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129 Cards in this Set
- Front
- Back
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4 Levels of Service Performance:
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Service Losers
Service Nonentities Service Professionals Service Leaders |
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A technique for displaying the nature and sequence of the different steps in delivering a service to the customer.
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Flowcharting
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A more detailed form of flowcharting, it clearly shoes the front-stage and backstage activites, and supplies information flows.
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Blueprinting
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3 Levels of Customer Participation
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Low Participation Level
Moderate ".." High ".." |
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employees and systems do all the workm often involves strandardized service
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Low Participation Level
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visiting a movie theater and needs physical presence
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Low Participation Level
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customer helps firm create and deliver service, make some personal effort; share physical possessions
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Medium Participation Level
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providing needed information and instructions like during a hair appointment
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Medium Participation Level
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customer works actively with provider to co-produce the service
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High Participation Level
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service cannot be created without customer's active participation and concumers can jeopardize quality of service outcome such as weight loss, marriage counseling
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High Participation Level
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6 Advantages of Self-Service Technologies
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Time Savings
Cost Savings Flexibility Convenience of Location Greater Control over service delivery high perceived level of customization |
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3 Disadvantage of SSTs
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Seen as a threat can causes anxiety and stress
Service encounters as social experience and prefer to deal with people |
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Self Service Technologies
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Ultimate form of customer involvement
Information-based services can easily be offered using SSTs Encourage customer to serve themselves |
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SSTs Challenge
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Getting customer to try this technology
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self checkouts and self gas pumps are examples of this
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Self Service Technologies
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People Love SSTs because...
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SST machines are conveniently located and accessible 24/7
transactions can be done faster than through face-to-face or telephone contact when work well, performs better than the service employee |
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People hate SSTs because...
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They fail-system is down, PIN numbers are not accepted, etc
Poorly designed tech The consumer messes up or has expections which causes their own dissatisfaction |
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Key weakness of SSTs
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too few incorporate service recovery systems
has to call or go in to fix problem |
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3 Questions for SSTs
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Does the SST work reliably?
Is the SST better than interpersonal alternatives? If it fails, what systems are in place to recover? |
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3-Step Approach used to prevent employee and customer failures:
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1) Collecting information on the most common fail points
2) Identifying the root causes of those failures 3) Creating strategies to prevent the failures that have been identified |
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Involves the analysing of business strategy, including the company's vision, industry trends, and compeition.
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strategy development
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means keeping every customer the company can afford
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zero defections
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customer who stop buying from a company and transfer their brand loyalty to another supplier
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brand loyalty
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a regular source of revenue over a period of many years
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brand loyalty
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4 factors that cause growth in profif from customer loyalty
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Increase Purchases
Reduced Operation Costs Referral to other customers Price premiums |
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Are loyal customer always more profitable than those making one-time transactions?
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Large customer may expect price discounts
Revenues don;t necessarily increase with time |
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To truly understand the profit impact of customers..
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Need to determine costs and revenues for customers from different market segments at different point in tehir customer lifecycles
Need to calculate Custormer Lifetime Value |
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Why are customer Loyal? Value can be created for customers through 3 benefits
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Confidence Benefits
2) Social benefits 3) Special treatment (both concrete and abstract) |
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Confidence Benefits
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A. Confidence in correct performance
B. Ability to trust the provider C. Lower anxiety when purchasing D. Knowing what to expect and recieve |
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Social Benefits
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Mutual recongnition and friendship between service provider and customer
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Special Treatment
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A. Better price
B. Discounts not available to most customers C. Extra services D. Higher priority when there is a wait |
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3 Steps of Wheel of Loyalty
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A. Foundation for loyalty
B. Create loyalty C. Reduce turnover |
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Customers are grouped in tiers in terms of profitability
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The Customer Pyramid
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Customer Response to a service failure
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A. Take some form of public action (complaining to the firm or a thrid party, body that controls the industry or courts).
B. Take some form of private action (swtich provider and spread Negative Work of Mouth) C. Take no action |
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Whay do customer complain?
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Obtain Compensation
B. Release their anger C. Help to improve service (feedback) D. Because of concern for others (spare other customers from experiencing the same thing). |
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What do customers expect once they have made a complaint?
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A. Procedural Justice
B. Interactional Justice C. Outcome Justice |
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Concerns the policies and rules that any customers will have to go throuh in order to seek service recovery. Customer expects the firm to take responsibility
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Procedural Justice
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involves employees of the firm who provide the service recovery and their behavior toward the customer
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Interactional Justice
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Concerns the compensation that a customer receives as a result of the losses and inconviences caused by the service failure
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Outcome Justice
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Guidelines for the Front Line in how to handle complaining customers and Recover from a Service Failure
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1) Act fast
2) Acknowledge customer's feelings 3) Do not argue with customers 4) Show that you understand the problem from the customer's point of view 5) Clarify the truth and sort out the causes 6) Give customers the benefit of the doubt 7) Propose the steps needed to solve the problem 8) Keep customers informed of the progress 9) Consider compensation 10) Continue trying to regain customer goodwill. 11) Self-check the system and improve it. |
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Make it easier for customer to give feedback
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Adding special toll-free numbers
Having feedback links on their websites Having customer comment cards displayed very obvious in their branches |
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Effective service recovery procedures should be (4)..
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1) proactive (on the spot, before customers have a chance to complain)
2) planned (provide scripts and roles to guide them in service recovery situation) 3) trained (teach recovery skills) 4) empowered (use their judgement and communication skills to develop solutions) |
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Deciding on Compensation
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A. What is positionin of firm?
B. How severe was the service failure C. Who is the afffect customer (long-term customer vs 1-time customers) |
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5 Power of Serive Guarantees
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1) Focus firms to focus on what customer want and expect
2) Set clear standards 3) Required systems to get & act on customer feedback 4) Force to understand why they fail and to overcome potential fial points 5) Build "mkt muscle" by reducing the risk of the purchase decision amd building loyalty |
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Service Guarantee Design
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1)Some are simple & unconditional (no surprises)
2)Others written by lawyers and have strict restrictions A. easy to understand and communicate B. meaningful to customer C. easy to invoke and collect D. credible |
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combines the wide scope of a full satisfaction guarantee with the low uncertainty of specific performance standards, and appears to be more effective than either a full satisfaction or an attribute-specific guarantee design
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Combined Gaurantee
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4 Types of Service Guarantees
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1) Single attribute-specific guarantee
2) Multiattribute-specific guarantee 3) Full-satisfaction 4) Combined |
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"Pizza guaranteed to be served in 10 minutes, if not next pizza will be free"
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Single attribute-specific guarantee
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one key attribute of the service is covered by the guarantee
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Single attribute-specific guarantee
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a few important attributes of the service are covered by the guarantee
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Multiattribute-specific guarantee
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"Our quality commitment to you is to provide:
*A friendly check-on *A friendly check-out If we, in your opinion, do not deliever on this commitment, we will give you $20. No questions asked |
Multiattribute-specific guarantee
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all aspects of the service aer covered by the guarantee. There are no exceptions
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Full-satisfaction guarantee
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"if you are not completely satisfied with anything...
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Full-satisfaction guarantee
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"Should we fail to deliever according to this guarantee, or should you be dissatified with apect to your work, you can deduct any amount from final payment which is deemed as fair"
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Full-satisfaction guarantee
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Guarantees are not appropiate when..
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A. Companies have a strong reputation for service excellence
B. Company does not have a good qaulity level and poor service C. Quality cannon be controlled bcause of external factors (weather) D. Consumers see little financial, personal, or physiological risk associatd with the purchase. |
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Someone who acts in a thoughtless or abusive way, causing problems for the firm, its employees, and other customers.
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Jaycustomers
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7 Types of Jaycustomers
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1) Cheat
2) Theif 3) Rule Breaker 4) Belligerent 5) Family Feuders 6) The Vandal 7) The Deadbeat |
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thinks of various ways to cheat the firm and service guarantees
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The Cheat
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has no intention to pay-steals, riding free on public transportation, sneaking in a movie theatre
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The Theif
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rules of behavoir for health and safety reasons (airplanes).
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The Rule Breaker
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Someone who acts in a thoughtless or abusive way, causing problems for the firm, its employees, and other customers.
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Jaycustomers
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7 Types of Jaycustomers
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1) Cheat
2) Theif 3) Rule Breaker 4) Belligerent 5) Family Feuders 6) The Vandal 7) The Deadbeat |
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thinks of various ways to cheat the firm and service guarantees
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The Cheat
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has no intention to pay-steals, riding free on public transportation, sneaking in a movie theatre
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The Theif
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rules of behavoir for health and safety reasons (airplanes).
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The Rule Breaker
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shouts loudly, maybe mouthing insults, threats, and curses. Service personnel are often abused even when they are not to be blames
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The Belligerent
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Subcategory of Belligerent, people who get into agruments with other customers or family memebrs
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Family Feuders
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physical abuse to service facilities and equipment, best cure is prevention
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The Vandal
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delay payment
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Deadbeat
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4 Different Perspectives of Service Quality
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1) Transcendent view
2) Manufacturing-based approach 3) User-based definitions 4) Value-bases definitions |
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people will learn to recongnize quality though experience, performing and visual arts
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Transcendent View
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supply based, looks at quality from the operations perspective, conformance to the firm's developed specifications
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Manufacturing-based approach
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quality lies in the eyes of the beholder
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User-based definitions
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quality is a trade-off between price and value, "affordable excellence"
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Value-based definitions
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Dimensions of service quality
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A. Tangibles
B. Reliability C. Responsiveness D. Assurance E. Empathy |
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appearance of physical elements, communication elements
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tangibles
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dependable and accurate performance
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reliability
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willingness and helpfulness
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responsiveness
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credibility-trustworthy, security, competene, courtesy
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assurance
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good communications, effort in customer understanding and easy access
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empathy
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6 Gaps of Serive
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Gap 1) Knowledge gap
2) The policy gap 3) the delivery gap 4) communications gap 5) perceptions gap 6) service quality gap |
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difference between what senoir mgt believes customers expect and what customers actually need and expect
Not knowing what customer expect |
Knowledge Gap
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difference between mgt's understanding of customer's expectation and the services standard they set for service delivery
not having the right service designs and standards |
Standards/Policy Gap
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Not delivering to service standards
different between service standards and the service delivery team's actual performance on these standards |
Delivery Gap
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Not matching performance to promise
*difference between what the company communicates and what it actually delievers to the cusomer. Two sub-gaps: internal communication gap and overpromise gap |
Communication Gap
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difference between what the company's advertising and sales pesonnel think are the product's features, perfomance, and service quality level and what the company is actually able to deliver
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Internal Communcation Gap
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caused by advertising and sales personnel being assessed by the sales they generate
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Overpromising Gap
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difference between what a service provider's communcation efforts actually promise and what a customer thinks was promised by these communications
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Interpretation Gap
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difference between what is actually delievered and what customers feel they have recieved because they are unable to accurately judge service quality accuratly
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Perceptions Gap
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the difference between what customers expect to recieve and their perception of the service that is actually delivered
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Service Quality Gap
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Customer Gaps
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1) difference between customer expectation and perceptions
2) difference between customer perceptions and service provided |
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customer-defined standards and measures of service quality can be grouped into two broad categories:
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Soft and Hard Measures
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cannot easily be observed and must be collected by talking to customers, employess, or others-feedback
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Soft standards and their measures
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characteristics and acivites that can be counted, timed, or measured through audits
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Hard standards and their measures
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the number of telephone calles dropped while customer was on hold, the temperature of a particular food
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hard measures
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3 Key Objective of Effective Customer Feedback Systems
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1) Assesment and benchmarkin of service quality and perfomance (to compeitiors, how satisfied are your customers)
2) Customer-driven learning and improvements 3) Creating a customer-oriented service culture |
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Learning from customer feedback..
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A. Total market surveys and annual surverys (major)
B. Transactional survery (after completion) C. Service Feedback Cards D. Mystery Shopping E. Unsolicated Customer Feedback (complaints) F. Focus Group and Service Reviews |
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simple method of displaying performance on hard measures over time aainst specific quality standards-monitor and communicate individual variables or overall index
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Control Charts
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embraces key activites that have an impact on customers
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service quality indexes
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cause and effect analysis uses a technique to identify potential cause of problems consisting of 8 groups
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Fishbone Diagram
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identifies the main causes of observed outcomes, 80% of the value of 1 variable is cause by only 20% of causal variable
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Pareto Analysis
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identifies the main causes of observed outcomes, 80% of the value of 1 variable is cause by only 20% of causal variable
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Pareto Analysis
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often marjority of problems is caused by a minority of causes
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Pareto Analysis
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often marjority of problems is caused by a minority of causes
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Pareto Analysis
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visualization of service delivery, identifying point where failures are most likely to occur.
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Blue Points
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visualization of service delivery, identifying point where failures are most likely to occur.
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Blue Prints
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ROQ approach is based on 4 assumptions:
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1) quality is an investment
2) quality efforts must be financially accountable 3) its possible to spend too much on quality 4) Not all quality expenditures are equally valid |
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Strategy of increasing reliability up to the point that the incremental improvement equals the cost of service recovery or the cost of failure
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Determine optimal level of reliability
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ROQ approach is based on 4 assumptions:
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1) quality is an investment
2) quality efforts must be financially accountable 3) its possible to spend too much on quality 4) Not all quality expenditures are equally valid |
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Strategy of increasing reliability up to the point that the incremental improvement equals the cost of service recovery or the cost of failure
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Determine optimal level of reliability
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8 Links in Service-Profit Chain
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1) Customer loyalt drives profitablility and growth
2) Customer satisfaction drives customer loyalty 3) Value drives customer satisfaction 4) Quality and productivity drive value 5) Employee loyalty drives service quality and procutivity 6) Employee loyalty drives service quality and productivity 7) Employee satisfaction drives employee loyalty 8) Top MGT leadership underlies the chains success |
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T/F
Customer satisfaction is not closely linked to shareholder value in most service industries |
False
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T/F
MKT, operations, and HR functions must collarborate to serve the customer |
True
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3 Functions should have requirements and goals that relate to customers and also contribute to the mission of the firm
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1) Marketing Function
2) Operations Function 3) HR Function |
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target the right customers and build relationships, offer solutions that meet their need
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MKT Function
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to create and deliever specified service to target customer, consistent quality.
Achieve high productivity to ensure acceptable costs |
Operations Function
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recruit, motivate, and train the best employees for each jon
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HR Function
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4 Levels of Service Perfomance
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1) Service Losers
2) Service Nonentites 3) Service Professionals 4) Service Leaders |
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firms at at the bottem, they survive because customers have no other choice
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Service Losers
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traditional operations mindset where costs savings can be obtained thru standardization - simple
neither seek our nor avoid them |
Service Nonentities
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clear mkt strategy, customer seek, measure customer satiscation, proactive
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Service Professionals
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the best in respective industries, outstanding service and delight, service delievery is organized around customers
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Service Leaders
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the development of vision and strargies, giving people the freedom and flexibility to overcome obstacles and make the vision happen
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Leadership
non-incremental changes |
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involves keeping the cureent situation going thru planning, bugeting, organzing, staffing, controllloing, and problem solving
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Managment
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works through people and culture
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Leadership
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works with hierarchy and systems
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Management
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Leadership Qualities
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love for the business
b. work with a team on decision-making c. make communication a prioirty See service quality as foundation for competing |
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shared value, understanding beliefs and styles
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Organizational culture
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tangible surface layer on top of the org's underlying culture
-standards that people set, level of commitment |
Organizational Climate
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