policy to give the easiest jobs to
the most inexperienced employee. The car
has to be brought back again on another day
and Car Dealers will place a new carpet in the
rear. Because it is closing time, there is no
other option than to return the car as
suggested and go through the same process of
arranging an appointment.
Car Dealers does not understand the
importance of the quality service dimensions
and is still looking to their products instead
of their services as a major distinguishing
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factor. In the meantime, the customer
concerned of course will never come back to
Car Dealers.
The key questions which are posed to the
management of Car Dealers are:
. What kind of introductory arrangements
have been made for new employees?
. How does management monitor the work
of new employees?
. Is management familiar with the service
quality gap model?
. Does management recognise the
difference between excuses and
opportunities for improvement?
Case history 5: Cable Co.
Cable Co. (CC) is a new company established
in response to the increased competitive
situation in supplying digital services in the
UK. One of the authors arranged with both
BT and CC that his telephone line and fax/
Internet line and television would be
transferred to CC on Thursday, 3 February
2000. The team charged with accomplishing
this task arrived as agreed. After spending
seven hours on the job they eventually left
leaving the household:
. without television channels;
. unable to receive any incoming calls apart
from those from CC;
. with one telephone extension not
working.
One week later, the household was able for
the first time to receive incoming calls, and all
extensions and the television are working.
The details below provide a blow by blow
account written in personal terms of what
happened in these six days. It is a sad tale of
inefficiency, rudeness, and general
incompetence.
Saturday, 5 February
There are still no incoming calls so the help line
is contacted and a promise is made that the
household will be on line during the afternoon.
The specialist team were scheduled to arrive
between 16.00 and 18.00. When the team did
not appear at 19.30 the help line was contacted
to ask where the specialists were. The response
was they were in a traffic jam but could come
later, the receptionist was told that this was
convenient. The receptionist said that therefore
it was the householder's fault that the specialists
could not fix the telephone that day and the next
possible appointment would be Wednesday,
9 February morning.
Quality ± why do organisations still continue to get it wrong?
B.G. Dale, A. van der Wiele and A.R.T. Williams
Monday, 7 February
The help line was contacted with a request to
speak to someone in authority and discussion was
held with a manager in the faults department on
the phone. A promise that the household would
be on line again by 16.30 at the latest. At 16.30
there was still no connection and the help line was
contacted at 17.00 with a request to speak with a
manager. The ``manager'' promised to send out a
technician within the next two hours because
according to him BT had connected us and there
was therefore a fault somewhere in the house.
After nearly three hours, at 19.50, the help line
was contacted again and a discussion was held
with another manager. The discussion revealed
that there was no technician booked for the
address that evening but that someone would be
sent out on Tuesday between 15.00 and 18.00.
Tuesday, 8 February
At 16.30 for the first time, someone from CC
rang to check whether everything was now OK.
They were told that the situation was exactly the
same as it had been on the Thursday evening.
The customer call representative therefore said
she would send an ``expert'' who would put
things right sometime after 18.00.
At 18.00 the ``expert'' arrived. He examined
the situation and announced that the CC line
had been switched on but that BT had not
ported the line over to the CC network. The
advice was that BT had to be contacted to get
this fixed. The response was that this was offered
on the previous Friday and had been told this
was impossible. He said his instructions from his
boss were that the householder should ring BT.
The ``expert'' could not tell the householder the
telephone number of BT, what department and
who to contact. At which stage the householder
said he could not ring BT under these
conditions. The ``expert'' then rang his boss who
agreed that CC would continue to ring BT. The
``expert'' said this was a simple job and it just
needed a new extension from the TV cable box.
But the ``expert'' could, for some reason, not
carry out the work himself. There was a team
booked tomorrow (Wednesday) to do this.
At 19.30 a customer call representative rang
from CC to ask if everything was sorted out. She
was told that despite the visits of six experts and/
or specialists from various CC subcontractors,
the situation was exactly the same as it had been
at the beginning. A request was made to speak to
a manager. Their manager, for the first time in
the dealings with CC, apologised, was
considerate and agreed that she personally would
take responsibility for sorting out this mess.
She said she would ring BT immediately; the
problem was now not in my house at all, but still
with BT. She rang back after ten minutes to say
that the BT man had put down the receiver on
her. The manager promised to ring a BT
manager she knew the next day and get
something done. She provided her mobile phone
number to call if needed. For the first time
someone at CC was taking the initiative and
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Volume 11 . Number 4 . 2001 . 241±248
keeping the householder informed as to what the
trouble was and what was being done about it.
The manager was also told about the telephone
extension which still did not work and that there
was a team coming to fix this the next day. She
checked, there was no team booked. Despite this
she promised she would send out a top engineer
the next morning to sort this out.
Wednesday, 9 February
At 09.00 the top engineer arrives. He is
apologetic and efficient. He immediately
diagnoses that the dead extension is in fact the
main BT switch. No one else apparently had
realised this. It will be simple ``We will run a
cable from the TV box and put another
telephone point in.'' He could not himself do
this. He would call up another team. It was a
simple 45-minute job. And he would stay until
the new team arrived.
At 09.30 the manager who now owned the
problem rang. She had spoken to her BT
manager and things were being sorted out. At
10.30 the new team arrives and fixes the new
telephone point in 15 minutes under the top
engineer's careful guidance. At 11.00 the
telephone rings. Incoming calls are on again.
Friday, 11 February
At 17.45 a ring at the doorbell. A gentleman
from CC ± ``We are in this area next week.
Would you like to be connected to CC cable
telephone and television?''
In conversations with the various specialist
and experts who visited it became apparent
that they felt poorly trained and always had to
rely on being able to contact a supervisor if
they came across any difficulty. Those who
were themselves supervisors were continually
interrupted as they attempted to carry out
work by members of other teams asking their
advice. One volunteered the information that
once, when he went sick in the middle of the
day, within one hour he had 62 messages
waiting for him although he had informed
everyone he believed would contact him that
he was leaving the job since he was ill. In
general, the field staff with whom contact was
made also felt that the customer call
representatives had very little understanding
of their jobs and therefore were continually
promising customers things which were
impossible to achieve.
Clearly neither field engineers nor customer
services staff have access to any kind of
database providing them with information
about a customer's complaint or what has and
is being done about it. The consequence of
this is that every time a customer rings the
help line, he or she gets a different operative
who know nothing of the background and the
whole saga has yet once more to be repeated.
 Quality ± why do organisations still continue to get it wrong?
B.G. Dale, A. van der Wiele and A.R.T. Williams
Similarly with field engineers. Every time a
different one/team arrives, they have received
no previous information from their
predecessors, they have no idea what their
predecessors have tried in order to solve the
problem and with what results. So every time
the wheel has to be rediscovered.
The key questions which are posed to the
management of Cable Co. are:
. How does organisational learning take
place if at all?
. Should the organisation have been
organised much more with a customer
orientation?
. Are processes looked at from a customer
point of view?
. How are customer complaints dealt with
and their underlying causes identified and
countermeasures put into place?
The underlying reasons for these types
of quality failure
The first thing to note is that all these
companies are in the service sector. The
authors (i.e. Dale et al. (1997)) have argued
that service organisations, because of the
simplicity of processes in comparison to
manufacturing, should find it easy to get the
basics of quality management into the
organisation. Having made this point, service
organisations are often not under the same
pressures as manufacturing with respect to
demanding customers and making cost
reduction in their business processes. As a
consequence, it is likely that the management
of the organisations described in the paper
will not be acquainted with the fundamentals
of quality management. Because of the nature
of the businesses the cash flow in the
organisations is excellent with little lag
between the service undertaken and incoming
monies. The companies also tend to be cash
rich leading to a lethargic approach to
managing the businesses with little drive to
make improvements. The individual
complaints made by customers from the
public serve merely as an irritant and by
themselves are not sufficiently strong,
powerful or threatening to warrant a serious
look at how they carry out their business and
are improving customer service by eliminating
the type of events described in the paper.
The organisations do not appear to be
exposed to serious competition for their
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Volume 11 . Number 4 . 2001 . 241±248
services and, as a consequence, can adapt a
take it or leave it approach to their customers'
and are apparently willing to allow them to be
inconvenienced and feel harshly treated. The
delivery of services is not in line with
advertisement material and the experiences
suffered leave customers with a lack of
confidence in the services offered.
In the businesses represented by the case
study organisations there is a lack of a quality
management heritage. They are all relatively
new companies and have been concentrating
on the operational and business issues with
the mistaken belief that they will consider
quality and its management at a later stage in
the process. Quality management is therefore
treated by senior management not as a
priority and its responsibility is delegated to a
lower level in the organisation.
The organisational structure and operation
across multi-sites with a large number of
interfaces presents a number of quality
management challenges. The connections
between customer service, service engineers
and field operators and help desks appear to
be particularly problematic. There is no
evidence that the management teams have
given sufficient intellectual thought to how
challenges can be faced and met. Instead they
have been ignored and the organisation has
continued to operate in a detection type
mode, with prevention activities given scant
attention. There is also some evidence that
the senior management teams of these
organisations are transient in nature and thus
there is a lack of stability in addressing the
longer-term improvement concerns.
In addition to the inconvenience suffered to
the individuals at the centre of these situations
there is also the knock-on effect to the
organisations with whom the victims of these
incompetencies have a relationship. There is
what Taguchi (1986) terms ``loss to society''.
Potential countermeasures to reverse
the situations encountered
The situations are reminiscent of what
European manufacturing business was like in
the 1970s and before the threat of the
Japanese appeared. It beggars belief to find
organisations still treating their customers
with such utter disrespect. It causes one to
question as to where their managements have
been for the last three decades and to what
 Quality ± why do organisations still continue to get it wrong?
B.G. Dale, A. van der Wiele and A.R.T. Williams
type of education and training they have been
subjected. It is almost as though the
managements of these organisations have
been immune to the quality evolution which
has taken place over this time frame, along
with appropriate dissemination routes.
Organisations by their very nature are not
meant to change and it is essential that the
organisations featuring as case histories in this
paper must be subjected to external and
internal forces if they are to change the way in
which they behave to their respective
customers. Unfortunately, the voices of
individual customers are not sufficiently
powerful and it needs some concerted public
and Government direction to provide the
necessary pressure points for change.
The organisations have got to start
employing some basic problem-solving
methodology using the more simple tools and
techniques to identify what is wrong with
their business processes and providing the
means to make improvements. They need to
pick up the information on problems to allow
them to improve customer service. The
inspiration to do this can come from an
internal change agent and/or suppliers who
are more advanced in their quality
management thinking.
Summary
The evidence from these five case histories,
other experiences related by colleagues, and
from the literature (Zemke and Bell, 1990;
Capodagli and Jackson, 1998) indicates that
customer satisfaction is not being treated
seriously in many areas in the service sector.
From a General Manager's point of view,
in this class of organisations, is improvement
really worthwhile? We fear the answer all too
often is no. What is happening in these
companies is obviously good business and
they feel they have no need to improve. And
the implication is clear; a quality
professional working for service businesses
such as those portrayed in this paper can
resign without affecting company
profitability. Their added value is nil. Why
can the behaviour outlined in the cases be
considered as good business? Because the
companies concerned have none of their
resources on unimportant single customers.
What all our cases have in common is that
the problems occur after purchase. They have
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Volume 11 . Number 4 . 2001 . 241±248
already made the important sale and they are
not going to sell us anything else for some time.
In some of the cases outlined the customer has
little option but to use their services. In others a
repeat purchase is so far in the future that it is
not worth salespeople providing the kind of
after sales service and service recovery which
might lead to further sales.
But even if repeat purchase was not a
reason to treat customers reasonably, surely,
any quality manager would argue, all the
companies concerned incurred unnecessary
extra costs through their poor treatment of
customers and by their disinterest in
reasonable complaints. That is of course true.
But we are professional quality people. We
complain. We asked those who have dealings
with the five companies whether they had
similar complaints such as ours. The answer
in every case was a surprising ``Not very
often''. And yet, from our experiences, their
key processes were so badly managed and
controlled that the same problems must have
occurred many times. Customers of these
types of business apparently do not complain
and so management will believe it is a waste of
the companies' time and money to improve
the processes.
There is a labour shortage in the service
industry. Hours and conditions are often
unattractive. So the industry has difficulty in
attracting top rate keen permanent staff. So
staff are often temporary and tend to move
jobs more than in other sectors. Which in turn
means new staff are untrained or over busy ±
and so the vicious circle of appalling customer
service is reinforced. But labour in the service
sector is cheap. Service businesses often pay
poorly. If they wanted to improve customer
service, retain staff and train them properly,
they would have to pay them more. And if
customers cannot or will not change their
buying behaviour, how can spending extra
money on extra pay, improving conditions,
and introducing better training in order to
improve staff possibly be cost-effective?
Some organisations as typically portrayed
by these five cases will only take steps to
improve if there is serious competition for
their business. The important business is key
and corporate customers and not single
customers whose repeat purchases are either
relatively small, a long way into the future, or
are guaranteed because of lack of
competition. Improving customer satisfaction
is impossible without top management
 Quality ± why do organisations still continue to get it wrong?
B.G. Dale, A. van der Wiele and A.R.T. Williams
commitment. Why should top managers of
these organisations spend their valuable time
trying to move their company in the direction
of improved customer service when they can
spend their efforts on new product or service
development or at mergers and acquisitions?
In some circles quality is perceived as a
faded star and a concept which has passed its
sell-by date. However, the experiences
outlined in this paper indicate that if the
quality message is not heeded by
organisations, and other more quality focused
organisations enter the marketplace and the
customer has a choice, then the business
might not be as secure as it was in the past.
References
Capodagli, B. and Jackson, L. (1998), The Disney Way;
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