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Six sigma in
The challenges of six sigma in improving
improving service quality service quality
Behnam Nakhai
Department of Business Administration, Millersville University of Pennsylvania, 663
Millersville, Pennsylvania, USA, and
Joao S. Neves Received 10 June 2008
Revised 2 March 2009
Department of Management, The College of New Jersey, Ewing, Accepted 24 March 2009
New Jersey, USA
Abstract
Purpose – The purpose of this paper is to critically evaluate the contributions of six sigma
methodology to the improvement of service quality. Since its development in the late 1980s, six sigma
has been extensively applied in manufacturing and quasi-manufacturing settings. This study aims to
explore the challenges of six sigma in reaching a much wider field of application.
Design/methodology/approach – Utilizing the service quality framework, the authors assess the
contributions of six sigma and explore its limitations when applied to services.
Findings – The relentless drive toward adopting six sigma to services has led both to a limited field
of applications and to unrealistic expectations as to what six sigma is truly capable of achieving,
particularly in knowledge-based environments.
Research limitations/implications – This research focuses on highlighting gaps in the six sigma
as applied to services; further work is necessary to identify and develop new methods and to study
their effectiveness.
Practical implications – The most immediate practical implication of this study is the call for the
redesign of the curricula of six sigma black belts training programs; training in service quality is vital
for the successful application of six sigma in service operations.
Originality/value – This study provides a fresh look into six sigma application to services by
combining a thorough analysis of the service quality model with the in-depth understanding of six
sigma statistical concepts.
Keywords Six sigma, Customer services quality, Consumer behaviour, Quality management
Paper type Research paper
Introduction
Service quality is an increasingly important priority for companies that wish to
differentiate their services in a highly competitive and often cutthroat environment.
Two trends are generally at work: in industrialized nations, the services have become
the dominant sector of the economy, and, at the same time, products are being offered
more and more as bundles of goods and services in response to a more comprehensive
understanding of customer needs. Aided by innovative and pervasive communication
technologies, even the old manufacturing facilities have largely turned into “service International Journal of Quality &
factories” (Chase and Garvin, 1989). Reliability Management
Vol. 26 No. 7, 2009
From an academic perspective, service quality continues to be a stimulating topic in pp. 663-684
contemporary management theory and practice. Researchers in the field of marketing q Emerald Group Publishing Limited
0265-671X
have contributed significantly to our understanding of the nature of services and of the DOI 10.1108/02656710910975741
IJQRM nature of customer satisfaction (Ghobadian et al., 1994; Grönroos, 1982, 1984). The
26,7 most consistent findings of three decades of service quality research are that:
.
service quality is more difficult for the consumer to evaluate than product quality;
.
service quality perceptions result from a comparison of consumer expectations
with actual service performance; and
664 .
quality evaluations are not based solely on the outcome of a service but also
involve evaluation of the delivery process.
The challenges of service quality management are well captured in the words of Berry
and Parasuraman (1997, p. 66):
The task of improving service in organizations is complex. It involves knowing what to do on
multiple fronts, such as technology, service systems, employee selection, training and education,
and reward systems. It involves knowing how to implement these actions and how to transform
activity into sustainable improvement. Genuine service improvement requires an integrated
strategy based on systematic listening. Unrelated, incomplete studies, outdated research, and
findings about customers that are not shared provide insufficient support for improving service.
In services, the meaning of quality can be elusive and is often defined as a measure of
how well the service level delivered meets customer expectations (Lewis and Booms,
1983). Rust et al. (1994) defined six levels of customer expectation as shown in Figure 1.
According to this hierarchical framework, the will expectation is the average level of
quality that is predicted based on all available information and represents the level of
quality most expected by the customer; the should expectation represents the level of
service the customer believes is deserving; and, the ideal expectation is what the
customer believes is the best of circumstances. The minimally acceptable expectation
is the threshold level of mere satisfaction, while the low-will expectation is the lowest
level of quality expected by the customer and the worst possible is the worst service
outcome that the customer can imagine.
Figure 1.
The hierarchy of customer
expectations
The concept of service quality is a technical term in the marketing literature that usually Six sigma in
embodies a particular model relating service performance, customer perceptions of improving
quality, customer expectations, and customer satisfaction. The seminal work in this area
was presented by Parasuraman and his colleagues who developed a framework for service quality
assessing five dimensions of customer perceptions of service quality (Parasuraman et al.
1985, 1988, 1991, 1994; Zeithaml et al., 1988, 1996; Berry and Parasuraman, 1997). A
number of studies have criticized and expanded the early stream of research and have 665
proposed alternative models, which are reviewed in Seth et al. (2005).
Recently, a number of articles has focused on the importance of six sigma for
services and the challenges of applying this quality improvement methodology to
service operations (Biolos, 2002; Patton, 2005; Hensley and Dobie, 2005; Antony, 2006;
Chakrabarty and Tan, 2007; Antony et al. 2007; and Kumar et al., 2008). For example,
Kumar et al. (2008) debunk the seven most common myths about six sigma that:
(1) it is a fad;
(2) it is all about statistics;
(3) it is good only for manufacturing processes;
(4) it is effective in large organizations;
(5) it is the same as TQM;
(6) it requires strong infrastructure and massive training; and
(7) it is not cost effective.
Myth 3 is of special interest to us given the context of this study. What is the effectiveness
of the six sigma methodology in improving the quality of services? What can be learned
from the service quality literature that may inform the six sigma professionals and
contribute to the effectiveness and to the range of applications of six sigma?
This article first summarizes the growing literature of six-sigma applications in
services, highlighting the potential and possible limitations of six sigma applications in
service industry particularly in a knowledge-based environment. We then examine the
theoretical contributions of six sigma to the quality field and compare it to total quality
management (TQM). We present the main tenets of the service quality model, point to
some deficiencies in the application of six sigma to services, and discuss the implications
of those deficiencies to the continued expansion of this approach in service industries.
While these are all important considerations when implementing six sigma in any
environment, there are specific difficulties in applying six sigma programs in the
service sector. Hensley and Dobie (2005, p. 87) identify some of the problems that come
about when implementing six sigma in the service sector:
.
it is harder to collect data in service industries; Six sigma in
.
it is harder to measure due to various things that happen when customers and improving
service providers interact; service quality
.
it may be more difficult to control and measure six sigma in the service industry
due to the difficulties that arise from the various sub-processes;
.
the data are not as reliable since the data are collected through more direct (“face 669
to face”) means.
Biolos (2002, pp. 3-5) and Antony (2006, pp. 239-241) provide useful advice for
consideration when applying six sigma to a service business:
. consider which processes can yield the most benefit from six sigma;
.
the customer comes first so you must consider the impact on your customer;
.
search relentlessly for the root causes;
.
get to the root cause of the main problems plaguing your process;
.
determine what is considered a service defect and how it will be measured;
.
compare your company and your company’s capabilities before and after six
sigma was implemented;
.
do not forget this is no short time commitment;
.
determine the risks that need to be considered with the project;
.
identify the costs as well as benefits associated with each part of the project;
.
clearly determine what everybody’s responsibilities are as well as any
milestones.
With training costs up to US$50,000 per worker, the costs of implementing six sigma in
an organization can be considerably high (Antony, 2006; Fahmy, 2006) and this has
kept many small- and medium-sized companies from adopting six sigma (Wessel and
Burcher, 2004; Antony, 2006; Fahmy, 2006). Wessel and Burcher (2004, p. 268-271)
describe ten imperatives for small and medium companies implementing six sigma:
(1) all projects must benefit the company’s bottom line;
(2) track results for 12 months;
(3) small and medium companies must focus their six sigma program on the first
two imperatives;
(4) incorporate a shorter training program that involves training the quality
leaders but not incorporating the large green belt base;
(5) implement a one day training program to create awareness in the company;
(6) allow the quality leaders to handle the six sigma projects;
(7) design a corporate structure that supports a six sigma culture;
(8) small and medium companies must make sure they have the “fundamental
elements of process management”;
(9) use consultants and trainers offering modular services;
(10) combine the efforts of six sigma and ISO 9000.
IJQRM The literature on six sigma applications to services is vast and varied. However,
26,7 something seems to be missing. While the importance of linking six sigma to customer
satisfaction is often mentioned in this literature, there is little analysis of what
customer satisfaction is and the role customer expectations may play in the evaluation
of quality. There seems to be little room to incorporate, or even provide linkages to, the
relevant research in the service quality literature. In none of the articles on six sigma
670 applications to services that we investigated did we find the recognition of a service
quality model or the development of a theoretical service framework; in only a few (e.g.
Hensley and Dobie, 2005; Kim, 2006) there was a brief reference to the service quality
model. It appears that the application of six sigma to services will be severely limited if
there is no deep understanding of the nature of services and of how people judge
quality in services.
Contributions of six sigma to quality
An excellent overview of six sigma’s assumptions, motivations, steps and tools can be
found in de Koning and de Mast (2006). Two basic references which provide a
comprehensive coverage of view of this approach are Pande et al. (2000) and Pyzdek
(2001). In this section we identify and discuss four fundamental contributions of six
sigma to the quality movement.
Six sigma as a philosophy: reducing process variability produces greater benefits than
just controlling for the process average
A critical contribution of the six sigma philosophy is the realization that the variation
of an operation impacts the rest of the process very significantly. This is due to the
interrelated nature of most production processes and to the impact that a single
defective may have across the entire process. Analytical studies show that the
reliability of a process is multiplicative, and thus the probability of producing a
defective item depends highly on the reliability of each operation. High variation of an
operation leads to a higher proportion of defectives and thus impacts the entire process.
An important assumption of the six sigma philosophy is that reducing the variation of
a process leads to greater insights about how it functions than simply focusing on how
to control its average. Associated with this assumption is the realization that in gaining
an understanding of how to reduce variation, one also learns how to control the process
average. These assumptions have totally replaced the focus on controlling the process
average with little regard to variation, as it was common in traditional statistical
process control (SPC) practices.
Figure 2.
The six sigma’s 3.4 EPMO
quality standard
Six sigma in
Feature TQM Six sigma
improving
Emphasis Customer satisfaction Process reliability, reduction of service quality
process variation
Hoerl (2001) presents a sample black belt curriculum for manufacturing applications.
Gitlow and Levine (2005) and Evans and Lindsay (2005) show full-blown six sigma
curricula for black belts and master black belts.
A number of researchers have attempted to define and model service quality. In their
classic study, Parasuraman et al. (1985) identified ten service quality determinants, i.e.
ten key criteria that customers use to evaluate quality regardless of the type of service:
reliability, responsiveness, competence, access, courtesy, communication, credibility,
security, understanding and knowing the customer, and tangibles. For Parasuraman et al.
(1985) credibility and tangibles are search attributes; access, communication, courtesy,
reliability, responsiveness, and understanding are experience attributes; and competence
and security are credence attributes. Using factor analysis, these researchers later
developed a service quality scale in which the ten original determinants of quality were
collapsed into five dimensions (Parasuraman et al., 1988, 1991):
(1) reliability – consistency of performance and dependability; performs service
right at the first time; honors its promises; keeps accurate records, correct
billing, and performs services at the designated times;
(2) responsiveness – readiness to provide the service; timeliness; setting up
appointments promptly;
(3) assurance – knowledge, competence and courtesy of employees; convey trust
and confidence; has the required skills and knowledge; polite, respectful,
considerate, friendly; trustworthiness, believability, honesty;
(4) empathy – caring; individualized attention, approachability, ease of contact;
effort in understanding the customers’ needs; and
(5) tangibles – physical evidence of the service; physical facilities, tools and
equipment; appearance of providers; appearance of other customers in the
service facility.
For each dimension, the service quality scale provides a score for customer
expectations (E) and a score for customer perceptions (P) of service quality. The
differences between the two scores on each dimension are called gap scores. Service
quality (SQ) is a function of the differences between perceived service (Pi) and expected
service (Ei) for n service quality factors, i.e.
X
n
SQ ¼ ðP i 2 E i Þ ¼ Gap 5
i¼1
and the gap equation, SQ ¼ P 2 E, has become the e ¼ mc 2 analog for service quality.
IJQRM Parasuraman and his colleagues have proposed one of the most important models of
26,7 service quality, known as ServQual or the Gap Model (Parasuraman et al., 1985, 1988,
1991, 1994; Zeithaml et al., 1988, 1996; Berry and Parasuraman, 1997). For these
authors, satisfaction is based on the disconfirmation of consumer expectations:
Satisfaction occurs when perceived performance meets or exceeds the customer
expectations and dissatisfaction results when there is a negative gap between
676 performance and expectations. The difference between perceived service and expected
service (Gap 5) produces satisfaction or dissatisfaction and is primarily due to four
organizational gaps, Gap 5 ¼ f (Gap 1, Gap 2, Gap 3, Gap 4). The four organizational
gaps, which fall under the responsibility of management, are:
(1) difference between consumer expectations or quality determinants, and
management’s perception of such consumer expectations;
(2) difference between management’s perceived quality determinants and service
specifications (i.e. the critical-to-quality specifications);
(3) difference between quality specifications and actual service delivery; and
(4) difference between actual service delivery and the company’s external
communications about its services (e.g. word of mouth, past experience,
promises, reputation, standard of care).
Figure 3.
The service quality model
Six sigma and service quality Six sigma in
Differences between goods and services lead to service firms and goods-producing firms improving
having different success factors (Ghobadian et al., 1994; Frei, 2008). To what extent does
six sigma fulfill the service quality gaps, lead to the improvement of the service quality service quality
dimensions, and contribute to service quality management? The answers to these
questions are not trivial since there are apparent challenges posed by the very nature and
core premises of services: Is the reduction of variation always compatible with individual 677
customer attention and service customization? Is measuring product attributes
fundamentally different from measuring customer perceptions and expectations,
especially given that the latter are not controllable by the provider? Do the inherent
service characteristics of heterogeneity, intangibility, perishability, and inseparability
pose unique challenges in the definition and measurement of quality?
In one way or another, these questions are relevant in all types of services but their
answers depend on the type of industry and on the nature of the service being
provided. For example, in process-based dominated service industries such as banking,
auto registration, or telecommunications, services may be highly standardized.
Whereas in knowledge-based services (e.g. legal services, interior and architectural
design, health industry and software development) and in highly psychological
industries (e.g. travel, lodging and entertainment) each customer’s expectations and
needs play a much more critical role. We will examine these issues in terms of the six
sigma contributions to service quality and in relation to the main service quality
concepts presented above.
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