Chapter 3: Service quality Flashcards
I. Development of quality management
Quality: A historical perspective
- Development of the concept of quality control in the 1920s in the production to ensure the consistency of the manufactured products
- Significant developments in quality management in the 1950s:
. First edition of the Quality Control Handbook (Dr. Joseph M. Juran)
. Concept of “Total Quality Control (TQC)” (Armand V. Feigenbaum)
. Lectures on the Fundamentals of Statistical Quality Control for the Union of Japanese Science and Engineers (JUSE) and the Managing Directors of Leading Japanese Companies (Including Sony, Nissan, Mitsubishi, Toyota) (Dr. W. Edwards Deming)
“Quality Gurus”
- Dr. W. Edwards Deming: 1900 – 1993. Japan. Statistical control of the production process. Increasing productivity by reducing variability.
- Dr. Joseph M. Juran: 1904 – 2008. Japan. Not only statistical analysis. Quality control as an integral part of a holistic management approach. Communication, management and people crucial to achieving quality.
- Philip Crosby: 1926 – 2001. West hemisphere. “Zero Defects” and “Do It Right First Time”. Four absolute guidelines: 1.Quality means conformity with the requirements, not “goodness”. 2. Quality arises through prevention, not just assessment. 3.Null defects must be the standard. 4.Measurement of quality is done via the price of non-conformity
Why is Quality important?
- Product differentiation and sustainable competitive advantage. Quality as the key to sustainability of competitive advantages.
- Market share and profitability. Quality perceptions of customers influence their loyalty.
- Cost of quality. Poor quality causes costs for the company
Total Quality Management, causes, core ideas, criticism
Causes:
Rising customer expectations
Increasing competition
Increasing quality level (products are better than 20 years ago)
Globalization (competition is international)
Core ideas: Focus on customer and efficiency Continuous, systemic improvement Required skilled, collaborative staff Required confident managers with inspiring leadership culture
Criticism:
Ignores of customer perception
Ignores of services
Ignoring guidelines on how the quality can be improved
II. Importance of service quality
Implications of the quality concept for services
- Introduction of quality concept into service literature in the 1980s, but strong focus on manufacturing and marketing of physical products
- Different characteristics of services and physical products, therefore lack of fit of the product-focused strategies
- No objective measures available to assess the quality of intangible services
- Service-specific alignment of the quality concept (i.e. Toyota, each employee try to reduce defects):
. Focus on the behavior, expectations and satisfaction of consumers
. Service quality as a subjective perception of an experience
. Assessment of service quality by the customer
Effects of service quality
Customer satisfaction: (service is only one component of Cust. satisf.)
- Consumer satisfaction of a need, desire, goal, etc. through a product, service or experience (satisfaction = related to consumption, quality = is observational/attitudinal or process-driven)
- Summary assessment of several experiences with a company
Customer loyalty: (see graphic loyalty vs satisfaction)
- 2 components: Attitude-based and behavior-based loyalty
- Customer Lifetime Value (firms seeks to maximize profitability over lifetime of customers.)
Customer Delight:
- Positive emotion (surprise is good, but the next time must increase it and it is not sustainable)
- Significant exaggeration of customer expectations
Theory of service quality:
role of customer,
understanding quality of service,
manage service quality.
Key role of the customer:
- Expectations of the service
- Assessment of service quality
Understanding the quality of service:
- Comparison of expectations and performance (rely on WOM, social media sources)
- Confirmation or non-confirmation of expectations (what will offer, or what should offer)
- Meeting or exceeding expectations (difficult to sustain, high costs)
- Influence of other customers (size of the audience)
To successfully manage service quality, companies need to answer two questions:
- How do customers perceive the quality of a service? (Conception of service quality)
- Which resources and activities of the company influence the service quality? (Determinants of service quality)
III. Measurement of services quality
Measure Service quality
No uniform measurement model available in the literature
Six common models of service quality:
- Nordic model (Grönroos 1982a)
- Two-dimensional model (Lehtinen 1983)
- Gaps model (Parasuraman / Zeithaml / Berry 1985)
- SERVQUAL (Parasuraman / Zeithaml / Berry 1985; 1988)
- SERVPERF (Cronin / Taylor 1992)
- E-S-QUAL (Parasuraman / Zeithaml / Malhotra 2005)
The different service quality measurement models agree that service quality is
(1) multifactorial (several aspects),
(2) complex (can not answer with one question only), and
(3) different in origin (Americans are different from Scandinavians).
Nordic Model (I / II)
- Measurement of service quality as a combination of technical and functional quality:
- Technical quality: What the customer (material) get or bought? i.e. eat
- Functional Quality: How did the customer get the service / how was delivered? i.e. service
- Functional quality (makes the difference - peripherial) more important than technical functionality. Focus on FQ to achieve organizational success.
Expanded Nordic Model (II/II)
see graphic
Two-dimensional model
Measurement of service quality as a combination of process and result quality:
- Process quality: Customer assessment during the service experience. Moments of true. Haircut – co-creator.
- Result quality: Customer assessment after the service experience. i.e. my hair cut result.
By controlling the process quality, the quality of the result can also be controlled
Gap Model
Measurement of service quality as comparison of expectations and perceptions (confirmation / non-confirmation):
- Expected Service: What I want to get
- Perceived Service: What I get
Customer judgements of several intermediate interactions (service design, communication, management, and delivery)
SERVQUAL
Measuring service quality as a multi-item scale to capture customer expectations and perceptions across five dimensions: - Reliability (reliability) - Standby (responsiveness) - Empathy (empathy) - Trustworthiness (Assurance) - Physical appearance (Tangibles) Extension of the gap model
Concept of the tolerance zone (Zone of Tolerance):
Division of the five dimensions:
- Result dimension: reliability
- Process dimensions: readiness, empathy, trustworthiness, physical appearance
Key Roles of Process and Result Dimensions:
- Meet expectations: reliability (result dimension). Minimal tolerance for what is not being meet.
- Exceed expectations: responsiveness, empathy, trustworthiness, physical appearance (process dimensions). Key to exceed expectations.
SERVPERF
Measurement of service quality as a multi-item scale to measure perceived performance (not measure expectations).
Development from the SERVQUAL scale
Hierarchical model with three superior dimensions (interaction, physical environment, outcome) of service quality, each with three sub-dimensions:
- Interaction: attitude, behavior, experience
- Physical environment: environment, design, social factors
- Outcome: waiting time, tangible elements, valence (personal factors that affect experience)
E-S-QUAL
Measuring service quality as a multi-item scale for evaluating online services. Four measures: - Efficiency (Efficiency) - Fulfillment (fulfillment) - System Availability - Data Protection (Privacy)
