Lecture Notes: Service Quality and the Gaps Model

Introduction to Service Quality

• Service quality is crucial in service management, tied to customer loyalty and people management.
• Service quality is an attitude regarding the global evaluation of a service, distinct from satisfaction.
• Key driver of repeat purchase and loyalty, formed over time by consumption experiences and word of mouth.

What is Service Quality?

• Defined as meeting or exceeding customer expectations.
• Consistency in meeting/exceeding expectations is vital.

Dimensions of Service Quality

1. Tangibles: Physical evidence, touchpoints, cues.
2. Reliability: Delivering as promised, highest customer priority.
3. Responsiveness: Willingness to help, especially in urgent situations.
4. Assurance: Trust and expertise.
5. Empathy: Caring and individualized attention.

Importance of Service Quality

• Leads to higher loyalty, word-of-mouth promotion, increased share of wallet, and higher profitability.
• PIMS Study shows link between quality, market share, and profitability.
• Superior quality is a key to profitability, exemplified by companies like Apple.

Diagnosing Service Quality - The Gaps Model

• Diagnoses shortfalls in service quality through different gaps.
• Scalable: Can be applied to levels ranging from whole company to specific processes or teams.
• Gaps Model Overview: Developed by Parasuraman, Zeithaml, and Berry.

Key Gaps in Service Quality

1. Knowledge Gap: Difference between customer expectations and management perceptions.

   • Caused by insufficient customer focus, lack of research, management's detachment.

2. Policy Gap: Difference between management perceptions and service quality specifications.

   • Common reasons: Too expensive or perceived as impossible to meet customer expectations.

3. Delivery Gap: Difference between service quality specifications and actual service delivery.

   • Often due to insufficient capacity, support tools, processes.

4. Communication Gap: Difference between service delivery and external communications/promises.

   • Misalignment between marketing promises and actual delivery.

5. Perception Gap: Difference between perceived service and actual service delivered.

   • Customers not seeing or understanding what is delivered.

6. Quality Gap: Overall gap between expected and perceived service.

   • Closing this gap requires addressing the other five gaps.

Investing in Service Quality

• Companies often under-invest rather than over-invest in quality.
• Important to determine the right level of investment in quality.
• Service Recovery: Balancing between delivering as promised and offering effective recovery.

Conclusion

• Service quality drives customer loyalty and profitability.
• The Gaps Model is a tool for diagnosing and fixing service quality issues.
• Considerations include the balance of investment in quality and effective service recovery.

Reflection Questions

• What are your key takeaways on service quality?
• What challenges and opportunities do you see for your company related to service quality?