7/3/2017

Service Marketing Management

Prof. Ravi Shekhar Kumar

XLRI- Xavier School of Management, Jamshedpur
ravishekhar@xlri.ac.in
Session-4

Measures of Service Quality

Hard Measures
Can be counted, timed, or
measured through audits
Typically operational processes
or outcomes
Standards often set with
reference to percentage of
occasions on which a particular
measure is achieved
Soft Measures
Not easily observed, must be
collected by talking to
customers, employees or others
Provide direction, guidance &
feedback to employees on ways
to achieve customer satisfaction
Can be quantified by
measuring customer
perceptions & beliefs

e.g., SERVQUAL, surveys, &

customer advisory panel

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Hard Measures of Service Quality

Service quality indexes
Embrace key activities that have an impact on customers
FedEx: One of the first service companies to understand need for an
index of service quality that embraced all key activities that affect
customers
Control charts to monitor a single variable
Offer a simple method of displaying performance over time against
specific quality standards
Enable easy identification of trends
Are only good if data on which they are based are accurate

Control Chart for Departure Delays

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Tools to Analyze Service Quality Problems

Fishbone diagram
Cause-and-effect diagram to identify potential causes of problems
Pareto Chart
Separating trivial from important. Often, a majority of problems are
caused by a minority of causes (i.e., the 80/20 rule)
Blueprinting
Visualization of service delivery, identifying points where failures
are most likely to occur

Root Causes of Service Failure

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Cause-and-Effect Chart:
Flight Departure Delays

Analysis of Causes: Flight Departure Delays

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Blueprint: Overnight Hotel Stay Service

Blueprinting
Depicts sequence of front-stage interactions
experienced by customers plus supporting backstage
activities
Used to identify potential fail points
where failures are most likely to appear
Shows how failures at one point can have a ripple effect
Managers can identify points which need urgent
attention
Important first step in preventing service quality problems

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Improving Service Reliability

Is improving Service Reliability always economical?

Alternatively

Is Return on Quality (ROQ) always positive?

ROQ approach is based on four assumptions:

quality is an investment
quality efforts must be financially accountable
its possible to spend too much on quality
not all quality expenditures are equally valid

When does improving Service Reliability

become Uneconomical?

Satisfy Target
100% Customers Through
Service Recovery
Service Reliability

Optimal Point of
Reliability: Cost of
Failure = Service
Recovery

Satisfy Target Customers

Through Service Delivery
as Planned
A B C D

Investment
Small Cost, Large Cost,
Large Improvement Small Improvement Assumption: Customers are equally (or
even more) satisfied with the service
recovery than with a service that is
delivered as planned.

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Soft attribute: Customer Feedback

Customer Feedback Collection Tools

Post- Ongoing
Total market transaction customer
surveys surveys surveys

Customer
Employee
advisory Focus groups
surveys/panels
panels

Mystery Complaint
shopping analysis

Perceived Serviced Quality

Expected
Service

GAP

Perceived
Service

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Gaps Service-Quality Model

Parasuraman, et al., 1985

Gaps Service-Quality Model

CUSTOMER
Expected
Service

Customer
Gap
Perceived
Service

External
COMPANY Service Delivery Communications
GAP 4 to Customers
GAP 1
GAP 3
Customer-Driven Service
Designs and Standards

GAP 2
Company Perceptions of
Consumer Expectations
Parasuraman, et al., 1985

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Provider Gap 5: Service-Quality Model

Gap 5: between perceived service & expected service

This gap occurs when consumer misperceives service

quality against expected service.

Key Factors Leading to Customer Gap

Customer Expectations

Provider Gap 1: Not knowing what

customers expect
Provider Gap 2: Not having/selecting the
right service designs & standards
Customer
GAP Provider Gap 3: Not delivering to service
standards
Provider Gap 4: Not matching performance
to promises

Customer Perceptions

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Provider Gap 5: Service Quality Parameter

Ability to perform promised service

Reliability dependably & accurately.

Knowledge & courtesy of employees & their

Assurance ability to convey trust & confidence.

Appearance of physical facilities, equipment,

Tangibles personnel, & communication materials.

Caring, individualized attention firm provides

Empathy its customers.

Willingness to help customers & provide

Responsiveness prompt service.

SERVQUAL Attributes
RELIABILITY EMPATHY
Providing service as promised
Employees who deal with customers in a
Dependability in handling customers service caring fashion
problems
Having the customers best interest at heart
Performing services right the first time
Employees who understand the needs of their
Providing services at the promised time customers
Maintaining error-free records Convenient business hours
ASSURANCE
Employees who instill confidence in
customers RESPONSIVENESS
Making customers feel safe in their Keeping customers informed as to when
transactions services will be performed
Employees who are consistently courteous Prompt service to customers
Employees who have the knowledge to Willingness to help customers
answer customer questions
Readiness to respond to customers
TANGIBLES requests
Employees who instill confidence in Modern
equipment
Visually appealing facilities
Employees who have a neat, professional
appearance
Visually appealing materials associated with
the service

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Provider Gap 1

CUSTOMER Customer
expectations

Perceived
Service

COMPANY

Gap 1:
The Listening Gap

Company perceptions
of customer expectations

Provider Gap 1
Gap 1: between consumer expectation & management
perception

Management does not always correctly perceive what

customers want.
Hospital administrators may think patients want better food,
but patients may be more concerned with nurse
responsiveness.

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Factors Leading to Provider Gap 1

Customer
Expectations

Inadequate Customer Research

GAP 1 Orientation
Lack of Upward Communication
Insufficient Relationship Focus
Inadequate Service Recovery

Company Perceptions of
Customer Expectations

Provider Gap 2
CUSTOMER

COMPANY

Customer-driven
service designs and
standards
Gap 2: Service Design
& Standards Gap
Company
perceptions of
customer
expectations

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Gaps Service-Quality Model

Gap 2: between management perception & service

Quality specification management might correctly perceive

customers wants but not set a performance standard.
Hospital administrators may tell the nurses to give fast
service without specifying it in minutes.

Factors Leading to Provider Gap 2

Customer-Driven Service
Designs and Standards

Poor Service Design

GAP 2 Absence of Customer-Driven Standards
Inappropriate Physical Evidence and
Servicescape

Management Perceptions
of Customer Expectations

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Provider Gap 3
CUSTOMER

COMPANY

Service delivery
Gap 3: Service
Performance Gap
Customer-driven
service designs and
standards

Provider Gap 3
Gap 3: between service-quality specifications & service
delivery

Employees might be poorly trained, or incapable of or

unwilling to meet the standard; they may be held to
conflicting standards,
such as taking time to listen to customers & serving them
fast.

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Factors Leading to Provider Gap 3

Service Delivery

Deficiencies in Human Resource Policies

GAP 3 Failure to Match Supply & Demand
Customers Not Fulfilling Roles
Problems with Service Intermediaries

Customer-Driven Service
Designs and Standards

Provider Gap 4

CUSTOMER

Gap 4: The Communication Gap

COMPANY External
Service delivery communications
to customers

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Provider Gap 4
Gap 4: between service delivery & external
communications

Consumer expectations are affected by statements made by

company representatives and ads.
If a hospital brochure shows a beautiful room but the patient
finds it to be cheap and tacky looking, external
communications have distorted the customers expectations.

Factors Leading to Provider Gap 4

Service Delivery

Lack of Integrated Services Marketing

Communications
GAP 4 Ineffective Management of Customer
Expectations
Overpromising
Inadequate Horizontal Communications
Inappropriate Pricing

External Communications
to Customers

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Gaps Model of Service Quality

The GAP Model

Causes of Gaps
Promoted
Expectation Inflated Expectation
G4 Communication
Real Expectation
Managements G1 Marketing
Service Perceived
Quality Customer
Expectation G2 Design
G5
Service
Design Spec.
G3 Conformance
Service
Service Received
Delivered

Service Providers Customers

Assessment Assessment
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Perceived Service Quality & Satisfaction

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Satisfaction/Dissatisfaction Judgments
Satisfaction can be defined as an attitude-like judgment
following a service purchase (or sometime series of service
interactions).

It reflects perceived service quality, price/quality

tradeoffs, personal, & situational factors.

Satisfaction is important to companies as well as to

customers, because research shows links between customer
satisfaction levels & a firms overall financial performance

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Further Reading
Chapter-14
Article titled A Conceptual Model of Service Quality and
Its Implications for Future Research

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