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Provider Gap 3
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Key Factors Leading to Provider Gap 3
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Employees Roles in ServiceDelivery
Service Culture
The Critical Importance of Service
EmployeesBoundary-Spanning Roles
Strategies for Delivering Service Quality
Through PeopleCustomer-Oriented Service Delivery
Chapter
12
McGraw-Hill/Irwin Copyright 2009 by The McGraw-Hill Companies, Inc. All rights reserved.
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Objectives for Chapter 12:Employees Roles in Service Delivery
Demonstrate the importance of creating a service culturein which providing excellent service to both internal andexternal customers is a way of life.
Illustrate the pivotal role of service employees in creatingcustomer satisfaction and service quality.
Identify the challenges inherent in boundary-spanningroles.
Provide examples of strategies for creating customer-oriented service delivery through hiring the right people,developing employees to deliver service quality,providing needed support systems, and retaining thebest service employees.
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Service Culture
A culture where an appreciation for good
service exists, and where giving goodservice to internal as well as ultimate,external customers, is considered a naturalway of life and one of the most importantnorms by everyone in the organization.
- Christian Grnroos (1990)
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The Critical Importance of ServiceEmployees
They are the service.
They are the organization in the customers eyes.
They are the brand.
They are marketers.
Their importance is evident in: the services marketing mix (people)
the service-profit chain
the services triangle
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The Power of One
Every encounter counts
Employees are the service
Every employee can make a difference
Through their actions, all employees shapethe brand
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The Services Marketing Triangle
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Aligning the Triangle
Organizations that seek to provideconsistently high levels of service excellencewill continuously work to align the threesides of the triangle.
Aligning the sides of the triangle is anongoing process.
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Making Promises
Understanding customer needs
Managing expectations
Traditional marketing communications
Sales and promotion
Advertising
Internet and web site communication
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Keeping Promises
Service delivery
Reliability, responsiveness, empathy, assurance,tangibles, recovery, flexibility
Face-to-face, telephone & onlineinteractions
The Customer Experience
Customer interactions with sub-contractorsor business partners
The moment of truth
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Enabling Promises
Hiring the right people
Training and developing people to deliver
serviceEmployee empowerment
Support systems
Appropriate technology and equipmentRewards and incentives
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Ways to Use theServices Marketing Triangle
Overall StrategicAssessment
How is the service
organization doing on allthree sides of thetriangle?
Where are the
weaknesses? What are the strengths?
Specific ServiceImplementation
What is being promoted
and by whom? How will it be delivered
and by whom?
Are the supporting
systems in place todeliver the promisedservice?
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The Service Profit Chain
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Service Employees
Who are they?
boundary spanners
What are these jobs like? emotional labor
many sources of potential conflict
person/role
organization/client
interclient
quality/productivity tradeoffs
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Boundary Spanners Interact with BothInternal and External Constituents
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Boundary-Spanning Workers Juggle ManyIssues
Person versus role
Organization versus client
Client versus client
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Human Resource Strategies for DeliveringService Quality through People
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Empowerment
Benefits: quicker responses to
customer needs duringservice delivery
quicker responses todissatisfied customers duringservice recovery
employees feel better abouttheir jobs and themselves
employees tend to interactwith warmth/enthusiasm
empowered employees are agreat source of ideas
great word-of-mouth
advertising from customers
Drawbacks: potentially greater dollar
investment in selection andtraining
higher labor costs potentially slower or
inconsistent service delivery
may violate customers
perceptions of fair play
employees may give awaythe store or make bad
decisions
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Seattles CLICK!
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Traditional Organizational Chart
Manager
Supervisor
Front-lineEmployee
Customers
Front-lineEmployee
Front-lineEmployee
Front-lineEmployee
Supervisor
Front-lineEmployee
Front-lineEmployee
Front-lineEmployee
Front-lineEmployee
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Customer-Focused Organizational Chart
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Inverted Services Marketing Triangle
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The grocery chain paid over $54 millionfor college scholarships for 17,500+employees over the past 20 years.
Wegmans did not hesitate to sendcheese manager Terri Zodarecky on aten-day sojourn to cheesemakers inEurope.
The firm gives employees flexibility to
deliver great customer satisfaction.
How can this be justified?
How Employee Satisfaction Drives Productivityand Customer Satisfaction at Wegmans
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How does this affect performance?
Wegmans labor costs are 15-17% ofsales, compared with 12% for industry.
But annual turnover is just 6% (19% forsimilar grocery chains).
20% of employees have 10+ years ofservice. This in an industry where turnover
costs can exceed annual profits bymore than 40%.
Wegmans operating margins are7.5%, double what the big grocersearn.
Sales per square foot are 50% higherthan industry average.
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