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The focus of the modern marketers has shifted away from a one-time sale to
making repeated sales to the same customer. Increasing attention is being paid to
medium and long term perspectives, rather than just the short-term perspective.
This has been a major revolution in thinking in the field of marketing. Customer
retention usually pays dividends by way of:
Lifetime value of the customer. If the customer remains loyal to the company,
naturally, the repeated purchases represent a cumulative value which is quite
substantial compared to any single transaction.
Reduced costs. It costs much more to acquire a new customer than to retain an old
customer. Therefore, the focus of marketing has shifted away from the goal of mere
customer acquisition to customer retention in order to substantially reduce
marketing costs.
Benefit from wider opportunities to market more products and services to
customers who are already loyal to you. The key differentiator between customer
retention is customer satisfaction.
Satisfaction results when the customer feels that the value of a service received by
him is substantially higher than the price he paid for acquiring the service.
Customer satisfaction can be largely attributed to the quality of the service or
product. Thus, delivery of high quality service is crucial to the high service value
perception. When the major marketing goal of a company is customer retention, the
quality of service delivery is, undeniably, the key differentiator.
Other producers under similar marketing conditions would adhere to similar norms
of non-compliance or transgression of quality. Thus the issue of competition driving
up the quality was not taken seriously. Live and let live was the motto that most
large producers adhere to. The lack of serious quality improvement translates into
savings in production costs as elaborate effort for improvement was not done.
Almost every customer assumed that the service or product received by them will
not be perfect in every respect. Customers took it for granted that luck was involved
in receiving high-quality goods and services. Thus, people would avoid cars
assembled on Fridays or Mondays. It was assumed that during the pre-weekend
phase, when the employees where focused on the forth coming weekend, and the
post-weekend phase , when the employees were physically and mentally tired from
their weekend exploits, they paid less attention to work. It was thus assumed that
on Fridays and Mondays, nobody would stop the assembly line for just a bolt not
fitted at the appropriate place. People preferred cars which were driven from the
factory to the dealer’s premises rather than carried by trucks to the delivery points.
Customers believed that inherent defects were bound to be uncovered during this
pre-delivery phase, and, therefore they would be duly identified and rectified before
customer delivery.
The total service quality management [TSQM] emphasizes different policies.
Statements such as the following demonstrate the approach:
Quality is free. It is the non-quality that costs money. Non-quality means that
everything is not done right from the beginning.
About 35% of the company’s costs are due to faults and their corrections.
Quality enhancement usually improves profitability by 5 to 10%. This is a sizable
jump in the overall profitability. To get a similar increase in profitability with quality
improvement, the company will need to increase the turnover by 20 to 25%, which
is quite a sizable task.
The costs of the quality improvement are roughly divided into two groups: cost of
conformance and cost of non-conformance.
Cost of Conformance
This includes costs incurred to adhere or stick to the existing established standards
or norms. This is the maintenance and improvement of the quality.
• Preventive costs: these include staff training cost and costs of the robust design or
robustness built into the service.
• Cost of Control: to continuously maintain the high quality, it is necessary to carry
out surveys and obtain feedback from the customers to ensure that the delivery is
as per the planned level of service and quality standards.
Cost of non-conformance
The non-conformance to the established standards results in additional cost of
customer dissatisfaction, complaints and warranty claims. The costs are for
replacement, correction or compensation of the faulty delivery of services or goods.
A further problem in understanding and managing service quality flows from the
intangibility, variability and inseparability of most services which results in a series
of unique buyer-seller exchanges with no two services being provided in exactly the
same way. It has been noted that intangibility and perceived risk ness affects
expectations, and in one study of a long-distance phone service, a bookstore and a
pizza shop service, it was concluded that intangibility had some role in service
quality expectations. Managing customers’ expectations can be facilitated by
means of managing the risks a consumer perceives when buying a particular
service.
a. Reliability
This dimension is shown to have the highest influence on the customer perception
of quality. It is the ability to perform the promised service dependably and
accurately. Sahara Airlines, an upcoming domestic air carrier within India, has been
striving to protect itself as a reliable airline. It hopes to differentiate itself from other
airlines Indian Airlines. To p[protect this reliability, Sahara Airways has a scheme of
full refund plus a coupon of Rs3,000 to every passenger on delay of flights by more
than 59 minutes.
When service delivery fails the first time, a service provider may get a second
chance to provide the same service in the phase called ‘Recovery’. The
expectations of the customer are usually higher during the recovery phase than
before because of the initial failure. Thus, the service provider is likely to come
under greater scrutiny, thereby increasing the possibility of customer
dissatisfaction. The reliability dimension, which ensures timely delivery time after
time, helps the service provider to meet the customer expectations fully at the
lowest level of service expectation.
b. Responsiveness
It is the willingness of the service firm’s staff to help customers and to provide them
with prompt service. The customers may have queries, special requests,
complaints, etc. In fact, each customer may have problems of his or her own. While
the front-end employee may have been trained or equipped to deliver standardized
services, the customers want them to go beyond this limit. It is the willingness to
help the customer or willingness to go that extra distance that is responsiveness.
Example: A customer calls room service to find out if they would pack a Jain lunch. It
is not the hotel’s normal policy to cook such specialty and customized meals.
However, the customer being very religious minded would be very pleased if the
hotel could pack it for him to carry and eat. This may impose some strain on the
kitchen. However, the hotel may be rewarded in two different ways if it agreed to
provide the meal. The customer would be very pleased with the service and is very
likely to recommend the hotel to his friends and acquaintances. In addition, the
hotel could charge extra commensurate with the extra efforts. He is unlikely to
mind paying more.
The second aspect of responsiveness is speedy response to a customer request.
When response is delayed customers usually loses interest. Many sales
representatives respond on the phone, ‘I will call you back’. The call is never
returned. The customer draws his or her own conclusion about the quality of service
he is likely to receive in the future.
c. Assurance
It defined as the ability of the company to inspire trust and confidence in the service
delivery. It refers to knowledge and courtesy of the service firm’s employees and
their ability to inspire trust and confidence in the customer toward the company.
This dimension is considered vital for services that involve high risk as customers
may not be able to evaluate all the uncertainties involved in the process by them.
Example: Medical services requiring complex uncommon procedures, sales /
purchase of financial securities, investment issues, legal affairs, etc. demand this
service quality dimension.
There are property developers/builders who provide a list of previous buyers of flats
or apartments to potential buyers. The evaluation of construction services is beyond
technical capabilities of most buyers. However, the prospective customers are free
to call the previous customers. When prospective customers hear from them about
the company and its satisfactory delivery, they feel assured and develop a more
positive attitude towards the company.
d. Empathy
It refers to the caring, individualized attention the service firm provides each
customer. When service provider puts himself in the shoes of the customers, he
may see the customer’s viewpoint better. When customers feel t5hat the provider is
making his best effort to see their viewpoint, it may be good enough for most.
Example: a lady customer with a young child arrives slightly late at the check-in
counter and requests the agent for a seat along the aisle and near the toilet. Even if
all such seats have already been taken up, the agent and the airline may make
even effort to request another passenger to exchange seats and meet the customer
demand. The lady passenger would be delighted if her request could be honored
despite the last minute checking in, and even if she does not get such a seat, she
would be grateful for their effort.
e. Tangibles
It refers to physical facilities, equipment, and appearance of a service firm’s
employees. The job of the tangible and physical evidence of a service is
multifunctional. When a patient in the waiting room of a clinic sees the doctor’s
certificate, he becomes aware of the quality of service he is about to receive. If a
dental clinic provides patients with clean rubber footwear and freshly laundered
bibs or coats before the actual service, the patients and their accompanying
relatives or friends will be impressed. A dentist dressed in a spotless white coat is
likely to impress, them even further. Tangibles provide the customer proof of the
quality of service.
MEASURING SERVICE QUALITY
The Customer Gap: The difference between customer perceptions and expectations
Example: A contractor using an electrical subcontractor for the first time may
expect the subcontractor to use a certain grade of wire conduit in all of their
construction sites they subcontractor, however, may think the contractor wants to
use the lowest grade to keep the cost down. Unless the contractor clearly delineates
his expectations, he will probably be dissatisfied because the subcontractor did not
do what was expected.
The reverse may also occur. Management can provide a service they think
customers expect without conforming customer expectations. Although on the
surface this sounds good because customer expectations will probably be
exceeded, there are two dangers. First, if customer expectations are consistently
exceeded, in time, these expectations will rise to meet the service being provided.
Example: If customers do not expect their cars to be vacuumed and cleaned inside
when the oil is changed at Quik Lube, then at first they will be pleased with this
extra touch. But the next time they use Quik Lube, their expectations increase and
after a few times of receiving this special touch, it will become a permanent part of
their expectations. Failure to vacuum and clean the interior of the car will then
result in a negative gap since the vacuuming and the cleaning of the interior
becomes something customers expected. The second danger is that the firm may
be spending money on providing services that the customers do not expect or
perhaps even care about, thus yielding a negative impact on profit.
Causes of Gap One:
• No direct interactions with customers. When people with the authority and
responsibility for setting priorities do not fully understand customers’ service
expectations, they may trigger a chain of bad decisions and suboptimal resources
allocations that result in perceptions of poor service quality. One example of
displaced priorities stemming from an inaccurate understanding of customers’
expectations is spending far too much money on buildings and appearance of a
company’s’ physical facilities when customers may be much more concerned with
how convenient, conventional and functional the facilities are. Another example is
illustrated by the management of Sears in the early 1990s, when the company
failed to understand that the customers had changed there desires and modes of
shopping. The company kept its traditional catalogue store long after customers
had decided to take their business elsewhere. In the mid-1990s, Sears management
rediscovered its customers, now defined primarily as women, and began once again
to be profitable and satisfying to customers. The service providers see themselves
as indifferent or superior to customers. This typically happens in government-run
services such as railways or postal departments where they would not want to know
what customer desires.
• Unwillingness to ask customers about expectations. Service providers may think
that they know what is best for their customers. This is the patronizing attitude
towards the customers. In today’s changing organizations, the authority to make
adjustments in service delivery is delegated to empowered teams and front line
people. For example, when AT&T asked its long-distance operators to improve their
service to customers, the team identified key customer segments and conducted its
own customer research to determine expectations. Gap one was closed without
involving management as it is traditionally defined.
• Unprepared ness to address the expectations. The service provider may be aware
of the Shortfalls but may be unprepared to address the issue in the mistaken belief
that the customers may be tolerant or that the lapse is unlikely to loss of customer
patronage. Another trend related to Gap One involves current company strategies
to retain customers and strengthen relationships with them. The term relationship
marketing is used to describe this approach, which emphasizes strengthening the
bonds with existing customers. When customers have strong relationships with their
customers, gap 1 is less likely to occur.
• Lack of market segmentation to understand the needs are such segment. Market
segmentation is the grouping of customers sharing similar requirements,
expectations and demographic or psychographic profiles. Segmentation is usually
done to understand the needs of customers more elaborately or distinctly. While
segmentation has been used by marketers for decades, it may be more critical
today than any other time. Customers are no longer satisfied by homogenous
products and services for the mass market; now, more than ever before, they
seeking and buying services that fit their unique configuration of needs. If the needs
are not precisely understood due to lack of segmentation, quality perception is
likely to be poor.
Another problem associated with the bridging of provider gap 3 is that of dealing
with franchisees, agents, retailers and brokers. Because quality in service occurs at
the moment of truth i.e. at the point of interaction between the service provider and
the customer, control over the service encounter by the company is crucial, yet it is
rarely possible.
When one NIIT franchisee falls short of set educational standards, it reflects on the
company as a whole. When food at one outlet of Birdy's , McDonald's or Croissants
etc is below quality standards, the image of the entire chain is tarnished. For this,
the firm needs to develop systems to either control or motivate these
intermediaries to meet company goals.
Primary causes of this gap are variable and inseparable nature of services. Because
most services are performed by people, the quality of service is highly dependent
upon well the service provider performs his or her job. If the service contact
personnel provide services as specified, customers are usually satisfied and their
expectations are met, if employees do not provide the service as specified in the
service specifications, customer expectations will not be met and customers will be
dissatisfied.
• Pricing of services.
In packaged goods many customers posses enough price knowledge before
purchase to be able to judge whether a price is fair or in line with competition. With
services customers often have no internal reference point for prices before
purchase and consumption. Pricing strategies such as discounting, “everyday
prices” and couponing obviously need to be different in services in cases where the
customers have no sense of the price to start with! Techniques for developing
prices for services are more complicated than those for pricing of tangible goods.
ause service providers need to know whether their objective should be to have
consumers who are satisfied with their performance or to deliver the maximum
level of perceived service quality.’
Oliver takes the view that satisfaction is ‘the emotional reaction following a
disconfirmation experience’. Getty and Thompson defined satisfaction as a
‘summary psychological state experie
HUMAN FACTORS
It basically includes employee recruitment and selection, training, rewards and
motivation. ‘I shall not deliver substandard service nor shall I let anybody else
deliver substandard service’ is the type of motto to be adopted. For example, some
quality conscious automobile companies have given the right of halting the
assembly line to any concerned employee who may have noticed inadequate or
defective components fitted on a vehicle. This quality consciousness is crucial to
long term quality maintenance. In addition, customer feedback on quality issues has
to be an important component of employee evaluation.
SYSTEMS SUPPORT
It is not employees but also system which tends to produce defects. Thus,
organizations have to put systems in place that ensure high quality services
delivery. For example, the computerized system in the bank has to ensure accurate
and timely delivery of the customer bills and statements.
ORGANIZATIONAL FACTORS
Organizations with very high number of levels within the structure tend to have very
poor interaction between the front-end employees and the higher echelons within
the organization. The reporting structure and close interaction between the
supervisors and the front-end service delivery employees is very important. A
receptionist being a front-end employee may be seen as the key person for the
customer interaction. However if the receptionist is not authorized to ask the
housekeeping unit to improve upon the service when a customer has complained
about it, it may demotivate the employee, and, in future, the receptionist may not
report problems with the housekeeping unit.
FEEDBACK
Organizations need to encourage feedback from every employee including the
front-end employees as a part of the quality monitoring system. Employees have to
be told that this feedback is crucial for the organizational success.
1] QUALITY CIRCLES
Quality circles are groups of non-supervisors and work leaders in a single company
department who volunteer to conduct group activities in order to improve the
effectiveness of the work in their respective departments. Fishbone or Ishikawa
diagrams prepared by Ishikawa help to trace quality complaints to the responsible
production process that is the root cause of the problem. The role of individual
employees is very crucial to quality control of services as well as goods production.
This is more so in the case of services where the service is usually delivered in
person by one of the employees.
The diagram below is a root cause diagram that enables you to pinpoint the causes
contributing to the delayed departure. In addition, the frequency of each failure can
be measured so that the reasons for poor quality service can be understood and
both short and long-term measures can be instituted to tackle the
situation.
2] Customer panels
These can provide a continuous source of information on customer expectations.
Groups of customers, who are generally frequent user, are brought together by a
company on a regular basis to study their opinions about the quality of service
provided. On other occasions, they may be employed to monitor the introduction of
a new or revised service – for example a panel could be brought together by a
building society following the experimental introduction of a new branch design
format.
The use of continuous panels can offer organizations a means of anticipating
problems and may act as an early warning system for emerging issues of
importance. Retailers have been involved in the operation of continuous panels
contribute to monitor their level of service provision as well as letting panels
contribute to new product development research. User groups also have an
important part to play in many of the UK’s recently privatized industries such as
gas, water, electricity and telecommunication. However, the validity of this research
method is quite dependent on how well the panel represents consumers as a whole.
There has been a suggestion that the number of people prepared to become
members of panels is not rising as quickly as firms’ appetite for information. The
result has been the emergence of ‘professional’ panel members who may not be
representative of service users as a whole.
3] Transaction analysis
An increasingly popular method of evaluative research involves tracking the
satisfaction of individuals with particular transactions that they have recently been
involved in. This type of research enables management to judge correct
performance, particularly customers’ satisfaction with the contact personnel with
whom they have interacted, as well as their overall satisfaction for the service.
The research effort normally involves a mail-out questionnaire survey to individual
customers immediately after a transaction has been completed. For example, the
Automobile Association surveys customers who have recently been served by its
breakdown service and many building societies invite customers who have just used
their mortgage services to express their views on the service received via a
structured questionnaire. An additional benefit of this research is its capability to
associate service quality performance with individual contact personnel and link it
to reward system.
4] Perception surveys
These investigations use a combination of qualitative and quantitative research
methods. Many professional services organization have employed such studies in
order to develop future market strategies. Their aim is to achieve a better
understanding of how customers view an organization. In other words, to help the
firm itself as clients see it. The initial qualitative stages of a study involve
researchers in identifying the attitudes of clients towards the firm as well as how
the firm is perceived by the community at large. Group discussions and/or in depth
interviews are the vehicles used for assessing the perceptions of people at this
stage. In the quantitative phase of the survey , clients are asked to judge the
company’s performance using a battery of attitude statements. Perception studies
of ten include an analysis of the perceptions of a firm’s employees.
5] Mystery customers
The use of ‘mystery customer’ is a method of auditing the standard of service
provision, particularly the staff involvement in such provision. A major difficulty in
measuring service quality is overcoming the non-conforming of staff with
performance guidelines. This so called service-performance gap is the result of
employees being unable and/or unwilling to perform the service at the desired level.
An important function of mystery customer surveys is therefore to monitor the
extent to which specified quality standards are actually being met by staff.
This method of researching actual service provision involves the use of trained
assessors who visit service organizations and report back their observations. Audits
tend to be tailored to the specific needs of a company and focus on an issue that it
wishes to evaluate. The format of the enquiry is determined jointly by the client and
research organization.
The constructive nature of this research technique has to be stressed, as the
mystery customer can quite easily be mistaken by staff as an undercover agent
spying on them on behalf of the management. In particular, if the techniques are
applied correctly, they can allow management to know what is really happening at
the sharp end of their business. To be effective mystery shopping surveys need to
be undertaken independently, should be objective and must be consistent. The
training of assessors is critical to the effective use of this research method and
should include, for example, training in observation techniques which allows them
to distinguish between a greeting and an acknowledgement.
6] Analysis of complaints.
Dissatisfaction of customers is most clearly voiced through the complaints that they
make about service provision. For many companies, this may be sole method of
keeping in touch with customers. Complaints can be made directly to the provider
or perhaps indirectly through an intermediary or a watch dog body. Complaints by
customers, referring to instances of what they consider poor-quality service may, if
treated constructively, provide a rich source of data on which to base policies for
improving service quality. However, customer complaints are at best an inadequate
source of information. Most customers don’t both to complain, remain dissatisfied
and tell others about their dissatisfaction. Others simply change to another supplier
and do not offer potentially valuable information to the service provider about what
factors where wrong which cause them to leave.
In truly market - oriented organizations, complaints analysis can form a useful
pointer to where the process of service delivery is breaking down. As part of an
overall programme for keeping in touch with customers, the analysis of complaints
can have an important role to play. The continuous tracking of complaints is a
relatively inexpensive source of data which enables a company to review the major
concerns of customers on an ongoing basis and hope fully rectifies any evident
problems. In addition the receipt of complaints by the firm enable staff to enter into
direct into direct contact with customers and provides an opportunity to interact
with them over their matters of concern. As well as eliciting customers’ views on
these issues in particular, complainants can also contribute views about customer
service in general. Many companies have gone to great lengths to make it easy for
customers to complain, for example by creating free phone telephone lines and
making comment cards readily available.
7] Employee research
Research undertaken among employees can enable their views about the way that
services are provided and their perceptions of how they are received by customers
to be taken into account. Data gathered from staff training seminars and
development exercises, feedback from Quality circles, job appraisal and
performance evaluation reports, etc. can all provide valuable information for
planning quality service provision. One way in which formal feedback from staff can
be built into a systematic research program is the operation of a staff suggestion
scheme. The proposals which staff may make about how services could be provided
more efficiently and/or effectively certainly do have an important role to play in
moving service quality.
Research into employees’ needs can also identification of policies which improve
their motivation to deliver a high quality f service. Many of the techniques employed
to elicit the views of employees as internal customers are in principle the same as
those used in studies of external customers. Interviews and focus may be used in
the collection of qualitative data on employee needs, wants, motivations and
attitudes towards working conditions, benefits and policies.
In the respect of obtaining involvement and participation, involving employees in
the research process and its findings, for example by using them to gather data,
showing them videotapes of group discussions and interviews with customers and
circulating them with the findings of research reports, can do a lot for improving
their understanding of service quality issues throughout their organization. There
are many barriers to the flow of information from employees to managers,
especially in organization where there is no culture of listening to staff. Where there
are clearly identified, and for acting on the result, a shared commitment to
improving quality can greatly improve customers’ perception.
8] Benchmarking studies
The nature of customers’ quality expectations in other similar service industries can
be useful source of information for managers. It is often apparent that customer
needs may be similar between different industries, even though the service product
on offer is ostensibly quite different. Many common dimensions cut across the
boundaries of industries and apply to services in general – for example courteous
and competent staff, a pleasant environment, and helpfulness, to name but a few. It
can therefore be beneficial to investigate the nature of service provision in closely
related services areas, and draw upon the findings of any research that has been
made available. In particular, it is worth while investigating what is known in those
services sector that have a good track record of analyzing and responding to
customers’ needs and identifying whether it is applicable to an industry that has
only recently adopted a customer-led approach. For example, it is possible to learn
a lot about certain aspects of hospital service from what hotel and catering
establishments have been researching and practicing for some considerable time.
Continuing with this theme, many services organizations that have been operating
outside the private market place for many years can benefit from an understanding
of the operations of their counterparts in other countries that have openly marketed
their services I in a freely competitive market. In this way, managers within the UK
National Health Service may learn a lot about customer care by examining health
services in the USA.
The term benchmarking is frequently used to describe the process by which
companies set standards for themselves, based on a study a best practice
elsewhere. Best practice could be defined in terms of firms within the same sector,
or completely different sectors which share similar processes.
Benchmarking can be undertaken at a number of levels, based on what is compared
and what the comparison is being made against:
• Performance benchmarking This is essentially based on outcome measures.
• Process benchmarking For example, the efficiency and effectiveness of customer
handling procedures.
• Strategic benchmarking For example, comparing the integrity of a company’s
strategic plan with best practice in the industry.
• Internal benchmarking This involves comparing internal processes and structures.
• Competitive benchmarking This may be with respect to market share, selling price
etc.
• Functional benchmarking Sometimes the task will be compare the performance of
a company’s functions with best practice.
Benchmarking involves a five-step continuous process: plan the study; from the
benchmarking team; identify potential benchmarking partners; collect and analyze
the information; and adapt and improve. While benchmarking produces a standard
against which improvements are continuous and benchmarks can go out of date
very quickly.
9] Intermediary research
Service intermediaries often perform a valuable function in the process of service
delivery, performing their role in quite a different manner to goods intermediaries.
Research into intermediaries focuses on two principle concerns:
• Firstly, where intermediaries form an important part of a service delivery process,
the quality perceived by a customer is to a large extent determined by the
performance of intermediaries. In this way, the perceived quality of an airline may
be tarnished if its ticket agents are perceived as being slow or unhelpful to
customers. Research through such techniques as mystery customer surveys can be
used to monitor the standard of quality delivered by intermediaries.
• Secondly, intermediaries as co-producers of a service are further down the
channel of distribution and hence closer to customers. They are therefore in a
position to provide valuable feedback to the service principal about consumers’
expectations and perceptions. As well as conducting structured research
investigations of intermediaries, many services principals find it possible to learn
more abut the needs and expectations of their final customers during the process of
providing intermediary support services such as training.
Response to suggestions/feedback/complaints(0.628)
Recreational or special facilities – play area for children, indoor games, etc. (0.508)
Research Methodology: Sample population was 100 individual. Avoiding all the
drawbacks of the SERVQUAL method and taking necessary precautions I have used
the gap theory methodology for measuring service quality performance of
McDonalds, Pizza Hut & Dosa Plaza. I have applied the SERVQUAL instrument to the
fast food industry. I have formulated it as per the particular industry and its
relevancy to customers.
I made my respondents to compare McDonalds, Pizza Hut & Dosa Plaza with the
ideal firm in the fast food industry. In order to prevent biases, I measured the
customer expectations prior to the service and customers perception after the
service delivery. I have considered the fact that customers are affected by
advertising and word-of-mouth communications, and thus the time between
measuring expectations and perceptions have been kept very less.
The above table shows, that the fast food industry received strong ratings on the
empathy dimensions, particularly caring and individualized attention and low
ratings on the Assurance dimensions. This study used a seven point’s scale range
from “strongly agree” (7) to “strongly disagree” (1), to assess all five dimensions of
service.
Table I suggests that Dosa Plaza is the highest performing fast food restaurant and
holds an advantage over others in the area of perceived reliability, assurance and
empathy dimensions. Whereas Pizza Hut is good at responsiveness and tangible
dimensions.
Responses were computed by subtracting the expectation response from the
perception response. Each aspect of the quality of service showed differences with
respect to the size of gap score. The bigger the gap is, the more important the
dimensions from the customer’s point of view, which would be ranked in the
following, order: Empathy, Responsiveness, Tangibles, Reliability and Assurance.
None of the service quality dimensions had a positive SERVQUAL score, suggesting
that the Fast food restaurants considered for this study did not meet or exceed
consumer’s expectations.
Conclusion:
Findings from this study provide initial direction in determining the optimum service
quality attributes to focus on in promoting fast food services. No positive scores
were found. The largest discrepancy was found along the “empathy” dimension.
This indicates that the sample population appears not to be getting what they
expect from their fast food service experience as far as individual attention is
concerned.
If the industry persists in measuring and monitoring the perceptual aspects of fast
food service quality, the complementary aspects of basic outcome must be tracked
as well to ensure an appropriate and satisfactory customer experience.
Managerial Implications:
These results have several managerial implications, in that they support the
findings of previous research which indicates that customer contact employees play
an important role in affecting customer perception of service quality. In general, it is
important for managers to identify the relevant intrinsic and extrinsic cues used by
consumers in order to communicate the relevant quality signals to them. The
implication of this research is to design a service delivery system that promotes
positive “moments of truth”. Moreover, using service quality assessment like
SERVQUAL can ensure that fail points in customer encounters are reduced, leading
to a positive experience and strong customer referrals.
Additionally, managers should make key performers aware of their role and provide
them with adequate training in order to offer a consistently high standard of service
delivery. We saw low customer ratings on the empathy dimension of service quality
in our research. Due to the dominant role played by the employees in the fast food
industry, management should make sure that there are always sufficient staffing
levels to cope with peaks and troughs in demand. In doing so, they will optimize
service delivery and provide consistent service at all times.
Finally, it is important that the service quality be assessed on a regular basis. The
first assessment provides a baseline for comparison with future assessments. This
comparison is essential for gauging the effectiveness of service quality
improvement efforts and identification of service quality trends as they emerge. The
frequency of reassessments will vary with the individual firm’s situation.
Conclusion
The “Service Quality Top Ten” Lessons
The Key lessons which I learned after the whole study and the developments of the
last 10-15 years are as follows:
Service delivery is a process, it is as subject to the disciplines of analysis and
process control as any manufacturing process. Customer value is “built in” to
service design, and it is possible to evaluate service design systematically using
tools such as service blueprinting, Gap model of service delivery, service profit
chain, return on quality analysis.
“The times are changing”, as Bob Dylan wrote gives a conclusion that the old road
for financial success for business was to seek profit growth through market share
and through cost economies. Times have changed, and the new order identifies that
both cost reduction and revenue increases through retention and satisfaction, or
seeking market share and customer loyalty.
Everything includes service, and most things are predominantly services.
Think globally, act locally. Larger organizations need to recognize that in delivering
customer value, homogenous an enterprise following a single, perspective customer
value formula doesn’t work optimally.
Quality isn’t free. Investments in service quality improvements must be made with
the an eye on Net Present Value (NPV) or Return on Investment (ROI) as other
investments, and with the same discipline in identifying anticipated benefits, and
measurement of outcomes.
Quality doesn’t always lead to profits; “For an individual firm, higher service quality
is not an unconditional guarantee of profitability”. Blind faith in quality initiatives is
often a cover on the organization’s failure.
Do it with numbers. Clearly there is an emerging science to developing quality
service, and increasing customer value. There are many tried and true methods for
measuring customer satisfaction.
One size doesn’t fit all. The ultimate goal of the customer value models is company
profitability – but service delivery systems aren’t designed as one size to fit all. The
consequence may be an active plan to lose some customers.
Understanding customers’ needs – even when you know different customers have
different needs, recognize that each customer’s needs may vary dependent on
situational factors.
And, lastly, when in doubt – ask. The best way to understand what customers’ value
is to ask them. The Gap model of service delivery is useful approach to ask
customers what they value, and explore with staff and management as to how to
deliver it.