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Chapter 8

Designing Quality
Services

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Chapter 8

Differencesbetween services and


manufacturing
What do services customers want?
SERVQUAL
Designing and improving the services
transaction
The customer benefits package

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Chapter 8

Service Transaction Analysis


Improving Customer Service in
government
Quality in Health Care
Supply Chain Quality in Services
A Theory for Service Quality Management

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Chapter 8

Power of satisfied customers


Profit Growth over Time

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Differences between Services and Manufacturing

 Many service attributes are intangible


Output of service are heterogeneous
Customer contact
Customer coproduction
Internal versus external services
Voluntary versus involuntary services

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Differences between Services and Manufacturing

How service quality issues different from


those of manufacturing?
In manufacturing, dimensions are
available for measurement
In services, such measurable dimensions
are often unavailable
Simultaneous production and
consumption means you have to get it right
the first time
Product liability
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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Differences between Services and Manufacturing

How service quality issues similar to those


of manufacturing?
For both, the customer is the core of the
business
By focusing on the customer many
manufacturers and services firms have
come to view themselves as service
providers

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
What do Services Customers want?

Chapter 1 listed dimensions of quality:


Tangibles
Reliability
Responsiveness
Assurance
Empathy

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

Developed for assessing services quality.


An off-the-shelf approach that can be
used in many service situations

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

Advantages are:
It is accepted as a standard for
assessing different dimensions of services
quality
It has been shown to be valid for a
number of service situations

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

Advantages are:
It has been demonstrated to be
reliable
It is parsimonious in that it only has
22 items
It has a standardized analysis
procedure

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

The SERVQUAL survey has two parts:

1. Customer expectations
2. Customer perceptions

If we understand them both, we can


assess the gap in these areas

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

The SERVQUAL survey has 22


questions:

Tangibles – Questions 1 – 4
Reliability – Questions 5 – 9
Responsiveness – Questions 10 – 13
Assurance – Questions 14 – 17
Empathy – Questions 18 – 22

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SERVQUAL
Expectations
Survey

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SERVQUAL Perceptions Survey

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

The SERVQUAL survey is useful for gap


analysis

Gaps in communication and


understanding between employees and
customers have a serious negative effect
on the perceptions of service quality.

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

The SERVQUAL survey is useful for gap


analysis – Gap 1

Difference between actual customer


expectations and management’s idea or
perception of customer expectations

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

The SERVQUAL survey is useful for


gap analysis – Gap 2

Managers’ expectations of service


quality may not match service quality
specifications

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

The SERVQUAL survey is useful for


gap analysis – Gap 3
Service delivery
and
Service quality expectations

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

The SERVQUAL survey is useful for


gap analysis – Gap 4
Service delivery
and
External communications to customers

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

The SERVQUAL survey is useful for gap


analysis – Gap 5

Expected service
and
Perceived service

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

The SERVQUAL survey is useful for


gap analysis

The key to closing gap 5 is to first close


gaps 1 through 4

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

The SERVQUAL survey is useful for


gap analysis

By averaging the difference between


Perception and expectation a two
dimensional map can be created
identifying strengths and weaknesses

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
SERVQUAL

Two-
Dimensional
Differencing
Plane

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Designing and improving the services transaction

One way to improve perceptions of


quality …Improve the process of delivery
of the service

Services Blueprinting
Moments-of-truth Concept
Poka-yoke

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Designing and improving the services transaction

Services Blueprinting

1. Identify processes
2. Isolate fail points
3. Establish a time frame
4. Analyze profits

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Designing and improving the services transaction
Services Blueprinting Example in a Hair Salon

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Designing and improving the services transaction

Moments-of-truth Concept
Fail Points .. Moments of truth.

These are times at which the customer


expects something to happen.

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Designing and improving the services transaction

Poka-yoke
Fail safe devices
 Warning methods
 Physical contact methods
 Visual contact methods

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Designing and improving the services transaction
Poka-yoke
Fail safe devices – “The Three T’s”
1. Tasks to be performed
2. Treatment provided to customer
3. Tangibles provided to customer

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
The Customer Benefits Package

Customer benefits packages (CBP)

Tangibles that define the service


Intangibles that make up the service

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
The Customer Benefits Package

Customer benefits packages (CBP)


Four stages of the service benefit
package…
1. Idea/concept generation
2. The definition of a service package
3. Process definition and selection
4. Facilities requirements definition

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
The Customer Benefits Package

CBP Design Process

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
The Customer Benefits Package

Customer benefits packages (CBP)


Objectives…

 Make sure the final CBP attributes you


are using are the correct ones

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
The Customer Benefits Package

Customer benefits packages (CBP)


Objectives…

 Evaluate the relative importance of each


attribute in the customers mind

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
The Customer Benefits Package

Customer benefits packages (CBP)


Objectives…

 Evaluate each attribute in terms of


process and service encounter capability

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
The Customer Benefits Package

Customer benefits packages (CBP)


Objectives…

 Figure out how to best segment the


market and position CBP’s in each
market

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
The Customer Benefits Package

Customer benefits packages (CBP)


Objectives…

 Avoid CBP duplication and proliferation

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
The Customer Benefits Package

Customer benefits packages (CBP)


Objectives…

 Bring each CBP, and associated process and


service encounters, to market as quickly as
possible. Use the CBP framework and final
attributes to design facilities, processes,
equipment, jobs, and service encounters.

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
The Customer Benefits Package

Customer benefits packages (CBP)


Objectives…

 Maximize customer satisfaction and


profits.

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
The Customer Benefits Package

Services Package
 Unique services package
 Selective services package
 Restricted services package
 Generic services package

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Service Transaction Analysis

Method of identifying service


transactions and evaluating them
from the customer’s perspective to
determine if there is a gap between
service design and what the
customer perceives as the service

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Improving Customer Service in Government

The government established a searchable


list of 4,000 customer service standards for
570 federal departments and agencies

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Improving Customer Service in Government

32 states have established quality award


programs

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Improving Customer Service in Government

Several factors driving this change:

People want and desire to do good work

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Improving Customer Service in Government

Several factors driving this change:

Quality management is associated with


improved employee satisfaction

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Improving Customer Service in Government

Several factors driving this change:

Government leaders are mandating


standards, strategic plans and new levels of
performance

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Improving Customer Service in Government

Several factors driving this change:

Demand for government services is


growing at a faster rate than funding for
them

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Improving Customer Service in Government

Several factors driving this change:

Threat of privatization in government has


led to an improvement in service

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Quality in Health Care

 Health care is facing the same “cost


squeeze” that government is facing
 A move to HMO’s is causing hospitals to
streamline operations
 There is increased diversity in health
care

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Supply Chain Quality in Services

Bi-directional Services Supply Chain

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
A theory for Service Quality Management

Proposition 1: Unified services theory


Proposition 2: The unreliable supplier
dilemma
Proposition 3: Capricious Labor
Proposition 4. Everyone presumes to be
an expert

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
Strategic Quality Planning
Designing Quality Services
Summary

 Because services involve intangibles


they are different from manufacturing
 Lack of hard measures, statistical
Quality Control techniques are not
always successful

The bottom line is a satisfied customer

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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or
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otherwise, without the prior written permission of the publisher.
Printed in the United States of America.

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