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Unit 4-1

The document compares goods and services, highlighting key differences such as tangibility, ownership transfer, storage, and perishability. It also discusses customer expectations and perceptions of services, introducing the SERVQUAL model which identifies gaps in service quality. Additionally, it covers service design, innovation, and the importance of physical evidence in customer interactions.

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harsh9097raj
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38 views

Unit 4-1

The document compares goods and services, highlighting key differences such as tangibility, ownership transfer, storage, and perishability. It also discusses customer expectations and perceptions of services, introducing the SERVQUAL model which identifies gaps in service quality. Additionally, it covers service design, innovation, and the importance of physical evidence in customer interactions.

Uploaded by

harsh9097raj
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Services vis-à-vis Goods

Basis of Comparison Goods Services

Nature Tangible Intangible

Transfer of Ownership Possible Not Possible

Separable Goods can be separated from Services cannot be separated


the seller from the service provider
(Inseparable)

Storage Goods can be stored Services cannot be stored

Perishable Not all goods are perishable Services are perishable

Production and Consumption Goods have a significant time Services are produced and
gap between production and consumed together
consumption
Customer Expectation
of Services
• Customer expectation can be defined as “Customers assumption of
his / her experience in fulfillment of a need with the available
resources at his / her disposal”.

• Customer expectation can be influenced by cultural background,


demographic factors, advertising, family lifestyle, personality, beliefs,
reviews, and experience with similar services.
Customer expectation can be classified into two categories
• Explicit expectation is expressed by the customer and usually relates
to product performance such as the number of servings per bottle,
free maintenance period, electricity consumption per hour, etc.
• Implicit expectation is tricky, and most organizations fail to address
it, resulting in poor customer satisfaction. Implicit expectations are
things the customer believes to be obvious and thinks the seller
knows it. But, they are unspoken assumptions of the customer.
Customer Perception of Services

• Customer perception is the customer experience via


consumption and interaction with the service
provider.
• Customer perception is subjective and can differ
from person to person.

• Customer perception is a review of the experience.


It’s a past oriented concept.
SERVQUAL MODEL
The Gaps
Model of Service Quality
Gap 1: Knowledge Gap

The knowledge gap is the difference between the


customer’s expectations of the service and the
company’s provision of that service.
• Lack of management and customer interaction.
• Lack of communication between service
employees and management.
• Insufficient market research.
• Insufficient relationship focus.
• Failure to listen to customer complaints.
The gap between management perception and service quality
specification

• The second gap examines the difference between what


management perceives quality service is and how accurately
management specifies the level of quality they expect from
their team

• Lack of customer service standards.


• Poorly defined service levels.
• Failure to regularly update service level standards.
Gap 3: The Delivery Gap

• The delivery gap is the difference between service


delivery policies and standards and the actual
delivery of the service.

This gap can occur for a number of reasons:


• Deficiencies in human resources policies.
• Failure to match supply to demand.
• Employee lack of knowledge of the product.
• Lack of cohesive teamwork to deliver the product or
service.
Gap 4: The Communication Gap

• The communication gap is the gap between what gets


promised to customers through advertising and what
gets delivered.

There are a number of reasons why this can happen:


• Overpromising.
• Viewing external communications as separate to
what’s going on internally.
• Insufficient communications between the operations
and advertising teams.
Gap 5: The Customer Gap

• The customer gap is the difference between


customer expectations and customer perceptions.

• This gap occurs because customers do not always


understand what the service has done for them or
they misinterpret the service quality.
Service Design
• Service design is a process of improving the experiences of
both the user and employee through designing, aligning, and
optimizing an organization’s operations to better support
customer journeys.

Or

Service design is the activity of planning and organizing a


business’s resources (people, physical evidences, and
processes) in order to improve the employee’s and the
customer’s experience.
Components of ‘Service Design’

• People : Employees, Customers, Fellow


customers encountered throughout the
service, Partners

• Process: Workflows, Procedures

• Physical Evidences: Physical space, props,


digital environment
Service Innovation
• Service innovation can be defined as developing new
services through innovation process, which are equally
valuable for the customers

• Changes in service concepts or service delivery processes


driven by new technologies or organizational competences
that create added value.

• Such as new knowledge or technologies that companies


incorporate into their service offerings, which results in
value for both customers and businesses
Service Innovation Types
• Innovating around customer roles
• Innovation through service solution
• Service offering with innovation
• Service innovation through interconnected
products
Stages in Service Innovation and
Development
Customer-Defined Service Standards

• Customer service standards are set of policies and


expectations that have been created adopted by a
service provider.

• The standards cover all the points of contact the


business may have with the customer.
Types of Customer-Defined Service Standards

Hard and Soft Standards


• Delivery time
• Response time
• Courteous
• Trustworthiness
• Communication skills
Physical Evidence
• Physical evidence refers to everything a customers see
when interacting with the service provider.
• Physical evidence is a collection of tangible cues that
signals service quality.
This includes:
• The physical environment where you provide the
product or service
• The layout or interior design
• Packaging/Presentation
• Branding
Types
• Essential Evidences: It represents those things
associated with a service that are essential to its
creation.

• Peripheral Evidences: Evidences in such case is


marginal or operates at the fringe of image making
process.

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