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Customer-Defined Service Standards: Importance, Development, and Implementation

This chapter explores the factors necessary for appropriate customer-defined service standards and provides a process for developing and implementing these standards. It also discusses the differentiation between company-defined and customer-defined standards, the role of the service encounter sequence, and translating customer expectations into actionable behaviors. Examples and exercises are included.

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Customer-Defined Service Standards: Importance, Development, and Implementation

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  1. Chapter Customer-Defined Service Standards 9 • Factors Necessary For Appropriate Service Standards • Customer-Defined Service Standards • Process for Developing Customer-defined Standards • Service Performance Indexes

  2. Objectives for Chapter 9:Customer-defined Service Standards • Differentiate between company-defined and customer-defined service standards. • Distinguish among one-time service fixes and “hard” and “soft” customer-defined standards. • Explain the critical role of the service encounter sequence in developing customer-defined standards. • Illustrate how to translate customer expectations into behaviors and actions that are definable, repeatable, and actionable. • Explain the process of developing customer-defined service standards. • Emphasize the importance of service performance indexes in implementing strategy for service delivery.

  3. Table 9.1 Examples of HardCustomer-Defined Standards

  4. Table 9.2 Examples of SoftCustomer-Defined Standards

  5. Figure 9.2AT&T’s Process Map for Measurements Internal Metric Business Process Customer Need % Repair Call % Calls for Help Functional Performance Test Supervisor Observations % Proposal Made on Time % Follow Up Made Average Order Interval % Repair Reports % Installed On Due Date % Repeat Reports Average Speed Of Repair % Customers Informed % Billing Inquiries % Resolved First Call % Billing Inquiries Reliability (40%) Easy To Use (20%) Features / Functions (40%) Knowledge (30%) Responsive (25%) Follow-Up (10%) Delivery Interval Meets Needs (30%) Does Not Break (25%) Installed When Promised (10%) No Repeat Trouble (30%) Fixed Fast (25%) Kept Informed (10%) Accuracy, No Surprise (45%) Resolve On First Call (35%) Easy To Understand (10%) 30% Product 30% Sales 10% Installation 15% Repair 15% Billing Total Quality Source: AT&T General Business Systems

  6. Exercise for Creating Customer-Defined Service Standards • Form a group of four people • Use your school’s undergraduate or graduate program, or an approved alternative • Complete the customer-driven service standards importance chart • Establish standards for the most important and lowest-performed behaviors and actions • Be prepared to present your findings to the class

  7. Customer-Driven Standards and Measurements Exercise Measurements Customer Requirements Service Encounter Service Quality

  8. Figure 9.3Getting to Actionable Steps Requirements: Abstract Diagnosticity: Low Satisfaction Value Relationship Solution Provider General Concepts Dig Deeper Reliability Empathy Assurance Tangibles Responsiveness Price Dimensions Delivers on Time Returns Calls Quickly Knows My Industry Dig Deeper Attributes Delivers by Weds 11/4 Returns Calls in 2 Hrs Knows Strengths of My Competitors Dig Deeper Behaviors and Actions Concrete High

  9. Figure 9.4Process for Setting Customer-Defined Standards 1. Identify Existing or Desired Service Encounter Sequence 2. Translate Customer Expectations Into Behaviors/Actions 3. Select Behaviors/Actions for Standards 4. Set Hard or Soft Standards Measure by Transaction- Based Surveys Measure by Audits or Operating Data Hard 5. Develop Feedback Mechanisms Soft 6. Establish Measures and Target Levels 7. Track Measures Against Standards 8. Update Target Levels and Measures

  10. Figure 9.5Importance/Performance Matrix HIGH 10.0 Maintain Improve Does whatever it takes to correct problems (9.26, 7.96)  Delivers on promises specified in proposal/contract (9.49, 8.51)   Gets project within budget, on time (9.31, 7.84)   Completes projects correctly, on time (9.29, 7.68)   Gets price we originally agreed upon (9.21, 8.64)    9.0 Tells me cost ahead of time (9.06, 8.46) Provides equipment that operates as vendor said it would (9.24, 8.14) Gets back to me when promised (9.04, 7.63) Takes responsibility for their mistakes (9.18, 8.01) Delivers or installs on promised date (9.02, 7.84) Importance 8.0 LOW 7.0 HIGH 8.0 9.0 10.0 Performance

  11. Figure 9.6Linkage between Soft Measures and Hard Measures for Speed of Complaint Handling 10 9 8 7 6 5 4 3 2 1 0 Large Customers SATISFACTION Small Customers 2 4 6 8 12 16 20 24 W O R K I N G H O U R S

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