Service Management Issues - Coursework Example

Service Management Name Name of Institution Contents Introduction 3 Background 3 Summary of Key Findings 6 Proposal to Address Key Findings 7 Conclusion 8 References 10 Service Management Introduction Service management is taking an increasingly prominent role in today’s business environment. According to Grönroos (1994, p. 6), service management can be defined as the total organizational approach that ensures that the quality of service, as perceived by the customer, is the key driving force of the operations of the organisation. The importance of service management is seen in its contribution to the global economy. For example, 2015 estimates show that the service sector accounted for 70% of Australia’s GDP, and it employs 75% of the workforce (CIA World Factbook). It is worth noting that the hospitality industry is a major player in the service industry, with the sector catering to a global clientele. This report focuses on the issue of customer perception of quality in the hospitality industry setting where firms offer services to individuals from diverse cultures. The report argues that the differences in culture will affect expectations, and thus, the perception of service quality in the hospitality industry. Therefore, firms in the sector should be aware of cultural difference and develop appropriate ways to address them and create value-laden relationships with clients. Background The topic of customer perception of service quality has attracted considerable debate from both managers and practitioners. This considerable research can be attributed to the realisation that service quality has a direct relation to profitability, customer loyalty, business performance, cost reduction, and customer satisfaction (Carter-Steel 2008, p. 393). To understand customer perception of service quality, it is essential to understand the meaning of service quality. Carter-Steel (2008, p. 393) defines quality as the degree to which a service provider can provide customer oriented service at a performance level that corresponds with the expectation of the customer. It is evident that customer satisfaction can only occur when the perceived quality surpasses the expected level of quality. Over the years, scholars have developed several models in a bid to assist in the management of service quality. One such model is Grönroos’ model, which is based on the definition of service quality as the difference between customer expectations and what they experience from a service (Carter-Steel 2008, p. 395). Grönroos’ model identified three dimensions of quality that included technical quality, functional quality, and image. According to Carter-Steel (2008, p. 395), the technical quality refers to a component that is easy to measure as it is what is actually received from a service provider. The functional quality focuses on the manner in which the customer gets the outcome of service meaning that the evaluation of the functional quality is subjective. Thirdly, the image of a service provider plays a mediating role in how the functional and technical qualities will be judged (Carter-Steel 2008, p. 395). Figure 1. Grönroos model (Carter-Steel 2008) In addition to identifying the three dimensions, Grönroos proposed seven criteria that can be used to evaluate each of the three dimensions (Prideaux, Moscardo, & Laws 2006, p. 122). First, the technical dimension can be examined by looking at the professionalism and skills of the service provider, the operations, and the employees. When it comes to the functional dimension, it can be evaluated by examining the service provider’s attitudes and behaviour, reliability and trustworthiness, service recovery, serviscape, and accessibility and flexibility (Prideaux, Moscardo, & Laws 2006, p. 122). Finally, the image-related dimension can be judged by looking at the reputation and credibility of the service provider (Prideaux, Moscardo, & Laws 2006, p. 122). In addition to the above model that was developed by Grönroos, the Gummesson 4Q also seeks to explain the components of service quality. In this mode, factors like the image, brand, expectations, experiences, design quality, relationship quality, technical quality, and delivery quality affect perception of quality (Baccarani, Ugolini, & Bonfanti 2015, p. 873). The SERVQUAL model also lists some of the determinants of perceived service quality in a bid to assist in service management. These include responsiveness, reliability, access, competence, credibility, courtesy, communication, tangibles, security, and understanding the customer (Wankhade & Dabade 2010, p. 29). Summary of Key Findings An examination of service quality shows that customer expectations play a pivotal role in determining whether a service will be perceived to be of a high standard. As such, a critical understanding of customer expectations is vital to service providers (Kueh & Ho Voon 2007, p. 657). This report argues that culture plays a major role in determining the levels of expectations. This should have direct implications for the hotel industry. Laroche et al. (2004, p. 58), conducted a study on the role of culture in service quality perceptions. The authors used a dentist’s office as the setting and included participants from the US, Canada, and Japan. The finding of the study was significant as it indicated that perception of service quality of the Japanese participants was lower than the others when the service quality was high. Similarly, there was a difference in perception of quality when the services were of lower quality, with the Japanese giving a higher rating than participants from the US and Canada (Laroche 2004, p. 58). This supports the argument that culture has an impact on expectations and perceptions of service quality. Kueh & Ho Voon (2007, p. 675) conducted a similar study on service quality expectations in the hospitality sector using the SERVQUAL model with the subjects being individuals from Generation Y. The finding was that individuals from this cultural segment have higher service expectations, thereby confirming that service providers have to consider culture when designing strategies for service delivery. A third study by Tsikriktsis (2002, p. 109) also confirmed the important role of culture in determining quality expectations. This evidence confirms the argument that culture is an important determinant of expectations, and thus, the perception of service quality. According to Cummins (2015), the hospitality sector is expected to experience growth owing to factors such as increased hotel development, tourism initiatives, and the weaker Australian dollar which attract foreigners. A critical part of the success of hospitality establishments is the ability to attract repeat business. The implication is that hotels will need to understand the substantial impact of culture on the expectations of both the domestic and international visitors. Proposal to Address Key Findings As stated, service quality has a direct relation to profitability, customer loyalty, business performance, cost reduction, and customer satisfaction (Carter-Steel 2008, p. 393). The realisation of this factor might convince hotels to take measures to evaluate customer perception of service quality. This can be through the issuance of surveys that measure the levels of customer satisfaction. The findings of the report have shown that culture has a mediating effect on how clients perceive the quality of services. For example, it has been noted that Japanese clients are unlikely to give a high service quality rating (Laroche 2004, p. 58). Similarly, individuals from Generation Y have been found to have very high expectations of quality (2007, p. 675), meaning that they will be unlikely to offer a rating that is commensurate with the quality of service. It is worth noting that the results of such surveys can be used to make important business decisions. This report proposes that hotels consider the culture of respondents when using the results of such surveys for decision making. For example, poor ratings from a predominantly Japanese audience should not be used as the basis for demoting or firing employees. The second proposal involves the acquisition of as much client information as possible. This should be relatively easy given the rapid improvements of technology. Hotels should invest in IT systems that allow the capture of as much information as the clients are willing to share. Examples of such data include demographic and social attributes of the customers. This will facilitate an understanding of the cultural identity of the clients. The hotel can use this information to train employees on how to deliver services to individuals from identifiable cultures. In turn, the understanding of the culture will enable the development of a relationship between the clients and the hotel staff. It will be easier to predict the expectations of such clients, meaning that the service provider has a better chance of delivering customised services that are of the highest quality. This will breed customer loyalty and encourage repeat visits from the consumers leading to the attainment of business goals. Conclusion In summary, this paper focuses on the service management topic of customer perception of service quality. The topic is of importance to scholars and practitioners as evidenced by the extensive research it has attracted. The paper defines service quality and describes some of the models that have been developed to facilitate the management of service quality. The paper identifies customer expectation as the key driver of perception. An evaluation of research shows that customer expectations, and by extension perception of service quality, is directly related to culture. This finding has implications for the hotel industry as it seeks to offer high quality to individuals from diverse cultures. The paper offers two proposals on how an understanding of culture can be leveraged for improved perception of service quality. References Australia-Oceania: Australia, 2016. The CIA World Factbook. Viewed Baccarani, C., Ugolini, M. and Bonfanti, A., 2015. A conceptual service quality map: The value of a wide opened perspective. In Toulon-Verona Conference" Excellence in Services". Cater-Steel, A. ed., 2008. Information Technology Governance and Service Management: Frameworks and Adaptations. IGI Global. Grönroos, C., 1994. From scientific management to service management: a management perspective for the age of service competition. International Journal of Service Industry Management, 5(1), pp.5-20. Gummesson, E., 1993. Quality management in service organizations. International Quality Service Association. Kueh, K. and Ho Voon, B., 2007. Culture and service quality expectations: Evidence from Generation Y consumers in Malaysia. Managing Service Quality: An International Journal, 17(6), pp.656-680. Laroche, M., Ueltschy, L.C., Abe, S., Cleveland, M. and Yannopoulos, P.P., 2004. Service quality perceptions and customer satisfaction: evaluating the role of culture. Journal of International Marketing, 12(3), pp.58-85.s Prideaux, B., Moscardo, G. and Laws, E. eds., 2006. Managing tourism and hospitality services: theory and international applications. CABI. Tsikriktsis, N., 2002. Does culture influence web site quality expectations? An empirical study. Journal of service research, 5(2), pp.101-112. Wankhade, L. and Dabade, B., 2010. Quality uncertainty and perception: information asymmetry and management of quality uncertainty and quality perception. Springer Science & Business Media. Read More