Service profit chain - operation strategy, Operation Management

Assignment Help:

Service Profit Chain - Operation Strategy

Prior to their work on the service-profit chain, Heskett and colleagues produced what they considered as the linkages between the employee and the customer. This is depicted in the next figure (page 88) as a 'cycle of failure'. Their contention is that service organisations have failure 'built-in' to their organisations by placing the least paid, least trained member of staff at the customer interface despite the fact that customers are becoming increasingly discerning in their demands. They suggest that many companies are more interested in paying for managerial control, exemplified by multiple levels of management than they are in providing better customer service.

1616_Service Profit Chain – Operation Strategy.png

Heskett asked the question 'would we rather pay for control than service?' To support his arguments he refers to a research study in the US of major retailers where it was found that of customers who defected to a rival company, only 14 per cent did so because they were unhappy with the product; the remaining 86 per cent did so because they were unhappy with the service. Heskett (1991) suggested that the research study showed that customer loyalty was a good predictor of not only current but future profits and as an important indicator it should be measured. Reichheld (1996) suggests that as the quality revolution in manufacturing has had a profound impact on competitiveness, so too will 'zero defects' have an impact on service management. The challenges for operations managers in the service sector would appear to be just as demanding as for those in the manufacturing sector.

 


Related Discussions:- Service profit chain - operation strategy

Explain their mission and strategy, Navigate to www.aboutmcdonalds.com/mcd ...

Navigate to www.aboutmcdonalds.com/mcd and access the "Our Company" located in the top tool bar. Then navigate to McDonald's FAQ to find the information needed. Describe their miss

Describe what is xyzs stock price today, Assume XYZ stocks last dividend wa...

Assume XYZ stocks last dividend was $3. The dividend growth rate is expected to be constant at 5% for 3 years, after which dividends are expected to grow at a rate of 6% forever. X

Assuming these are the critical attributes for perfect order, An analysis o...

An analysis of order and shipment data shows that the order fill rate is 97.1% and ABBA collected the following data concerning customer service performance: Late delivery-5 per

Calculating Standard time, ) A time study analyst observes a worker over a ...

) A time study analyst observes a worker over a period of time and calculates that the worker required 90.0 minutes per unit produced. The worker was rated at a 105 percent perfor

Explain what is the relationship between swot and strategy, What is the rel...

What is the relationship between SWOT and Strategy? Provide real world examples. Additional research is necessary by using scholarly publications. Cite accordingly.

Line balancing, #quest What happens if line balance doesn’t existion..

#quest What happens if line balance doesn’t existion..

Transportation, In VAM method when two penalties are same then which one is...

In VAM method when two penalties are same then which one is to be selected

Define the temporal flexibility workforce, Define the temporal flexibility ...

Define the temporal flexibility workforce. Temporal flexibility can be accomplished by varying the hours worked through employees within response to changes into demand for

Demerits of absolute standards and relative standards, Contrast the advanta...

Contrast the advantages and disadvantages of absolute standards and relative standards.

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd