Transcript The Service Encounter - the quality Catalyst

Chapter 7
The Service Encounter
Learning Objectives
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Use the service encounter triad to describe a service
firm’s delivery process.
Discuss the role of organizational control systems for
employee empowerment.
Prepare abstract questions and write situational
vignettes.
Discuss the role of customer as coproducer.
Describe how elements of the service profit chain
lead to revenue growth and profitability.
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The Service Encounter Triad
Service
Organization
Efficiency
versus
autonomy
Efficiency
versus
satisfaction
Contact
Personnel
Customer
Perceived
control
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The Organizational Chart
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The Organizational Chart
Customers
CEO
Upper Management
Middle Management
Contact Personnel
Contact Personnel
SAS
Middle Management
Upper Management
CEO
Customers
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The Service Organization
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Culture
Values
Behaviors
Empowerment
Invest in people
Use IT to enable personnel
Recruitment and training
Anchor performance
ServiceMaster (Service to the Master)
Disney (Choice of language)
like investing in equipment
customer history
match to firm’s CSF
recognition and reward
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Definitions of Culture
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Culture is a pattern of beliefs and
expectations shared by the organization’s
members.
Schwartz and Davis (1981)
Culture is the traditions and beliefs of an
organization that distinguish it from others.
Mintzberg (1989)
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Culture is shared orientations that hold the
unit together and give a distinctive identity.
Hoy and Miskel (1991)
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Culture
The shared beliefs and values of an
organization that guide employee
decision-making and behavior in the
firm.
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Corporate Culture
Behavior
Behavior
Behavior
Behavior
Behavior
Behavior
Behavior
Behavior
Behavior
Behavior
Behavior
Behavior
Behavior
Behavior
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Corporate Culture
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Values and beliefs
Strong systems
Weak systems
History
Rituals
Symbols
Communications
Storytelling
Rewards and recognition
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Rewards That Encourage
Behavior
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Pay
Promotion
Recognition
A Piece of the Action (Ownership)
Company Information
Freedom (Being Your Own Boss)
Personal Growth
Fun
Celebrations
"Thank You"
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Corporate Culture
Service
Organization
Efficiency
versus
autonomy
Efficiency
versus
satisfaction
Contact
Personnel
Customer
Perceived
control
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Empowerment
Providing contact personnel with the
training and information to make
decisions for the firm without close
supervision.
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Organizational Control
for Employee Empowerment
Beliefs
Systems
To
contribute
Core values Identify core
& mission
values
Boundary
Systems
To do right
Risks to be
avoided
Diagnostic
Control
Systems
To achieve
Specify and
enforce
rules
Build clear
targets
Interactive
Control
Systems
To create
Encourage
learning
Strategic
Uncertainties
Critical
performance
variables
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Contact Personnel Attributes
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Flexibility
Tolerance for Ambiguity
Ability to Monitor and Change Behavior
on the Basis of Situation Cues
Empathy for Customers
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Contact Personnel
Selection
1. Abstract Questioning
“From your past experience, …”
2. Situational Vignette ability to “think on their feet” in substance and delivery
3. Role Playing
requires careful scripting and customer actor rehearsal
Training
1. Technical Skills
2. Unrealistic customer expectations
3. Unexpected service failure
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Unrealistic customer expectations
1. Unreasonable demands
2. Demands against policies
3. Unacceptable treatment of
employees
4. Drunkenness
5. Breaking of societal norms
6. Special-needs customers
I want to take all my luggage on board
I have to smoke
You’re an idiot
Hey, where’s my drink?
I like to sunbath nude
Why don’t you understand English?
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Unexpected Service Failure
1. Unavailable service
Why isn’t the ATM working?
2. Slow performance
Why hasn’t our plane arrived?
3. Unacceptable service
There’s a fly in my soup.
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Training on Unrealistic Customer
Expectations and Unexpected
Service Failure
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A prescribed response to a any given situation
“I am very sorry, but federal safety regulations permit a passenger
only two carry-on pieces small enough to be stored under the seat
or overhead. May I check your larger pieces all the way to your
final destination?”
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Anticipate the types of exchange they might encounter
through role playing
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The Customer
Shopping attitudes
1. Economizing customer
2. Ethical customer
3. Personalizing customer
4. Convenience customer
Customer as Co-Producer
1. What is their role?
2. How to train?
3. When to retrain?
compares value with competition
moral obligation (Ronald McDonald House)
know your name
pay extra for hassle free service
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Service Encounter Success
Factors
C u stom er
H um an
M achine
S ervice P rovid er
H um an
M achine
E m ployee selection
Interpersonal skills
S upport technology
E ngender trust
E asy to access
F ast response
V erification
R em ote m onitoring
U ser friendly
V erification
S ecurity
E asy to access
C om patibility
T racking
V erification
S ecurity
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Employee Perceptions of Customer
Service at a Branch Bank
Outstanding
6
Customer
5
4
3
2
Terrible
1
1
Terrible
2
3
4
Employee
5
6
Outstanding
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Satisfaction Mirror
More
Repeat
Purchases
Stronger
Tendency to
Complain about
Service Errors
More Familiarity with
Customer Needs
and Ways of
Meeting Them
Greater Opportunity
for Recovery
from Errors
Higher Customer
Satisfaction
Higher Employee
Satisfaction
Lower
Costs
Better
Results
Higher
Productivity
Improved Quality
of Service
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Service Profit Chain
Internal
Operating strategy and
service delivery system
External
Service
concept
Target market
Loyalty
Customers
Satisfaction
Productivity
&
Employees
Output
quality
Capability
Service
value
Satisfaction
Revenue
growth
Loyalty
Profitability
Service
quality
Customer orientation/quality emphasis
Allow decision-making latitude
Selection and development
Rewards and recognition
Information and communication
Provide support systems
Foster teamwork
Quality & productivity
improvements yield
higher service quality
and lower cost
Attractive Value
Service designed
& delivered to
meet targeted
customers’ needs
Solicit customer
feedback
Lifetime value
Retention
Repeat
Business
Referrals
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Is attitude emphasized?
Are job previews utilized?
Are customers screened?
Careful Employee
and Customer
Selection
Are employees
encouraged to
refer friends?
Are referrals from
the “best”
employees given
priority?
Is satisfaction
measured
periodically?
Are measurements
linked to other
functions on
the cycle?
Are they linked to
service objectives?
Are they balanced
between monetary
and non-monetary?
Is training for job and
life?
(and Self-selection))
Employee
Referrals of
Potential
Job
Candidates
Satisfied
Employees
HighQuality
Training
Cycle
of
Capability
Appropriate
Rewards
and Frequent
Recognition
Well-Designed
Support
Systems
 Information
 Facilities
Greater Latitude
to Meet
Customer’s
Needs
Clear Limits
on, and
Expectations
of, Employees
Do they limit the “right” risks?
Are they logical to employees?
Is it an important
element of quality of
work life?
Do they reflect
needs of the
service encounter?
Are they designed
to foster
relationships?
Does it reflect top
management
“talk”?
Is it enough to
allow delivery of
results to
customers?
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Empowerment Control Exercise
Comes up with an example from each of the four
organizational control systems (i.e., belief,
boundary, diagnostic, and interactive) for:
1. Bank Teller
6. Automotive Repairperson
2. Bartender
7. Restaurant Waitperson
3. Ski Lift Operator
8. Financial Planner
4. University Advisor
9. Hotel Desk Clerk
5. Company Receptionist
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