SERVICE QUALITY

Chapter 6

McGraw-Hill/Irwin Copyright © 2014 by The McGraw-Hill Companies, Inc. All rights reserved.
Moments of Truth
• Quality is assessed during the service delivery process.
• Each customer contact is called a moment of truth.
• Service delivery may involve multiple moments of truth.
• You have the ability either to satisfy or dissatisfy
customers when you contact them.
• A service recovery is satisfying a previously dissatisfied
customers and making them loyal customers.

6-2
Perceived Service Quality

Word of Personal Past

mouth needs experience

Service Quality Expected Service Quality Assessment

Dimensions service 1. Expectations exceeded
Reliability ES<PS (Quality surprise)
Responsiveness 2. Expectations met
Assurance Perceived ES~PS (Satisfactory quality)
Empathy service 3. Expectations not met
Tangibles ES>PS (Unacceptable quality)

6-3
 Dimensions of Service Quality
• Reliability:

• Responsiveness:

• Assurance:

• Empathy:

• Tangibles:

6-4
Service Quality Gap Model

6-5
SERVQUAL
• Measures the five dimensions of service quality.

• Pairs an expectation statement with a corresponding

perception statement.

• Most important function is to track trends over time.

6-6
Walk-Through-Audit (WtA)
walk through the service blue print

• Service delivery system should conform to customer

expectations.
• Customer impression of service is influenced by use of all
senses.
• Service managers lose sensitivity owing to familiarity.
• A detailed service audit from a customer’s perspective is
needed.

6-7
Quality Service by Design
• Quality in the Service Package
Budget Hotel example (next slide)
• Taguchi Methods
Focus on specific goal rather than acceptable
range
• Poka-yoke (fail-safing)
Height bar at amusement park
• Quality Function Deployment
House of Quality

6-8
 9

Quality Service by Design: Example

Taguchi’s Cost of Quality Function

Taguchi quadratic
cost function
(internal quality)

Customer
cost function
(no loss within limits)

6-10
Classification of Service Failures
Server Errors Customer Errors

6-11
House of Quality

6-12
Costs of Service Quality
(Bank Example)
Failure costs Detection costs Prevention costs
External failure: Process control Quality planning
Loss of future business Peer review Training program
Negative word-of-mouth Supervision Quality audits
Liability insurance Customer comment card Data acquisition and
analysis
Legal judgments Inspection Recruitment and selection
Interest penalties Supplier evaluation

Internal failure:
Scrapped forms
Rework

Recovery:
Expedite disruption
Labor and materials

6-13
Control Chart of Departure Delays

expected

Lower Control Limit

Percentage of ontime

100

90
flights

80

70

60

1998 199
9

p (1  p p (1  p
UCL  p  3 LCL  p  3
n n

6-14
Unconditional Service Guarantee: Customer
View: Five Features

6-15
Unconditional Service Guarantee: Management
View: Five Features

6-16
Customer Feedback and Word-of-Mouth
• The average business hears only from 4% of their customers
who are dissatisfied with their products or services. Of the
96% who do not bother to complain, 25% of them have serious
problems.
• The 4% complainers are more likely to stay with the supplier
than are the 96% non-complainers.
• About 60% of the complainers would stay as customers if their
problem were resolved and 95% would stay if the problem were
resolved quickly.
• A dissatisfied customer will tell between 10 and 20 other people
about the problem.
• A customer who has had a problem resolved by a company will
tell about 5 people about the situation.

6-17
Service Recovery Framework

6-18
Approaches to Service Recovery: four options

6-19
Customer Complaints should be treated as:

6-20