Prof. Ashok Patnaik

Gaps Model of

Service Quality

By

Prof. Ashok Kumar Patnaik

Head Marketing and Communication-AIMS

Prof. Ashok Patnaik

What is GAP

• The customer gap is the difference between customer expectations and perceptions.

• For e.g. when you buy an expensive car/ buy a business class ticket you expect a high level of service, considerably superior to the other cheaper options available.

Prof. Ashok Patnaik

Five Dimensions of Service Quality

• Reliability: Delivering on promise

• Responsiveness: Being willing to help

• Assurance: Inspiring trust and confidence

• Empathy: Treating customers as individuals

• Tangibles: Representing the service physically

Prof. Ashok Patnaik

Example: Car repair • Problem fixed at the first time and ready

when promised• Accessible; no waiting; responds to

requests• Knowledgeable & skilled mechanics• Acknowledges customer by name;

remembers previous problems and preferences

• Repair facility; waiting area; uniforms; equipment

Prof. Ashok Patnaik

Example: Airline • Flights to promised destination; departure

and arrival on schedule• Prompt and speedy system of ticketing, in-

flight baggage handling• Trusted name; good safety record;

competent employees• Understands special individual needs;

anticipate customer needs • Aircraft; ticketing counters; baggage area;

uniforms

Prof. Ashok Patnaik

The customer gap

Customer Gap

Expected Service

Perceived Service

Prof. Ashok Patnaik

The customer gap (Restaurant)

Customer Gap

Expected Service(hygiene, temperature, service style, superior quality ingredients)

Perceived Service (experience you get at the end of the day)

Prof. Ashok Patnaik

Basis for Gaps model

• Closing the gap between what customers expect and what they perceive is critical to delivering quality service.

• It aims at understanding the customer better and better than any thing else as customer is the critical component of services marketing.

Prof. Ashok Patnaik

The provider gaps

• These gaps occur within the organisation providing the service:– Gap1: Not knowing what customers expect– Gap2: Not selecting the right service designs

and standards.– Gap3: Not delivering to service designs and

standards– Gap4: Not matching performance to promises

Prof. Ashok Patnaik

Not knowing what customer expect

• It is the difference between customer expectations of service and company understanding of those expectations.

Few Reasons:– Managers don’t interact with customers directly– They may be unwilling to ask about expectations– They may be unprepared to address them

Prof. Ashok Patnaik

Key factors leading to providers gap-1A

• Inadequate marketing research orientation– Insufficient marketing research– Research not focused on service quality – Inadequate use of market research

Prof. Ashok Patnaik

Key factors leading to provider gap-1B

• Lack of upward communication– Lack of interaction between management and

customers– Insufficient communication between contact

employees and managers– Too many layers between contact personal

and top management

Prof. Ashok Patnaik

Key factors leading to provider gap-1C

• Insufficient relationship focus– Lack of market segmentation– Focus on transactions rather than

relationships– Focus on new customers rather than

relationship with existing customers

Prof. Ashok Patnaik

Key factors leading to provider gap-1D

• Inadequate service recovery – Lack of encouragement to listen to customer

complaints– Failure to make amends when things go

wrong– No appropriate recovery mechanism in place

to service failures

Prof. Ashok Patnaik

Not having the right service quality designs and standards

• Accurate perceptions of customer’s expectations are necessary but not sufficient for delivering superior quality service.

• Another perquisite is the presence of service designs and performance standards that reflect those accurate perceptions.

Prof. Ashok Patnaik

Not having the right service quality designs and standards

• Customer driven standards are different from the conventional performance standards that companies establish for service.

• There are operations standards set to correspond to customer expectations and priorities rather than company concern s such as productivity or efficiency.

Prof. Ashok Patnaik

Not having the right service quality designs and standards

• Poor service design– Unsystematic new service development

process– Vague, undefined service designs– Failure to connect service design to service

positioning

Prof. Ashok Patnaik

Not having the right service quality designs and standards

• Absence of customer driven standards– Lack of customer driven standards– Absence of process management to focus on

customer requirements– Absence of formal process for setting service

quality goals

Prof. Ashok Patnaik

Not having the right service quality designs and standards

• Inappropriate physical evidence and service escape – Failure to develop tangibles in line with

customer expectations– Servicescape design that does not meet

customer and employee needs– Inadequate maintenance and updating of the

servicescape

Prof. Ashok Patnaik

Not delivering to service designs and standards

• Deficiencies in human resource policies – Ineffective recruitment– Role ambiguity and role conflict– Poor employee technology job fit – Inappropriate evaluation and compensation

systems– Lack of employment, perceived control and

teamwork

Prof. Ashok Patnaik

Not delivering to service designs and standards

• Customers who do not fulfill roles– Customers who lack knowledge of their roles

and responsibilities– Customers who negatively impact each other

Prof. Ashok Patnaik

Not delivering to service designs and standards

• Problems with service intermediaries– Channel conflict over objectives and

performance– Difficulty controlling quality and consistency– Tension between employment and control

Prof. Ashok Patnaik

Not delivering to service designs and standards

• Failure to match supply and demand– Failure to smooth peaks and valleys of

demand– Inappropriate customer mix– Over-reliance on price to smooth demand

Prof. Ashok Patnaik

Not matching performance to promises

• Lack of integrated services marketing communications– Tendency to view each external

communication as independent – Absence of interactive marketing in

communication plans– Absence of strong internal marketing

programme

Prof. Ashok Patnaik

Not matching performance to promises

• Ineffective management of customer expectations– Absence of customer expectation

management through all forms of communication

– Lack of adequate education for customers

Prof. Ashok Patnaik

Not matching performance to promises

• Over promising – Over promising in advertising – Over promising in personal selling– Over promising through physical evidence

cues

Prof. Ashok Patnaik

Not matching performance to promises

• Inadequate horizontal communications– Insufficient communication between sales and

operations– Insufficient communication between

advertising and operations– Differences in policies and procedures across

branches or units

Prof. Ashok Patnaik

Service Delivery External

Communication to Customers

Perceived Service

Expected Service

Customer Driven Service Designs and Standards

Company perceptions of Consumer Expectations

CUSTOMER

COMPANY

Customergap

Gap1

Gap4Gap3

Gap2

Prof. Ashok Patnaik

Factors that influence service expectations

Personal needs

Beliefs about What is possible

Situational factors

Perceived services

Adequate services

Desired services

Predicted service

Explicit and implicit service promises Word of mouth past experience

ZONE OF

TOLERANCE

Prof. Ashok Patnaik

Consumer Behaviour in Services

By

Prof. Ashok Kumar Patnaik

Prof. Ashok Patnaik

“Memorable are experiences and not gadgets”

- Daniel Bethamy

Prof. Ashok Patnaik

Consumer behaviour in service settings

• “For companies who want to successfully enter the Indian market, there is no substitute for a deep understanding of the Indian consumer…..Companies doing business in India need to capture the differences in consumers’ needs and aspirations and the barriers and triggers to change”– Keki Dadiseth, Ex Chairman, HLL India

Prof. Ashok Patnaik

The purchase process of services Awareness of Need

Future Intentions

Information search

Evaluation of alternative service suppliers

Request service from chosen supplier

Service delivery

Evaluation of service performance

Prof. Ashok Patnaik

Pre-purchase stage• Seeking information from respected personal

sources (family, friends, peers)• Relying on a firm that has a good reputation• looking for guarantees and warranties• Visiting service facilitates or trying aspects of

the service before purchasing• Asking knowledgeable employees about

competing services• Examining tangible cues or other physical

evidence• Using the internet to compare service offerings

Prof. Ashok Patnaik

An understanding of CB lies at the heart of services marketing

• Why do customers buy one service and not the other?

• Who or what influences their decisions and their brand preferences?

• What criteria do they evaluate possible alternatives?

• Why do they buy this type of service when a different type of service might have provided a better solution to their needs?

• What drives these needs in the first place?

Prof. Ashok Patnaik

Perceived risks in purchasing and using services-2

• Physical risk (personal injury or damage to possessions)

• Psychological risk (personal fears and emotions)

• Social risk (how others think and react)

• Sensory risk (unwanted impacts on any of the five senses)

Prof. Ashok Patnaik

Customer decision making and evaluation of services

Need reorganization

Information search

Evaluation of alternatives

Purchase

Consumer Experience

Post experience evaluation

Prof. Ashok Patnaik

Need recognition • Physiological needs are such as biological

needs such as food, water and sleep.• Safety and security needs include shelter,

protection and security.• Social needs are for affection, friendship

and acceptance.• Ego needs are for prestige, success,

accomplishment and self-esteem.• Self actualization involves self-fulfillment

and enriching experiences.

Prof. Ashok Patnaik

Information search

• Personal and non-personal sources

• Perceived risk

Prof. Ashok Patnaik

Understanding user costs for services

• Price and other financial expenditure – Search costs– Purchase and use costs– After costs– Operating costs– Incidental expenses

• Non-financial outlays and burdens – Time expenditures – Physical effort– Psychological burdens– Sensory burdens

Prof. Ashok Patnaik

Perceived risks in purchasing and using services-1

• Functional risk (unsatisfactory performance outcomes)

• Financial risk (monetary loss, unexpected costs)

• Temporal risk (wasting time, consequences of delays)

Prof. Ashok Patnaik

Understanding difference among consumers

• The role of culture – Values and attitudes differ across culture– Manners and customs– Material culture – Aesthetics– Educational and social institutions

Prof. Ashok Patnaik

Understanding difference among consumers

• Group decision making– Households– Organisations

• The initiator• The gatekeeper• The decider• The buyer• The user

Prof. Ashok Patnaik

Consumer expectations of service

Prof. Ashok Patnaik

Customer expectation

• It is the beliefs about service delivery that serve as standards or reference points against which performance is judged.

• Customers compare their perceptions of performance with these reference points when evaluating service quality, through knowledge about customer expectations is critical to service matters.

Prof. Ashok Patnaik

Types of service expectations

• Ideal expectations or desire: Every one says this restaurant is as good as one in France and I want to go somewhere very special for my birthday.

• Normative “should” expectation: As expensive as this restaurant is, it ought to have excellent food and service.

Prof. Ashok Patnaik

Types of service expectations

• Experience based norms: Most times this restaurant is very good, but when it gets busy the service is slow.

• Acceptable expectations: I expect this restaurant to service me in an adequate manner.

• Minimum tolerable expectations: I except terrible service from this restaurant but come because the price is low.

Prof. Ashok Patnaik

Sources of adequate service expectations

• Temporary service intensifiers

• Perceived service alternatives

• Self-perceived service role

• Situational factors

Prof. Ashok Patnaik

Issues in customer service expectations

• What does a service marketer do if customer expectations are unrealistic’?

• Should a company try to delight the customer?

• How does a company exceed customer service expectations?

• Do customer service expectations continually escalate?

• How does a service company stay ahead of competition in meeting customer expectations?

Prof. Ashok Patnaik

Customer perception of service

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Consumer perception

• Satisfaction vs service quality

• Transaction vs cumulative perception

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Determinants of customer satisfaction

• Product and service features

• Consumer emotions

• Attributes for service success or failure

• Perceptions of equity or fairness

• Other consumers, family members and

co-workers

Prof. Ashok Patnaik

Service encounters

• Types of service encounters– Remote encounters (interaction to bank

through ATM, railway ticket from internet)– Phone encounters (customer service, general

enquiry and order booking)– Face-to-face encounters (maintenance

personal, ticket counter, food and beverage services etc.)

Prof. Ashok Patnaik

Pleasure and displeasure in service encounters

• Recovery- employee response to service delivery failures

• Adaptability- employee response to customer needs and requests

• Spontaneity-unprompted and unsolicited employee actions

• Coping –employee response to problem customers

Prof. Ashok Patnaik

Listening to customer through research

• Companies think that they believe they know customers should want and deliver that, rather than finding out what they do want.

• Listening to customers uses marketing research to understand customers and their requirements fully.

Prof. Ashok Patnaik

Research objectives for services

• To discover customer requirement or expectation for service

• To monitor and track service performance• To assess overall company performance

compared with that of competition• To assess gaps between customer

expectations with perception• To identify dissatisfied customers, so that

service recovery can be attempted

Prof. Ashok Patnaik

Research objectives for services

• To gauge service effectiveness changes in service delivery

• To appraise the service performance of individuals and teams for evaluation, recognition, and rewards

• To determine customer expectations for a new service

• To monitor and forecast changing customer expectation in an industry

Prof. Ashok Patnaik

Criteria for an effective service research programme

• Includes both qualitative and quantitative research

• Includes both expectations and perceptions of customers

• Balances the cost of the research and the value of the information

• Includes statistical validity when necessary• Measures priorities or importance of attributes• Occurs with appropriate frequency • Includes measurement of loyalty, behavioral

intentions or actual behavior

Prof. Ashok Patnaik

Complaint soliciation

• To identify /attend to dissatisfied customers

• To identify common service failures

Prof. Ashok Patnaik

Critical incident studies

• To identify best practices at transaction level

• To identify customer requirements as input for quantitative studies

• To identify common service failure points

• To identify systemic strength and weaknesses in customer contact services

Prof. Ashok Patnaik

Requirement research

• To identify customer requirements as input for quantitative research

Prof. Ashok Patnaik

Relationship surveys

• To monitor and track service performance

• To assess overall company performance

• To determine links between satisfaction and behavioural intentions

• To assess gaps between customer expectations and perceptions

Prof. Ashok Patnaik

Trailer calls

• To obtain immediate feedback on performance of service transactions

• To measure effectiveness of changes in service delivery

• To assess service performance of individuals and teams

• To use as input for process improvements

• To identify common service failure points

Prof. Ashok Patnaik

Service expectation meetings and reviews

• To create dialogue with important customers

• To identify what individuals large customers expect and then to ensure that it is delivered

• To close the loop with important customers

Prof. Ashok Patnaik

Process checkpoint evaluations

• To determine customer perceptions of long term professional service during service provision

• To identify service problems and solve them early in the service relationship

Prof. Ashok Patnaik

Market oriented ethnography

• To research customers in natural settings

• To study customers from culture other than India in an unbiased way

Prof. Ashok Patnaik

Mystery shopping

• To measure individual employee performance for evaluation, reorganization and reward

• To identify systematic strengths and weaknesses in customer contact services

Prof. Ashok Patnaik

Customer panel

• To monitor changing customer expectations

• To provide a forum for customer expectations

Prof. Ashok Patnaik

Lost customer research

• To identify reasons for customer defections

• To assess gaps between customer expectations and perceptions

Prof. Ashok Patnaik

Future expectations research

• To forecast future expectations of customers

• To develop and test new service ideas

Prof. Ashok Patnaik

Data base marketing research

• To identify the individual requirements of customers using information technology and database information