Download - The Service Encounter
The Service Encounter
Learning Objectives
• 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.
The Service Encounter Triad
Service
Organization
Efficiencyversus
satisfaction
Efficiencyversus
autonomy
CustomerContact
Personnel Perceived control
Definitions of Culture
• Schwartz and Davis (1981) - Culture is a pattern of beliefs and expectations shared by the organization’s members.
• Mintzberg (1989) - Culture is the traditions and beliefs of an organization that distinguish it from others.
• Hoy and Miskel (1991) - Culture is shared orientations that hold the unit together and give a distinctive identity.
The Service Organization
• CultureServiceMaster (Service to the Master)Disney (Choice of language)
• EmpowermentInvest in peopleUse IT to enable personnelRecruitment and training criticalPay for performance
Organizational ControlBeliefsSystems
Tocontribute
Core values& mission
Identify corevalues
BoundarySystems
To do right Specify andenforcerules
Risks to beavoided
DiagnosticControlSystems
To achieve Build cleartargets
Criticalperformancevariables
InteractiveControlSystems
To create Encouragelearning
StrategicUncertainties
Contact Personnel
• Selection1. Abstract Questioning2. Situational Vignette3. Role Playing
• TrainingUnrealistic customer expectationsUnexpected service failure
Difficult Interactions with Customers
Unrealistic customer expectations Unexpected service failure
1. Unreasonable demands 1. Unavailable service
2. Demands against policies 2. Slow performance
3. Unacceptable treatment of 3. Unacceptable service
employees
4. Drunkenness
5. Breaking of societal norms
6. Special-needs customers
Use scripts to train for proper response
The Customer
• Expectations and AttitudesEconomizing customerEthical customerPersonalizing customerConvenience customer
• Customer as Co-Producer
Service Encounter Success Factors Customer Service Provider
Human Machine
HumanEmployee selectionInterpersonal skillsSupport technologyEngender trust
User friendlyVerificationSecurityEasy to access
MachineEasy to accessFast responseVerificationRemote monitoring
CompatibilityTrackingVerificationSecurity
Employee Perceptions of Customer Service at a Branch Bank
1
2
3
4
5
6
1 2 3 4 5 6
Employee
Customer
Terrible
Terrible
Outstanding
Outstanding
Satisfaction Mirror
Higher Customer Satisfaction
More Familiarity with Customer Needs and Ways of Meeting Them
Greater Opportunity for Recoveryfrom Errors
Higher EmployeeSatisfaction
Higher Productivity
Improved Quality of Service
MoreRepeatPurchases
Stronger Tendency to Complain about Service Errors
Lower Costs
Better Results
Is attitude emphasized?Are job previews utilized?Are customers screened?
Are employees encouraged to refer friends?
Are referrals from the “best” employees given priority?
Is satisfactionmeasured periodically? Are measurements linked to other functions on the cycle?
Careful Employeeand Customer Selection
(and Self-selection))
High-Quality Training
Well-DesignedSupport Systems Information Facilities
Greater Latitude to Meet
Customer’s Needs
Clear Limits on, and Expectations
of, Employees
AppropriateRewards
and FrequentRecognition
SatisfiedEmployees
EmployeeReferrals of
Potential JobCandidates
Is training for job and life? 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?
Do they limit the “right” risks?Are they logical to employees?
Cycle of Capability
Are they linked toservice objectives? Are they balanced between monetary and non-monetary?
Service Profit Chain
Internal
Operating strategy andservice delivery system
Service concept Target market
Servicevalue
Customers
Loyalty
Productivity&
Outputquality
Servicequality
Capability
Satisfaction
Employees Satisfaction Loyalty
Revenuegrowth
External
Profitability
Customer orientation/quality emphasisAllow decision-making latitudeSelection and developmentRewards and recognitionInformation and communicationProvide support systemsFoster teamwork
Quality & productivity improvements yield higher service quality and lower cost
Attractive Value Service designed& delivered tomeet targetedcustomers’ needsSolicit customerfeedback
Lifetime valueRetentionRepeat BusinessReferrals
Topics for Discussion• How does the historical image of service as servitude affect
today’s customer expectations and service employee behavior?
• What are the organizational and marketing implications of considering a customer as a “partial employee”?
• Comment on the different dynamics of one-on-one service and group service.
• How does use of a “service script” relate to service quality?• If the roles played by customers are determined by cultural
norms, how can services be exported?
Interactive Exercise
The class breaks into small groups and each group comes up with an example from each of the four organizational control systems (i.e., belief, boundary, diagnostic, and interactive)
Amy’s Ice Cream on Guadalupe
Amy’s Ice Cream
1. Describe the service organization culture at Amy’s Ice Cream.
2. What are the personality attribute of the employees who are sought by Amy’s Ice Cream?
3. Design a personnel selection procedure for Amy’s Ice Cream using abstract questioning, a situational vignette, and/or role playing.
AMY’S ICE CREAMAbstract Questions
• What was your most rewarding past experience and why?
• What are you looking for in your next job?
• What have you done in the past to irritate a customer?
• What flavor of ice cream best describes your personality?
AMY’S ICE CREAMSituational Vignette
A particular customer has the irritating habit of always showing up about two minutes before closing and staying late. Often this occurs on the night when weekly store meeting are held after closing time. This delays starting the meeting and furthermore employees are on the clock waiting for the customer to leave. What would you do?
AMY’S ICE CREAMSituational Vignette
As a new employee at a busy store, you have been routinely performing clean-up tasks (garbage removal and restroom cleaning). Company policy dictates that these are tasks to be shared. It has become clear that two employees consistently avoid these jobs in favor of more pleasant duties. How would you handle this situation?
Enterprise Rent-A-Car
1. How has Enterprise Rent-A-Car (ERAC) defined its service differently than that of the typical national car rental company?
2. What features of its business concept allow ERAC to complete effectively with the existing national rental care companies?
3. Use the service profit chain to explain the success of ERAC.