Marketing Action Plans: managing quality
In this chapter we provide an overview of managing quality and explore SERVQUAL, servicescape and Net Promoter Score; tools that marketing practitioners may employ to measure and manage customer satisfaction and are often employed in a marketing action plan to manage quality..
We will now explore how organisations set customer satisfaction goals, manage quality and explore how three tools assist marketing practitioners to evaluate and control customer satisfaction against stated objectives.
[click the image to access the module handouts]
Service quality needs to be managed
Earlier we discussed how business is like theatre and the need to manage both front stage & back stage activities to ensure a consistent quality experience. Although luck happens it cannot be relied upon as the means of a competitive advantage.
Learning objectives of the chapter: After completing this chapter students should be able to demonstrate the importance of the 5-gap theory and the SERVQUAL tool for measuring and managing customer satisfaction.
The activity the quality dilemma is worth exploring prior to undertaking this chapter. The activity should give you a better understanding as to how quality and the processes that produce quality are an important and ongoing marketing action plan.
The circle of satisfaction is one of the 3 mega-marketing concepts discussed in section 2. The notion is that there are 4 types of satisfaction [episodic, cumulative, collective, and aggregate] and as satisfaction is fundamental to a competitive advantage it needs to be managed on an everyday and as needed basis.
The quality dilemma
This activity describes George and Gillian’s experience of buying a large screen TV. This vignette presents readers with the opportunity to apply important marketing concepts. Readers should review the five gaps model and SERVQUAL whilst completing this activity.
[click image to access activity]
The 5-gap model
The 5-gap model is a well-recognised marketing tool developed by Parasuraman, Zeithaml and Berry (1985). They present the argument that managing quality is about identifying and closing quality gaps – they identified five possible gaps: the knowledge gap, the standards gap, the delivery gap, the communication gap, and the total gap between what is expected and what is received.
Adapting the 5-gap model to MAP
The 5-gap model is a well-recognised services marketing tool developed by Parasuraman, Zeithaml and Berry (1985). Whilst it was originally developed from a services marketing genre perspective it is more insightful when considered from a COMP perspective as this provides guidance when considering a number of marketing action plans, how action plans interact, and how marketing action plans require collaboration with other disciplines.
Adapting the 5-gap model to MAP
It has often been discussed how marketing plans are crafted after the desired market position and basis of competition is articulated by the strategic business planning group and how marketing action plans are how the strategy that is outlined in the marketing plan is transformed to tactics. The 5 gap model spans a number of marketing action plans and requires consultation and collaboration with other disciplines.
The knowledge gap
1: The knowledge gap: – the knowledge gap occurs when managers do not fully understand the needs and wants of the selected market segments – i.e., managers lack knowledge. This is the gap between what the customer expects and what managers believe that the customer expects.
The knowledge gap
To close this gap: Managers must gain a better understanding of the customer through formal and informal research. Formal research can be both qualitative and quantitative research for example, focus groups and surveys; Informal research is direct communication between managers, customers, and staff. The objective is to nurture a more customer-focussed culture one based on listening to the customer and learning from the customer.
The standards gap
2: The standards gap: – this gap occurs when managers have researched and understand what customers expects, however, what is known has not been documented – or correctly documented. The gap occurs between management knowledge and the written documentation of the customer experience – there are insufficient documented specifications.
The standards gap
To close this gap: Managers must establish and document service quality standards. Managers should produce a service blueprint [also known as a flow-chart] that details front-stage and back-stage activities and outlines the delivery sequence. Part of the blueprint is a detailed description of the roles and responsibilities of staff as the customer moves through the service delivery process.
There is a need to establish current standards and be time specific about meeting quality goals. Identify areas where the greatest improvements can be made – establish a hierarchy of priorities and do the most important tasks first. At this point it may also be beneficial to identify repetitive tasks that can be improved through the use of technology and self-service technology. This can often be achieved when the customer plays [or can play] a role in the service delivery process [e.g., airport check-in and seat allocation].
The service quality gap
3: The service delivery gap: – this gap occurs when there are differences between what has been specified by the organisation and what has been delivered to the customer.
The service quality gap
To close this gap: Managers must ensure that the specified standards are delivered. Managers must ensure that both front-stage and back-stage staff know the roles they must play, and act according to the script. It is important to minimise role conflict and to establish responsibilities and to empower staff to act when appropriate. Staff need to be trained to identify any deviations from documented standards and take the appropriate action. The objective is to reduce the number of deviations from established specifications and to recover when deviations occur.
The communication gap
4: The communications gap: – this gap occurs when the service is being delivered to specification, however, what has been ‘promised’ to the customer is different to what has been specified and delivered.
The communications gap
To close this gap: Managers must ensure that the promises that are made to customers are truthful and can be profitably fulfilled. An important part is to ensure that those responsible for delivering external communication [e.g., advertising, personal selling, and promotions] are aware of the specified standards and the negative effect that over-promising has on customer satisfaction.
Managers must ensure that staff input is part of the development process for external communication. Whilst external communication is important to ensure customer satisfaction, there is also a need for internal marketing that educates staff on service delivery specifications and motivates staff to maintain high service quality standards. It is important to ensure that advertised promises/pledges are communicated to front-stage and back-stage staff. Pre-test all communication material prior to release. When the customer is part of the delivery process there is a need to communicate with and educate the customer. The objective is to make a promise that is attractive to the customer and the organisation.
The total gap
5: The total gap: – All the gaps between gaps 1 and 4, this gap is the evaluation between the customer’s expectations and what the customer believes has been delivered. The total gap spans the entire buyer decision process. This results in one of the following outcomes – dissatisfaction – indifference – satisfaction. This gap between expectations and performance is referred to as the ‘confirmation – disconfirmation model’ or the ‘disconfirmation of expectations’ model. Confirmation or disconfirmation is the result of an evaluation process in which the customers’ expectations have either been confirmed or disconfirmed (Hill, 2003).
The Total gap
To close the total gap: Managers must close all previous gaps. They must manage all aspects that influence customer expectations and affect the delivery performance. To do this, managers must ensure that all communication informs the customer as to what is possible and then ensure that what is delivered conforms to specified standards.
The 5 gap model
In this video we explore the 5 gaps and how to close each of the gaps. Plus, the benefits of applying a COMP perspective are suggested.
Over a number of years, Parasuraman, Zeithaml and Berry (1985, 1988, 1991, 1994) developed the SERVQUAL tool for measuring service quality. Their work has received a great deal of attention. It is worthwhile to be familiar with SERVQUAL as it is useful across a wide range of businesses and although readers may find it daunting at first, SERVQUAL is quickly grasped and very applicable.
A cumulative score across all dimensions may provide a hierarchy of attention for marketing practitioners and therefore a marketing action plan.
Gathering SERVQUAL dimensions and plotting them on a radar graph is worthwhile.
A brief overview of SERVQUAL
In this video we explore the 10 dimensions of SERVQUAL – provide example of each dimension and emphasise theimprtance of researching expectations and then performance to ensure that the gap between customer expectations and performance can be reduced.
Marketing practitioners are urged to study Bitner’s (1992) classic article as it provides insight into the importance of managing the place [plus the interacting components of experience, people, service, and ideas]. It also highlights that place sends physical evidence to prospective customers.
Technical, functional, Place, & relational qualities
Keeping in mind our 8 consumption qualities discussed in the buyer decision process, and if we synthesise our work to this point we may conclude that marketing practitioners may consider product qualities as Technical qualities [what is delivered, Functional qualities [ how it is delivered] Place qualities [where it is delivered] Relational qulaities [why it is delivered]
Net Promoter Score
Reichheld advocates measuring the likelihood of customer recommendations through the use of Net Promoter Score (NPS). Although, Reichheld (2003) has attracted some criticism, he is recognised as a leader in this field of study and the NPS tool is widely adopted. It appears as if Reichheld had an epiphany and realised that he was measuring too many elements of customer satisfaction and could take a short-cut by simply asking the likelihood that a customer would recommend an organisation in the future [i.e., loyal behaviour].
Closing the gaps
Given the importance of quality [see circle of satisfaction] quality may require an everyday marketing action plan to maintain a level of quality or as needed marketing action planwhen there is a deviation or a gap that needs to be closed.
Net promoter score
Earlier we mentioned that just as the success of a theatrical production is dependent of good reviews so does the success of a product/organisation. One interesting method of eliciting feedback is called net promoter score [NPS].
Reichheld advocates measuring the likelihood of customer recommendations through the use of Net Promoter Score (NPS). Although, Reichheld (2003) has attracted some criticism, he is recognised as a leader in this field of study and the NPS tool is widely adopted. It appears as if Reichheld had an epiphany and realised that he was measuring too many elements of customer satisfaction and could take a short-cut by simply asking the likelihood that a customer would recommend an organisation in the future [i.e., loyal behaviour]. Building on his previous work, he advocates a simple test to indicate how an organisation will fare in the future. The basic premise is that customers are asked to rate, on a scale of 0-10, the likelihood of recommending a product to someone in the future.