1Service Encounter

Service Blueprint Interaction with Customers Service Quality Service Recovery

The Service Encounter Triad

2

ServiceOrganization

Efficiencyversus

satisfaction

Efficiencyversus

autonomy

CustomersContactPersonnel Perceivedcontrol

2Service Organization

3

Employee Selection Training

Control + Empowerment

Strategy + Culture

The service encounter occurs within the context of an organizations culture as well as its physical surroundings.

4

arrival

ordering

kitchen cooking

serving payment

departuredining

preparation

billing

Line of Visibility

Interactive line

Line of Support

Design Control: Service Blueprint

F

FF

front office

back office

reservationF

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Failsafing (pokayokes)

Service Encounter = moments of truth

Every customer contact is an opportunity to satisfy the customer.

To improve customers perception of service quality.

Service failures are often caused by interruptions or negligence.

Task to be done Treatment accorded to the customer Tangible features of the service

6

Selection1. Abstract Questioning2. Situational Vignette3. Role Playing

TrainingUnrealistic customer expectationsUnexpected service failure

Contact Personnel

47

What was your most rewarding past experience and why?

What are you looking for in your next job?

What have you done in the past to irritate a customer?

What flavor of ice cream best describes your personality?

Example: Amys Ice Cream

8

Managing Customer-Introduced Variability

A trade-off between cost and service quality (customer satisfaction)

59

Managing Customer-Introduced Variability

10

Difficult Interactions with Customers

Unrealistic customer expectations1. Unreasonable demands 2. Demands against policies 3. Unacceptable treatment of employees4. Drunkenness 5. Breaking of societal norms6. Special-needs customers

Unexpected service failure 1. Unavailable service 2. Slow performance 3. Unacceptable service

6Satisfaction Mirror

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Higher CustomerSatisfaction

More Familiarity with Customer Needs and Ways of Meeting Them

Greater Opportunity for Recovery from Errors

Higher EmployeeSatisfaction

Higher Productivity

Improved Quality of Service

More RepeatPurchases

Stronger Tendency to Complain about Service Errors

Lower Costs

Better Results

12

Dimensions of Service Quality

Reliability: Perform promised service dependably and accurately.

Responsiveness: Willingness to help customers promptly.

Assurance: Ability to convey trust and confidence.

Empathy: Ability to be approachable.

Tangibles: Physical facilities and facilitating goods.

713

Service Gap = Perceptions - Expectations Does this restaurant Is speed of service important?provide fast service?

SERVQUAL

Word of mouth

Personal needs

Past experience

Expectedservice

Perceivedservice

Service Quality DimensionsReliability

ResponsivenessAssuranceEmpathyTangibles

Service Quality Assessment1. Expectations exceeded

ESPS (Unacceptable quality)

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THE SERVQUAL INSTRUMENT

EXPECTATIONS PERCEPTIONS This survey deals with your opinions of banks. Please show the extent to which you think banks should posses the following features. Please circle a number that best shows your expectations about institutions offering bank services

The following statements relate to your feelings about the XYZ bank that you chose. Please show the extent to which you believe XYZ has the feature described in the statement. Please circle a number that shows your perceptions about XYZ bank

Strongly Strongly Strongly Strongly Disagree Agree Disagree Agree 1 2 3 4 5 6 7 1 2 3 4 5 6 7

(E)

(P)Gap Score

P - E Tangibles Tangibles E1. Excellent banking companies will have modern looking equipment.

P1. XYZ bank has modern looking equipment.

E2. The physical facilities at excellent banks will be visually appealing.

P2. XYZ Banks physical facilities are visually appealing.

E3. Employees at excellent banks will be neat appearing.

P3. XYZ Banks reception desk employees are neat appearing.

815

A Service Recovery is satisfying a previously dissatisfied customer and making them a loyal customer.

About 60% of the complainers would stay as customers if their problem was resolved and 95% would stay if the problem was resolved quickly.

A customer who has had a problem resolved by a company will tell about 5 people about their situation.

A dissatisfied customer will tell between 10 and 20 other people about their problem.

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05

1015202530 Average number of people told

Level of Customer Dissatisfaction

917

Server ErrorsTask:

Doing work incorrectlyTreatment:

Failure to listen to customer

Tangible:Failure to wear clean uniform

Customer ErrorsPreparation:

Failure to bring necessary materials

Encounter:Failure to follow system flow

Resolution:Failure to signal service failure

Classification of Service Failures

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The Customer is Not Always Right

Washington Post April 08, 2003

Southwest managers tell employees they are Southwest's No. 1 customer, that the paying customer is not always right. Thinking the paying customer is right all the time, Southwest executives say, only undermines the trust between management and employees.

"The theory goes that if we treat our employees well, they'll treat the customer well," a Southwest executive said. And that translates, most of the time anyway, into profits.

10

19

Case-by-case addresses each customers complaint individually but could lead to perception of unfairness.

Systematic response uses a protocol to handle complaints but needs prior identification of critical failure points and continuous updating.

Early intervention attempts to fix problem before the customer is affected.

Substitute service allows rival firm to provide service but could lead to loss of customer.

Approaches to Service Recovery

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Unconditional (L.L. Bean)

Easy to understand and communicate (Bennigans)

Meaningful (Mobile phone service)

Easy to invoke (Internet shopping)

Easy to collect (Amazon)

Service Guarantee: Customer View

11

21

Service Guarantees As Design Drivers Focuses on customers (British Airways)

Sets clear standards (FedEx)

Guarantees feedback (Proactive approach)

Promotes an understanding of the service delivery system (Bug Killer)

Builds customer loyalty by making expectations explicit

Service Guarantee: Management View

Summary

The front-end and back-end of the encounter are not created equal

Pay attention to norms and rituals Training to anticipate possible situations. Customers are the ultimate judges of a

services value. Let the punishment fit the crime in service

recovery

22