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Chapter 8 The Service Encounter

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1. “Moment of truth”?

by J. Carlzon (SAS)

2. 請顧客幫忙公司選新員工？ ex. Southwestern Airlines

3. 事先演練可能出現的各種狀況？

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Learning Objectives

1. Service encounter triad

2. Service organization’s culture

3. Contact personnel: empowerment

4. Customer as coproducer

5. Service profit chain

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1. The Service Encounter Triad

Service

Organization

Efficiencyversus

satisfaction

Efficiencyversus

autonomy

CustomerContact

Personnel Perceived control

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2. The Service Organization

• Mintzberg (1989) - Culture is the traditions and beliefs of an organization that distinguish it from others.

• CultureServiceMaster (Service to the Master)Disney (Choice of language)

Ritz-Carlton (L&G service L&G)

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3. Employee empowerment

• Invest in people

• Use IT to enable personnel

• Recruitment and training critical

• Pay for performance

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3. Contact Personnel

• Selection(1) Abstract Questioning(2) Situational Vignette(3) Role Playing

• TrainingUnrealistic customer expectationsUnexpected service failure

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4. 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

e.g. 遠航李董

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Examples of Unethical Behaviors

Misrepresenting the Nature of the Service

Customer Manipulation General Honesty and Integrity

• Promising a nonsmoking room when none is available

• Using bait-and-switch tactics

• Exaggerating the benefits of a specific service offering

• Padding a bill with hidden charges

• Hiding damage to customer possessions

• Making it difficult to invoke a service guarantee

• Treating customers unfairly or rudely

• Stealing customer credit card information

• Sharing customer information with third parties

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4. Customer as Co-Producer

• Expectations and AttitudesEconomizing customerEthical customerPersonalizing customerConvenience customer

• Customer as Co-Producer

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4. Service Encounter Success Factors

Customer Service Provider Human Machine

Human

Employee selectionInterpersonal skillsSupport technologyEngender trust

User friendlyVerificationSecurityEasy to access

MachineEasy to accessFast responseVerificationRemote monitoring

CompatibilityTrackingVerificationSecurity

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4. Employee Perceptions of Customer Service at a Branch Bank

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2

3

4

5

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1 2 3 4 5 6

Employee

Customer

Terrible

Terrible

Outstanding

Outstanding

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4. 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

      

 

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4. The Cycle of Capability

• Careful employee and customer selection

• High-quality training

• Well-designed support systems

• Greater latitude to meet customer’s needs

• Appropriate rewards and recognition

• Satisfied employees

• Employee referrals of job candidates

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5. Service Profit Chain

Internal

Operating strategy andservice delivery system

Service concept Target market

Servicevalue

Customers

 

Satisfaction Loyalty

Revenuegrowth

External

Profitability

Loyalty

Productivity&

Outputquality

Servicequality

Capability

Satisfaction

Employees

Workplace designJob design / decision-making latitudeSelection and developmentRewards and recognitionInformation and communicationAdequate “tools” to serve customers

Quality & productivity improvements yield higher service quality and lower cost

Attractive Value Service designed& delivered tomeet targetedcustomers’ needs

Lifetime valueRetentionRepeat BusinessReferral

                    

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Topics for Discussion

• 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?

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Situational Vignette 1

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?

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Situational Vignette 2

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?