CUSTOMER PERCEPTIONS OF SERVICE by RushenChahal

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									CUSTOMER PERCEPTIONS OF
SERVICE


        Prof. Rushen Chahal




                              Page 1
  Customer Perceptions of Service

• Provide you with definitions and
  understanding of customer satisfaction and
  service quality
• Show that service encounters or the
  “moments of truth” are the building blocks of
  customer perceptions
• Highlight strategies for managing customer
  perceptions of service


                                           Page 2
   Customer Perceptions of Service Quality and
             Customer Satisfaction

      Reliability                  Situational
                                    Factors
Responsiveness         Service
                       Quality

     Assurance
                                    Customer
       Empathy                     Satisfaction
                       Product
                       Quality
       Tangibles


                                    Personal
                        Price       Factors
                                                  Page 3
       Factors Influencing
      Customer Satisfaction

• Product/service quality
• Product/service attributes or features
• Consumer Emotions
• Attributions for product/service success
  or failure
• Equity or fairness evaluations


                                       Page 4
         Outcomes of
     Customer Satisfaction

• Increased customer retention
• Positive word-of-mouth communications
• Increased revenues




                                   Page 5
                                                                            Figure 4-3
                                            Relationship between Customer
                                              Satisfaction and Loyalty in
                                                Competitive Industries
                                           100%
                     Loyalty (retention)


                                           80%

                                           60%

                                           40%

                                           20%

                                            0%
                                               Very        Dissatisfied     Neither       Satisfied        Very
                                            dissatisfied                  satisfied nor                  satisfied
                                                                          dissatisfied

                                                               Satisfaction measure

Source: James L. Heskett, W. Earl Sasser, Jr., and Leonard A. Schlesinger, The Service Profit Chain, (New York, NY: The Free Press, 1997), p. 83.


                                                                                                                                   Page 6
        Service Quality


• The customer’s judgment of overall
  excellence of the service provided in
  relation to the quality that was expected.
• Process and outcome quality are both
  important.



                                       Page 7
              The Five Dimensions of
                  Service Quality

Reliability    Ability to perform the promised
               service dependably and
               accurately.
Assurance      Knowledge and courtesy of
               employees and their ability to
               convey trust and confidence.
Tangibles
               Physical facilities, equipment,
Empathy        and appearance of personnel.
               Caring, individualized attention
               the firm provides its customers.
Responsiveness
               Willingness to help customers
               and provide prompt service.
                                                  Page 8
                       Exercise to
               Identify Service Attributes
In groups of five, choose a services industry and spend 10 minutes
brainstorming specific requirements of customers in each of the five
service quality dimensions. Be certain the requirements reflect the
customer’s point of view.
Reliability:

Assurance:

Tangibles:

Empathy:

Responsiveness:

                                                                       Page 9
                   SERVQUAL Attributes
                                                ASSURANCE
                                                  Employees who instill confidence in
                                                   customers
                                                  Making customers feel safe in their
                                                   transactions
RELIABILITY                                       Employees who are consistently courteous
                                                  Employees who have the knowledge to
   Providing service as promised                  answer customer questions
   Dependability in handling customers’
    service problems                           EMPATHY
   Performing services right the first time      Giving customers individual attention
   Providing services at the promised time       Employees who deal with customers in a
   Maintaining error-free records                 caring fashion
                                                  Having the customer’s best interest at heart
                                                  Employees who understand the needs of
RESPONSIVENESS                                     their customers
   Keeping customers informed as to              Convenient business hours
    when services will be performed            TANGIBLES
   Prompt service to customers                   Modern equipment
   Willingness to help customers                 Visually appealing facilities
   Readiness to respond to customers’            Employees who have a neat,
    requests                                       professional appearance
                                                  Visually appealing materials
                                                   associated with the service
                                                                                   Page 10
               The Service Encounter

• is the “moment of truth”
• occurs any time the customer interacts with the firm
• can potentially be critical in determining customer
  satisfaction and loyalty
• types of encounters:
   – remote encounters
   – phone encounters
   – face-to-face encounters
• is an opportunity to:
   – build trust
   – reinforce quality
   – build brand identity
   – increase loyalty                                    Page 11
                      Figure 4-4
             A Service Encounter
           Cascade for a Hotel Visit

Check-In

   Bellboy Takes to Room

                Restaurant Meal

                       Request Wake-Up Call
                                         Checkout



                                              Page 12
                          Figure 4-5
               A Service Encounter
             Cascade for an Industrial
                   Purchase

Sales Call

    Delivery and Installation

                           Servicing

                                Ordering Supplies
                                                    Billing



                                                        Page 13
Critical Service Encounters Research



 • GOAL - understanding actual events and
   behaviors that cause customer
   dis/satisfaction in service encounters
 • METHOD - Critical Incident Technique
 • DATA - stories from customers and
   employees
 • OUTPUT - identification of themes
   underlying satisfaction and dissatisfaction
   with service encounters
                                          Page 14
Sample Questions for Critical Incidents
         Technique Study

  • Think of a time when, as a customer, you had
    a particularly satisfying (dissatisfying)
    interaction with an employee of             .
  • When did the incident happen?
  • What specific circumstances led up to this
    situation?
  • Exactly what was said and done?
  • What resulted that made you feel the
    interaction was satisfying (dissatisfying)?
                                             Page 15
  Common Themes in Critical
 Service Encounters Research


   Recovery:            Adaptability:
Employee Response      Employee Response
 to Service Delivery   to Customer Needs
   System Failure         and Requests


     Coping:            Spontaneity:
 Employee Response       Unprompted and
to Problem Customers   Unsolicited Employee
                       Actions and Attitudes

                                               Page 16
                 Recovery

  DO                     DON’T
• Acknowledge           • Ignore customer
  problem               • Blame customer
• Explain causes        • Leave customer to
• Apologize               fend for him/herself
• Compensate/upgra      • Downgrade
  de                    • Act as if nothing is
• Lay out options         wrong
• Take responsibility
                                             Page 17
                 Adaptability

  DO                         DON’T
• Recognize the            • Promise, then fail to
  seriousness of the         follow through
  need                     • Ignore
• Acknowledge              • Show unwillingness
• Anticipate                 to try
• Attempt to               • Embarrass the
  accommodate                customer
• Explain rules/policies   • Laugh at the
• Take responsibility        customer
• Exert effort to          • Avoid responsibility
                                                     Page 18
                 Spontaneity

    DO                         DON’T
• Take time                • Exhibit impatience
• Be attentive
                           • Ignore
• Anticipate needs
                           • Yell/laugh/swear
• Listen
• Provide information      • Steal from or cheat
  (even if not asked)        a customer
• Treat customers fairly   • Discriminate
• Show empathy             • Treat impersonally
• Acknowledge by
  name                                         Page 19
                  Coping


 DO                    DON’T

• Listen             • Take customer’s
• Try to               dissatisfaction
  accommodate          personally
• Explain            • Let customer’s
• Let go of the        dissatisfaction affect
  customer             others


                                           Page 20
                                   Figure 4-6
                    Evidence of Service from the
                     Customer’s Point of View
                                                   Contact employees
                                                   Customer him/herself
 Operational flow of                              Other customers
activities
                                  People
 Steps in process
 Flexibility vs.
standard
 Technology vs.                     Physical              Tangible
human                   Process
                                     Evidence             communication
                                                           Servicescape
                                                           Guarantees
                                                           Technology


                                                                      Page 21

								
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