The Link between Organizational Culture between Employees, Customers and Service Provision - Essay Example

A REPORT ON HOW TO ACHIEVE SERVICE SUCCESS THROUGH THE SERVICE ENCOUNTER By (Student Name) Course Tutor University City/State Due Date EXECUTIVE SUMMARY The operations director has compiled the following report which is meant for the chartered quality institute (CQI) after attending a seminar on understanding service encounters. The report will give clear insight on how to achieve success through service encounter based on information gathered by critically examining theories and principles of customer satisfaction that touch service links between employees and customers, organizations culture and customer expectations. INTRODUCTION In order to differentiate themselves in the competitive marketplace, service providers are driving for Service excellence by continuously improving service quality (Berry and Parasumaran, 1991). Service encounters entail providing high quality service tothe customers this is ensured by the management making sure that the employees are competitive, skilled and friendly to the customers. The management should therefore organize forums to train their employees and seminars on how to handle their customers because for value to be created in an organization there must be a good relationship between the customers and employees in the service encounter. The relationship should entail trust between the two parties. Trust has been highly recognized in the literature as an effective element for establishing a successful relationship (e.g. Swan et al., 1999; Tam and Wong, 2001). The link between organizational culture between employees, customers and service provision Robins (2003) defines organizational culture as a common view or perception held by the members of an organization, which provides an underpinning of shared purpose. Kotler (2001) states that organizational culture represents the norms of behavior and shared values of concern within an organization. The culture of an organization plays an important role in ensuring proper service provision between employees and customers. The culture of an organization is crucial in ensuring an organization is effective, successful and attains high profit margins. Each employee that sets foot in an organization should therefore ensure they are conversant with the norms, mission and vision of an organization. Culture of organization and fulfillment of employees Different organizations have different cultures. The culture of an organization refers to the working environment and how bosses treat their employees. The environment will by a great way determine how the employees treat the customers as well. A conducive and friendly relationship between employees and the bosses help determine how the frontline employees treat the customers. Growing cultures are receptive to change and they listen to their employees concerning how the organization should be run. When the employees are fulfilled and are comfortable they will pass on that friendly attitude to the customers hence the organization will achieve its profit chain because there will be inflow of customers in the organization. An employee can either be dissatisfied, satisfied, or over satisfied where the reality exceeds reality. Employees need to engage the customers on a personal level so as to create a rapport between them. This will create an element of trust between the two. Organizational culture and customer satisfactions Customer satisfaction entails how the employees of an organization treat their customers. The competence of the service providers will contribute a lot to whether the customer is satisfied. The reception a customer gets from the employees will determine whether they will be coming back. Customers expect to be treated with respect and they also need to trust the service providers. If customers are satisfied they will add value to the firm. They will lead to more profits because if they are served well they will spread word and more customers will come streaming in thus leading to more profits for the firm. PRINCIPLES THAT GUIDE SERVICE ENCOUNTERS 1. Customer control In any service encounter, the customer should always be left to control the process with the notion of the fact that the customer is always right in mind. It has been proven that the customers complain less if they are allowed to determine how they will be served. In a case scenario where patients are given the freedom to determine which hand to receive an injection, they are less likely to complain of pain. 2. Bad news should be given first followed by good news Given a situation whereby an employee is supposed to give both bad and good news to a customer, most customers prefer receiving the bad news so that they can absorb the shock then receive the good news which will help them forecast a brighter future. 3. Break down the pleasurable moments and combine the painful ones During service delivery, it is important for the management to make sure that good moments take longer while painful moments are not prolonged so as to avoid feelings of hatred from the customers. The customer should not be let to endure so much pain this should be combined into a single process. 4. Giving service delivery a robust finish Most service encounters receive customers so warmly but at the end of the service the customer is dissatisfied. What matters most in service encounter is the finish. A competent employee will treat a customer well from the beginning to the end and this to a great extent determines customer satisfaction because every customer wants to leave a service provision premise satisfied of the service offered. 5. A close miss is worse than a mile Most customers will feel so bad if a service provider gives bad news of how close they missed. They would rather not give the information at all. For a case scenario of a flight agent who tells a customer that they just missed the plane by a few minutes and if they were there before they would not have missed. The service provider would rather not give this kind of information because it will leave the customer completely dissatisfied. By the application of these principles in day to day service delivery, it ensures that organizations are competent and achieving the set target for profits by ensuring their customers is satisfied. THEORIES ON SERVICE ENCOUNTERS 1. Equity Theory The equity theory states that the ratio of results to inputs should not change across the individuals involved in an exchange. A customer is believed to be satisfied if he thinks that result or outcome to input ratio is equal to that of the service provider. Criticism of equity theory The theory does not have much impact on customer satisfaction but rather has moderate effect even on after purchase behavior of customers. 2. Hypothesis Testing Theory Hypothesis testing theory was formulated by Deighton in (1983); the theory is based on pre-purchase information of products where awareness of products in made through advertising. From awareness created customer get attracted to the products and will go ahead and buy to test whether the product will meet their needs. The theory explains that customers use their experience with products as base to attempt confirm their expectations. Criticism of Hypothesis testing theory Pre- purchase information largely advertising doesn’t fully justify that products/ services will meet satisfy consumers since the main aim of advertising is to create awareness to push sales of a product. Hypothesis testing theory therefore isn’t the only factor that can be used to determine choice of product or customer satisfaction 3. Cue utilization theory Cue utilization theory describes that products and services hold some special factors that give an indication of quality of a product or service. These factors can be intrinsic or extrinsic they help consumer get insights on the quality of product/service, intrinsic factors provide information on physical attributes of products while extrinsic factors provide information on brand and price. Criticism of cue utilization theory Cue utilization theory is a dependable theory to give consumers cues on whether a product will meet their expectations and offer satisfaction especially intrinsic factors that provide physical attributes. Intrinsic factors are normally requirements in product manufacturing policies that are checked by independent bodies to give consumers information on components of a product. Extrinsic factors cannot be used as standalone cues to give information on quality of that would lead to consumer satisfaction, factors such pricing do not clear determine quality of product or services high prices do not translate to high quality. 4. Negativity theory Negativity theory was developed Carl smith and Aronson (1963) describing that any difference of performance and customer expectations will upset the customer especially where consumers strong hold their expectations at heart any nonconformity will make them respond negatively. Dissatisfaction will occur either way whether the product or service exceeds expectations or shortfalls the expectations. Criticisms of negativity theory Having strong attachments to products or services leads to consumers having overrated expectations which if not satisfied cause high levels negative energy. Expectations should be held in moderation. 5. Contrast theory Contrast theory was developed by Hovland, Harvey and Sherif (1987). Dawes et al (1972) described contrast theory as the aspect of consumers enlarging the differences between their expectations and product or service performance. According to this theory any differences between expectations and performance are exaggerated both on the negative when performance shortfall expectations and on the positive when the performance exceeds expectation. Criticisms of contrast theory The exaggeration of both positive confirmation and negative disconfirmation does not send the true information of a product or service quality and customer satisfaction thus products will not be improved accordingly to meet consumer expectations. While contrast theory emphasizes on exaggeration of differences between product performance and consumer expectations, assimilation theory emphasizes on minimization of that discrepancy. CONCLUSIONS From the report it is clearly seen that an organizations culture is a key element that affects customer satisfaction since the culture entails behavior of employees that is how they handle the customers. Customer satisfaction ensures organizations attain high profits revenues. Employees who find themselves in a good working environment are satisfied and highly motivated therefore they give quality service to the customers as the old saying goes, ‘treat your employees well and will treat your customers well’. As indicated in the report all theories on customer satisfaction form great piece of guidance to service organization on customer expectations and their reactions dependent on which theory they fall best. RECOMMENDATIONS Organizations should ensure that they provide conducive working environment for the employees as these will have a great impact on how they treat the customers. They should provide employees with incentives as a form of motivation. Organizations should ensure that they hire competent employees with great skills on customer relations. They should also offer trainings seminars for employees to sharpen their skills on customer relations. Organizations should carry out market research to determine the customer expectations and attitudes so as to understand under what theory of customer satisfaction do their customers fall. The market research helps determine what promotional strategy suits the customers most e.g. discounts, free samples, product customization. REFERENCES Berry, L.L. and Parasumaran, A. (1991) Marketing Services - Competing Through Service Quality, TheFree Press, New York. Hovland, C., O. Harvey & M. Sherif (1957). “Assimilation and contrast effects in reaction to communication and attitude change”. Journal of Abnormal and Social Psychology, 55(7), 244-252. Anderson, R. (1973). “Consumer Dissatisfaction: The Effect of Disconfirmed Expectancy on Perceived Product Performance”, Journal of Marketing Research, 10(2), 38-44. Carlsmith, J. & Aronson, E. (1963). “Some Hedonic Consequences of the Confirmation and Disconfirmation of Expectations”, Journal of Abnormal and Social Psychology, 66(2), pp.151-156. Read More