MTM 2233 Service Quality Management

MTM 2233 Service Quality Management Introduction to service quality management Mr. Navindu Sathsara – Lecturer 10/05/2024 Intended learning outcomes Understand the need for quality management in tourism, hospitality, and leisure industri...

MTM 2233 Service Quality Management Introduction to service quality management Mr. Navindu Sathsara – Lecturer 10/05/2024 Intended learning outcomes Understand the need for quality management in tourism, hospitality, and leisure industries; Demonstrate the definition of quality; Be aware of the historical evolution of service quality management and identify its major influencers; Understand the contemporary quality management 10/05/2024 Let's watch these videos !!! https://www.youtube.com/watch?v=K6W4ViZVhzQ https://www.youtube.com/watch?v=awoz4t2wJgo https://www.youtube.com/watch?v=In82xKXvFQ0 10/05/2024  The need for service quality management Support Services Cleaning A tourism product is a Accommodati on sector combination of different sub- Retailing Entertainmen Transportatio products. t Sector n sector Telecommunicati Unsatisfactory performance of on one sub-product (sector) can reflect badly on the performance of the total product, and on Events Sector Attraction sector overall tourist experience and Manufacturin Peopl satisfaction with the total e g product. Constructio The nature of the tourism Tourism Travel product implies the importance Information Sector Trade sector of cooperation between all the Wholesaling sectors in order to achieve an Financial Outdoor and indoor integrated tourism product and Catering Sector recreation and leisure accomplish a major goal, which activities Insurance is tourist satisfaction. Painting sector Medical Support Services 10/05/2024 The tourism product – A total tourism Experience The need for service quality management (con…) Unique characteristics of tourism, hospitality, and leisure services Intangibility Tourism services represent a more abstract concept than physical goods, and most tourism services offer a combination of intangible and tangible elements. The implication: tourism services cannot be displayed, sampled, tested, or evaluated before purchase. You cannot “try” before purchase. Inseparability of production and consumption tourism services cannot be produced in one place, transported for sale in another, and sold and consumed again in another. 10/05/2024 The need for service quality management (con…) Unique characteristics of tourism, hospitality, and leisure services Heterogeneity Tourism services are delivered by people to people and are a function of human performance. Each service experience is different because it varies from producer to producer and from customer to customer. Service providers are unable to maintain the same service performance because performance also depends on tourist demand for services. Lack of consistency It is difficult to achieve standardized tourism services since employee performance fluctuates. 10/05/2024 The need for service quality management (con…) Unique characteristics of tourism, hospitality, and leisure services Perishability Tourism services have to be used up right away because they cannot be kept. Tourism services must be consumed at the time of their production to avoid a loss. Ownership For example: purchase a flight ticket, what do you own? In-flight entertainment, the memory of the flight attendant’s smile, the opportunity to socialize with other travellers, the benefit of the flight experience… 10/05/2024 The need for service quality management (con…) Benefits purchased – a bundle For example, a customer may find the dining-out experience pleasant if other customers in the restaurant are quiet and polite; The in-flight service if they sit next to interesting travellers with whom they can chat. The benefits (if these experiences are positive) or dissatisfaction (if these experiences are negative) may last for a long time. More difficult to control quality – corrections made before being purchased? Evaluation process Pre consumption (consumer selects among alternatives) Consumption (consumer compared experiences with expectations) Post consumption (consumer compares experiences with expectations formed at the above two stages) No warranties or Guarantees – Can we purely blame the service provider if the service fails? Easy imitation, people based and personality intensive 10/05/2024 What is quality? Provider perspective The degree to which process output meets its specified performance standard. How do you set service standards? externally imposed: by contracts, established criteria, government regulations… Internally imposed: by leadership dictates, competitor performance, improvement targets How to measure the quality? An inspection system that should provide unbiased and precise performance data. 10/05/2024 What is quality? (con…) Service standards How do you achieve the service standards? 1. Service policies of the organization Establish policies that are deemed comparable to their image and appropriate to their target market. Set the standards for the provision of guest services in the company. 2. The actual performance of the service procedures The actual performance of service procedures in tourism is influenced by several factors, including employee skills, training, motivation, and external conditions like customer demand and environmental factors. 10/05/2024 What is quality? (con…) Customer perspective The degree to which a service satisfies customers. What influences customer satisfaction? customer expectations based on service provider information and customers’ related experiences How to measure the quality? Customer satisfaction survey that should be provide unbiased and precise data 10/05/2024 What is quality? (con…) Customer expectations Essential service The essence of the service business, meet the fundamental requirements to continue operations. Eg. Service providers must maintain reasonable business hours, admit or check-in guests, inform guest of service details, and acknowledge complaints. Guests predict or believe these services will be performed. Expected service Guests assume the service provider should offer in order to provide adequate service. Eg. Convenient operating hours, payment options, reservations… Expected services increase, guests become more demanding, requiring the service provider to move beyond what is commonplace. 10/05/2024 What is quality? (con…) Customer expectations Optional service The added bonus that enhances the value of the guests. Express the uniqueness of the service provider and contribute to its competitive edge. Eg. Indulgence including ambiance, convenience If such services are not available, the ordinarily will not fault the service provider. To effectively provide optional services, it becomes essential for the service provider to recognize the true desires of the targeted guests. 10/05/2024 What is quality? (con…) Case: A troubleshooting call center where the hotel targets a maximum hold time of 10 minutes. As the manager, how do you analyse the service quality of the call center under this standard? Provider perspective Customer perspective Set up a relevant Customer surveys: performance metric: The dissatisfaction with the The percentage of calls hold time, many customers within a 10-minute or less may consider a 10- minute hold time wait to be unacceptable Good Poor customer performance to satisfaction the internal 10/05/2024 standard What is quality? (con…) Case: A troubleshooting call center where the hotel targets a maximum hold time of 10 minutes. As the manager, how do you analyse the service quality of the call center under this standard? Notes: Good performance to the internal standard coexists with poor customer satisfaction. An effective quality analysis approach would encompass both perspectives and clearly delineate this conflict. Both perspectives of quality should be applied to the way customers define the value of the service they receive, i.e. how a customer evaluates service quality - A better-than/worse than” comparison between expectations and actual services results in a positive or negative outcome. 10/05/2024 Performance dimensions Performance dimensions (also called discriminators or drivers) are categories that span all of the ways in which a customer evaluates service quality. What is the list of performance dimensions? Should be tailored to customers of the business process under study. For example: A tourist who applies for a business visa through a third-party, what kind of performance dimensions may be concerned by this tourist in terms of evaluating service quality? Convenient application process, an accurate analysis, a fast decision, knowledge service providers, courteous interactions, information security… 10/05/2024 Historical evolution and influencers The Dodge approach The first formal quality control sampling plans developed during World War II. Acceptance sampling required the inspection of a specified number of items from each batch of manufactured items. On the basis of the inspection results, the entire batch was either accepted and sent to customers or rejected and returned to the manufacturer. This approach has also been applied to services, but less formally and not as commonly. Harold F. Dodge 10/05/2024 Historical evolution and influencers (con…) The Dodge approach Review (inspect) service process output prior to delivery to customers. Product designs are reviewed by the engineering manager before delivery to the manufacturing department Architectural projects proposals are reviewed by a partner before submission to the client In-hospital patient pharmaceutical plans are reviewed by the lead pharmacist before initiation Travel cost calculations are checked for accuracy by a senior manager before giving quotations Harold F. Dodge 10/05/2024 Historical evolution and influencers (con…) The Dodge approach Are there any drawbacks of assuring quality with inspections, reviews, or checks? Place the responsibility for quality in the hands of inspectors who were often not process experts They add time to the service They use valuable resources inefficiently They do not identify many noncompliant characteristics They are ineffective at facilitating improvements inspectors focus on identifying errors rather than carefully recording their occurences, i.e., focus on what is wrong rather than why it went wrong Harold F. Dodge 10/05/2024 Historical evolution and influencers (con…) The Dodge approach Review (inspect) service process output prior to delivery to customers. Harold F. Dodge 10/05/2024 Historical evolution and influencers (con…) Walter Shewhart’s influence Father of statistical quality control He believes that data analysis is an essential part of any improvement effort, and checking does not necessary imply an in-depth study. Major contributions: the development of methodologies for statistical quality control that used performance data to improve quality, such as control charts The creation of a quality improvement framework - Shewhart cycle or plan- do- check- act (PDCA) [Deming Cycle] Walter A. Shewhart 10/05/2024 Historical evolution and influencers (con…) W. Edwards Deming’s influence The most important figure in the history of quality management Deming Cycle (PDCA) Seven Deadly Diseases of Management describe the most serious barriers that management faces to improving effectiveness and continual improvement W. Edwards Deming https://www.youtube.com/watch?v=e4gOPeHSRo8 10/05/2024 Historical evolution and influencers (con…) W. Edwards Deming’s influence Seven Deadly Diseases of Management 1. Lack of constancy of purpose; 2. Emphasis on short-term profits; 3. Evaluation of performance, merit rating, or annual review; 4. Mobility of management; job hopping; 5. Management by use only of visible figures; 6. Excessive medical costs; 7. Excessive costs of liability, swelled by lawyers that work on contingency fees. W. Edwards Deming Out of the Crisis (pages 97-98) 10/05/2024 Historical evolution and influencers (con…) Joseph Juran’s influence Influential in creating the profession of quality management. He promoted quality- related training and education of managers, and he advocated for a new role of the quality department. Juran’s trilogy (quality planning, quality control, and quality improvement) helped to promote a professional emphasis on the field of quality by shifting the emphasis from inspections to a more broad focus on quality improvement. Joseph M. Juran Quality Control Handbook (Juran, 2010) 10/05/2024 Historical evolution and influencers (con…) Joseph Juran’s influence Juran (and others) also quantified the cost of quality (COQ), which includes four categories: (1) prevention costs (e.g., planning and training for quality); (2) appraisal costs (e.g., performing inspections and auditing); (3) internal failure costs (e.g., correcting defects or mistakes found within the firm); (4) external failure costs (e.g., correcting defects or mistakes identified by customers). Some practitioners refer to the latter two categories as the cost of poor quality (COPQ). Some organizations routinely collect data on internal failures Joseph M. Juran (often called turnbacks) and external failures (often called escapes). 10/05/2024 Historical evolution and influencers (con…) Kaoru Ishikawa’s influence The inventor of quality circles, where small groups of workers solve their own problems. Guide to Quality Control (Ishikawa, 1982). He advocated the use of fishbone diagram (also called the cause- and- effect or Ishikawa diagram), check sheets, control charts, and Pareto charts. He stressed that internal processes need to be monitored to ensure that they contribute to the overall quality of goods and services sold to customers – you pass your work onto someone else in the firm Kaoru Ishikawa 10/05/2024 Historical evolution and influencers (con…) Leonard Berry’s influence Discovering the Soul of Service (Berry, 1999) Study of successful service businesses to identify the drivers that assured long- term success. Many of the drivers of success are associated with quality (such as executional excellence) while others focus on human relationships (such as building trust- based relationships and investment in employee success). Berry also worked with other academicians to develop a tool, called the SERVQUAL survey, for evaluating service quality (Parasuraman et al., Leonard L. Berry 1985). 10/05/2024 Contemporary quality management (con…) The Shewhart influence Ensure that the analysis of outcome data will account for expected variations while including mechanisms for identifying root cause. The quality system will include control charting and a structured quality improvement framework. The Deming influence Appreciate that performance is dictated primarily by the system within which a process and its workers operate. A quality system will avoid creating incentives that ignore variation or assume that an individual is solely responsive for the quality of process output. 10/05/2024 Contemporary quality management (con…) The Juran influence Assign the quality department responsibility for maintaining the quality system and training workers so that the Shewhart and Deming approaches can take root. A quality system will be cognizant of both visible and hidden costs that result from poor quality. The Ishikawa influence Verify that employees and their managers work in concert to ensure that process output meets the needs of customers. A quality system will include cooperative team efforts to improve quality using basic qualitative and quantitative tools. 10/05/2024 Contemporary quality management (con…) The Berry influence Create an organizational culture that possesses features common to high quality entities, including seeking extraordinary performance and nurturing an effective workforce. A quality system will identify the totality of customer needs listed as a set of performance dimensions. 10/05/2024 Contemporary quality management Quality system 1. Quality control The statistical methods that collect, analyze, and interpret quality- related information to determine if processes are creating products and services that are consistent with expected performance, based on performance metrics and customer satisfaction surveys. 10/05/2024 Contemporary quality management (con…) Quality system 2. Quality assurance The procedures that an organization employs to ensure that products and services have quality levels that meet the needs of customers, including determining performance metrics and targets, and developing customer satisfaction surveys. 10/05/2024 Contemporary quality management (con…) Quality system 3. Quality management The creation and maintenance of a quality system that integrates quality assurance and quality control, and ensures that the organization empowers everyone to participate in quality improvement activities. 10/05/2024 Contemporary quality management (con…) Total Quality Management (TQM) It describes a management approach to long-term success through customer satisfaction. In a TQM effort, all members of an organization participate in improving processes, products, services, and the culture in which they work. Responsibility Quality Each process for ensuring department manager quality Quality Inspections Control charts control 10/05/2024 https://www.youtube.com/watch?v=oy3LUdXf3qQ Contemporary quality management (con…) Issue: sustained TQM implementation Weak or decentralized coordination led to inconsistencies in approaches across functions Ineffective communication Inconsistent employee training Leadership sometimes failed to appreciate the performance 10/05/2024 Contemporary quality management (con…) Case A hotel promised to a travel agency to upgrade the room for the tourist. However, when the customer arrived at the hotel, hotel did not give upgrade as per what they have promised, instead, they mentioned to the tourist that an upgrade can be given only by paying extra. Then the customer complained to the travel agency and requested a refund. In the whole process, the travel agency lost money and the trust of the tourist, and it also created tension on the relationship between the travel agency and the hotel. How will you improve this process? 10/05/2024 10/05/2024 Contemporary quality management (con…) DMAIC Define, Measure, Analyse, Improve, and Control Define: Describe the problem, the project’s purpose, the process boundaries, key stakeholders, and customers. Finalize the project team, list relevant metrics, indicate important risk factors, and develop a project plan. The result is a summary problem statement, objective, and project charter. 10/05/2024 Contemporary quality management (con…) DMAIC Define, Measure, Analyze, Improve, and Control Measure: Gather information on the current process, develop a process map, describe process inputs and outputs, collect data and summarize using statistical methods, and confirm accuracy of measurement systems. The result is a description of the current process focusing on the problem at hand. 10/05/2024 Contemporary quality management (con…) DMAIC Define, Measure, Analyse, Improve, and Control Analyse: Evaluate process maps and associated data to identify wasteful activities and instances of unacceptable quality, identify root causes of problems, and confirm findings using statistical methods. The result is a thorough evaluation of the current process with a focus on where improvements should be targeted. 10/05/2024 Contemporary quality management (con…) DMAIC Define, Measure, Analyse, Improve, and Control Improve: Use available methods to list potential corrective actions, choose improvement ideas, develop the revised approach (including benefits, costs, risks), and evaluate alterative interventions. The result is a set of improvement recommendations and their justification. 10/05/2024 Contemporary quality management (con…) DMAIC Define, Measure, Analyse, Improve, and Control Control: Design a plan for ensuring that the predicted improvements are sustained by developing training courses, data collection routines, quality tracking mechanisms, and statistical analysis procedures. The result is a plan for confirming and sustaining the improvements. 10/05/2024 Contemporary quality management (con…) Six Sigma Six Sigma developed as a comprehensive quality system to replace TQM. Includes a formal project-based framework for process improvement (DMAIC) and a highly structured training regimen based on certifying individuals as belts (green belt, black belt, etc.) https://www.youtube.com/watch?v=4EDYfSl-fmc 10/05/2024 Contemporary quality management (con…) Lean Management Lean production – the Toyota Production System (TPS) The elimination of time spent on wasteful activities so that only items in demand by customers are produced, thereby eliminating costly inventory and streamlining the production lead time. To improve quality in a Lean setting, many organizations employ a methodology called kaizen (continuous improvement). LSS (Lean Six Sigma) https://www.youtube.com/watch?v=s2HCrhNVfak 10/05/2024