Lecture 10 Flashcards
Explain the process that leads to rage behaviour and how to deal with these incidents
Refer to diagram
Before
- take pre-emptive action to anticipate rage incidents
- recruit service-minded people and train staff for customer dissatisfaction
During
- develop a culture that welcomes complaints
0 minimise damage to customer relationship and protect employees
- empower frontline staff to make discretionary decisions
- restore customer sense of self-esteem, fairness and give control
After
- attempt to salvage customer relationship and limit psychological damage to employees
- conduct root-cause analysis
- involve senior management if high-net-worth customer
Explain the theory of stress and coping
= Think-feel-do framework
- Cognitive appraisal is the process of categorising the encounter, with respect to its importance to wellbeing
- Coping refers to the constantly changing efforts (behavioural and cognitive) that people employ to master, tolerate or minimise a stressful situation
->Emotion-focused coping eg. venting
->Problem-focused coping eg. written complaint
- People complain
->To recover economic loss
->Rebuild self esteem
- Consumer attributions of blame
->Causal = who is to blame for (dis)satisfaction
->Control = is the cause of dissatisfaction in the control of the company
->Stability = is the (dis)satisfaction likely to recur
- Service recovery paradox
-> Customers who experience a service failure but subsequently receive excellent service recovery beyond what they expected, may ultimately be even more satisfied than they were before the failure
-> Companies should plan to lower expectations so they can recover and gain stronger loyalty
…Eg. suggest wait will be half an hour but will really only be 10 minutes
->SRP tends to occur in low harm failures followd by an exemplary ervice recovery
Explain the factors that influence complaining behaviour
- Level of dissatisfaction
- Personal importance of the service
- Cost of complaining eg. time and effort and anxiety involved with confrontation
- Benefit to be gained from complaining ie value of the outcome
- Access to a means of registering a complaint
- Who is to blame for the problem (attributions)
- Demographic factors eg. education, age, culture
- Successful past complaint
Explain service switching behaviours
= Pricing
- High price
- Price increases
- Unfair pricing
- Deceptive pricing
= Inconvenience
- location/hours
- Wait for appointment
- Wait for service
= Core service failure
- Service mistakes
- Billing errors
- Service catastrophe
= Service encounter failures
- Uncaring impolite
- Unresponsive
- Unknowledgable
= Responsive to service failure
- Negative response
- No response
- Reluctant response
= Competition
- Found better service
= Ethical problems
- Cheat
- Hard sell
- Unsafe
- Conflict of interest
= Involuntary switching
- Customer moved
- Provider closed
Explain the components of the service recovery process
= service recovery involves actions taken by the organisation to put things right for the customer following a service (core or supplementary) failure
- Most customer complaints are only satisfied with the response 50% of the time
Refer to diagram
Outline the three types of justice - it is the major service recovery theory
- Procedural justice
- Process used to resolve the problem eg. speed and convenience - Interactional justice
- Behaviour of the firms representatives during the complaint resolution process eg. open communication, concern, effort - Distributive (outcome) justice
- What a customer receives as an outcome of the recovery process eg. refund, replacement
Outline some strategies for developing an effective service recovery process
- Top management commitment
- Develop a ‘complaints as opportunities’ culture
- Training and empowerment
- Ownership of the complaint
- Service recovery tactics
- > Act fast
- > Apologise but don’t be defensive
- > Show you understand the problem from the customers point of view
- > Don’t argue with customers
- > Acknowledge customer feelings
- > Give customers benefit of the doubt
- > Clarify the steps needed to solve the problem
- > Keep customers informed of progress
- > Consider compensation
- Learning from experience and preventing problem recurrence
- > Blueprinting = understand the processes behind service delivery to identify potentially weak links
- > Control charts = displaying performance as measured by specific criteria over a period of time
- > Fishbone diagram = a cause and effect analysis
- > Pareto analysis = used to identify the principal causes of observed outcomes (80% of problems caused by 20% of areas)
Identify the types of service failure
- The service itself
- > eg. unavailable service - going for a 3-month pregnancy check-up and the doctor gets called away
- Service provider
- > Eg. rude, unhelpful, robotic
- Things outside service providers control
- > Eg. air traffic controllers on strike, another flight is delayed and needs the runway
- Customer-related
- > Eg. made booking for the wrong day
Explain some things that would dictate the level of compensation for poor service/quality
- Positioning of the restaurant (for pizza restaurant maybe offer to replace for free, for fine dining offer to waive the bill)
- Importance of the customer to the business (eg. a regular customer may expect to receive preferential treatment plus the restaurant has more to lose should the customer not be satisfied)
- The degree of dissatisfaction and damage/inconvenience incurred to the customer eg. if the customer entertains an important client, the failure is seen as more serious
- Rule of thumb - customer shoul be compensated with generosity
- Firm cant be perceived as stingy and calculating BUT should not be seen to be overcompensating
- > Overcompensation does not only fail to increase satisfaction much further beyond recovery perceived as fiar, but gives the wrong incentives to the wrong customers to complain too much
