When I began studying Operations Management (OM) in my Ph.D. program at Georgia Tech in the 1990’s, the discipline was much different. It was often called “Production and Operations Management” which indicated its emphasis on the production or manufacture of goods. While service sector jobs were already outpacing the manufacturing or goods-producing sector jobs by the late 1960’s, the service economy has boomed since while the goods-producing economy has remained fairly stable.
It wasn’t until the mid-to-late 1990’s that the study of OM began putting significant emphasis on how to best deliver services. Therefore, while the OM courses I currently teach still address the important issues associated with manufacturing goods, equal or greater emphasis is placed on similar issues associated with providing services. Given how services now dominate our economy, I imagine more of our readers work in service businesses. So, in today’s column, I will address how to improve the quality of your service business.
Before we get started on discussing services, it is important to address the differences between goods and services. Basically, goods are physical, tangible objects that can be used or consumed, while services are activities that provide intangible value and are typically experienced by the customer. One of the major differences that we must be aware of concerning services is that there is typically a high level of customer contact involved. While the customer is usually not in the manufacturing facility when a good is being produced, the customer is typically highly involved when a service is being provided. It would certainly be a challenge for a haircut or dental care to be provided without the customer being present. Therefore, when considering the quality of service delivery, we need to be cognizant of the customer experience.
In business, we typically define quality as the degree to which our product meets or exceeds customer needs and expectations. Given the customer is often present when a service is being provided, service quality is measured not only by performance aspects of the service such as reliability, speed/time, and competence, but also by experiential aspects such as courtesy, empathy, and responsiveness. Let’s take a look at each of these, how they are defined, and some examples of each, both good and bad.
- Reliability: The ability to perform a service dependably, consistently, and accurately. This attribute has much to do with expectations. The first time a customer uses a service, expectations for that service have been set. Therefore, it is important for your processes to be consistent in order to meet or exceed those initial expectations. When my wife and I went to Hilton Head a couple of weeks ago, we patronized an Italian restaurant that we visit every time we are on the Island. As usual, their food and service were impeccable, always meeting our high expectations.
- Speed/Time: Since a customer is experiencing the service, long wait times can be intolerable. Therefore, quick service is preferred. However, more important, is making sure service is provided in the time promised. While customers understand some services can take time to be provided, they are less understanding when you do not meet promised completion times or longer than expected waits are endured. I used to dread my eye doctor appointments due to long waits. However, they clearly have responded to customer feedback and have made wait times much shorter.
- Competence: Clearly, we all want a service provider who is good at his or her craft. Whether it is a financial advisor, hair stylist, chef, or doctor (some of these are more crucial than others), demonstrating that they are able to provide highly capable service is vital.
While these “performance” or “technical” aspects are essential to good service quality, a service business must also consider the factors that impact the customer’s experience. Otherwise, the customer will downgrade their quality assessment despite good provider performance. The business needs to make sure that the customer experience is good by ensuring:
- Courtesy: Nothing makes customers feel better than courtesy and respect. If you treat your customers nicely, they will likely feel good about their service experience and return. In my undergraduate class last week, a student commented that they thought Chick-fil-A’s food was good, not great, but she always goes back because she is treated so well.
- Empathy: Being aware of what your customer is going through and treating them appropriately leads to higher service quality. Many people are unsettled when going to medical appointments, so a good “bedside manner” usually leads to happier patients.
- Responsiveness/Recovery: Sometimes, no matter what you do, something bad can happen either to your customer or in your process which is out of your control or an honest mistake. However, if you respond well to that bad situation, you can “save” your customer’s experience. Allowing your employees to “make things right” by giving an upgrade or something free demonstrates to customers they are valued and ultimately, their experiences end up positive.
As noted above, an important aspect of services is that they are experienced rather than consumed. Unfortunately, it can be difficult to assess the quality of a customer’s experience without asking him or her for feedback. Therefore, it is very important to gather customer feedback however you can. Surveys are most popular today, but return rates on such surveys can be low, so do not be hesitant to engage your customers in person to gather feedback on your service.
Service quality is critically important to customer loyalty, good reviews, and ultimately business success. I hope these insights will help you deliver higher quality in your service business.
