LESSON 2: QUALITY SERVICE OPERATIONS IN TOURISM AND MARIA FE S.

ROQUE,MM
HOSPITALITY 2nd Semester, 2024-2025
LESSON OBJECTIVES

At the end of the chapter, the student should be able to:

1.Explain the meaning and characteristics of services

2.Describe the service matrix;
3.Discuss the management of service quality; and
WHAT ARE SERVICES?
Service is the heart of hospitality

1. A service is defined as an intangible good that is

produced and consumed simultaneously. This can
be contrasted with a physical good, which is a
tangible product that is produced and then
consumed at a later time.

2. Services are intangible, value-added activities that

a company provides to its customers. They are the
core of what a company does to create value for its
customers and generate revenue.
 WHAT ARE SERVICES?
3. A service is any activity or benefit that one party can offer
to another that is essentially intangible and does not result
in the ownership of anything.

4. Services can be physical or digital. Physical services are

those that you can touch, feel, or see, such as a haircut or a
massage. Digital services are those that exist in the digital
world, such as an app or a website.

5. Services are often complex and involve multiple steps to

complete. They may require special skills or knowledge to
perform. And they may need to be delivered in person,
online, or through some combination of both.
IMPORTANT CHARACTERISTICS OF SERVICES

There are four characteristics of service:

(Kotler and Keller, 2007).
1. Intangibility
2. Inseparability
3. Variability, and
4. Perishability
The Service Process Matrix

• The matrix was derived by Roger Schmenner and first

appeared in 1986.

• The Service Process Matrix can be useful when

investigating the strategic changes in service operations.

In addition, there are unique managerial challenges

associated with each quadrant of the matrix. By paying
close attention to the challenges associated with their
related classification, service firms may improve their
performance.
CLASSIFICATION CHARACTERISTICS OF
SERVICE PROCESS MATRIX

The classification characteristics include the degree of labor intensity and a jointly
measured degree of customer interaction and customization.
1. Labor intensity can be defined as the ratio of labor cost to plant and equipment. A firm
whose product, or in this case service, requires a high content of time and effort with
comparatively little plant and equipment cost would be said to be labor intense.
2. Customer interaction represents the degree to which the customer can intervene in the
service process. For example, a high degree of interaction would imply that the customer
can demand more or less of some aspects of the service.
3. Customization refers to the need and ability to alter the service in order to satisfy the
individual customer's particular preferences.
Service Process Matrix
SERVICE PROCESS MATRIX

1. The upper left quadrant contains firms with a low degree of labor intensity and a low degree of interaction and
customization.
This allows service firms in this quadrant to operate in a fashion similar to factories, hence the title "Service
Factory." These firms can take advantage of economies of scale and may employ less expensive unskilled
workers as do most factories.
2. The upper right quadrant contains firms with a low degree of labor intensity but a high degree of interaction and
customization. The upper right quadrant is labeled "Service Shop.“
3. The lower left quadrant contains firms with a high degree of labor intensity but a low degree of interaction and
customization. This quadrant is labeled "Mass Service."
4. The lower right quadrant contains firms with a high degree of labor intensity and a high degree of interaction
and customization. The lower right quadrant is labeled "Professional Service."
 SERVICE QUALITY MANAGEMENT

Service quality is a measure of how an

organization understands its users’
needs and fulfills their expectations.
Understanding how to improve the
service quality of your product is the key
step to growth for any organization.
SERVICE QUALITY MANAGEMENT

Service Quality Management - The

process of managing the quality of
services delivered to a customer
according to his expectations. . It
basically assesses how well a service
has been given, so as to improve its
quality in the future, identify problems
and correct them to increase customer
satisfaction.
 RELEVANCE OF SERVICE QUALITY MANAGEMENT

1. Builds a Good Reputation

Guests are more likely to leave positive reviews and

recommend the hotel to their friends and family
when they feel that their needs were met, and any
issues were promptly resolved. A good reputation is
crucial to the success of any business, and hotels
that provide exceptional customer support are more
likely to attract and retain loyal customers.
SERVICE QUALITY MANAGEMENT

Resolves Guest Issues Quickly

Inevitably, issues will arise during a guest's stay,

but hotels that provide excellent customer
support can resolve these issues quickly and
efficiently. Whether it's a problem with the room
or a question about hotel amenities, guests
should feel comfortable and confident that the
hotel staff can address their concerns.
Resolving issues quickly can prevent negative
reviews and improve guest satisfaction,
resulting in more bookings in the future.
SERVICE QUALITY MANAGEMENT
Increases Guest Satisfaction
Guest satisfaction is critical to the success of
any hotel. When guests feel satisfied, they are
more likely to leave positive reviews,
recommend the hotel to others, and return for
future stays. Exceptional customer support
plays a crucial role in increasing guest
satisfaction. When guests feel that their needs
are being met, and their concerns are being
addressed, they are more likely to have a
positive experience and leave the hotel feeling
satisfied.
SERVICE QUALITY MANAGEMENT

Creates Repeat Business

Hotels that provide exceptional customer
support are more likely to see repeat
business from satisfied guests. When guests
have a positive experience, they are more
likely to return for future stays and
recommend the hotel to others. Repeat
business is essential for the success of any
hotel, and customer support plays a crucial
role in ensuring that guests return.
 FIVE STARS OF SERVICE QUALITY

RATER model
✓ The RATER Model was created by professors Valarie Zeithaml, A. Parasuraman, and
Leonard Berry, and published in their 1990 book, "Delivering Quality Service."
✓ The RATER model is a simple and easy-to-remember framework that identifies five
dimensions of service quality: Reliability, Assurance, Tangibles, Empathy, and
Responsiveness.
✓ These are the factors that customers use to evaluate your service performance and
satisfaction. The RATER model suggests that you should ask your customers to rate each
dimension on a scale of 1 to 10, and then compare the average scores with your own
standards and goals.
The model highlights five areas that customers
generally consider to be important when they use a
service. These are:

1. Reliability – your ability to provide the service you

have promised consistently, accurately, and on
time.
2. Assurance – the knowledge, skills, and credibility
of staff; and their ability to use this expertise to
inspire trust and confidence.
3. Tangibles – the physical evidence of the service
you provide. This could be offices, equipment,
employees, and the communication and marketing
materials that you use.
4. Empathy – the relationship between employees
and customers.
5. Responsiveness – your ability to provide a quick,
high quality service to your customers.
 RELIABILITY
Your reliability is your ability to deliver the service a customer
expects, when the customer expects. Reliable service is
regular, accurate, timely, and consistent. Unsurprisingly, it’s the
most important of all the service dimensions.

✓ How well do you provide the service that you've promised to

your customers?
✓ Are your systems and processes robust and reliable?
✓ Is service delivery consistent and timely, across all service
channels (including online)?
✓ Could you improve the quality of your service in any other
way?
 ASSURANCE
Assurance measures the ability of service providers to relay
trust to the customers which are paramount in getting
confidence in customers to stick with the organization as
opposed to the competition.

✓ Do staff have the skills and knowledge needed to deliver a

good service, across all channels?
✓ Do your people need any further training or development?
✓ Do staff inspire trust in customers?
✓ Is your service safe and secure?
TANGIBILITY It encompasses how your customers respond to the
environment you create.
✓ Is the evidence of your service (products, packaging,
marketing materials, website, offices, staff appearance, and
so on) attractive and appropriate for your customers?
✓ Are your website FAQs useful, comprehensive, and up to
date? And can people talk to a human being through other
channels if their questions haven't been answered, or if
your website is broken?
✓ As well as managing traditional channels and your website,
are you properly handling queries and feedback through
Twitter, Facebook, LinkedIn and other online services?
✓ Does physical or virtual evidence fit with your
organization's brand?
EMPATHY
Empathy governs exactly what it sounds like: do customers feel as though
your team is empathetic?

✓ Do your people build good relationships with customers?

✓ Is all communication with customers clear and timely?
✓ Do staff show empathy with customers?
✓ Do they understand why empathy is essential for providing a great service?
✓ Do your people genuinely care about customer needs?
✓ Are staff able to see things from a customer's point-of-view?
RESPONSIVENESS
Responsiveness governs how quickly, how well, and where
you respond to your customers. Good responsiveness
involves being available for customers during the times and
channels that they prefer.

✓ Do you provide a prompt service, which is easy to access?

✓ Do you manage complaints and feedback appropriately?
✓ Are staff always willing and able to help customers?
✓ Do you resolve customer issues and problems satisfactorily,
and in good time, across all service channels?
 DIMENSIONS OF SERVICE QUALITY
SERVQUAL model is the model of service quality that is used for measuring service quality
and customer satisfaction. American marketing gurus Valarie Zeithaml, Leonard Berry, and A.
Parasuraman suggested this SERVQUAL model in the year 1988 to analyze dimensions of
service quality as well as perceptions of service quality.
1. Tangibles-The physical appearance of the facilities, staff, buildings, etc., e.g. Does the
equipment appear modern? How clean is the waitress’s apron?
2. Reliability-The ability to reproduce the same level of service again and again e.g.. Is
feedback regarding student progress always given? Are messages always passed on?
3. Responsiveness-The speed with which queries etc. and dealt with e.g.. Are letters replied
to by return of post, or does it take a month? Is feedback on assignments given within a week
in time for students to assimilate the information, or does the feedback come too late, after
the examination has been taken?
DIMENSIONS OF SERVICE QUALITY
4. Communication-The clarity and understandability of the information given to the client, e.g. Does the doctor
take the time to explain in terms the patient can understand, what is going to happen next? Does the solicitor
explain clearly what the legal jargon means?
5. Credibility-The trustworthiness of the service provider, e.g. Does the newspaper reporter report all the facts or
only those which support his/her argument? Does the financial adviser present all the options or only those which
earn him/her the most commission?
6. Security-The physical safety of the customer or privacy of client information, e.g. Are the medical records of
patients kept confidential? Are the stands in the football ground strong enough to support the weight of all the
supporters?
DIMENSIONS OF SERVICE QUALITY

7. Competence-The actual technical expertise of the service provider, e.g. Is the doctor really
qualified to perform heart surgery? Does the financial adviser have sufficient knowledge of all
the relevant tax regulations?
8. Courtesy-The attitude of the service provider and manner adopted by the server, e.g.. Is the
receptionist friendly, helpful and polite? Does the doctor treat the patient as an inferior being?
9. Understanding-How well the provider of the service understands the client’s needs e.g.
.Does the bank recognize that most clients cannot get to the bank in working hours? Are there
mirrors positioned in the hotel bathrooms which allow guests to see the back of their hair?
10. Access-How easy is it to reach the service provider, geographically or by phone, e.g Are
there car parking facilities close to the solicitor’s office? Does it always take five attempts to get
the solicitor on the phone?
 THE FIVE GAPS OF SERVICE QUALITY

1. Knowledge Gap
A gap emerges when a firm’s information on consumer needs is not
enough, keeping them from precisely moving toward customers.

Also known as the management perception gap. When the

organization’s assumptions of customer perception are different from
the customers, this gap arises. This occurs as a result of insufficient
and careless research.
Causes:
Lack of quality marketing, poorly interpreted information,unfocused
research on customer needs, Too much miscommunication between
front line employees and top-level management.
 THE FIVE GAPS OF SERVICE QUALITY
2. Standards Gap
The firm has framed its thought regarding what the client anticipates
from its administration. In the event that this thought isn’t right from
the beginning and doesn’t relate to what clients expect, there is a
huge danger that the firm will interpret it wrongly into a quality
approach and comparing rules.

It is also known as the quality specification gap. Service design and

performance standards are required to fill this gap.

Causes:
Absence of proper goal, insufficient planning, absence of quality
service, not estimating the feasibility of the service, overall
inadequate approach towards task standardization.
 THE FIVE GAPS OF SERVICE QUALITY
3. Delivery Gap
A gap can likewise happen when the firm offers a service that is not
the same as what the customer had anticipated. This additionally
includes off-base usage. For example, in the manner in which
workers complete strategy.

This gap is also known as the service delivery gap. Hence customer
experience with a particular service or product must be taken into
account for improvement. This is usually done in form of natural
process.

Causes- Ineffective recruitment, role conflict, could not match

demand and supply, lack of teamwork, employee0technology fit
ineffective, inadequate planning.
 THE FIVE GAPS OF SERVICE QUALITY
4. Communications Gap
This gap occurs when the organization promises services that they
are not capable to deliver. The communications that the firm sends
out can create wrong expectations. It is the difference between
consumer experience and expectations.

It is also known as the market communication gap. The firms often

exaggerate the results they deliver and this, in turn, leaves the
customer unhappy and dissatisfied.

Causes- failure to manage consumer demand, failure to perform

promised services, poor communication, over-estimating on behalf of
the marketing team.
 THE FIVE GAPS OF SERVICE QUALITY
5. Satisfaction Gap
This is a combination of knowledge gap and communication gap. It is
the overall difference between the perceived service by the customer
and the experience of the customer with the service and the firm.

Unless customer satisfaction is kept intact, the firm is at risk of losing

credibility and reputation in the market. Also known as perceived
service quality gap.

Causes- online information, reviews, feedbacks by other customers,

word of mouth, cultural background, personality, and other various
factors can cause a satisfaction gap between the consumer and the
provider.
WHAT ARE CUSTOMER EXPECTATIONS?

WHAT ARE CUSTOMER EXPECTATIONS?

✓ Customer expectations refer to individuals’ anticipated outcomes, experiences, and
standards regarding the quality, attributes, and interactions associated with a product or
service.

✓ Customer expectations represent the set of criteria that customers use to evaluate and
judge their interactions with a business. These criteria encompass various dimensions:
product performance, service reliability, ease of use, value for money, and emotional
connection.
FACTORS AFFECTING CUSTOMER EXPECTATIONS

1. Word of mouth (WOM- is essentially the act of one person telling another about a
product or service that they've enjoyed or found valuable. It's an organic form of
advertising that relies on personal recommendations and trust between individuals.
2. Personal Needs and preferences-The relative importance that the person gives to the
service as an essential part of the offer.
3. Experience-The customer expectations also depend upon past experiences of the
customer with the service provider.
4. External Communications-External communications like advertising, public relations
and other publicity tools
 IMPORTANCE OF CUSTOMER EXPECTATIONS
1. Customer Satisfaction
Meeting customer expectations leads to higher levels of customer satisfaction. Satisfied customers
are more likely to deal with repeat future purchases, recommend your business to others, and leave
positive reviews. On the other hand, failing to meet basic expectations can lead to dissatisfaction and
negative word-of-mouth, harming your reputation.
2. Customer Loyalty
Consistently meeting or exceeding customers expectations cultivates loyalty. Loyal customers stick
with your brand over time, even in the face of competition. They become advocates who promote your
products or services to their network, effectively becoming a free preferred channel.
3. Brand Reputation
Customer expectations influence your brand’s reputation. When you consistently deliver what you
promise, your brand becomes associated with reliability and trustworthiness. This positive reputation
can attract new customers and differentiate your business in a crowded marketplace.
IMPORTANCE OF CUSTOMER EXPECTATIONS

4. Competitive Advantage
Understanding and meeting customer expectations can give you a competitive edge. Businesses
that consistently provide exceptional experiences are more likely to stand out and attract
customers away from competitors. This advantage is particularly significant in industries
with a similar product or service.
5. Repeat Business
A loyal customer is likelier to deal with repeat buyers. They’ll return for additional purchases when
they know they can rely on your business to fulfill customer needs according to customer
expectation. Repeat business contributes significantly to revenue and profitability.
IMPORTANCE OF CUSTOMER EXPECTATIONS

6. Reduced Churn
Churn, or customer attrition, is a common challenge for businesses. You reduce
the likelihood of losing customers to competitors by consistently meeting
customer expectations. This stabilization of your customer base contributes to
steady revenue and growth.

7. Positive Word-of-Mouth
Happy customers are sharing their positive customer experiences with friends,
family, and colleagues. Word-of- mouth recommendations are powerful and
can significantly impact your customer acquisition efforts.
IMPORTANCE OF CUSTOMER EXPECTATIONS
8. Innovation and Improvement
Customer feedback and expectations drive innovation and improvement. By actively listening to
your customer feedback and desires, you can develop new products, services, or features that align
with their expectations, enhancing your competitive offerings.
9. Emotional Connection
To meet customer expectations creates an emotional connection between your brand and
customers. Emotional connections lead to deeper relationships and increased customer lifetime
value.
10.Long-Term Growth
Consistently exceeding customer expectations ultimately leads to long-term business growth.
Loyal customers and positive word-of-mouth contribute to a stable customer base and a strong
market position.
 TASK #2
❑Create a presentation or infographic illustrating the key characteristics of
services.
❑Provide real-life examples of services in different industries and highlight how
each characteristic ;intangibility, inseparability, perishability, and variability
applies
❑Record your discussion maximum of 5 minutes.
❑Submit the mp4 file using the format (student surname-task#)
❑Deadline of submission March 1, 2025.
❑Send your outputs at mfroque@psu.Palawan.edu.ph