Managing Service Quality

Emerald Article: Improving service quality: a tale of two operations

Clinton O. Longenecker, Joseph A. Scazzero

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To cite this document: Clinton O. Longenecker, Joseph A. Scazzero, (2000),"Improving service quality: a tale of two operations",
Managing Service Quality, Vol. 10 Iss: 4 pp. 227 - 232
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Bo Edvardsson, (1998),"Service quality improvement", Managing Service Quality, Vol. 8 Iss: 2 pp. 142 - 149
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Nimit Chowdhary, Monika Prakash, (2007),"Prioritizing service quality dimensions", Managing Service Quality, Vol. 17 Iss: 5 pp.
493 - 509
http://dx.doi.org/10.1108/09604520710817325

V. John Peters, (1999),"Total service quality management", Managing Service Quality, Vol. 9 Iss: 1 pp. 6 - 12
http://dx.doi.org/10.1108/09604529910248759

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Case studies
Improving service
quality: a tale of two
operations
Clinton O. Longenecker and
Joseph A. Scazzero
The authors
Clinton O. Longenecker and Joseph A. Scazzero are
both based at The University of Toledo, Toledo, Ohio,
USA.
Keywords
Quality management, Service quality, Quality, TQM
Abstract
At two different warehousing/distribution facilities of the
same organization, workers were surveyed about their
experiences with the company's TQM program. The
facilities were nearly identical with respect to
infrastructure, technology, and systems but only one was
considered a success from a quality perspective. The
survey indicated that the successful facility exhibited
greater attention to the human aspects of the quality
process than the unsuccessful facility, for example, a
greater degree of management support for TQM,
communication and teamwork between managers and
workers, effective supervision, effective corrective action
procedures, and follow-up of quality problems. While this
study was limited in scope to two operations within the
same organization, lessons for the successful
implementation of service quality can be drawn from this
case study.
Electronic access
The research register for this journal is available at
http://www.mcbup.com/research_registers/
quality.asp
The current issue and full text archive of this journal is
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Managing Service Quality
Volume 10 . Number 4 . 2000 . pp. 227232
# MCB University Press . ISSN 0960-4529
227
Our struggle is that in the service industry
quality, consistency, reliability and improvement
can be driven to a great extent by human factors
that are very difficult to replicate between
different facilities . . . Even with the same systems
and equipment, the variance between similar
operations can be staggering which is a very
frustrating situation for us.
(Vice President for Distribution,
US Fortune 1000 Service Organization).
While much of the fervor for total quality
management (TQM) as a key organizational
practice has died down in recent years, the
need for quality improvement continues
unabated in both the manufacturing and
service sectors. The manufacturing sector
learned some very painful lessons during the
past 20 years about the necessity of improving
product quality to remain competitive. In
manufacturing, quality was once a
competitive advantage. Today it has become
more or less of a market segment mandate
improve your quality or run the risk of being
driven out of business. While many TQM
efforts still exist in manufacturing, they have
frequently been absorbed or incorporated into
reengineering activities, ISO 9000 practices,
or continuous improvement initiatives as
these processes integrate themselves into
nearly every facet of manufacturing
organizations.
Service organizations have all too often
lagged behind many of their manufacturing
counterparts in developing quality
improvement systems for a host of reasons.
These reasons frequently include the lack of
competitive pressure, the difficulty in
establishing and measuring quality, and the
belief that human-driven delivery systems are
more difficult to develop and regulate than
the technologies associated with
manufacturing. Yet, quality problems in the
service sector are well-known and well
documented in many industries. Restaurants
make customers wait too long for food that
may be cold or poorly prepared. Airliners
have long waiting and departure lines for
check-in and baggage pick-up. Hotel rooms
are not always properly cleaned or maintained
according to specified company standards.
Long cycle times often exist for hospital
emergency room patients in need of urgent
care. Government agencies are frequently
accused of being unresponsive and sluggish in
providing critical human services. And, as the
popularity of online shopping grows, orders
 Improving service quality: a tale of two operations
Clinton O. Longenecker and Joseph A. Scazzero
can contain the wrong items or the items are
damaged in transit. In spite of these common
examples, the service sector continues to
improve quality as competition heats up and
organizations seek new competitive
advantages.
The importance of applying TQM in the
service sector can be seen by examining
employment and dollar output statistics. In
1998, US service sector employment was
more than five times that of manufacturing,
100.5 million people versus 18.8 million. By
2008, forecasts indicate that service sector
employment will grow approximately 20
percent from 1998 while manufacturing
employment will remain relatively constant.
In terms of dollars, service sector output in
1998 was almost double that of
manufacturing, and this ratio is projected to
hold through 2008 (Thomson, 1999). It is
important to note that similar patterns in the
service sector exist or are emerging in the UK,
Canada, Germany, France, Italy and Spain.
The process of quality improvement in the
service sector follows the same logical process
used in manufacturing with some adjustments
(Rosander, 1985). This quality improvement
process typically includes:
. defining quality;
. developing quality standards;
. measuring quality;
. developing effective corrective-action
procedures;
. making changes to eliminate quality
problems;
. integrating all factors that affect quality.
Yet, one of the greatest problems facing
service organizations is the fact that a host of
quality problems can be driven by human
factors that are not always as easy to identify
and correct as a problematic production
process. Deming (1982, 1986) consistently
stated that lack of top management support
and poor supervision will doom any quality
effort. He also emphasized the need for all
organizational employees to make a
commitment to practice TQM on an ongoing
basis. Juran (1993) emphasized that
management needs to instill a philosophy of
continuous improvement and provide the
necessary supporting organizational practices.
In some of our previous research, we have
observed that an organization's TQM efforts
can be severely undercut by such people
problems as individuals not performing their
jobs effectively, ineffective training,
228
Managing Service Quality
Volume 10 . Number 4 . 2000 . 227232
communication breakdowns, lack of
teamwork, lack of worker involvement, and
ineffective managers (Longenecker and
Scazzero, 1993, 1996).
While human factors are important in all
quality improvement, they are critically
important in service industries. As seen in the
opening quote from an executive in the
distribution industry, ``Even with the same
system and equipment, the variance between
operations can be staggering''. This variance
was very frustrating to the executive because
the two operations were quite different in
terms of the quality of the services they
provided even though they had the same work
environment, processes, and systems. In this
paper, we will explore a case study of two
nearly identical distribution operations that
have significantly different levels of quality
and performance. And, as the reader will see,
the major differences are due to ``human''
rather than technological factors. A discussion
will offer lessons for improving service quality
based on this study.
The study
In this study, we will explore two nearly
identical warehousing/distribution operations
located in the Midwest area of the USA. Both
operations are part of the same large
organization that implemented a TQM
process on a corporate-wide basis
approximately four years prior to this study.
Both operations use the same computer
system, technology, measurement systems,
equipment, and processes to fill and deliver
customer orders to both commercial and
retail accounts. Both operations handle the
same product mix and have approximately the
same number of personnel employed using
the same human resource management
system for all personnel issues governing
selection, training, compensation, benefits
and conditions of employment. It is at this
point that the similarities end.
These warehousing operations receive
customer orders that are filled by workers and
loaded on to trucks for direct customer
delivery. Distribution and warehousing
operations frequently measure quality using
four primary indicators:
(1) Completeness of order was the customer
order properly filled without overages or
shortages?
 Improving service quality: a tale of two operations
Clinton O. Longenecker and Joseph A. Scazzero
(2) Damages was the customer order filled
completely without damaging the product
in the storage, loading, and transit
process?
(3) Service did the order leave the facility on
time, so it could be delivered punctually
to the customer?
(4) Documentation was the paper work
accompanying the order properly
completed, including an accurate
manifest and invoice?
Collectively, these specific measures combine
to determine the service organization's
``quality of product''. These measures are
common performance standards in
warehousing, distribution, and transportation
industries.
In this study of two nearly identical
operations, the variance on these critical
quality measures was statistically different on
all four quality measures. That is to say, one
operation's quality of product was
significantly better than the other operation's.
A clear pattern of superior quality
performance was demonstrated by one
operation while the other operation's
performance was problematic. To explore
why this difference existed, a 15-item
questionnaire was administered to the
workforces in both operations. Operation A,
the high performing operation, had a response
rate of 81 percent (119 people out of 147
people) while operation B had a response rate
of 76 percent (103 out of 136 people). The
questionnaire asked respondents a series of
agree/disagree statements that assessed the
degree to which the organization had
implemented 15 key factors that have been
found necessary to support ongoing quality
performance and improvement.
Table I contains the agreement percentages
for these factors at the two different locations.
Completed questionnaires were analyzed
and tests of hypotheses were conducted to
determine the factors whose agreement
percentages at the two locations were
statistically significantly different. In the
following section, we discuss how different
implementation of certain factors and
practices resulted in a successful TQM effort
at one location and a failure at the other.
Survey results
Table I ranks the key TQM quality factors by
the differences in agreement percentages at
229
Managing Service Quality
Volume 10 . Number 4 . 2000 . 227232
the two locations. Ten out of the 15 factors
were found to differ significantly after
performing two-sample proportion tests of
hypotheses using a level of significance of
0.01. In reviewing these factors, a number of
critical observations are in order.
The factor that most differed in terms of
implementation was teamwork/cooperation
among management personnel. Approximately
two-thirds of the workforce perceived
management personnel working together at
the effective TQM location, compared with
only one-third at the ineffective TQM
location. This result emphasizes the critical
role of all management personnel when
attempting to implement and sustain a TQM
initiative. Without management support
throughout the organization, any TQM effort
is doomed to failure since workers will see
such effort as external to the prevailing
corporate culture. The importance of
management commitment to quality is
further illustrated by its use as a criterion
when evaluating companies for the Malcolm
Baldrige National Quality award (Tamimi
and Sebastianelli, 1998).
The responses to factor 6 show further
evidence of the difference in management
support for TQM. Approximately 80 percent
of the workforce at the effective TQM
location stated that improving quality was an
organizational priority compared with only 56
percent at the ineffective TQM location. This
difference in management commitment to
TQM is also reflected in the responses to
factors 4, 5, 7, and 10, i.e. having effective
measures of quality, operating policies,
corrective action procedures, and following
up quality problems. As stated earlier in the
paper, these are essential components for
improving quality.
The survey results also highlight the
importance of front-line supervision to the
TQM process. As seen in the responses to
factors 2, 3, 8 and 9, the successful TQM
location had more effective supervision than
the less successful location. A significantly
higher percentage of workers at the former
location reported the following factors as
effective: two-way communication, feedback
on performance, and workers cooperating
with one another. These factors are all critical
in a service organization whose performance
depends so heavily on the human component.
In summary, several factors have been
identified as contributing to the significant
 Improving service quality: a tale of two operations Managing Service Quality
Clinton O. Longenecker and Joseph A. Scazzero Volume 10 . Number 4 . 2000 . 227232

Table I Percent agreement on key quality improvement factors by location

Location
A B Difference
Quality improvement factors (%) (%) (%)
(1) Management personnel demonstrate teamwork/cooperation 66 33 33*
with each other
(2) We practice effective two-way communication 74 43 31*
(3) People receive effective feedback on their performance 68 39 29*
(4) We have effective corrective-action procedures in place 72 44 28*
(5) Our organization follows up on quality problems 69 42 27*
(6) Improving quality is an organizational priority 81 56 25*
(7) We can effectively measure quality 78 54 24*
(8) Our operation has effective supervision 68 48 20*
(9) Workers demonstrate teamwork/cooperation with each other 75 55 20*
(10) Standard operating procedures/policies are effective 70 53 17*
(11) Managers are properly trained to perform their jobs 66 51 15
(12) We have clearly defined quality standards 79 67 12
(13) Workers are properly trained to perform their jobs 69 59 10
(14) Our operating system/technology is effective 73 64 9
(15) We have adequate resources/equipment to do our work 71 65 6
Note: *Significant at the 0.01 level of significance

differences found in the TQM culture of two
nearly identical warehousing operations of the
same company. As discussed below, a
number of important lessons can be drawn
from these findings.
Implications for organizational
improvement
The findings of this study offer a number of
rather strong lessons for organizations
anxious to improve the quality of their service
product. Significant differences were found in
ten out of 15 key practices necessary for
quality improvement. These differences are
quite common based on both our research
and consulting experience with service
organizations. Acting on these common
patterns is a critical mandate for managers at
all levels who are interested in improving
service quality.
Lesson No. 1: assess the effectiveness of
your current practices that impact
service quality
Mature TQM organizations are well-served to
survey management personnel on the issues
identified in this study to assess their current
perception of the organization's TQM
processes and the consequences of these
perceptions. Managers should be surveyed
first to assess their belief in the TQM process
230
and willingness to support this effort in both
word and deed. Workers should then be
surveyed to solicit their perceptions of the
organization's TQM process to determine
their support and confidence in the system.
Such an audit allows the organization an
opportunity to determine its location along
the TQM continuum and provides input on
what steps the organization must take to move
forward in the TQM maturation process. The
feedback garnered from this process can be an
invaluable source of information and impetus
for change while at the same time reinforcing
desired behaviors.
Lesson No. 2: management support and
teamwork are critical to long-term
quality improvement
It is a well-documented fact that management
support is needed to initiate any TQM effort
started. What is not always apparent is the
necessity of the continued involvement and
support of managers to keep TQM efforts
viable. To this end, top management must
make continuous improvement and
cooperation an ongoing priority for all
managers throughout the organization.
Managers' roles and duties must be specified
with continuous improvement as part and
parcel of every manager's job description.
Involvement on correction action teams,
providing leadership on defining and refining
quality standards, providing the resources
 Improving service quality: a tale of two operations
Clinton O. Longenecker and Joseph A. Scazzero
necessary for improvement, developing and
implementing feedback mechanisms, and
coaching are all critical elements of a
manager's job as a TQM leader. In service
industries, there is no substitute for effective
leadership on these critical practices.
Managers must be selected, trained,
promoted, appraised, and rewarded on their
ability to foster continuous improvement in
their areas of responsibility within the
organization. Without this focus, as seen in
this study, managers' enthusiasm and support
for TQM will decrease over time, creating less
than positive role models for the rest of the
organization.
Lesson No. 3: people drive service quality
Technical problems are generally dealt with
early on in the TQM process. This study
suggests that long-term improvement is
predicated on systematically addressing the
``human side of quality''. As was previously
discussed, workers at all levels need to be
properly led by their superiors. Furthermore,
workers need proper training to perform their
jobs, to develop effective problem-solving/
conflict-resolution skills, to develop effective
communication skills, and to learn how to
function in team-oriented cultures. In
addition, employee input must be
systematically tapped by managers on issues
that impact both continuous improvement
and the workplace. Feedback and coaching
for the individual is paramount for overall
TQM efforts to progress. Both practice and
research demonstrate that workers are the key
ingredients in long-term quality improvement
and that they respond favorably when given
proper support and leadership. The human
element cannot be ignored or neglected
without negative consequences.
Lesson No. 4: TQM systems must
continuously improve TQM practices
Service quality will be enhanced when an
organization implements an effective
improvement system. Yet, even the most
effective system must evolve and mature in
conjunction with the dynamic demands
associated with changing organizational
needs. This suggests that systematic
approaches to long-term quality improvement
must be periodically scrutinized and feedback
provided to enhance quality improvement
systems. To this end, corrective action
procedures must be modified and
231
Managing Service Quality
Volume 10 . Number 4 . 2000 . 227232
streamlined, feedback mechanisms must be
continually evaluated and improved, quality
standards must evolve, and measurement
procedures must be meaningful and
cost-effective. Without adjustments, these
TQM systems can hinder rather than help
quality improvement and be perceived as
barriers to improvement. In addition,
technical improvements must be made to
operating systems to keep them viable and
technologically up to date. Negative
consequences are inevitable for the
organization that is guilty of not practicing
continuous improvement of its TQM systems.
Lesson No. 5: there is no substitute for
leadership in improving service quality
performance
A number of introspective questions are in
order for managers operating in a service
organization that desires to improve its quality:
(1) Am I practicing continuous improvement
on an ongoing basis?
(2) Am I encouraging my employees to
practice the principles of TQM through
my actions?
(3) Am I providing leadership in addressing
ongoing/persistent quality problems?
(4) Am I providing leadership to improve our
existing quality improvement processes?
(5) Are we using corrective action procedures
and following up quality problems in an
effective and efficient manner?
These are questions that TQM managers
must be encouraged to address honestly on an
ongoing basis. The answers to these questions
are critical and represent the true test of an
organization's leadership commitment to
long-term continuous improvement. When
two operations have nearly identical TQM
systems, technology, and processes but differ
significantly in their quality of product, a
careful examination must be made of
leadership and other human factors. This is
no small challenge, requiring purpose,
honesty, and openness.
Summary
Although this study was limited in scope, we
believe a great deal can be learned by the
comparison of two different facilities within
the same large organization. Both facilities
had the same infrastructure and systems but
 Improving service quality: a tale of two operations
Clinton O. Longenecker and Joseph A. Scazzero
only one location had a TQM process that had
a positive effect on service quality. Through
workers' responses to a survey, several factors
were identified as contributing to the
difference in TQM. These include:
management support for TQM,
communication and teamwork between
managers and workers, effective supervision,
effective corrective action procedures, and
follow-up of quality problems. The lesson for
top management is clear as it relates to
improving quality throughout any large-scale
service organization. In order to compete
strategically, an organization must make a
commitment to provide the leadership,
personnel practices, and resources needed to
address the host of human issues that drive the
process of service quality. In the end, service
organizations that want to improve quality and
overall performance must give due diligence to
both people and process issues.
232
Managing Service Quality
Volume 10 . Number 4 . 2000 . 227232
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management from theory to practice: a case study'',
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