Chapte1r0-1

Customer-Defined Service
Standards
10

 Factors Necessary for Appropriate Service

Standards

 Types of Customer-Defined Service

Standards

 Development of Customer-Defined Service

Standards

McGraw-Hill/Irwin Copyright ©2009byThe McGraw-Hill Companies, Inc. All rightsreserved.

 10-2
Objectives for Chapter 10:
Customer-Defined Service Standards
 Distinguish between company-defined and customer-defined
service standards.

 Differentiate among “hard” and “soft” customer-defined standards

and one-time fixes.

 Explain the critical role of the service encounter sequence in

developing customer-defined standards.

 Illustrate how to translate customer expectations into behaviors and

actions that are definable, repeatable, and actionable.

 Explain the process of developing customer-defined service

standards.

 Emphasize the importance of service performance indexes in

implementing strategy for service delivery.
 10-3

FedEx Service Quality Indicator (SQI)

 10-4

Service Standards
Standards are based on the most important customer
expectations and reflect the customer’s view of these expectations.

Customer- SOURCES
Customer Expectations
Defined Customer Process Blueprint
Standards Customer Experience
Observations

SOURCES
Company- Productivity Implications Cost
Implications
Defined Company Process Blueprint
Standards Company View of Quality
 10-5

Customer Service Report Card for

Puget Sound Energy
 10-6

Counting…

“Not everything that

counts can be
counted...and not
everything that can be
counted, counts.”
Albert Einstein
 10-7

Standards…

HARD STANDARDS AND MEASURES

Things that can be counted, timed, or
observed through audits (time, numbers
of events)

SOFT STANDARDS AND MEASURES

Opinion-based measures that cannot be
observed and must be collected by
talking to customers (perceptions, beliefs)
Exhibit 10.1
Examples of Hard Customer-Defined Standards

Many schools of thought,

Exhibit 10.2
Examples of Soft Customer-Defined Standards
 10-10

Exercise for Creating Customer-Defined

Service Standards
 Form a group of four people
 Use your school’s undergraduate or graduate
program, or an approved alternative
 Complete the customer-driven service standards
importance chart
 Establish standards for the most important and
lowest-performed behaviors and actions
 Be prepared to present your findings to the class
 10-11

Customer-Driven Standards and

Measurements Exercise
Service Encounter Customer Requirements Measurements

Service
Quality
 10-12

What Customers Expect: Getting to

Actionable Steps
 Figure 10.4 - Process for Setting Customer-Defined Standards

1. Identify existing or desired service encounter sequence

2. Translate customer expectations into behaviors/actions

3. Select behaviors/actions for standards

4. Set hard or soft standards

Measure by Measure by
audits or Hard 5. Develop feedback mechanisms Soft transaction-
operating data based surveys
6. Establish measures and target levels

7. Track measures against standards

8. Provide feedback about performance to employees

9. Update target levels and measures

 10-16

Example of Customer-Defined
Service Standards at Circuit City
Initial Sales Contact with Circuit City in Store
act in a professional and courteous manner
ask customer what he or she is looking for
 offer to be available when needed if customer not ready
ask customer several questions about specific needs or
wants
educate the customer about products in category
explain the differences between products (such as TVs)
that customer is considering
be honest about options and price

Adapted from: John R. DiJulius III (2005), Secret Service, Hidden Systems That Deliver Unforgettable Customer Service.
 10-17

Example of Customer-Defined Service

Standards at Circuit City
Checkout at Circuit City in Store
act in a professional and courteous manner
probe customer to assure that product meets needs and
reduce any anxiety and uncertainty that the customer might
feel
explain the warranty service that accompanies the product
encourage purchase

Adapted from: John R. DiJulius III (2005), Secret Service, Hidden Systems That Deliver Unforgettable Customer Service.
 10-18

Example of Customer-Defined Service

Standards at Circuit City
Post-sale Follow Up
telephone customer within next 7 days to ask how
TV is operating
ask if client is ready to schedule first service
if client is ready, establish date for first service
send out postcard one week in advance of first
service call to remind customer and explain what
needs to be done

Adapted from: John R. DiJulius III (2005), Secret Service, Hidden Systems That Deliver Unforgettable Customer Service.
 10-20

Soft Standards at Toyota in Japan

 Standards for salespeople patterned
after samurai behaviors:
 assume the samurai warrior’s “waiting
position” by leaning five to ten degrees
forward when a customer is looking at a
car
 stand with left hand over right, fingers
together and thumbs interlocked, as the
samurais did to show they were not
about to draw their swords
 display a closed- mouth smile intended
to put customers at ease
 10-21

More Soft Standards at Toyota in

Japan
 Standards for salespeople patterned
after samurai behaviors:
 when serving coffee or tea, kneel on the floor
with both feet together and both knees on the
ground
 bow more deeply to a customer who has
purchased a car than a casual window
shopper
 stand about two arms’ lengths from
customers when they are looking at a car and
come in closer when closing a deal
 point with all five fingers to a car door’s
handle, right hand followed by left, then
gracefully open the door with both hands
 10-22

Hard and Soft Service Standards at Ford

 Appointment available within one day of

customer’s requested service day
 Write-up begins within four minutes
 Service needs are courteously identified,
accurately recorded on repair order and verified
with customer
 Service status provided within one minute of
inquiry
 Vehicle serviced right on first visit
 Vehicle ready at agreed-upon time
 Thorough explanation given of work done,
coverage and charges
Physical evidence

Physical evidence is the environment in

which the service is delivered and where
the firm and the customer interact and
any tangible commodities that facilitate
performance or communication of the
service.

Physical evidence includes the

servicescape, a term used to describe
the physical facility where the service is
produced and/or delivered.
 Table 11.1

Elements of Physical Evidence

Servicescape Other tangibles

Facility exterior Exterior design Business cards

Signage Parking Landscape Stationery
Surrounding environment Billing statements
Reports Employee dress
Uniforms Brochures
Web pages
Virtual servicescape
Facility interior Interior design
Equipment Signage Layout
Air quality/temperature

Many schools of thought,

 Table 11.2
Examples of Physical Evidence from
the Customer’s Point of View