At every customer service encounter, the service quality of an organisation is tested. Customers compare the actual service they receive with the expected service. They are dissatisfied when the actual service falls below the expected service level and are delighted when actual service exceeds their expectations.
In contrast, as mentioned earlier, a perception gap is created in case a service does not meet the customer’s expectations. This gap adversely affects the image and revenues of the organisation. To identify and bridge perceptions gaps, organisations use service quality models that capture and define service quality. Therefore, these models are also called gap models.
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The primary reason for an organisation to implement gap analysis is to understand what leads to customer dissatisfaction. Measuring the existing the level of service quality is the first step towards improving customer satisfaction.
Gap analysis helps to determine whether an organisation exceeds or falls below customer expectations. It is applicable to any aspect of the industry where organisations want to improve the performance of a product or service.
Gap Model of Service Quality
A gap model offers an integrated view of a customer-organisation relationship. It is based on substantial research carried out by a large number of service providers. It shows the perception gap and outlines factors that affect service quality.
Let us now study the five types of gaps as defined by Parasuraman et al.
The first four gaps are caused due to knowledge, standard/policy, delivery and communication gaps at the service provider’s level. These gaps occur due to differences between the organisation and the customer perception of service quality.
The last gap occurs due to differences between the customer expectation and customer perception; therefore it is called customer gap. Any gap whether it is at a service provider’s level or customer’s level, bridging it is of utmost importance for an organisation to improve service quality and facilitate synchronisation between perception, expectation and satisfaction levels. Let us discuss these five gaps in detail.
A knowledge gap refers to the difference between the management’s perception of customer expectations of a service and the expected service (service expected by customer) that includes quality specifications. It is the result of a lack of understanding of customer expectations by the management team.
Knowing what a customer wants is the most critical step inproviding a good service. Many service providers often lack accurate information about what customers need and expect. This can result in poor decisions. For example, a supermarket might hire extra people to make sure the shelves are stocked so consumers will always find what they want, but it may fail to realise that consumers are most concerned about waiting at the checkout line.
From the customer’s perspective, the supermarket’s service would improve if the extra employees were used to open more checkout lines rather than to stock shelves.
The key reasons for the existence of a knowledge gap are:
- Inadequate marketing research orientation: It includes insufficient marketing research, inadequate use of marketing research and research not focused on service quality.
- Lack of upward communication: It includes a lack of communication between employees and managers, various levels of management and lack ofinteraction between management and customers.
- Insufficient relationship focus: It includes a lack of market segmentation and focus on transactions and new customers rather than building relationship with customers.
- Inadequate service recovery: It refers to a lack of encouragement to listen to customer complaints and provide appropriate services.
Service providers can reduce the knowledge gap and develop a better understanding of customer expectations by undertaking customer research, increasing interaction between managers and customers and improving communication between managers and employees who provide customer services.
For example, Sears’ employees who deliver and assemble furniture in homes ask customers to give feedback regarding services, which helps the organisation to understand customers’ requirements and reward employees who provide good services.
A policy gap refers to the gap between the management’s perception of customer expectations and the service quality specifications (customer driven). This gap is created as a result of incorrect translation of service policy into rules and guidelines for employees. Policy gap may lead to poor service design, failure to maintain and improve the current level of service, etc.
Another type of provider gap is the delivery gap. This refers to the difference between service quality specifications for a service and delivery of those specifications by the service provider. In this situation, managers are aware of customers’ desired level of service, but may not be able to deliver it due to factors such as poor employee performance, failure to match demand and supply and insufficient training.
To reduce the delivery gap and provide services that meet standards, the service provider must give employees the necessary knowledge and skills, reduce conflict and empower employees to act in the customer’s and organisation’s best interests.
For example, Walt Disney World provides its maintenance workers four days of training, even though they can learn howto pick up trash and sweep streets in much less time. Disney has found that its customers are more likely to direct questions towards maintenance staff than to the various clean cut assistants wearing nice outfits. Thus, Disney trains maintenance people to confidently handle the numerous questions they may be asked.
Toys “R” Us, a leading kids store for toyssuch as video games, dolls, action figures, learning toys, building toys and baby and toddler toys, assesses customer satisfaction by counting a number of abandoned shopping carts, carts with merchandise left in the store because customers became impatient with the time required to make a purchase. After the organisation noticed an alarming increase in abandoned carts, it developed a unique program to reduce customers’ waiting time in line to pay for a purchase.
Cashiers’ motions while ringing up and bagging merchandise were studied. Based on this research, a training program was developed to show cashiers how to use their right hand to record purchases at the POS terminals and their left hand to push merchandise along the counter.
Counters were redesigned to have a slot line with shopping bags in the middle of the counter. As a cashier pushes the merchandise along the counter, it drops into a bag. After the customer pays for the merchandise, the cashier simply lifts the bag from the slot and hands it to the customer and a new bag pops into place.
The key reasons for a delivery gap include:
- Shortcomings in human resource policy: This could mean a lack of effective recruitment policy, employee role ambiguity, inappropriate compensation systems and lack of empowerment.
- Problem with service intermediaries: It refers to channel conflict, difficulty in controlling quality and inability to strike a balance between empowerment and control.
- Failure to match supply and demand: This includes lack of teamwork and inappropriate supervisory control due to which service providers fail to meet the demand of customers.
There are various strategies that can be used for closing a delivery gap. These include:
- Attracting the best employees
- Recruiting, selecting and training right employees
- Developing and supporting employees
- Retaining good employees
- Linking compensation and recognition to the delivery of quality service
- Encouraging teamwork
- Empowering employees with decision making along with accountability
- Motivating and rewarding employees
A communication gap refers to the difference between a service that is delivered and the external communication of the organisation. It occurs due to unrealistic service level promotion that cannot be delivered. It can also stem from service personnel being poorly briefed about the service resulting in over promise and under delivery.
It is challenging to develop a communication program that creates a positive service image for a service organisations but that does not over promise. For example, Domino’s Pizza addresses the communication gap by delivering on the promise made in its external communication to customers about delivering a pizza within 30 minutes.
The goal has to be achieved or it will result in creating a bad impression on customers. Similarly, an ad campaign by American Airlines’, “why it seems every Airlines Flight is late?”, is an example of a communication program that addresses the communication gap issue.
In print ads, American Airlines recognised its customers’ frustration and told customers about some uncontrollable factors causing the problem: overloaded airports, scheduling problems and intense price competition. Then the ads described how American Airlines was working to improve the situation.
The key reasons for a communication gap include:
- Lack of integrated service marketing communication: It includes interactive marketing, strong internal marketing program and a tendency to view each external communication as dependent.
- Ineffective management of customer expectations: This implies the absence of customer expectation management through all forms of communication and lack of adequate information for customers.
- Overpromising: This includes overstatement in advertisement, personal selling and physical evidence cues.
There are various strategies for closing a communication gap. These include:
- Seeking information from operations personnel on what can be done.
- Advertising realservice.
- Seeking input from employees on advertising.
- Gaining communication between sales, operations and customers.
- Focusing on characteristics that are important to customers.
- Formulating internal marketing programs.
- Ensuring consistent standards in multi-sites.
- Managing customer’s expectation.
- Offering different levels of services.
Customer gap refers to the difference between what customers expect from a service and the perceived service (service actually delivered to the customer). For example, if customers visit an expensive restaurant, then they expect better services than offered by a regular fast food retail chain.
In any case, if the service delivered is not as per customer expectations, a service gap is created. This gap forms the basis of the gap model. Organisations try to bridge differences between customer expectations and perceptions. For example, some retailers like JC Penney have established programs for assessing customers’ expectations and service perception.
Every year the sales associates at JC Penney prepare questionnaires for shoppers at each of their stores. Shoppers are asked about the service and merchandise offered at JC Penney and at competing departmental stores.
Over 50,000 completed questionnaires are collected and analysed. The same questionnaire is used each year, allowing JC Penney to track service performance, determine whether it is improving or declining, and identifying opportunities for improving service quality. JC Penney attaches a lot of importance to customer service. This statement can be verified from JC Penny’s annual customer profile used to evaluate performance of its store managers.
The key reasons for the existence of customer gaps include:
- Not knowing what customers expect.
- Notselecting appropriate service designs and standards.
- Not delivering services as per the required service standards.
- Notmatching performance to what has been promised.
The strategies for closing customer gaps include:
- Conducting a research to understand customer expectations
- Involving service personnel in designing services
- Making reasonable promises to customers
- Delivering maximum performance
Prescription for Closing Service Gaps
The relationship between customer service and customer loyalty is often complex. A competitive environment may further complicate issues. Therefore, organisations should align themselves with their customers. There are a fewtechniques that they can follow to do so.
Gap 1 Prescription
Learn what customers expect
- Understand customer expectations through research, complaint analysis or customer panels.
- Increase direct interaction between managers and customers to improve understanding.
- Improve upward communication from contact personnel to management.
- Turn information and insights into action.
Gap 2 Prescription
Establish appropriate service quality standards
- Ensure that top management displays on-going commitment to quality, as defined by customers.
- Set, communicate and reinforce customer-oriented service standards for all work units.
- Train managers in skills needed to lead employees to delivering quality service standards for all work units.
- Become receptive to new ways of doing business so as to overcome barriers in delivering quality service.
- Standardise repetitive work tasks to ensure consistency and reliability by substituting hard technology for human contact and improving work methods.
- Establish clear service quality goals that are challenging, realistic and explicitly designed to meet customer expectations.
- Clarify which job tasks have the biggest impact on the quality and should receive the highest priority.
- Ensure that employees understand and accept goals and priorities.
- Measure performance and provide regular feedback.
- Reward managers and employees for attaining quality goals.
Gap 3 Prescription
Ensure that service performance meetsstandards
- Clarify employee roles
- Ensure that all the employees understand howtheir jobs contribute to customer satisfaction.
- Match employees to jobs by selecting for the abilities and skills needed to perform each job well.
- Provide employees with the technical training needed to perform their assigned tasks effectively.
- Develop innovative recruitment and retention methods to attract the best people and build loyalty.
- Enhance performance by selecting the most appropriate and reliable technology and equipment.
- Teach employees about customer expectations, perceptions and problems.
- Train employees in interpersonal skills, especially for dealing with customers under stressful conditions.
- Eliminate role conflict among employees by involving them in the process of setting standards.
- Train employees in priority setting and time management.
- Measure employee performance and associate compensation and recognition to delivery of quality service. Develop reward systems that are meaningful, timely, simple, accurate and fair.
- Empower managers and employees in the field by pushing decision-making power down the organisation; allow them greater discretion in the methods they use to reach goals.
- Ensure that employees working at internal support jobs provide efficient service to customer-contact personnel.
- Encourage teamwork so that employees work well together, and use team rewards as incentives.
- Treat customers as partial employees; clarify their roles in the process of service delivery, and motivate them to perform well in their roles as co-producers.
Gap 4 Prescription
Ensure that communication promises are realistic
- Seek inputs from operations personnel when new advertising programs are being created.
- Develop advertising that features real employees performing their jobs. Allow service providers to preview advertisements before customers are exposed to them.
- Get sales staff to involve operations staff in face-to-face meeting with customers.
- Develop internal educational, motivational and advertising campaigns to strengthen links among marketing, operations and human resource departments.
- Ensure that consistent standards of service are delivered across multiple locations.
- Ensure that advertising content accurately reflects those service characteristics that are most important to customers in their encounter with the organisation.
- Manage customers’ expectations by letting them know what is and is not possible, and the reason why.
- Identify and explain the reasons for shortcoming in service performance that can’t be controlled.
- Offer customers different levels of service at different prices, explaining the distinctions.