Service Recovery Report for Moments of Truth - myassignmenthelp

Question: Write about theService Recovery Report for Moments of Truth. Answer: Introduction The quality of service is important for all organizations in order to retained satisfied customers who become loyal to the organization. This report will discuss the moments of truth and show the determinants of satisfaction or dissatisfaction for Starbucks. It will also use theory to discuss service quality management. "Moments of Truth" for Starbucks Moments of truth can be described as any moment that a customer has an interaction with a company, or its products, services or staff however remote the interaction is, and the customer has the opportunity to form an impression about the company, whether it is good or bad (Hyken, 2014 para4). All companies need to manage the moments of truth and create an above average experience for their customers whenever they interact with the company. This is a good way to retain loyal customers while attracting new ones and create positive word of mouth by the happy customers which is an effective marketing tool. Moments of truth for all companies are important if they want to become great. Customers evaluate the quality of products at the time of the purchase and also at the time of consumption. In the first instance, the company should grasp the customers attention and ensure to educate the customer about the benefits of the product they are buying. In the second instance, the customer should be empowered to experience the benefits of using the product. This totals up to the customer experience whether good or bad (Lfgren, 2005 p103). Moments of truth for Starbucks include those moments when the customers come in to contact with the company, giving the customers the chance to form or change the impression about the company. Some of these instances include when greeting the customers as they visit their outlets, while handling customer queries or their orders, when attending to customer complaints, while giving any special discounts or offers, during service, delivery of the order, while handling customer payments and any online interactions including queries, complaints, orders and any other interactions. Components of service for hotel and hospitality industry like Starbucks can be grouped in to three being the technical this being the physical aspects like reception and the rooms, functional being the interactive service like greetings to customers and image quality (Hudson Hudson, 2012 p74). Determinants of Satisfaction/Dissatisfaction Customer satisfaction is assumed to determine if the customer will become a repeat customer, spread positive word of mouth or even become a loyal customer. It is also important to the individual customer because it determines whether they put their resources in to the best purchase and thus fulfilled their needs (Komunda and Osarenkhoe, 2012 p90). Customer dissatisfaction may then have the opposite effects which include negative word of mouth, lack of repeat purchase and loss of customers. The effort should thus be identifying the determinants of satisfaction and increase them while improving the dissatisfaction. One of the determinants of dissatisfaction is unsatisfactory purchase, which could either be wrong product or poor quality of product. One in every five purchases results in dissatisfaction with the services or with durable products (Hoyle, 2009 p560). Some customers may react be complaining or seeking redress while some customers may not take any action after dissatisfaction. Failure to complain or seek redress means the company does not get an opportunity to correct the mistake (Sabharwal, Soch Kaur, 2010 p139). Another determinant of satisfaction is disconfirmation which positively affects satisfaction. When a customer buys a product or service that works better than expected, then the customer is more satisfied and vice versa. Performance also determines customer satisfaction. If the purchase performs well, then customer is satisfied but if it performs poorly, it leads to dissatisfaction. Expectation is another determinant of satisfaction and it combines with performance to determine customer satisfaction (Powers Valentine, 2008 p91). Overall customer satisfaction depends on the satisfaction while using the product or service which is called attribute satisfaction and the information the customer used while buying the product or service which is information satisfaction. Both attribute and information satisfaction arises from a customers assessment of how much the product meets or exceeds the consumers expectations and desire (Udo, Bagchi Kirs, 2010 p481). Service Quality Measurement Service quality positively affects customer satisfaction and it evaluates how customers evaluate the performance of service providers (Zhao, Lu, Zhang and Chau, 2012 p647). There are various tools that are used to measure service quality which an organization can select from. These include use of customer feedback which can be collected from surveys, cards or other feedback forums. Another tool is by having a customer complaints policy which assists to know the pain areas. An organization can also use benchmarking against other organizations or use online customer review sites like trip advisor. Social media has become a common tool of receiving feedback and measuring the quality of service for example Facebook and Twitter. Due to the fact that services are intangible, the quality of customer interactions is a very important dimension of service quality (Brady Cronin, 2001 p36). SERVQUAL model was designed to measure the elements in quality of service that generate satisfaction within the five dimensions. Service quality is the measure of expectations compared to performance. The SERVQUAL model measures the gaps that exist between these customer expectations and the service perceptions. When the gaps between one and four that separate the customer from the organization are closed then gap five closes (Parasuraman,A., Zeithaml, V. Berry, 1985 p42). The figure below shows the gaps in the quality service model. Figure 1: Service quality model. Retrieved: Parasuraman,Zeithaml Berry (1985) The SERVPERF model was developed by Cronin and Taylor in 1992 from SERVQUAL and it measures service using customer perceptions. It uses only perception to measure service quality and thus leaves out expectations as proposed by SERVQUAL. This scale is seen to be more superior and efficient as it also reduces the items that are measured by around half (Shanka, 2012 p1). This model can be used by the company to measure the service quality based on what customers perceive. Conclusion The service offered and customers satisfaction are key issues for all business organizations as they influence overall loyalty, repeat customers and positive word of mouth. This is especially crucial for service industries due to the intangibility of the services. Organizations therefore need to understand the determinants of customer satisfaction and dissatisfaction. They can consequently use various tools and models to measure the quality of service and any gaps that exist and implement strategies that enhance customer satisfaction. References Brady, M.K. and Cronin, J. (2001) Some New Thoughts on Conceptualizing Perceived Service Quality: a Hierarchical Approach, Journal of Marketing 65:3449. Hudson, S. Hudson L. (2012). Customer ServiceforHospitalityand Tourism. Goodfellow Publishers Limited. Hoyle, D. (2009). ISO 9000QualitySystems Handbook: Using the Standards as a Framework for Business Improvement. Elsevier Hyken, S. (2014). Manage Your Customer Service Moments of Truth and Create Moments of Magic. Forbes. Komunda, M and Osarenkhoe, A. (2012). Remedy or Cure for Service Failure? Effects of Service Recovery onCustomer SatisfactionandLoyalty. Business Process Management Journal, 18(1): 82-103 Lfgren, M. (2005). Winning at the First and Second Moments of Truth: an Exploratory Study.Managing Service Quality: An International Journal,15(1), 102-115. Parasuraman,A., Zeithaml, V. Berry, L.(1985). A Conceptual Model of Service Quality and its Implications for Future Research. The Journal of Marketing. Powers,TL. Valentine, DB. (2008). A Review of the Role ofSatisfaction, Quality, and Value on FirmPerformance. Journal of Consumer Satisfaction, Dissatisfaction and Complaining Behavior; Provo 21:80-101. Sabharwal, N., Soch, H. Kaur,H. (2010). Are we Satisfied with Incompetent Services? A Scale Development Approach for Service Recovery. Journal of Services Research. Shanka, MS. (2012). Bank Service Quality, Customer Satisfaction and Loyalty in Ethiopian Banking Sector. Journal of Business Administration and Management Sciences Research Vol. 1(1), pp. 001-009. Udo,GJ., Bagchi, KK. Kirs, PJ. (2010). An Assessment ofCustomers' E-serviceQuality Perception,Satisfactionand Intention. International Journal ofInformation. Zhao, L., Lu, Y., Zhang,L and Chau P. (2012). Assessing the Effects of Service Quality and Justice on Customer Satisfaction and the Continuance Intention of Mobile Value-Added Services: An Empirical Test of a Multidimensional Model. - Decision Support Systems, Elsevier