Service product Marketing: Service Failure and Recovery - Case Study Example

Service product marketing; Service failure and recovery Service failure and the eventual service recovery efforts in diverse service institutions have been cited as having adverse impacts on the level of consumers’ satisfaction in that particular organization. This also influences the quality of long-relationship that will be emanating from these interactions (Mostert, Meyer & Rensburg, 2009, p. 118). This paper will explore an instance of service failure experienced at British Midland Airways Limited in the U.K, namely the failure of an online booking process culminating in delayed flight. The eventual service recovery efforts will also be analyzed aimed at arriving at feasible recommendations to minimize these phenomena. However, it is imperative to briefly explore the undertakings of this company aimed at gaining an insight into some of the activities they are involved in and the initial reason for choosing them as the prudent service provider prior to the service failure scenario. Brief company profile According to BMI (2007, p.1), this company launched its operations in 1938 as Air School Ltd with primary specialization in RAF pilot training. In the 1950s, BMI ceased the training of RAF pilots and instead undertook expansion of the cargo routes worldwide as well as passenger routes across the UK and the wider Europe. In 1964, the company adopted the name British Midland Airways. In 1965, the company shifted from its home at Burnaston to the East Midland Airport which had been newly opened before an eventual merger with Invica Airways in 1969. Since then, the company has enjoyed extensive expansion which is best epitomized by the fact that today, BMI operates close to 2,000 flights per week over a system of 69 airports in the UK, Middle East, Africa and Europe (BMI website, 2012, p.1). American Chambers of Commerce in Almenia website (2012, p.1), IBI is a renowned innovator and a market leader with its developments and evolution being forged to meet the passengers’ needs. There is thus widespread embracing of technology at BMI, for instance, e-ticketing, self-check in and online booking at the airport which has been key in heightening efficiency as well as the betterment of consumers’ experience. This expansion method has been in the effort to meet the dynamics in the consumer needs as well increasing technological competition in the industry. Service failure phenomenon It is worth noting that diverse service failures are encountered in the operations of the airline industry. Bejou and Palmer (1998, p. 8) cited that majority of the service failure in this industry emanate from the service processes which are usually put into utility in service delivery. Coye (2004, p. 60) noted that despite the fact that there might be a tendency for the passengers to hold heightened expectations before their impeding flight, research has shown that there are a number of causes that often result to service failure in diverse airlines, which includes overbooking of flights, cancellation of flights, strikes, attitudes of the cabin and ground staff as well as problems in reservations (Bamford & Xystouri 2005, p. 314). As stated in the preceding section, British Midland Airways Limited has diverse services. Nonetheless, my experience in service failure was related to online booking resulting to delayed flight among other implications which will be explored in a subsequent section. The flight that I had previously booked online was destined to Bologna, a city in Northern Italy and the capital of Emilia Romagna where I has heading for a vacation. The flight was scheduled take off at 19:45 on 16th April, 2012 at Boston and get to Bologna at 14:00 on 17th April 2012. I had done my online booking for the flight on 13th April, 2012, three days before the departure date in accordance with the airline’s policy of two days prior online booking and the flight schedules were confirmed on the same day. Nonetheless, on arrival at the Airport at Boston at 19:15 on 16th April, 2012 and upon confirmation from the flight schedules for the flights destined to Italy, I was made to understand that the flight I had booked had already left. This culminated to a slight confrontation with the consumer service department and the case was eventually referred to the management of the airline. Upon supplying the administration with my flight details as outlined in the flight confirmation message dated 13th April 2012, namely the flight number, the departure and arrival time, destination, seat number, the ticket number and the passport details, it was realized that the details had been wrongly entered into the database. After the verification of the error, it was apparent that diverse inconveniences were just beginning and it called for swift action by the service provider to come up with a viable solution to salvage the situation aimed at not only solving my problem but also saving their corporate reputation in case this occurrence was to leak to other prospective consumers. It is worth noting that the airline industry is being confronted by diverse challenges which include but not limited to cut-throat competition based on the fact that there has been a gradual decrease of demand for air transport in the recent years which can be attributed to the global financial slump in 2008 (Fodness & Murray 2007, p. 493) as well as reduced profitability in the industry (Anon, 2006, p. 33). Thus it was fundamental for British Midland Airways Limited to solve this anomaly aimed at averting any probable losses that would have culminated from reduced consumer trust, declining reputation and subsequent slump of the profit if this scenario was to get into the media realms. This is founded on the inference by Mostert, Meyer and Rensburg (2009, p. 123) who determined that the management organ of an institution is under the obligation to support the service recovery process based on the fact that the first occurrence of failed services means that there is a probability of the consumer being let down in subsequent occasions. Lewis and McCann (2004, p. 8) inferred that this can pose diabolical impacts on the company in a scenario whereby the dissatisfied consumers spread negative information about the company thorough word-of mouth communication, or worse still, defect from the institution to a competitor. According to Maxham (2001, p. 12), lack of swift service recovery response can also culminate in the consumers poorly rating the organization instantaneously after experiencing the failure. How the British Midland Airways Limited came provided assistance From the above phenomenon, it is apparent that the airline industry is prone to service failure. This fact is supported by Mostert, Meyer and Rensburg (2009, p. 118) who determined that majority of the airlines are confronted by diverse challenges which threaten their survival and one of these challenges is confirmed by the fact that these firms are vulnerable to service failures. This calls for efficient service recovery procedures where in this instance, service recovery can be perceived to refer to the actions which are usually taken by an institution as a feasible response to the service failure (Grönroos 1990, p. 7) aimed at averting the dissatisfaction of the consumers (Bell, 1994, p. 7) which is fundamental in the retention of the consumers (Miller et. al., 2000, p. 388). In my failed online booking case, they booked me for the next available flight to Bologna which was scheduled at 12:00, 18th April 2012 which meant a one day delay of my flight. This was followed by incentives aimed at indirectly compensating for the losses which could emanate from the delayed flight. This is based on the inference by Smith and Bolton (2002, p. 5) who determined that the level of consumer satisfaction is greatly influenced by the responses which are emotional in nature to the imminent service failure and that they are bound to respond in diverse ways to different types of recovery efforts, for instance, apology, compensation. In my case, the compensation was in form of reduced flight fare by 30% for my next flight which was scheduled the following day. This was aimed at compensating for the monetary loss which would result from the delayed flight, for instance, costs for an extra day that will be incurred at the destination based on the fact that the vacation was bound to take exactly 7 days. In addition, I was booked for first class above the economy class which I had booked in my initial flight. This was probably a form of compensation of distress or inconvenience aimed at making me enjoy higher services than what I had initially booked for. Lastly, based on the fact that leaving the next day meant boarding and lodging costs would be incurred as I await the flight, the airline offered to book me into one of their apartments adjacent to the airline free of charge and other costs like room services. This was aimed at making sure that I did not incur any other overhead costs which would emanate from the delaying of the flight. Could British Midland Airways Limited have assisted in a better way? Based on the fact that my initial flight ticket was two-way, the airline should have made efforts to ensure that the return trip was properly booked and advanced a day later after the day I had initially booked for return. This would have not only regained my trust in their services in case of successful return trip but would have also impacted on their returns. However, I booked for a one way ticket aimed at avoiding any probable inconveniences that would have emanated out of delayed return trip based on the already delayed departure flight. Recommendations There are several recommendations that can be implemented by the management to enable them to better handle the situation if it should recur in the future. Firstly, the service recovery personnel ought to be equipped with fundamental skills and knowledge to enable them efficiently and effectively handle delay disputes in case they occur in the future, for instance, through training programs. This is based on the fact that substantial confrontation with the consumer service before the authenticity of my flight details was verified led to much time wastage and this confrontation scenario was also witnessed by other nearby travelers. This fact is supported by La & Kandampully (2004, p. 394) who revealed the importance of ensuring that the service recovery personnel have adequate professional approach in their actions. Mostert, Meyer and Rensburg (2009, p. 124) suggested that the training geared towards efficiency in service recovery should include effective assurance to the consumers who have been victims of service failure, paying profound attention on the ways in which the satisfaction of the employees can be improved through effective recovery of services, emotional response to the consumers who have experienced service delay as well as empowerment of the wider human resource realm. Another strategy that the airline can use aimed at successful service recovery efforts is offering the consumers an alternative option that will be viable in meeting their specific requirements as well as timely communication to the consumers who have become victims of service failure. This fact is supported by Mostert, Meyer and Rensburg (2009, p. 124) who cited timely provision of feedback as well as offering viable explanation to the consumer citing the reasons for the service failure as feasible strategies in the service recovery process. This is based on the fact that they will play an integral role in avoiding the confusion on the side of the consumer, accompanying family members and friends as well as probable waiting parties at the point of destination that could emanate from delayed communication in regard to the status of the flight and the alternative solutions. This could also save all the involved parties from extensive inconveniences, both financial and emotional that would result in delayed dissemination of communications from the airline. Lastly, the organization ought to develop a standard mechanism of service recovery, most notably with the service failure after online booking among other failures arising from diverse reasons previously mentioned in a preceding section. This will ensure consistency in service recovery. In addition, the instances of service failure as well as the service recovery efforts ought to be adequately documented and stored from two reasons. Firstly, these case studies will help future employees mandated with service recovery in this institution on the dynamics of consumer responses and practice service recovery efforts. This is based on the inference by Smith and Bolton (2002, p. 5) who determined that the consumers who experience service failure are likely to exhibit diversity in responses, ranging from neutral to exceedingly negative. Secondly, this recording of cases and documentation of cases is paramount for monitoring and evaluation purposes in regard to the trends of service failure in the firm as well as the effectiveness of interventions like training of service recovery personnel previously mentioned. Feeling after the end of the process After the end of the process, I felt relieved that at least the impediment that had previously encountered had been resolved and the flight was rescheduled to the following day. This was more enhanced after the flight departed at exactly the scheduled time and arrived at the destination on time. However, I did not feel like the compensation of distress was enough to cover for all the inconveniences that I had to incur as a result of the delayed flight. This fact is supported by Wirtz and Mattila, (2004, p. 1) who determined that in most cases, compensation may not enhance the level of consumer satisfaction after the completion of the recovery process. On the other hand, the immediate response of the customer care department before the error was discovered had inadequacies in professionalism based on the fact that it even went to the extent of verbal confrontation. After the fright on the following day was successful and according to schedule, I sent an email to the airline citing my gratitude for the swift service recovery process but added the importance of acquainting the customer care personnel with the relevant skills of handling a flight schedule dispute. Their response was timely and positive, once again apologizing for any inconveniences as a result of the delayed flight as well as giving me a robust assurance that the situation will not occur in future. Nonetheless, it is imperative to note that despite the effectiveness of the service recovery process at the airline my perception about the services and the overall reputation of British Midland Airways Limited way was substantially negatively affected based on the fact that I even had opt for another airline, cautious of probable inconveniences. This is against the perception by Maxham (2001, p. 13) that the attitudes of the consumer are bound to be more favorable after the service recovery process when juxtaposed with how they were before the service failure, provided the recovery process was robust. This is because the consumers are bound to be substantially paranoid, mostly if the delay resulted in enormous financial losses or missing an important occasion like a graduation ceremony, a wedding among other events which cannot be repeated. On the other hand, despite the efficiency of the recovery process, this phenomenon made me cautious about utilizing online booking when dealing with British Midland Airways Limited in the future albeit being assured that that case was rare and would probably never occur again in the future. This is against the inference by Oliver (1997, p. 16) that the effectiveness in the service recovery process will not only play an integral role in the maintenance loyalty among the consumers but will also heighten it even to higher levels that it initially was. This is based on the fact that the service failure phenomena will shed long-term doubts on the efficiency of the services offered by the airline, and one may even be tempted to caution other close traveler planning to use the airline about probable delays when asked his/her opinion in regard to the services at the airline. Change in purchasing behavior From the preceding section, it is apparent that the instance of service failure on my flight bound for Bologna on 16th April 2012 changed my perception not only on the efficiency of online bookings but also on the service effectiveness of British Midland Airline Limited as a company. This had impacts in the sense that it changed my services purchasing behavior based on the fact that in the current times, I strongly prefer the manual flight booking as opposed to online booking where there is a higher level of guarantee that the flight is ready and will depart at the scheduled time. The fact that one also physically books the flight and received immediate confirmation elevates the increased trust the latter model of booking despite being a little bit tasking and time consuming. In regard to booking my flights with British Midland Airline Limited, this is not often and is usually done when its absolutely necessary, for instance, due to departure time, cost and distance from the destination airport to the place where I am planning to go. References American Chambers of Commerce in Almenia website, 2012, ‘British Midland Airways Limited’, Retrieved, 04 August 2012 . Anon, 2006, ‘The future of the airline industry: going into free-fall or climbing steadily?’, Strategic Direction, vol. 22, no. 6, pp. 33–36. Bamford, D. & Xystouri, T. 2005, ‘A case study of service failure and recovery within an international airline’, Managing Service Quality, vol. 15, no. 3, pp. 306–322. Bejou, D. & Palmer, A, 1998, ‘Service failure and loyalty: an exploratory empirical study of Airline customers’, Journal of Services Marketing, vol. 12, no. 1, pp. 7–22. 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Smith, A & Bolton, R, 2002, ‘The Effect of Customers’ Emotional Responses to Service Failures on Their Recovery Effort Evaluations and Satisfaction Judgments’, Journal of the Academy of Marketing Science, vol. 30, no. 1, pp. 5-23. Wirtz, J. &Mattila, A. 2004, ‘Consumer responses to compensation, speed of recovery and apology after a service failure’, International Journal of Service Industry Management, vol. 15, no. 2, pp.150 - 166 Read More