Models of service quality

The evolution of
service quality
 Disconfirmation of expectations
 The Nordic model
 The three component model
 The Gaps model of service quality &
SERVQUAL
Disconfirmation of expectations (Oliver 1980)
Frequently Asked Questions
About Customer Expectations

 Should a company aim to ‘delight’ the customer?

 How does a company exceed customer service expectations?

 Do customer service expectations continually escalate?

 Is it a better strategy to under-promise and over-deliver?

 How does a service company stay ahead of competition in meeting

customer expectations?
The Nordic model
(Gronroos 1990)

 Represents the service experience on the basis of

functional and technical elements
 Technical quality refers to what the customer
receives from the service
 Functional quality refers to service delivery
 Model emphasises companies must be careful what
they promise
The three-component model Rust &
Oliver (1994)

Source: Rust & Oliver, 1994. p. 11

Customer expectations of service

 Types of expectations customers hold for

service performance
 Sources of customer expectations
Possible Levels of Customer Expectations
Dual customer expectations levels and
the Zone of Tolerance

Desired Service

Zone of
Tolerance

Adequate Service
 Zones of Tolerance for Different
Service Dimensions
Desired
Desired Service
Service

Level Zone
of of
Expectation Tolerance Desired Service

Adequate
Adequate Service
Service
Zone
of
Tolerance

Adequate Service

Reliability Tangibles
Source: L. L. Berry, A. Parasuraman, and V. A. Zeithaml, “Ten Lessons for Improving Service Quality,”
Marketing Science Institute, Report No. 93-104 (May 1993).
Factors That Influence Desired Service

Lasting
Lasting Service
Service
Intensifiers
Intensifiers

Desired Service

Personal
Personal Needs
Needs Zone
of
Tolerance

Adequate Service
 Factors That Influence Adequate Service

Temporary
Temporary Service
Service
Intensifiers
Intensifiers

Desired Service
Perceived
Perceived Service
Service
Alternatives
Alternatives Zone
of
Tolerance
Self-Perceived
Self-Perceived
Service
Service Role
Role Predicted
Predicted
Adequate Service
Service
Service

Situational
Situational
Factors
Factors
Factors That Influence Desired
and Predicted Service
Explicit Service
Promises

Implicit Service
Promises

Desired Service Word-of-Mouth

Zone Past Experience

of
Tolerance

Predicted
Adequate Service Service
Customer perceptions

 Factors which influence consumers’

perceptions
 Factors which influence satisfaction
 Dimensions of service quality
 Service encounters
Customer Perceptions of Quality and
Customer Satisfaction
Factors Influencing
Customer Satisfaction
 Product/service quality
 Specific product or service features

 Consumer emotions

 Attributions for service success or failure

Factors Influencing
Customer Satisfaction
 Perceptions of equity or fairness
 Other consumers, family members, and
coworkers
 Price
 Personal factors
 the customer’s mood or emotional state
 situational factors
Outcomes of
Customer Satisfaction
 Increased customer retention
 Positive word-of-mouth communications

 Increased revenues
Service Quality

 The customer’s judgment of overall excellence

of the service provided in relation to the
quality that was expected.
 Service quality assessments are formed on

judgments of:
 outcome quality
 interaction quality

 physical environment quality

The SERVQUAL dimensions
– Perceived Service Quality
(Parasuraman, Zeithaml & Berry 1988)

 Reliability (dependability, accurate performance)

 Assurance (competence, courtesy, credibility & security)
 Tangibles (appearance of physical elements)
 Empathy (easy access, good communications & customer
understanding)

 Responsiveness (promptness & helpfulness)

 The Five Dimensions of
Service Quality
Ability to perform the promised service
Reliability dependably and accurately.

Assurance Knowledge and courtesy of employees

and their ability to inspire trust and
confidence.
Tangibles
Physical facilities, equipment, and
appearance of personnel.
Empathy
Caring, individualized attention the firm
provides its customers.
Responsiveness
Willingness to help customers and
provide prompt service.
Exercise to
Identify Service Attributes
In groups of five, choose a services industry and spend 10 minutes
brainstorming specific requirements of customers in each of the five
service quality dimensions. Be certain the requirements reflect the
customer’s point of view.

Reliability:

Assurance:

Tangibles:

Empathy:

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

 can potentially be critical in determining customer

satisfaction and loyalty
 types of encounters:
 remote encounters, phone encounters, face-to-face encounters
 is an opportunity to:
 build trust
 reinforce quality

 build brand identity

 increase loyalty
A Service Encounter Cascade
for a Hotel Visit

Check-In
Check-In

Bellboy
Bellboy Takes
Takes to
to Room
Room

Restaurant
Restaurant Meal
Meal

Request
Request Wake-Up
Wake-Up Call
Call
Checkout
Checkout
A Service Encounter
Cascade for an Industrial Purchase

Sales
Sales Call
Call

Delivery
Delivery and
and Installation
Installation

Servicing
Servicing

Ordering
Ordering Supplies
Supplies
Billing
Billing
Critical Service Encounters Research
 GOAL:

 understanding actual events and behaviors that cause

customer dis/satisfaction in service encounters
 METHOD:

 Critical Incident Technique

 DATA:

 stories from customers and employees

 OUTPUT:

 identification of themes underlying satisfaction and

dissatisfaction with service encounters
Sample Questions for Critical Incidents
Technique Study
 Think of a time when, as a customer, you had a particularly satisfying
(dissatisfying) interaction with an employee of ______________.

 When did the incident happen?

 What specific circumstances led up to this situation?

 Exactly what was said and done?

 What resulted that made you feel the interaction was satisfying
(dissatisfying)?
Common Themes in Critical
Service Encounters Research

Recovery: Adaptability:
employee response employee response
to service delivery to customer needs
system failure and requests

Coping: Spontaneity:
employee response unprompted and
to problem customers unsolicited employee
actions and attitudes
Recovery

DO DON’T
 Acknowledge problem  Ignore customer
 Explain causes  Blame customer

 Apologize  Leave customer to fend

 Compensate/upgrade for him/herself

 Downgrade
 Lay out options
 Act as if nothing is wrong
 Take responsibility
 “Pass the buck”
 Adaptability

DO DON’T
 Recognize the  Ignore

seriousness of the need  Promise, but fail to follow

 Acknowledge through
 Anticipate  Show unwillingness to try

 Attempt to accommodate  Embarrass the customer

 Adjust the system  Laugh at the customer

 Explain rules/policies  Avoid responsibility

 Take responsibility  “Pass the buck”

Spontaneity

DO DON’T
 Take time  Exhibit impatience
 Be attentive  Ignore
 Anticipate needs  Yell/laugh/swear
 Listen  Steal from customers
 Provide information  Discriminate
 Show empathy
Coping

DO DON’T
 Listen  Take customer’s
 Try to accommodate dissatisfaction
 Explain personally
 Let customer’s
 Let go of the customer
dissatisfaction affect
others
 Evidence of Service from the
Customer’s Point of View
 Contact employees
 Customer him/herself
 Operational flow of  Other customers
activities People
 Steps in process
 Flexibility vs.
standard
 Technology vs.
Physical  Tangible
human Process communication
Evidence
 Servicescape
 Guarantees
 Technology

Source: From “Managing the Evidence of Service” by M. J. Bitner from The Service Quality Handbook,
 Website
eds. E. E. Scheuing and W. F. Christopher (1993), pp. 358-70.
UNDERSTANDING
CUSTOMER
REQUIREMENTS
 Provider Gap 1

CUSTOMER
Expected
Service

Listening
COMPANY Gap
Company
Perceptions of
Consumer
Expectations

Part 3 Opener
 Listening to customers through market
research
 Using Marketing Research to Understand
Customer Expectations
 Elements in an Effective Services Marketing
Research Program
 Analyzing and Interpreting Marketing Research
Findings
 Model Services Marketing Research Programs
 Using Marketing Research Information
 Upward Communication
Objectives for Chapter 6:
Listening to Customers through Research
 Presentthe types of and guidelines for marketing
research in services.

 Show how marketing research information can and should

be used for services.

 Describe the strategies by which companies can facilitate

interaction and communication between management and
customers.

 Present ways that companies can and do facilitate

interaction between contact people and management.
Common Research Objectives
for Services
 To discover customer requirements or expectations for service.
 To monitor and track service performance.
 To assess overall company performance compared with that of
competition.
 To assess gaps between customer expectations and
perceptions.
 To identify dissatisfied customers, so that service recovery can
be attempted.
 To gauge effectiveness of changes in service delivery.
 To appraise the service performance of individuals and teams
for evaluation, recognition, and rewards.
 To determine customer expectations for a new service.
 To monitor changing customer expectations in an industry.
 To forecast future expectations of customers.
Criteria for an Effective
Service Research Program
 Includes both qualitative and quantitative research
 Includes both expectations and perceptions of

customers
 Balances the cost of the research and the value of the

information
 Includes statistical validity when necessary

 Measures priorities or importance of attributes

 Occurs with appropriate frequency

 Includes measures of loyalty, behavioral intentions, or

actual behavior
Stages in the Research Process
 Stage 1 : Define Problem

 Stage 2 : Develop Measurement Strategy

 Stage 3 : Implement Research Program

 Stage 4 : Collect and Tabulate Data

 Stage 5 : Interpret and Analyze Findings

 Stage 6 : Report Findings

 Portfolio of Services Research
Research Objective Type of Research
Identify dissatisfied customers to attempt recovery;
identify most common categories of service failure
Customer Complaint
for remedial action Solicitation
Assess company’s service performance compared to
competitors; identify service-improvement priorities; “Relationship” Surveys
track service improvement over time

Obtain customer feedback while service experience is

fresh; act on feedback quickly if negative patterns develop
Post-Transaction Surveys

Use as input for quantitative surveys; provide a forum Customer Focus Groups
for customers to suggest service-improvement ideas

Measure individual employee service behaviors for use

in coaching, training, performance evaluation, “Mystery Shopping” of
recognition and rewards; identify systemic strengths Service Providers
and weaknesses in service

Measure internal service quality; identify employee- Employee Surveys

perceived obstacles to improve service; track
employee morale and attitudes

Determine the reasons why customers defect Lost Customer Research

Forecast future expectations of customers; develop
and test new service ideas Future Expectations Research