The service profit chain
This case study sets out a simple and well-defined way to build profitability and growth in a service business. It’s focusing on how satisfied our customers must be in order to become profitable and to keep those customers, companies must manage all the aspect of the operation that affects customer satisfaction, which is determined by the service-profit chain as it helps managers target new investments to develop service and satisfaction levels to gain competitive advantage. As a result, companies that perform well on the service-profit chain aspect are probably doing well.
The service profit chain starts with the internal service quality (selection, development, training), which is based on engagement and
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This link includes things as employee selection and recognition meant to help employees achieve the results for customers and finally themselves. They have given some specific examples of companies and CEO’s, I have chosen Herbert Kellehr, CEO of southwest airlines as an example of the case. He believes that the right attitude is crucial for the hiring process furthermore focusing on employees and customers is even more important, therefore he could be found aboard airplanes, terminals, interacting with the employees and customers, even more listening to employees’ suggestions for improvement. Another factor that is linked to high customer/employee satisfaction is a low employee turnover (a key marker of employee loyalty), where again Southwest Airlines succeed, as they are known for the highest rate of employee retention in the airline industry, which enable them to boost profitability. Besides being focused on customer satisfaction, some factors that drive profitability are for example, investment in people and technology that supports employees at every level: “if a company takes care of his staff, the staff will take care of its customers.” Furthermore, in comparison with its competitors, the company is outstanding; they might have lower revenue but they are more profitable. Moreover, they arrive almost always on time.
This is due the enhancing of the internal service quality (relationship within the company).
Additionally, the article