Service Quality

and the
AuQS 2000 Quality Management System

By Asst. Prof. Teay Shawyun Ph.D.

 CUSTOMER VALUE PERSPECTIVES

Customer Delivered Value (Kotler, 1999)

Customer Delivered Value = Total Customer Value – Total Customer Cost

Whereby

TCV is a function of { Product Value, Service Value, Personnel Value, Image Value}
TCC is a function of {Monetary Cost, Time Cost, Energy Cost, Psychic Cost,
Opportunity Cost}

Customer Value (Gale, 2000)

Customer Value = f (Product Quality, Service Quality, Relationship, Image)

 Customer Benefit (Kotler, 2001)

Customer benefit = f (v, b, r, -c, -t)

Whereby

• v is Value of Market value

• b is Value of Brand
• r is Value of Relationship
• -c is Cost of Market Offering
• -t is cost of time
 Service Quality (Parasuraman et. al, 1988 and 1990)

SERVQUAL 5 Dimensions:
4.4.Assurance
Assurance––Knowledge
Knowledgeand and
1.1.Tangibles
Tangibles––Appearance
Appearanceofofphysical
physical courtesy
courtesyofofemployees
employeesand andtheir
theirability
ability
facilities,
facilities,equipment,
equipment,personnel,
personnel,and
and totoconvey
conveytrust
trustand
andconfidence
confidence
communication materials
communication materials (Competence,
(Competence, courtesy, credibilityand
courtesy, credibility and
security
securityofofthe
theservice)
service)

2.2.Reliability
Reliability––Ability
Abilitytotoperform
performthe
thepromised
promisedservice
servicedependably
dependablyand
andaccurately
accurately

5.5.Empathy
Empathy––Caring,
Caring,individualized
individualized
3.3.Responsiveness
Responsiveness––Willingness
Willingnesstoto attention
attention the firm providesits
the firm provides its
help customers (Access to
customers (Access to
helpcustomers
customersand
andprovide
provideprompt
prompt organization’s
service organization’srepresentatives,
representatives,
service communication
communication andunderstanding
and understanding
the customer
the customer
 Ten Dimensions of Service Quality (1)

1. RELIABILITY involves consistency of performance and dependability.

It means that the firm performs the service right the first time. It also
means that the firm honors its promises. Specifically it involves:
™ accuracy in billing
™ keeping records correctly
™ performing the service at the designated time

2. RESPONSIVENSS concerns the willingness or readiness of employees

to provide service. It involves timeliness of service:
™ mailing a transaction slip immediately
™ calling the customer back quickly
™ giving prompt service (e.g. setting up appointments quickly)
 Ten Dimensions of Service Quality (2)

3. COMPETENCE means possession of the required skills and

knowledge to perform the service. It involves:
™ knowledge and skill of the contact personnel
™ knowledge and skill of operational support personnel
™ research capability of the organization e.g. securities brokerage firm

4. ACCESS involves approachability and ease of contact. It means:

™ the service is easily accessible by telephone (lines are not busy and
they do not put you on hold)
™ waiting time to receive service (e.g. at a bank) is not extensive
™ convenient hours of operation
™ convenient location of service facility
 Ten Dimensions of Service Quality (3)

5. COURTESY involves politeness, respect, consideration, and

friendliness of contact personnel (including receptionists, telephone
operators, etc.) It includes:
™ consideration for the consumer’s property (e.g. no muddy shoes on
the carpet)
™ clean and neat appearance of public contact personnel

6. COMMUNICATION means keeping customers informed in language

they can understand and listen to them. It may mean that the company
has to adjust its language for different consumers – increasing the level
of sophistication with a well-educated customer and speaking and
plainly with a novice. It involves:
™ explaining the service itself
™ explaining how much the service will cost
™ explaining the trade-offs between service and cost
™ assuring the consumer that a problem will be handled
 Ten Dimensions of Service Quality (4)

7. CREDIBILITY involves trustworthiness, believability, and honesty.

It involves having the customer’s best interests at heart.
Contributing to credibility is:
™ company name
™ company reputation
™ personal characteristics of the contact personnel
™ the degree of hard sell involves interactions with the customer

8. SECURITY is the freedom from danger, risk or doubt. It involves:

™ physical safety (Will I get mugged at the ATM?)
™ financial security (Does the company know where my stock
certificate is ?)
™ confidentiality (Are my dealings with the company private ?)
 Ten Dimensions of Service Quality (5)

9. UNDERSTANDING the customer involves making the effort to

understand the customer’s needs. It involves:
™ learning the customer’s specific requirements
™ providing individualized attention
™ recognizing the regular customer

10. TANGIBLES include the physical evidence of the service:

™ physical facilities
™ appearance of personnel
™ tools or equipment used to provide the service
™ physical representations of the service, such as a plastic credit card
or a bank statement
™ other customers in the service facility
Customer Assessment of Product/Service Quality
Source: Delivering Service Quality by Zeithaml, Parasuraman and Berry, 1991

Dimensions of Product External

Quality: Personal Communications
Needs
• Performance Past
Word of
• Features Experience
Mouth
• Reliability
• Conformance
• Durability
• Serviceability
• Aesthetics Expected
• Perceived Quality Product/Service Perceived
Perceived
Product
Product or
or
Service
Service
Dimensions of Service Quality
Quality
Quality: Perceived
Product/Service
• Tangibles
• Reliability
• Responsiveness
• Competence
• Courtesy
• Credibility
• Security
• Access
• Communication
• Understanding the customer
Customer Assessment of Service Quality
The difference between Customer Expectations and
Customers Needs
Conceptual Model of Service Quality
The Extended Gaps Model of Service Quality