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Service Quality Project Report

Service Quality Project Report



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Published by kamdica
Service Quality mba Project Report
Service Quality mba Project Report

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Published by: kamdica on Oct 19, 2009
Copyright:Attribution Non-commercial


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For more Notes, Presentations, Project Reports visita2zmba.blogspot.comhrmba.blogspot.commbafin.blogspot.com
OBJECTIVES OF SERVICE QUALITY The subject of service quality has aroused considerable recent interest amongbusiness people and academics. Of course, buyers have always been concernedwith quality, but the increasing competitive market for many services has ledconsumers to become more selective in the services they choose. Conceptualizingthe quality for services is more complex than for goods. Because of the absence of tangible manifestations, measuring service quality can be difficult but there arepossible research approaches. Comprehensive models of service quality and therelimitations can be studied. Understanding just what dimensions of quality are of importance to customers is not always easy in their evaluation process. It is notsufficient for companies to set quality standards in accordance with misguidedassumptions of customers’ expectations. A further problem in defining servicequality lies in the importance which customers often attach to the quality if theservice provider is distinct from its service offers – the two cannot be separated asreadily as in the case of goods. Finally, issues relating to the setting of qualitystandards and implementation of quality management should be studied.INTRODUCTION TO SERVICE QUALITYQuality improvement and adherence to accepted norms of quality are central to themodern concept of marketing of services. The quality of service delivery results incustomer satisfaction and their retention as it reinforces the perception that thevalue of the service received is greater that the price paid for it. Some importantconcepts are:Modern quality concepts result in better profitability, which is the main goal of allthe business.Quality control has much to do with changing the frame of min d and psychology of the service provider and particularly the front-end and back-end employees actuallyproviding the services. We need to know how this fundamental change in attitudecan be brought about.
 Traditionally, most service providers have felt that they know all there is to knowabout the customers and their requirements. This smug or self-satisfied approachneeds to be changed.Development of feedback systems is very essential part of the quality improvement.How this can be used to develop better quality standards is an issue of immenseimportance.Goal setting and adherence to the goals are both essential to ensure continuousimprovement in the quality standards.CUSTOMER RETENTION THROUGH QUALITY IMPROVEMENT The focus of the modern marketers has shifted away from a one-time sale tomaking repeated sales to the same customer. Increasing attention is being paid tomedium and long term perspectives, rather than just the short-term perspective. This has been a major revolution in thinking in the field of marketing. Customerretention usually pays dividends by way of:Lifetime value of the customer. If the customer remains loyal to the company,naturally, the repeated purchases represent a cumulative value which is quitesubstantial compared to any single transaction.Reduced costs. It costs much more to acquire a new customer than to retain an oldcustomer. Therefore, the focus of marketing has shifted away from the goal of merecustomer acquisition to customer retention in order to substantially reducemarketing costs.Benefit from wider opportunities to market more products and services tocustomers who are already loyal to you. The key differentiator between customerretention is customer satisfaction.Satisfaction results when the customer feels that the value of a service received byhim is substantially higher than the price he paid for acquiring the service.Customer satisfaction can be largely attributed to the quality of the service orproduct. Thus, delivery of high quality service is crucial to the high service valueperception. When the major marketing goal of a company is customer retention, thequality of service delivery is, undeniably, the key differentiator.LINK BETWEEN SERVICE QUALITY AND PRODUCTIVITY The approach towards quality has changed quite drastically during the past few
years. Previously people thought in terms of quality control. Quality is defined asthe ability of the service provider to satisfy customer needs. Customer perception,service quality, and profitability are interdependent values. The idea of control wasthat the manufacturer decided to find the reasonable number of defects that acustomer would accept without demur. The goal of the exercise was to restrict thenumber of defects in order to be called a high-quality producer. This approach wasbased on two assumptions:Other producers under similar marketing conditions would adhere to similar normsof non-compliance or transgression of quality. Thus the issue of competition drivingup the quality was not taken seriously. Live and let live was the motto that mostlarge producers adhere to. The lack of serious quality improvement translates intosavings in production costs as elaborate effort for improvement was not done.Almost every customer assumed that the service or product received by them willnot be perfect in every respect. Customers took it for granted that luck was involvedin receiving high-quality goods and services. Thus, people would avoid carsassembled on Fridays or Mondays. It was assumed that during the pre-weekendphase, when the employees where focused on the forth coming weekend, and thepost-weekend phase , when the employees were physically and mentally tired fromtheir weekend exploits, they paid less attention to work. It was thus assumed thaton Fridays and Mondays, nobody would stop the assembly line for just a bolt notfitted at the appropriate place. People preferred cars which were driven from thefactory to the dealer’s premises rather than carried by trucks to the delivery points.Customers believed that inherent defects were bound to be uncovered during thispre-delivery phase, and, therefore they would be duly identified and rectified beforecustomer delivery. The total service quality management [TSQM] emphasizes different policies.Statements such as the following demonstrate the approach:Quality is free. It is the non-quality that costs money. Non-quality means thateverything is not done right from the beginning.About 35% of the company’s costs are due to faults and their corrections.Quality enhancement usually improves profitability by 5 to 10%. This is a sizable jump in the overall profitability. To get a similar increase in profitability with qualityimprovement, the company will need to increase the turnover by 20 to 25%, whichis quite a sizable task.

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