MANAGING A

SERVICE-RELATED
BUSINESS
 Learning Outcomes:
• Discuss the culture of service
• Explain co-creation in the context of tourism and
hospitality industry
• Discuss three stages where service evaluation takes
place
• Compare and contrast the types of tourist
experience
• Explain the gaps in service quality
SERVICE ENCOUNTER
• This is defined as the actual interaction between the
organization and its customers who evaluate the
interaction based on the perceived benefits they
received.
• Walt Disney Company is the best example of the
concept of service in tourism
• “Guestology” originated by Bruce Laval of WDC
means that “all the organization’s employees must
treat customers like guests and manage the
organization from the guest’s point of view.
SERVICE ENCOUNTER
• Used to “refer to the person-to-person interaction or
series of interactions between the customer and the
person delivering the service.
• An encounter is the period of time during which the
organization and the guest interact. The length of a
typical service encounter will vary from one service
providers or organizational type to another
Moment of Truth
• These are key instances of contact between a tourist
and a representative of an enterprise
• These can be experiences with the brand, personnel,
product or service of tourist-related organization
wherein the customer gets an opportunity to form an
impression.
• It occurs in Three Stages
• Pre-Purchase
• Purchase
• Post-Purchase
Three Stages
• Pre-Purchase
• All aspects related to interaction between
a visitor and an organization before
purchase.
• Selection from alternatives and substitutes
Three Stages
• Purchase
• This covers actions related to the actual purchase
including but not limited to, the final selection of
a product, the mode of payment, as well as the
attitude of the staff and the environment where
the sales takes
• Expectation versus Actual Experience
• Post-Purchase
Three Stages
• Post-Purchase
• Interaction happen after sale
• An important phase that can lead to either
customer loyalty or dissatisfaction
• Comparison of experiences with the expectations
formed at the pre-purchase and purchase stage
TOURIST EXPERIENCE
• To create memorable experience to remain
competitive.
• An mixture of inputs and processes created along a
value chain
• It is also influenced by individual motivations and
preferences; shared experiences; knowledge of the
destination and its attractions as well as non-
controllable issues such as weather, traffic and
irregular internet connection
FOUR TYPES OF TOURISM
EXPERIENCES
• Conventional Tourism Experience
• Company-centric approach of creating pre-
fabricated experience and delivery it to mainly
passive tourist consumer
• Technology does not constitute a part in the
exprience
• Co-Creation Tourism Experience
• Experiences that are actively created by the
tourist consumer in conjunction with the company
FOUR TYPES OF TOURISM
EXPERIENCES
• Technology Tourism Experience
• This is determined by a high level of technology
use, with low level of consumer involvement
remains predominantly company-centric.
• Fully Technology-Enhanced Tourism Experience
• This experiences maximizes the potential offered
by both elements of co-creation and technology.
CO-CREATING THE TOURISM
EXPERIENCE
• It introduced the concept of value co-creation
referring to mutual benefits that can be derived by
customer and the organization

• It has been defined as “joint activities by parties

involved in direct interactions, aiming at contributing
to the value that emerges for one or both parties”
ADVANTAGES
• It reduces employee costs
• It allows management to re-assign personnel to more
critical tasks
• It eliminates the need for additional staff
• It helps manage the guest expectations
• It helps save time for guests
DISADVANTAGES
• It increases safety risks for both organization and
guest
• It requires additional training for staff who need to
be extra attentive to the guests but can irritate some
guests who are familiar with experience
• It increases costs for the purchase, installation and
management of sophisticated technology that is
accessible across all types of gadgets
• It increase costs of maintaining equipment
FOUR TYPES OF SERVICE
FAILURES
• Service Product Failures
• Problems related to the actual product or the
service system.
• Failure to meet Customer Requests
• These are specific tourists requests that were not
provided
FOUR TYPES OF SERVICE
FAILURES
• Failure caused by Employee Action or Inaction
• These include any inappropriate behavior
• Failures caused by other Guests, Natural
Phenomena or any Circumstance beyond the
control of the Organization
SERVICE QUALITY
• It is identified as a key in differentiating service
products and building a competitive advantage in
tourism

• According to Hudson – “70% of customers will use

the same company again and 50% will recommend
products and services if they receive excellent
customer service.
MODEL OF SERVICE QUALITY
Four Gaps Concerning the
Delivery of Service Quality
• GAP #1: NOT KNOWING WHAT THE CUSTOMER
EXPECTS
• This refers to the gap between the guests’ expected
service vis-à-vis the perceptions of management
• GAP #2: WRONG SERVICE QUALITY STANDARDS
• This occurs when management perceives as customer
expectations do not match service quality perceptions.
Four Gaps Concerning the
Delivery of Service Quality
• GAP #3: SERVICE PERFORMANCE GAP
• This happens when management’s perception of customer
expectations influence the external communication to
customers.
• GAP #4 WHEN PROMISES DO NOT MATCH
DELIVERY
• This occurs when there are discrepancies between external
communication for customers in relation to the service
provided.