Service Quality

Dimensions of Service Quality

 Reliability
 Perform promised service dependably and accurately.
Examples: delivered home heating oil on schedule, correct
diagnosis and treatment of a medical problem.
 Responsiveness
 Willingness to help customers promptly. Example: avoid
keeping customers waiting for no apparent reason.
 Assurance
 Knowledge and courtesy of employees. Ability to convey
trust and confidence. Example: being polite and showing
respect for customer.
 Empathy
 Providing caring, individualized attention to customers.
Example: being a good listener.
 Tangibles
 Physical facilities and facilitating goods. Example:
cleanliness.
 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)
 Service Quality Gap Analysis

Customer Satisfaction
Customer GAP 5 Customer
Perceptions Expectations

Managing the Customer / Understanding

Evidence Communication Marketing Research the Customer
GAP 4 GAP 1
Management
Service
Perceptions
Delivery of Customer
Expectations
Conformance
Design GAP 2
GAP 3
Conformance Service Design
Service
Standards
 Quality Service by Design
 Quality in the Service Package
 Supporting facility
 Facilitating goods
 Information
 Explicit services
 Implicit services
 Taguchi methods (robust design)
 Poka-yoke (fail-safing)
 Example: Height bar at amusement park
 Quality Function Deployment
 House of Quality
 Walk-Through Audit
 Quality Service by Design
Exercise
 How can healthcare services be redesigned to jointly optimize safety,
effectiveness, and cost?

 Currently, malpractice law is intended to ensure doctors provide

appropriate care and incompetent doctors are weeded out. It has the
unintended consequence of incentivizing doctors to "over-service"
patients to minimize liability.
 Some statistics - over 90% of medical malpractice cases are decided in favor
of the doctor, 20%-30% of tests and procedures are done primarily to
minimize the doctor's liability risk, 15% of initial diagnoses are incorrect.

 Issues to address:
 What is the service concept (i.e., how is value being created for the patient)?
 Quality of care vs. quality of service
 How does a gap analysis inform the healthcare services design process?
(Patients are good at assessing the quality of service but less so the quality
of care.)
 How can expectations be better managed?
 Achieving Service Quality
Cost of Quality
 Cost Categories (in order of cost increase)
 Prevention (to prevent failures from occurring)
 Detection (to determine the condition of a service and
whether it conforms to standards)
 Internal Failure (costs incurred to correct problems prior to
delivery to the customer)
 External Failure (costs incurred to correct problems after
delivery to the customer)
 Tradeoff between prevention/detection and internal
failure/external failure costs goal is to minimize sum
of these costs
 Examples in healthcare services?
 Achieving Service Quality
Statistical Process Control
 Statistical process control (SPC) is implemented via control
charts that are used to monitor the output of the process over
time and indicate the presence of problems requiring further
action.
 A control chart consists of a centerline based on the process
average and two control limits to indicate whether action needs
to be taken. It is intended to reflect only common (random)
causes of variation in order to detect special (assignable) causes
of variation.
 The control limits are set to strike a balance between the
following competing priorities:
 Usually detect when the process has gone out of control (narrow
control limits work better), but increases producer’s risk
 Usually not overreact to random variation (wider control limits
work better), but increases consumer’s risk
 Average number of errors

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 Achieving Service Quality
Unconditional Service Guarantee:
Customer View

 Unconditional (L.L. Bean)

 Easy to understand and communicate
(Bennigan’s)
 Meaningful (Domino’s Pizza)
 Easy to invoke (Cititravel)
 Easy to collect (Bennigan’s and Domino’s)
 Achieving Service Quality
Unconditional Service Guarantee:
Management View
 Focuses on customers (British Airways)
 Sets clear standards (FedEx)
 Guarantees feedback (Manpower)
 Promotes an understanding of the service
delivery system (Bug Killer)
 Builds customer loyalty by making
expectations explicit
 Approaches to Service Recovery

 Case-by-case addresses each customer’s

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.
 Service Recovery Framework

Severity Perceived Psychological Tangible Psychological

Of Service -empathy -fair fix -apology
Failure Quality -apology -value add -show interest

Service Follow-up Loyalty

Service Service
Patronage Recovery Satisfaction
Recovery Recovery
Expectations Retention

Customer Service Speed of Frontline Tangible

Loyalty Guarantee Recovery Discretion -small token

Service Provider Fair

Failure Aware of Restitu-
Occurs Pre-recovery Failure Immediate tion Follow-Up
Phase Recovery Phase Phase