C hapter 13 D EFINING A ND M EASURING S ERVICE Q UALITY

1. Chapter 13DEFINING AND MEASURING SERVICE QUALITY

2. SERVICE QUALITY • Government measures of service quality improvements • GNP does not recognize improvements in service quality • based on output measures • GNP may actually increase due to poor service quality • complaining customers spend $ on • phone calls • return shipping, etc.

3. THE DIFFERENCE BETWEEN CUSTOMER SATISFACTION AND SERVICE QUALITY • Customer Satisfaction • short-run, transaction specific measure • Service Quality • long-run overall evaluation of the firm’s performance • looks at how firms should perform • measures a higher standard of service delivery • expectations drive service quality perceptions

4. Conceptual Model of Service Quality Customer expectations Knowledge Gap Management perceptions of customer expectations Standards Gap Retailer communications about services Standards specifying service to be delivered Service Gap Delivery Gap Communication Gap Actual service delivered Customer perception of service Source: Adapted from A. Parasuraman, Valerie Zeithaml, and Leonard Berry, “A Conceptual Model of Service Quality and Its Implications for Service Quality Research,” Journal of Marketing 49 (Fall 1985), pp.41-50.

5. DIAGNOSING FAILURE GAPSIN SERVICE QUALITY • Gap 1: The Knowledge Gap • research orientation • upward communication • levels of management

6. DIAGNOSING FAILURE GAPSIN SERVICE QUALITY • Gap 2: The Standards Gap • perceptions of feasibility • commitment to service quality vs. cost reduction and short-term profits • No culture or goal setting for services • timeliness, accuracy, responsiveness

7. DIAGNOSING FAILURE GAPSIN SERVICE QUALITY • Gap 3: The Delivery Gap • unable or unwilling to perform service • employee/job fit • role conflict • role ambiguity • dispersion of control • Learned helplessness • inadequate support

8. DIAGNOSING FAILURE GAPSIN SERVICE QUALITY • Gap 4: The Communication Gap • exaggerated promises • attempts to acquire new business • attempts to beat the competition • absence of horizontal communication

9. DIAGNOSING FAILURE GAPSIN SERVICE QUALITY • Gap 5: The Service Gap • expectations compared to perceptions • Gap 5 = f(Gaps 1+2+3+4)

10. MEASURING SERVICE QUALITY:SERVQUAL • Diagnostic tool used to determine “gap scores” • The larger the gap, the lower the service quality evaluation • 44 Item Scale the Compares “Should” to Perceptions • SQ consists of five dimensions • Tangibles Reliability • Responsiveness Assurance • Empathy

11. THE TANGIBLES DIMENSION • Two-dimensional construct • Equipment and facilities • Personnel and communication materials E1: Excellent companies will have modern looking equipment P1: XYZ has modern looking equipment E2: The physical facilities at excellent companies will be visually appealing.

12. THE TANGIBLES DIMENSION E3: Employees of excellent companies will be neat-appearing. E4: Materials associated with the service (such as pamphlets or statements) will be visually appealing in an excellent company.

13. THE RELIABILITY DIMENSION • Reflects the consistency and dependability of the firm’s performance E5: When excellent companies promise to do something by a certain time, they will do so. E6: When customers have a problem, excellent companies will show a sincere interest in solving it.

14. THE RELIABILITY DIMENSION E7: Excellent companies will perform the service right the first time. E8: Excellent companies will provide their services at the time they promised to do so. E9: Excellent companies will insist on error-free records.

15. THE RESPONSIVENESS DIMENSION • The willingness or readiness of employees to provide the service E10: Employees of excellent companies will tell customers exactly what services will be performed. E11: Employees of excellent companies will give prompt service to customers.

16. THE RESPONSIVENESS DIMENSION E12: Employees of excellent companies will always be willing to help customers. E13: Employees of excellent companies will never be too busy to respond to customer requests.

17. THE ASSURANCE DIMENSION • Reflects the competence of the firm, the courtesy extended to its customers, and the security of its operations E14: The behavior of employees of excellent companies will instill confidence in customers.

18. THE ASSURANCE DIMENSION E15: Customers of excellent companies will feel safe in their transactions. E16: Employees of excellent companies will be consistently courteous with customers. E17: Employees of excellent companies will have the knowledge to answer customer questions.

19. THE EMPATHY DIMENSION • The ability to experience another’s feelings as one’s own E18: Excellent companies will give customers individual attention. E19: Excellent companies will have operating hours convenient to all their customers.

20. THE EMPATHY DIMENSION E20: Excellent companies will have employees who give customers personal attention. E21: Excellent companies will have the customer’s best interest at heart. E22: The employees of excellent companies will understand the specific needs of their customers.

21. SERVQUAL CRITICISMS • Expectation and perception questions seem redundant • what’s the value of including the expectation set? • compromises have been developed • Questions need to be adjusted to fit specific industry under examination • Measurement issues

22. THE DIAGNOSTIC ADVANTAGE OF SERVQUAL SCORES

23. SERVICE QUALITY INFORMATION SYSTEMS • Solicitation of customer complaints • Identify unhappy customers • Identify weaknesses in the firm’s service delivery system • After-sale surveys • More active approach than above

24. SERVICE QUALITY INFORMATION SYSTEMS • Customer focus group interviews • Group interaction provides ideas • Other forms of research are needed to confirm the group’s ideas • Mystery shopping • Measures individual employee behavior • Aids in coaching, training, and evaluating

25. SERVICE QUALITY INFORMATION SYSTEMS • Employee surveys • Employee satisfaction is directly related to customer satisfaction • Employee surveys should examine morale, attitudes, and perceived obstacles • Total market service quality surveys • Assesses the firm’s and its competitors’ satisfaction ratings

26. KEY COMPONENTS: SERVICE QUALITY INFORMATION SYSTEMS • Listening • quality is defined by the customer • expectations are a rising bar • Reliability • little else matters when the service is unreliable • Basic service • deliver the basics first, the frills can come later

27. KEY COMPONENTS: SERVICE QUALITY INFORMATION SYSTEMS • Service design • design flaws hinder the basic service • Recovery • firms that do not respond to customer complaints escalate the service failure • Surprising customers • develops customers satisfaction into customer “delightment”

28. KEY COMPONENTS: SERVICE QUALITY INFORMATION SYSTEMS • Fair play • be careful of the “squeaky wheel” • Teamwork • service team building should not be left to chance • customer service is everyone’s responsibility • Employee research • employee needs are as important as customer needs

29. KEY COMPONENTS: SERVICE QUALITY INFORMATION SYSTEMS • Servant leadership • leadership must serve the servers • inspiring AND • enabling