Ch01 Short Ans

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Services Marketing: Concepts, Cases and Strategies

SHORT-ANSWER ESSAYS

Chapter 1: An Introduction to Services

1. What is a service?

ANS:

The distinction between goods and services is not always perfectly clear.

In general, services can be defined as deeds, efforts, or perforances.

The scale of !ar"et #ntities helps to disting$ish goods fro services based on

their tangibility and often highlights areas that are often overloo"ed that ay be$sed as so$rces of copetitive advantage.

%. What are the seven categories of coplaints that c$stoers have toward serviceproviders?

ANS:& Apathy: What coedian 'eorge (arlin refers to as )I**I'A)+)o I loo" li"e I

give a dan?& r$sh-off: Attepts to get rid of the c$stoer by disissing the c$stoer

copletely...the I want yo$ to go away/ syndroe& (oldness: Indifferent service providers who co$ld not care less what the

c$stoer really wants& (ondescension: The yo$ are the client0patient, so yo$ $st be st$pid/ approach& obotis: When the c$stoers are treated siply as inp$ts into a syste that

$st be processed

& $leboo": 2roviders who live by the r$les of the organi3ation even when thoser$les do not a"e good sense& $naro$nd: 2assing the c$stoer off to another provider, who will siply pass

the off to yet another provider.

4. )isc$ss the coponents of the Serv$ction !odel. What does the odel attept toe5plain?

ANS:

The coponents of the Serv$ction !odel incl$de: other c$stoers, contact

personnel0service providers, servicescape, and organi3ation and systes 6the

r$les, reg$lations, sched$les and all other behind the scenes activities thatinfl$ence the c$stoer7s service e5perience8.

The first three coponents are visible to the cons$er, the invisible organi3ation

and systes are not.

The odel attepts to e5plain that the b$ndle of benefits received by the

c$stoer is the e5perience created for the c$stoer by the service fir.

9nli"e goods c$stoers, service c$stoers are involved in the prod$ction

process of the service.


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. Why has the deand for services ar"eting "nowledge increased in recent years?

ANS:

The change in perspective fro ind$strial anageent approaches to ar"et-

foc$sed approaches.

The treendo$s growth in service sector eployent.

Service sector contrib$tions to the world econoy

;. )isc$ss the service sector contrib$tions to the world econoy.

ANS:

New technology has led to considerable changes in the nat$re of any services

and in the developent of new services.


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The systes sho$ld also facilitate eployee efforts to do their Bobs.

The critical incidents or oents of tr$th created by c$stoer0eployee

interactions.

SHORT-ANSWER ESSAYS

Chapter 2: unda!enta" #i$$erences %et&een 'oods and Services

1. )efine the characteristics of intangibility, inseparability, heterogeneity, andperishability.

ANS:

Intangibility eans that services have no s$bstance and therefore cannot be

to$ched or eval$ated li"e goods. Inseparability refers to the interaction and physical presence of the service

provider and the cons$er thro$gho$t the service e5perience.

The heterogeneity of services pertains to the variability that is inherent in the

service delivery process.

2erishability refers to the service providerCs inability to store or inventory

services.

%. )isc$ss the ar"eting probles associated with intangibility and the possiblesol$tions to solve these probles.

ANS:The ar"eting probles that arise incl$de:

it is diffic$lt to easily display or co$nicate the properties of services to

cons$ers

prices are diffic$lt to set

services are not patentable, th$s they are easily copied by copetitors

services cannot be stored for f$t$re $se

Sol$tions s$ggested to inii3e the probles associated with intangibility incl$de:

$tili3ing tangible cl$es to infl$ence c$stoer perceptions of service delivery

developing prootional plans that ephasi3e personal so$rces of inforation developing the organi3ation7s iage to red$ce c$stoer levels of perceived ris"

4. )isc$ss the ar"eting probles associated with inseparability and the possiblesol$tions to solve these probles.

ANS:The ar"eting probles associated with inseparability are:


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the service provider7s face-to-face interactions with the c$stoer

the c$stoer7s involveent in the service delivery process

the ipact of Dother c$stoersD that are sharing the service e5perience

centrali3ed ass prod$ction of services is diffic$lt

S$ggested sol$tions to inii3e the ipact of inseparability incl$de:

the caref$l selection and thoro$gh training of p$blic contact personnel

anage c$stoers to enhance their service e5perience

the $se of $lti-site locations to overcoe the diffic$lties associated with

centrali3ed ass prod$ction

. )isc$ss the ar"eting probles associated with heterogeneity and the possiblesol$tions to solve these probles.

ANS:The priary ar"eting proble associated with heterogeneity is that:

Standardi3ation and @$ality control are diffic$lt for the service fir to provide on a

reg$lar basis.

Standardi3ation ay be achieved via a$toation--replacing h$an labor with

achines.

In contrast, any service firs are ta"ing advantage of the variability that is

inherent in service delivery by offering c$stoi3ed services.

The tradeoffs associated with c$stoer preferences with standardi3ation and

c$stoi3ation incl$des price, speed of delivery, and consistency of perforance.

;. )isc$ss the ar"eting probles associated with perishability and the possiblesol$tions to solve these probles.

ANS:)$e to the characteristic of perishability:

it is not possible to inventory services

Strategies $tili3ed to inii3e the ipact of perishability incl$de:

strategies to increase s$pply and0or alter deand

Strategies which increase the s$pply of service incl$de:

$tili3ing part-tie eployees sharing capacity with other service providers

a"ing preparations in advance with regards to f$t$re e5pansion

$tili3ing third-parties

increasing the ao$nt of c$stoer participation d$ring the service process

Strategies to alter deand incl$de:


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developing creative pricing strategies

$tili3ing reservation systes

developing copleentary services

developing nonpea" deand


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SHORT-ANSWER ESSAYS

Chapter (: An Overvie& o$ the Services Sector

1. )isc$ss the val$e of classification schees.

ANS:

(lassification schees highlight the characteristics that different services have in

coon.

(lassification schees help $s e5aine the ar"eting iplications of these

coonalities.

%. )isc$ss how the ter aterialiso snobbery is related to service wages.

ANS:

!aterialiso snobbery reflects the belief that witho$t an$fact$ring there willbe less for people to service and ore people available to do less wor".

As a res$lt, the s$pply of labor will go $p and at the sae tie the deand for

labor will go down. oth effects will drive the price of labor down.

4.)isc$ss the coparisons of changing fro an agric$lt$ral econoy to an ind$strialeconoy

as they relate to the changes associated with oving fro an ind$strial econoy to aservice

econoy.

ANS: In 1E;F, =; percent of the pop$lation was connected to faring.

)$ring this period, any voiced concern over wor"ers leaving their fars to wor"

in factories.

Today, less than % percent of the 9.S. labor force is involved in faring

operations.

Siilarly, with advances in technology and new anageent practices, the need

no longer e5ists to have as any people in an$fact$ring as we had in the id1GFFs.

. )isc$ss the possible political conse@$ences associated with the dichotoi3ation of

wealth inthe 9nited States.

ANS:

Soe theori3e that the service sector7s low wages will lead to f$rther polari3ation

in the distrib$tion in wealth within the 9nited States and other econoies.

)$e to the deocratic election process in ost service econoies, a $ltit$de of


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wor"ers $nable to feed and s$pport their failies co$ld s$bstantially alter thea"e$p and direction of f$t$re governents.

9ltiately, this sit$ation is what revol$tions are ade of.

;. )isc$ss the latest trends in the hotel ind$stry.ANS:

Wor" in hotels and other accoodations can be hectic, partic$larly for those

providing chec"-in and chec"o$t services.


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SHORT-ANSWER ESSAYS

Chapter ): The Consu!er #ecision *rocess In Services +ar,etin

1. #5plain the relevance of search, e5perience, and credence attrib$tes as they apply toservices? #5plain.

ANS:

Search attrib$tes--attrib$tes that can be deterined prior to p$rchase.

#5perience attrib$tes--attrib$tes that can be eval$ated only d$ring and after the

prod$ction process.

(redence attrib$tes--attrib$tes that cannot be eval$ated confidently even

iediately after receipt of the good or service.

)$e to intangibility, services possess few search attrib$tes and are priarily

characteri3ed by e5perience and credence attrib$tes.

%. )isc$ss the special considerations abo$t services d$ring the prep$rchase stage ofthe cons$er decision process.

ANS:

As copared to goods, cons$ers of services d$ring the prep$rchase stage of

the decision process perceive higher levels of ris" to be associated with thep$rchase

tend to be ore brand loyal

rely ore on personal so$rces of inforation

tend to have fewer alternatives to consider and

often incl$de self-provision as a viable alternative.

4. )isc$ss the special considerations abo$t services d$ring the cons$ption stage ofthe cons$er decision process.

ANS:

No service can be prod$ced or $sed with either the cons$er or the service fir

absent.

)$e to the e5tended service delivery process, any believe that the cons$er7s

postchoice eval$ation occ$rs d$ring and after, rather than B$st after, the $se of

services. Hro a ar"eterCs point of view, this provides the opport$nity to directly infl$ence

that eval$ation.

)$e to the client-copany interface, the service provider is able to catch

probles and change eval$ations in a way that the an$fact$rer of a pac"agedgood never co$ld.

. )isc$ss the special considerations abo$t services d$ring the postchoice stage of the


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cons$er decision process.

ANS:

The postp$rchase eval$ation of services is a cople5 process.

The eval$ation process begins soon after the c$stoer a"es the choice of the

service fir he or she will be $sing and contin$es thro$gho$t the cons$ptionand postchoice stages.

The eval$ation is infl$enced by the $navoidable interaction of a s$bstantial

n$ber of social, psychological, and sit$ational variables.

Service satisfaction relies not only on the technical @$ality of the service and the

fo$r eleents of the Serv$ction syste--contact personnel, inaniateenvironent, other c$stoers, and internal organi3ation systes--b$t also on thesynchroni3ation of these eleents in the service prod$ction0cons$ptionprocess.

;. )escribe odels that attept to e5plain the cons$er7s postp$rchase eval$ation.

ANS:

!odels which assist in o$r $nderstanding of the cons$er7s postp$rchase

eval$ation process incl$de the e5pectancy disconfiration odel, the perceived-control perspective and the script perspective.

In short, the e5pectancy disconfiration odel defines satisfaction as eeting or

e5ceeding c$stoer e5pectations.

The perceived-control perspective proposes that d$ring the service e5perience,

the higher the level of control over the sit$ation perceived by cons$ers, the

stronger will be their satisfaction with the service. The script perspective proposes that in a service enco$nter c$stoers perfor

roles, and their satisfaction is a f$nction of Drole congr$enceD -- whether or notthe act$al behaviors by c$stoers and staff are consistent with the e5pectedroles.

=. #5plain why cons$ers of services tend to be ore brand loyal.

ANS:

(ons$ers are ore brand loyal of services for the following reasons:

o epeat p$rchases fro the sae provider red$ces the ao$nt of

perceived ris" associated with the p$rchase.o rand loyalty ay also be higher d$e to the liited n$ber of alternative

choices available ando (ons$ers of services ay be ore brand loyal in the attept to avoid

switching costs.


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SHORT-ANSWER ESSAYS

Chapter .: Service #eve"op!ent and Innovation

1. There are new service categories of innovations state the categories andprovide ind$stry e5aples of how a service organisation can $se these strategies todevelop and ove forward.

ANS:

sell new services to e5isting c$stoers

sell ore e5isting services to e5isting c$stoers

sell e5isting services to new c$stoers

sell new services to new c$stoers

%. )isc$ss the pros and cons of aBor service innovations. 'ive e5aplesof organisations that have introd$ced aBor service innovations.

ANS:

pros - forward thin"ing strategy, new prod$cts and services for c$stoers.

cons aBor innovations involve long-ter planning, e5tensive training and are

e5pensive.

4. *ist and disc$ss the seven classifications of the contin$$ of new servicedevelopent.

ANS:1. !aBor service innovations%. !aBor process innovations4. 2rod$ct-line e5tensions. 2rocess-line e5tensions;. S$ppleentary service innovations=. Service iproveents. Style changes

. The service developents are s$ari3ed into fo$r diensions. State the fo$rdiensions and give e5aples of how organisations have c$stoers $se the new

services offered.

ANS:

The fo$r diensions are Service (oncept, (lient Interface, Service )elivery

Syste, Technological >ptions

;. )isc$ss the eight activities that create and enco$rage innovation and creativity.


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ANS:

(hallenge and involveent ens$re eployees $nderstand the visions and long

ters goals of the organisation and otivate eployees

Hreedo ens$re there is independence within the organisation and across

eployees so that ideas can be shared and people can wor" a$tonoo$sly Tr$st0openness ens$re people can co$nt on each other for professional and

personnel help

Idea tie fle5ibility in tie-lines, ability to disc$ss and test s$ggestions

2layf$lness0pport$nities when copetitors withdraw fro the ar"etplace this releases a

new opport$nity for organisations. Also new opport$nities eerge whenorganisations coplete their own research with cons$ers and staff.

eg$lations governents incl$de reg$lations with which organisations have to

coply. >rganisations can $se the reg$lations as a 2 e5perience s$ch asgreen iss$es, waste anageent or fra$d control.

2erishability new service processes and0or prod$cts need to be incl$ded to

ta"e into acco$nt of 2erishability services need to Jfill the spaceC available

Seasonal patterns service organisations need to consider the different ties ofthe year, pop$lar and c$lt$ral festivals and events and different ties of the dayto ta"e advantage of the seasonal opport$nities.

Hashions latest fashion trends affect all ar"ets at soe tie. >rganisations

need to "eep an eye on all e5ternal environents partic$larly pop$larfashionable ind$stries.

(opetitors service organisations need to $nderstand their b$siness, their

ar"eting strategies and sales. They also need to $nderstand their copetitorsso that they can becoe ore innovative and creative than their copetitors.


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SHORT-ANSWER ESSAYS

Chapter 1/: +anain the ir!0s *hsica" Evidence

1. >ne of the priary roles of a service fir7s physical evidence is to pac"age theservice. #5plain the anagerial iplications of Dpac"aging the serviceD.

ANS:

Since services are intangible, they cannot be eval$ated obBectively. ($stoers

loo" to the physical evidence that s$rro$nds the service for @$ality c$es. In t$rn,@$ality c$es provide the b$ilding bloc"s for iage developent. S$ccessf$liage developent red$ces the ao$nt of c$stoer perceived ris" associatedwith the p$rchase as well as the ao$nt of cognitive dissonance after thep$rchase. In addition, the fir7s physical evidence is iportant as the servicepac"age in that it conveys e5pectations to cons$ers.

%. The appearance of personnel often have a direct ipact on how cons$ers perceivethat the fir will handle the service aspects of its b$siness. )isc$ss the findings ofn$ero$s st$dies that have foc$sed on well-dressed vers$s $n"ept personnel.

ANS:

In short, well-dressed personnel are often perceived as ore intelligent, better

wor"ers, and ore open to interactions.

4. )isc$ss how a service fir7s physical evidence facilitates the flow of the servicedelivery process.

ANS:

The fir7s physical evidence can facilitate the flow of the service delivery process

thro$gh the inforation it provides to c$stoers. Inforation ed$cates thec$stoers so that they can as"ed ore-infored @$estions and prepares thec$stoer for the ens$ing service enco$nter a"ing the whole service deliveryprocess ore efficient. In addition, the fir7s physical evidence also assists inanaging c$stoers. Hor e5aple, physical dividers that separate so"ersfro nonso"ers, and waiting c$stoers fro c$stoers who are c$rrentlybeing served are typical.

. )isc$ss the design considerations of reote, self-service, and interpersonal services.

ANS:

In short, reote services see little direct c$stoer contact.


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c$stoers and eployees.

;. )isc$ss the physical environental diensions of DThe Servicescapes !odelD.

ANS:

The three aBor coponents of the fir7s environent incl$de abient

conditions, space0f$nction, and signs, sybols and artifacts. Abient conditionsincl$de teperat$re, air @$ality, noise, odor, and $sic. Space0f$nction incl$deslayo$t, e@$ipent, and f$rnishings. Signs, sybols and artifacts incl$designage, personal artifacts, and style of decor.

=. )isc$ss the stages of an atospheric developent plan

ANS:

Step 1: Who is the fir7s target ar"et?

Step %: What does the target ar"et see" fro the service e5perience? Step 4: What atospheric eleents can reinforce the beliefs and eotional

reactions that b$yers see".

Step :


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SHORT-ANSWER ESSAYS

Chapter 11: *eop"e Issues +anain Service E!p"oees

1. )isc$ss the role of bo$ndary spanning personnel.

ANS:

o$ndary-spanning personnel have two ain roles: inforation transfer and

representation. o$ndary spanners collect inforation fro the environent andfeed it bac" into the organi3ation. o$ndary-spanning personnel are also theorgani3ation7s personal representatives.

%. )isc$ss the ethods in which ar"eting can red$ce the so$rces of conflict felt by itseployees.

ANS:

!ar"eting can red$ce the person0role conflict of its eployees by being sensitive

to eployeesC feelings and by actively see"ing inp$t fro eployees abo$tiss$es. Siilarly, ar"eting can help red$ce conflicts between the organi3ationand its clients by a"ing s$re that c$stoer e5pectations are consistent withcapabilities of the service syste. Hinally, inter-client conflicts can often bered$ced if the c$stoers are relatively hoogeneo$s in their e5pectations.

4. )isc$ss the benefits and costs associated with epowerent.

ANS:

enefits associated with epowerent incl$de @$ic"er response to c$stoerneeds, @$ic"er response to dissatisfied c$stoers, eployees who feel betterabo$t their Bobs and theselves, eployees who interact with c$stoers withore warth and enth$sias, and increased word-of-o$th advertising andc$stoer retention. >n the other hand, the costs associated with epowerentincl$de a larger dollar investent in selection and training of personnel, higherlabo$r costs, slower or inconsistent service delivery, violations of fair play orperceived preferential treatent, and giveaways and bad decisions.

. )isc$ss the contingency approach to epowerent.

ANS: >ne ethod for deterining the appropriate level of epowerent is by

e5aining this decision based on a contingency basis. The five contingenciesincl$de the fir7s basic b$siness strategy, the tie to the c$stoer, technology,b$siness environent, and the types of people that are eployed by the fir.#ach contingency is eval$ated on a scale ranging fro 1 to ;. The lower thescore, the ore appropriate a prod$ction line approach becoes. (onversely,the higher the score, greater levels of epowerent sho$ld be eployed.


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;. )isc$ss the relevance of the Service-2rofit (hain as it relates to the !ar"et-foc$sed !anageent approach.

ANS:

#ployee satisfaction is derived fro a wor"place and Bob design which

facilitates internal service @$ality. The lin"s in the Service-2rofit (hain reveal thateployee satisfaction and c$stoer satisfaction are directly related. #ployeesatisfaction is lin"ed with increases in prod$ctivity and e5ternal service val$e.#5ternal service val$e is lin"ed with c$stoer satisfaction and the benefits ofc$stoer loyalty. The net effects of c$stoer loyalty are increased reven$es andprofitability for the fir. The o$tcoes associated with eployee satisfaction--e5ternal service val$es, c$stoer satisfaction, c$stoer loyalty, reven$e growth,and increased profitability provide feedbac" and reinforce the copany7s internalservice @$ality and eployee satisfaction.

=. )isc$ss the three so$rces of conflict for bo$ndary-spanning service wor"ers.

ANS:

o$ndary spanners face three ain so$rces of conflict: person0role conflicts,

organi3ation0client conflicts, and inter-client conflicts. With person0role conflicts, abad fit between an individ$alCs self-perception and the specific role the person$st play in an organi3ation. A ore salient conflict for ost front-line wor"ers isthe conflict between their two bosses the organi3ation and the client. Thisorgani3ation0client conflicts arises when a c$stoer re@$ests services that violate

the r$les of the organi3ation. Inter-client conflicts arise beca$se of the n$ber ofclients who infl$ence one anotherCs e5perience. This occ$rs ost often when theservice wor"er is serving $ltiple clients at the sae tie.


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SHORT-ANSWER ESSAYS

Chapter 12: *eop"e Issues +anain Service Custo!ers

1. Increasing cons$er participation in the service delivery process has becoe apop$lar strategy to increase the s$pply of service available to the fir and to provide afor of service differentiation. 2rovide g$idelines that assist the fir in effectivelyincreasing the ao$nt of cons$er participation.

ANS:

)evelop c$stoer tr$st.

2roote the benefits and sti$late trial.

9nderstand c$stoer habits.

2retest new proced$res.

9nderstand the deterinants of cons$er behavior

Teach c$stoers how to $se service innovations !onitor and eval$ate perforance

%. )isc$ss the pros and cons of increasing c$stoer participation in the servicedelivery process.

ANS:

Increasing c$stoer participation is associated with a n$ber of advantages

and disadvantages. The priary advantage to the c$stoer and the servicefir is that c$stoers can c$stoi3e their own service and prod$ce it fasterand less e5pensively than if the fir had prod$ced it. ($stoers who p$ptheir own gas, a"e their own salads, and pic" their own strawberries areclassic e5aples. >n the other hand, increased levels of c$stoerparticipation are also associated with the firCs losing control of @$ality,increased waste, which increases operating costs, and c$stoer perceptionsthat the fir ay be attepting to distance itself fro its c$stoers.

4. *ist the eight Dprinciples of waitingD.

ANS:1. 9nocc$pied tie feels longer than occ$pied tie.%. 2reprocess waits feel longer than in-process waits

4. An5iety a"es the wait see longer.. 9ncertain waits are longer than "nown, finite waits.;. 9ne5plained waits are longer than e5plained waits.=. 9nfair waits are longer than e@$itable waits.. The ore val$able the service, the longer the c$stoer will wait.E. Solo waits are longer than gro$p waits.

. )isc$ss the (! o$tcoes of coding, ro$ting, targeting and sharing.


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ANS:

(oding: (ategori3ing c$stoers based on how profitable their b$siness is.

o$ting: )irecting incoing c$stoer calls to c$stoer service representatives

where ore profitable c$stoers are ore li"ely to receive faster and better

c$stoer service. Targeting: >ffering the firCs ost profitable c$stoers special deals and

incentives.

Sharing: !a"ing accessible "ey c$stoer inforation to all parts of the

organi3ation and in soe cases selling that inforation to other firs.

;. )isc$ss the reasons behind the increased deployent of (! systes.

ANS:

($stoer relationship anageent 6(!8 is the process of identifying,

attracting, differentiating, and retaining c$stoers. (! allows the fir to foc$s

its efforts disproportionately to its ost l$crative clients. (! is based on the oldadage that EFK of a copanyCs profits coe fro %FK of its c$stoerstherefore, the %FK sho$ld receive better service than the EFK.

The increased $sage of (! practices, where high-val$e c$stoers are treated

s$perior to low-val$e c$stoers, can be attrib$ted to several trends. Hirst, soebelieve that c$stoers have done it to theselves by opting for price, choice,and convenience over high @$ality service. Another reason (! is c$rrentlyfashionable is that labor costs have risen, yet copetitive press$res have "eptprices low. The end res$lt is that gross argins have been red$ced to ; to 1Fpercent in any ind$stries. With these "inds of argins, copanies siplycannot afford to treat of all its c$stoers e@$ally. Hinally, (! is being

increasingly ipleented beca$se ar"ets are increasingly fragented andprootional costs are on the rise.

=. )isc$ss the liitations of (! practices.

ANS:

Technology greatly enhances (! processes by identifying c$rrent and potential

c$stoers, differentiating aong high-val$e and low-val$e c$stoers, andc$stoi3ing offers to eet the needs of individ$al high-val$e c$stoers.


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eliinated today beca$se their c$rrent p$rchasing behavior has the slotted andtreated as cooners./ Sp$rned by s$ch treatent, how any of thesec$stoers defect to another provider that appreciates their potential and treatsthe appropriately. *ife sit$ations and spending habits do change over tie.Hinally, service discriination also leads to soe interesting ethical @$estions.Sho$ld only the wealthy be recipients of @$ality service? Is this a for of red-"inin+the practice of identifying and avoiding $nprofitable types ofneighborhoods or types of people.


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SHORT-ANSWER ESSAYS

Chapter 1(: Custo!er Re"ationship +ar,etin

1. State what the L(2 odel is and disc$ss the three phases.

ANS:

The L(2 6Lisibility, (redibility and 2rofitability8 odel is the process that

organisations go thro$gh when establishing their relationship anageentsyste. 2hase one is Lisibility - organisations a"e theselves "nown topotential and e5isting c$stoers the ore vis$al they are the ore chancec$stoers will accept and be aware of the. 2hase two is (redibility organisations need to deonstrate reliability and ens$re c$stoers are confidentthat the organisation will "eep their proises. The third 2hase 2rofitability willocc$r is a $t$ally rewarding stage for both the organisation and the c$stoeras both gain satisfaction organisations receive a profit and c$stoers aresatisfied and they can tr$st and rely on the organisation to deliver a @$alityservice.

%. 9nder what conditions is it no longer worthwhile to "eep a c$stoer?

ANS:

The answer is when: the acco$nt is no longer profitable contract conditions are

no longer being et the c$stoer is ab$sive to the point that it lowers eployeeorale the c$stoer7s rep$tation is so poor that it tarnishes the rep$tation of theselling fir and c$stoer deands are beyond reasonable, and f$lfilling those

deands wo$ld res$lt in poor service for the reaining c$stoer base.

4. )isc$ss the five types or levels of relationship ar"eting.

ANS:

There are five types or levels of relationship ar"eting basic 1. transaction

and service $se, %. reactive organisation sells the service b$t enco$ragesc$stoer to get bac" in to$ch if they have any @$estions or probles, 4.acco$ntable organisation telephones the c$stoer d$ring an aftersalesprocess to ens$re satisfaction and see" coents, . proactive theorganisation contacts the c$stoers fro tie to tie to advise the of new

services available and ;. partnership organisation wor"s in partnership with thec$stoer to help iprove perforance.

. Not all organisations will be able to achieve partnership ar"eting. )isc$ss, withe5aples, why this is so.

ANS:

Soe organisations can achieve partnership ar"eting others can only achieve


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basic ar"eting. The reason that not all organisations can receive partnershipar"eting is beca$se soe instit$tions ay have c$stoers that are too diversewhich a"es contact too e5pensive. Additionally, soe c$stoers val$e theirprivacy and will not share personal, behavio$ral or transactional details. Table14.% shows that there are different types of relationship ar"eting. #5aples willvary dependant $pon the st$dentCs choice.

;. )isc$ss the stages of the ladder of loyalty and give s$ggestions of how serviceorganisations can ove c$stoers $p the loyalty ladder/.

ANS:

The stages of the loyalty ladder are 2rospects those that becoe ($stoers,

($stoers those that are ($stoers, (lients ($stoers who "eep ret$rningto the service organisation, S$pporters ($stoers who contin$e to s$pport theb$siness thro$gh greater involveent, Advocates- c$stoers who contin$e toret$rn to the b$siness, s$pport it and becoe ore involved in it, 2artners c$stoers who repeat their b$siness, becoe involved in the b$siness andbecoe friends/ of the b$siness and *apsed ($stoers c$stoers that haveta"en their b$siness elsewhere. S$ggestions will vary dependant $pon thest$dentCs choice.

=. )isc$ss the differences between an iplicit g$arantee, a specific res$lt g$arantee,and an $nconditional g$arantee.

ANS:

An iplicit g$arantee is an $nwritten, $nspo"en g$arantee that establishes an

$nderstanding between the fir and its c$stoers. A specific res$lts g$aranteeapplies only to specific steps or o$tp$ts in the service delivery process. An$nconditional g$arantee proises coplete c$stoer satisfaction, and at aini$, a f$ll ref$nd or coplete, no-cost proble resol$tion.

. )isc$ss strategies that are available to inii3e the ris" associated with aservice g$arantee payo$t.

ANS:

Hirs can inii3e a payo$t by f$lly $nderstanding the c$stoer7s needs prior to

service delivery trac"ing and onitoring the fir7s perforance thro$gho$t the

service delivery process liiting the payo$t so that it pertains to the "ey activitiesand not to inor details, specifying $p front who has the a$thori3ation to approvea payo$t and specifying prior to service delivery the ao$nt involved in thepayo$t.

E. )isc$ss the c$stoer defection anageent process.

ANS:


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)efection anageent is a systeatic process that actively attepts to retain

c$stoers before they defect. Steps in the process incl$de: co$nicating toeployees the iportance of retaining c$stoers training eployees indefection anageent--how to react to defecting c$stoers tying incentives to

defection rates and considering the creation switching barriers that disco$ragedefections.


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SHORT-ANSWER ESSAYS

Chapter 13: #e$inin and +easurin Service 4ua"it

1. #5plain how providing poor service can act$ally increase a co$ntry7s 'ross)oestic 2rod$ct 6')28.

ANS:

A typical e5aple wo$ld be the sit$ation where a ail order copany sends a

c$stoer the wrong prod$ct. The dollars spent on correcting the ista"e in thefor of phone calls and ret$rn ailings wo$ld add to the gross doestic prod$ct.

%. #5plain why the prod$ctivity of ed$cation and governent services is notorio$slydiffic$lt to eas$re.

ANS:

Increases in @$ality, s$ch as iproving the @$ality of ed$cation and training

governental eployees to be ore pleasant thro$gho$t their daily interactionswith the p$blic, do not show $p in traditional prod$ctivity eas$res s$ch as then$ber of grad$ates prod$ced or the n$ber of c$stoers served.

4. 2rovide a brief description for each of the seven gaps within the (oncept$al !odel ofService @$ality.

ANS:

service gap: the distance between a c$stoer7s e5pectation of a service and

perception of the service act$ally developed "nowledge gap: the differencebetween what c$stoers e5pect of a service and what anageent perceivesthe c$stoers to e5pect standards gap: the difference betweeercn whatanageent perceives c$stoers to e5pect and the @$ality specifications set forservice delivery delivery gap: the difference between the @$ality standards setfor service delivery and the act$al @$ality of service delivery co$nicationsgap: the difference between the act$al @$ality of service delivered and the @$alityof service described in the fir7s e5ternal co$nications, perceptions gap:act$al and what was perceived, interpretation gap: proise in co$nicationand that received.

. *ist the seven diensions of service @$ality. Which diension is typically rated byc$stoers as the ost iportant? Which is typically rated as the least iportant?

ANS:

The seven diensions of service @$ality incl$de reliability, responsiveness,

ass$rance, epathy, and tangibles. Their ordering reflects their typicaliportance fro ost iportant to least iportant.


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;. In general, service @$ality inforation systes foc$s on two types of research:c$stoer research and nonc$stoer research. *ist the coponents of the service@$ality inforation syste $nder the appropriate research heading.

ANS:

($stoer research: solicitation of c$stoer coplaints, after-sale s$rveys, foc$s

gro$p interviews, and total ar"et service @$ality s$rveys Nonc$stoerresearch: eployee s$rveys and ystery shopping.


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SHORT-ANSWER ESSAYS

Chapter 1.: Service ai"ures and Recover Strateies

1. )isc$ss the reasons any c$stoers never coplain.

ANS:

($stoers typically do not coplain for the following reasons 618 they don7t

"now who to coplain to 6%8 they don7t thin" it will do any good 648 anyc$stoers do$bt their own s$bBective eval$ation 68 any accept part of theblae d$e to their roles as co-prod$cers 6;8 any siply want to avoid aconfrontation and 6=8 any feel they lac" the e5pertise to a"e an acc$rate

B$dgent.

%. )isc$ss the reasons c$stoers coplain.

ANS:

($stoers that do coplain ay do so to: 618 correct the proble 6%8 provide an

eotional release fro fr$stration 648 regain soe eas$re of control byspreading negative w-o- 68 solicit sypathy 6;8 test for consens$s and 6=8create an ipression of being ore intelligent and discerning.

4. )isc$ss the ost coon fors of coplaining o$tcoes.

ANS:

The ost coon fors of o$tcoes are e5it, voice, and0or retaliation or soe

cobination of all three which can vary fro high, edi$, to low.

. What are the basic f$ndaental steps of establishing a service recovery progra?

ANS:

The fir sho$ld: eas$re the costs associated with losing a c$stoer actively

enco$rage coplaints, anticipate the needs for recovery respond @$ic"ly toc$stoer coplaints train eployees in service recovery tactics epower thefront-line so that they can act @$ic"ly and close the loop--infor c$stoers howtheir coplaint ade a difference in how the fir will operate in the f$t$re.

;. )isc$ss the recoended tactics to recover effectively fro a service fail$re.

ANS:

The c$stoerCs perception of whether the recovery strategy is B$st incl$des

eval$ations of the recovery process itself the o$tcoes connected to therecovery strategy and the interpersonal behaviors enacted d$ring the recoveryprocess. Accordingly, perceived B$stice consists of three coponents:distrib$tive B$stice proced$ral B$stice, and interactional B$stice.


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)istrib$tive B$stice foc$ses on the specific o$tcoe of the firCs recovery effort.

In other words, what specifically did the offending fir offer the c$stoer torecover fro the service fail$re, and did this o$tcoe 6o$tp$t8 offset the costs6inp$ts8 of the service fail$re? Typical distrib$tive o$tcoes incl$de

copensation 6e.g., gratis, disco$nts, co$pons, free $pgrades, and free ancillaryservices8 offers to end or totally replace0reperfor and apologies.

The second coponent of perceived B$stice, proced$ral B$stice, e5aines the

process that is $nderta"en to arrive at the final o$tcoe. stensivecoplaints: coplaints directed at soeone or soething o$tside the real ofthe coplainer efle5ive coplaints: coplaints directed at soe inner aspectof the coplainer.


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SHORT-ANSWER ESSAYS

Chapter 15: *uttin the *ieces Toether Creatin the Sea!"ess Service ir!

1. )isc$ss the concept of sealessness.

ANS:

The priary efforts of the service fir sho$ld foc$s on the service delivery

process and on the personnel providing c$stoer services. (reating a sealessservice organi3ation eans providing services witho$t interr$ption, conf$sion, orhassle to the c$stoer

%. )isc$ss the three-tiered odel of service firs separately and then as a cobined$nit.

ANS:

S$ccess is based on the effective anageent and integration of the c$stoer

tier, the bo$ndary tier, and a coordination tier. The ($stoer Tier foc$ses onc$stoer e5pectations, needs, and copetencies. The o$ndary Tier concernsitself with the individ$als who interact with the c$stoers--the bo$ndaryspanners. Service personnel in the bo$ndary tier $st be ore fle5ible,co$nicative, able to deal with stress, and willing to ta"e the initiative than theiran$fact$ring co$nterparts. 9ltiately, bo$ndary spanning personnel are onlyas good as the nonpersonal aspects of the service delivery syste that s$pportstheir efforts. The (oordination Tier is the responsibility of $pper anageentand involves coordinating the activities that help integrate the c$stoer and the

bo$ndary tiers. The priary challenge of the coordination tier is to get thevario$s departents within the organi3ation to wor" with one coon goal inind--serving the c$stoer.

4. )isc$ss the iportance of internal logics.

ANS:

Internal logics are iplicit and e5plicit principles that drive organi3ational

perforance. #ach departent7s logic is internally foc$sed on departentalneeds and creates seas in the service delivery process. >perations,ar"eting, and h$an reso$rces are types of logics disc$ssed in the te5t.

Service logic attepts to stitch the departental and f$nctional seas togetherin order to help the fir provide flawless service.

. )isc$ss the iportance of organi3ational c$lt$re.

ANS:

In short, organi3ational c$lt$re establishes the do7s and donCts of eployee

behavior and provides the basis on which vario$s behaviors can coalesce.


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($lt$re is the shared val$es and beliefs that drive an organi3ation.

;. #5plain the relevance of interf$nctional tas" forces and interf$nctional transfers asthey relate to corporate c$lt$re.

ANS:

oth approaches have been $sed to esh the logics of different gro$ps and to

allow the to better $nderstand one another. Interf$nctional tas" forces areproble-solving gro$ps in which individ$als with diverse viewpoints wor"together and develop a better $nderstanding of one another7s perspectives.Interf$nctional transfers are when a eployee fro one organi3ationaldepartent is transferred to another to foster inforal networ"s aongdepartents.

=. )isc$ss the aBor obBectives of a service a$dit.

ANS:

The service a$dit directs the fir to thin" abo$t forces that drive its c$rrent profits

and s$ggests strategies that lead to copetitive differentiation and long-terprofitability. The "ey coponents of a service a$dit incl$de: 618 profit and growth6%8 c$stoer satisfaction 648 e5ternal service val$e 68 eployee prod$ctivity6;8 eployee loyalty 6=8 eployee satisfaction 68 internal service @$ality 6E8leadership and 6G8 eas$reent relationship.


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Ch01 Short Ans