Fitzsimmons 8-Chapter 6.1-Black Board Notes-Service Quality-Fall 2018

Fitzsimmons 8-Chapter 6-Blackboard Notes (Service Quality) 1
Management 3121
Instructor: N. P. Loomba
Fitzsimmons 8- Chapter 6-Blackboard Notes (Service Quality)
MAIN POINTS EMPHASIZED IN CHAPTER 6 [19 Pages]
1) Five Dimensions of Service Quality: [Reliability, Responsiveness, Assurance,

Empathy, and Tangibles] [RRAET]
2) GAPS in Service Quality (Service Quality GAP Model) [Gap or difference between
a customer’s expectations of a service [ES] and the customer’s perceptions [PS] of
the service received]. Five Gaps are discussed in this Chapter.
[GAP 1: Market Research Gap; GAP 2: Service Design Gap; GAP 3: Conformance
Gap; GAP 4: Communication Gap; GAP 5: Customer Satisfaction Gap]
3) Measuring Service Quality (SERVQUAL) [A research instrument that was used to
measure Service Quality] [Some 1900 Customer from different Industries]
4) WtA [Walk-Through Audit] [A detailed audit of Service Quality of an organization]
5) Service Quality by Design: Build-in Quality --- as opposed to Inspect-in Quality
(e.g., build-in Quality in the entire Service Package); Taguchi Methods; Poka-Yoke
(Failsafing); Quality Function Deployment [QFD]
6) Classification of Service Failures [Server Errors: Task, Treatment, and Tangible.
[The three T’s of Service Design]. [Customer Errors: Preparation, Encounter, and
Resolution]
7) Costs of Quality [Four Categories of Costs associated with poor quality] [Prevention
Costs; Appraisal Cost; Internal Failure Costs; External Failure Costs]
8) Statistical Process Control [Achieving Statistical Control and then using Control
Charts to monitor the process] [CONTROL CHARTS: Mean or Average Charts,
Range Charts, p-Charts, and c-Charts]
9) Service Guarantee
10) Service Recovery
• For services, the assessment of quality is often made during the service delivery
process. [Pillar #4 in the Strategic Service Vision Diagram]
• Customer satisfaction with a service can be defined by comparing perceptions of
service received [PS] with expectations of service desired [ES]. [See Diagram on
page 4 of these notes] [Perception of Service takes place during the Service
Delivery --- Pillar #4 in the Strategic Service Vision Diagram]
• Quality Goal: PS > ES [Perceived Service must be greater than Expected
Service]
Five Principal Dimensions of Service Quality (in descending order of importance)
1) Reliability [The term “Reliability implies “dependability,” “accuracy,” and
“consistency.”]
[Reliability implies the ability to perform the promised service dependably
(The firm performs the service right the first time and that it honors its
promises); and accurately (e.g., accuracy in billing and records). Consistency
(Service is rendered on time, in the same manner, and without errors ---- every
time].
Dependability: Promised service is performed right and on time.
RELIABILITY
(Ability to fully Accuracy: Full compliance with details and procedures.
perform the promised
service)
Consistency: Service performed in the same manner,
without errors, and on time.
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2) Responsiveness [The willingness to help customers and to provide prompt

service] [Providing quick “Service Recovery” when and if a “Failure” occurs
during the Service Process] [Recall “Failure Points” from “Service Blueprint”
discussed in Chapter 3 of your Text].
First dimension of Responsiveness: [Promptness]
Responsiveness involves promptness and timeliness of the service; the
customer must not be made to wait for an unreasonable time --- immediate
service delivery.
Second Dimensions of Responsiveness: [Service Recovery]: The ability to
recover quickly when and if a service failure occurs.
*Willingness to help Customers

* Prompt Service
RESPONSIVENESS *Immediate Service Delivery
(Promptness and
Service Recovery)
*Service Recovery: The ability to recover quickly
when and if a Service Failure occurs.
3) Assurance [The Competence (required knowledge and skills), and Courtesy of

service employees; as well as their ability to convey Trust and Confidence].
[Competence implies possession of the required knowledge and skills to
perform the service].
[Courtesy involves politeness, respect, consideration, and friendliness of
service employees].
[Trust involves believability and honesty of service employees].
[Confidence implies that service providers believe in their ability to deliver
high quality service on time. Customers can sense this confidence of service
providers]
Assurance: ***Projecting an image that the service provider has best

interests of the customer at heart and following up this image with effective
communication and excellent service.
Competence: Required Knowledge and Skills.
Courtesy: Politeness; Respect; Consideration; Friendliness.

ASSSURANCE
1) Competence Trust: Believability and Honesty of Service Employees.
2) Courtesy
3) Trust
4) Confidence Confidence: Service providers believe in their ability to deliver
high Quality service on time. Customers can sense this
confidence of Service Providers.
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4) Empathy [The provision of Caring and Individualized attention to customers]

[Put yourself in Customer’s shoes]
[Approachability, Sensitivity, and Ease of Contact]
Caring and Individualized Attention to Customers
EMPATHY Approachability
[Put yourself in
Customer’s
Shoes]. Sensitivity
Ease of Contact
5) Tangibles [The Clean Appearance of physical facilities, equipment, personnel,

and communication materials] [Physical Evidence of the service: What one sees
and experiences --- remember Service Blueprint from Chapter 3 of your text]
TANGIBLES Clean Appearance of Physical Facilities, Equipment,

(Clean Personnel, and Communication Materials
Appearance of
everything
associated with Physical Evidence of the Service (what one sees and experiences).
service delivery)
*****Perceived Service Quality (PS): [The quality of service the customer believes he or
she actually got]
*****Expected Service Quality (ES): [The quality of service the customer expected to get]
*****Desired Outcome: PS should be greater than ES [PS > ES]

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Expected Versus Perceived Service Quality [SERVICE GAP]
Direct Mail Word of Mouth Personal Needs Past Experience Targeted Ads
Dimensions of Expected Perceived Service Quality

Service Quality Service 1. Expectations exceeded.
Reliability PS > ES (Quality Surprise; Service
Responsiveness Service Gap Delight)
Assurance 2. Expectations met.
Empathy Perceived
PS = ES (Satisfactory Quality)
Tangibles
Measuring Service
3. Expectations not met.
PS< ES (Unacceptable Quality)
Please remember that the Customer is comparing PS
and ES along each possible dimension of Service Quality.
Measuring Service Quality by using a “Customer Satisfaction Questionnaire”
• Club Med uses the questionnaire (shown in Figure 6.2 “Customer Satisfaction
Questionnaire” on page 146 of your text) to measure the gap between “Perceived
Service” and “Expected Service.”
• “Customer Satisfaction” Survey is an instrument for measuring “Overall”

service quality; whereas Walk-through Audit is an instrument that measures
service quality in “Detail.” [illustrated in Figure 6.5 “Walk-though Audit for
Helsinki Museum of Art and Design” on page 149 of your Text]
***** “Customer Satisfaction” Survey measures Overall service quality.

***** Walk-through Audit measures service quality in Detail.
Service Quality Gap Model: [SERVQUAL Instrument] [See Figure 6.3 “Service Quality
Gap Model” on page 147 of your text].
[Also see Diagram on Service Quality Gap Model posted as a separate document in my
Black Board Notes]
SERVQUAL was the foundation for Service Quality Gap Model. That is,
SERVQUAL provided the empirical data from which the concept of Service Quality Gap
Model was developed.
• In Figure 6.3 “Service Quality Gap Model” on page 147 of your text, the gap
between “Customer Perceptions” and “Customer Expectations” is defined as
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Gap 5. This Gap is a measure of overall Customer Satisfaction. [Theoretically,
any Gap has a magnitude and a direction] [That is “how much” and “Is it
positive or negative.”] [You can think of Gap 5 as the “Overall” Gap that
emerges out of the other four Gaps (See below).
• Customer Satisfaction [Measured by GAP 5] is dependent on minimizing Gaps 1

through 4 that are associated with different stages in the entire delivery cycle of
the service. These four Gaps are defined below:
Gap 1 (Market Research Gap) [Understanding the Customer] [What

does the Customer want in terms of selected Competitive Priorities?
Particularly, what does the Customer want in terms of five
dimensions of Service Quality? [Five dimensions of Service Quality
are, in effect, Competitive Priorities]
[Discrepancy between Customer Expectations and
Management’s Perceptions of these expectations]
[Please remember that Customer Expectations are formed along each
of the Competitive Priority that is important to the Customer] [Please
remember that Competitive Priorities drive all components of the
Service Package. Also, note that “Quality” and its five components
reflect the impact of selected Competitive Priorities.
Gap 2 (Service Design Gap) [Understanding Service Quality in terms

of quality specifications] [Information obtained from Market
Research is translated into Service Quality Specifications]
[Management’s inability to formulate target levels of service
quality (i.e., service standards or service specifications) to meet
perceptions of customer expectations. That is, Management is not
fully able to translate “customer expectations” into workable
specifications]
[Note the role of House of Quality during this stage (i.e., the
Service Design Stage) of the entire Service Delivery System] [Please
read “House of Quality” module posted on the Black Board]
[Please revisit page 31 of my BB Notes on Chapter 3]. [“An
Integrated Framework for Goods and Service Design”]
Gap 3 (Conformance Gap) [Actual service does not meet service

specifications] [Issue: Conformance to Specifications]
[Actual delivery of the service does not meet the specifications
set by management (does not conform)]
Gap 4 (Communication Gap) [Lack of adequate information provided

to customer and the service provider personnel by the Management]
[Discrepancy between actual service delivery and external
communication (by Management) in the form of exaggerated
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promises to the customer and lack of adequate information provided
to contact personnel]
Gap 5 (Customer Satisfaction Gap) [Lack of Customer Satisfaction with the service]
[Discrepancy between Customer Expectations (ES) and Customer Perception (PS)]
Measuring Service Quality [SERVQUAL Instrument: A tool to measure the five

dimensions of Service Quality] [Comparison of PS and ES along each dimension of Service
Quality]
• The authors of the Service Quality Gap Model developed a multi-item scale
[called SERVQUAL] to measure the five dimensions of service quality (i.e.,
comparing PS and ES along the dimensions of Reliability, Responsiveness,
Assurance, Empathy, and Tangibles). Then, the authors determined the
“GAP” --- along each of the five dimensions of quality --- between the
answers provided by the customers (Perception) and the original stated
Expectations of the customers [i.e., gaps between “paired Perception and
Expectation questions].
• Their survey involved some 1,900 customers from several different
industries.
• SERVQUAL is a two-part instrument [Please see the SERVQUAL document
posted on the Black Board]
• The first part, with 22 questions, measures Customer Expectations (ES)
• The second part, with 22 questions, measures Customer Perceptions (PS)
• The 22 statements in the survey describe aspects of the five dimensions of
Service Quality (i.e., Reliability, Responsiveness, Assurance, Empathy, and
Tangibles).
• A seven-point scale ranging from “Strongly Agree” (score of 7) to “Strongly
Disagree” (score of 1). [No labels for the intermediate scale points (i.e., scores
of 2 through 6) accompanied each statement].
• For example, a score for the quality of service [GAP 5] is calculated by
adding the differences between the ratings that customers assigned to
“paired expectation and perception” questions. This score is referred to
as GAP 5 [Customer Satisfaction Gap].
• [Scores for the other four “Gaps” can be calculated in a similar manner].
• Most important function of SERVQUAL is tracking Service Quality Trends
through periodic customer surveys.
• SERVQUAL can be used in marketing studies to compare a service with a
competitor’s service; and to identify the dimensions of superior or
inadequate service quality.
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•
Summary of the SERVQUAL Model
Three Steps using Two-Part Instrument
[(1) Record Customer Expectations
(2) Record Customer Perceptions
(3) Measure Gaps between (1) and (2)
SERVQUAL Used to Track service quality trends through periodic customer surveys
Used in marketing surveys to compare service quality with a competitor
Used to identify a poor-quality unit for firms having multi-site services
Walk-through Audit (WtA)

• A walk-through audit is a customer-focused survey to uncover areas for
improvement. [This is a detailed audit (See Figure 6.5 “Walk-Through Audit for
Helsinki Museum of Art and Design” on page 149 of your text)]. This WtA was
designed to uncover actionable items for improvement at Helsinki Museum of Art
and Design --- unlike a brief and overall customer satisfaction survey shown in
Figure 6.4 “Restaurant Satisfaction Survey” on page 149 of your text]
• The entire customer experience is traced from beginning to end.
Comparison of Customer Satisfaction Survey with a Walk-through Audit
• Please see Table 6.1 “Comparison of Customer Satisfaction Survey with Walk-
through Audit” on page 148 of your text.
Please recall:
• ***** Customer Satisfaction Survey Measures Overall service quality.
•
• ***** Walk-through Audit Measures service quality in Detail.
The Walk-Through Audit as a Diagnostic Instrument
• To test the use of a WtA, the same Helsinki Museum of Art and Design audit that
was given to the customers was also given to the managers and employees. [See page
151 of your text]
Service Quality by Design [Build-in Quality]

(1) Build-in Quality in various elements of the Service Package [Think of the
Framework shown on page 31 of my BB Notes on Chapter 3]
(2) Taguchi Methods [Robust design which can withstand “Adverse Conditions”]
(3) Poka-Yoke Methods [Fail-Safe Devices or Methods]
(4) Quality Function Deployment (QFD)] [How best to deploy resources to insure quality]
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[We will cover Taguchi Methods and QFD in separate documents I have posted on the
Black Board]
1) Incorporation of Quality in various elements of the Service Package
[See Table 6.2 “Quality Requirements for Budget Hotel” on page 153 of your text which
illustrates “Quality Requirements for Budget Hotel” by attempting to incorporate quality
into the five elements of a Service Package]
Table 6.2 “Quality Requirements for Budget Hotel” on page153 of your text illustrates the
“Conformance to Requirement” Approach to Quality Control. [Relate this to
“Conformance Gap.”]
[Please recall the five elements of a service package: (1) Supporting Facility, (2) Facilitating
Goods, (3) Information, (4) Explicit Services, and (5) Implicit Services] (see pages 18-20 in
Chapter 1 of your text).
• A concern for quality can lead us to focus on the five dimensions of the
service package: [Supporting facility, Facilitating goods, Information,
Explicit Services, and Implicit Services]. [Build-In Quality in each of the five
elements of the Service package]
• Quality Control is seen as an action-oriented activity requiring corrective
measures when nonconformance occurs. [Real Quality requires that the need
to take corrective measures is totally eliminated]
2) Taguchi Methods [See my “Taguchi Loss Function” Document which has been
posted on the Blackboard]
• The basic idea behind Taguchi design methods is that the design of a product or
service should be “robust” so that the product or service could function properly
under “adverse” conditions. [e.g., dropping the “Mouse” from the Computer Table
and finding that the Mouse did not break]
• Further, most of the production should be at or near the “Target” for the
performance characteristics. This is because the cost of poor quality to society
should be measured by the square of the deviation from the Target. [Discuss at this
point the concepts of “TARGET” versus “TOLERANCE LIMITS.”]
• See Figure 6.7 “Taguchi Cost of Quality Function” on page 154 of your text. Also
see my “Taguchi Loss Function” Document on the Black Board.
3) Poka-Yoke Methods (Failsafing)
• Poka-Yoke, translated roughly as “mistake-proofing,” refers to devices or methods

that use simple approaches to make sure that service errors (either by the server or
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by the customers) do not occur. [e.g., Specially designed nozzles to put diesel fuel in
automobiles] [Inform the class about my own experience]
• The Poka-Yoke methods often use checklists or manual devices that do not let
employee make a mistake.
• Service errors can originate from both the server and the customer (See Table 6.3
“Classification of Service Failures” on page 155 of your text). Poka-Yoke methods
should, therefore, address both sources.
Service Provider Errors [The three T’s of Service Design]

Three categories of service provider errors are:
1) Task [use of a French fry scoop] [Task Poka-Yoke]

2) Treatment [customer’s eye color must be entered at a bank by
using a check list] [Treatment Poka-Yoke]
3) Tangible [placement of mirrors in employee break rooms to
encourage appropriate appearance] [Tangible Poke-Yoke]
Customer Errors
Three categories of customer errors are:
1) Preparation [one example of preparation Poka-Yoke is the
requirement of filling out a comprehensive medical survey]
[Preparation Poka-Yoke]
2) Encounter [frames at airport check-in counters to gauge allowable
size of carry-on luggage] [Encounter Poka-Yoke]
3) Resolution [Fast food restaurants strategically locate tray-return
stands and trash bins at the exits] [Resolution Poka-Yoke ---
designed to help mold the behavior of customers as they leave the
service]
• Table 6.3 on page 155 of your text illustrates a “Classification of Service Failures”
by both Servers and Customers.
4) Quality Function Deployment [How best to deploy resources to insure quality]
• A process called “Quality Function Deployment” is used to provide customer input

at the product or service design stage.
Do you remember Gap 2 “Design Gap” in the Service Quality Gap

Model? [Understanding Service Quality in terms of quality
specifications]
• The process of QFD results in four matrices. The first and the most important
matrix is called the House of Quality [See Figure 6.8 “House of Quality for Village
Volvo” on page 156 of your text.
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[We will only discuss the House of Quality Matrix at this time; and not discuss the
other three matrices. [Other three Matrices are: Component Matrix; Production
Process Matrix; and Quality Control Matrix]
House of Quality
Customer Expectations (regarding the five dimensions of Quality) [VOICE OF THE

CUSTOMER]
***Reliability, Responsiveness, Assurance, Empathy, and Tangibles) are the
attributes that we must design into the service. Their respective importance is
indicated by assigning relative weights (e.g., 1 to 9). [Important Question: What are
the performance measures for these five attributes?] [Competitive Priorities?]
Five Service Elements [VOICE OF THE ENGINEER] [A Service Element is any physical,
procedural, technical, or informational component of the Service required for effective
Service Delivery] [A Service is defined by its Service Elements. Here we list five selected
service elements: Training, Attitude, Capacity, Information, and Equipment.
Service Element: What is needed from the Service Provider to render a Quality Service?
[Does this ring a bell? “Service Concept” from the Strategic Service Vision]. Can you
visualize the role of Service Elements in delivering the five dimensions of the service? We
have listed only five service elements --- there could be numerous additional service
elements with respect to a particular service.
• The House of Quality provides a framework for translating Customer Attributes

(required for customer satisfaction) or meeting Customer Expectations [“Voice of
the Customer” or “Customer’s Eyes”] into identifiable and measureable
specifications for Service Elements in the product or service design [“Voice of the
Engineer or “Provider’s Eyes”]
Translation: Meet or exceed Customer Expectations in terms of Reliability,

Responsiveness, Assurance, Empathy, and Tangibles by providing sufficient amount of
Service Elements such as Training, Attitude, Capacity, Information, and Equipment.
Question: Are “Competitive Priorities” issues involved here?
• Please see my notes on “House of Quality” contained in a separate document posted

on Black Board.
Achieving Service Quality
• Quality-inspection intervention between the customer and the contact employee is

not an option in services (while, in manufacturing, quality can be tested during the
production process).
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Note: Don’t you think that sometimes one might be able to see poor quality and, as a
result, intervene to correct the situation. Think of a hospital-based care of a patient?
Four categories of “Cost of Quality” identified by Joseph M. Juran: They are:
1) Prevention Costs [for keeping defects from occurring in the first place
(e.g., Quality Improvement Programs]
2) Appraisal (Detection) Costs [for inspection of purchased materials during
manufacturing or service procedures during service operations]
3) Internal Failure Costs [Costs that arise from defects discovered before
shipment (e.g., yield losses from defective output] [Costs that arise due to
Service Failures]
4) External Failure Costs [Costs that arise from defects discovered after
shipment (e.g., Legal Costs and Warranty Costs)] [Loss of reputation in
the Service Domain] [[Wells Fargo Bank Example]
• Table 6.4 “Costs of Quality for Services” on page 158 of your text gives examples of
Costs of Quality in Services [Bank Example]
Statistical Process Control
• The concept of Statistical Control [Obtaining a state of control in any process to

reduce or minimize variations in the process output]. [All processes are subject to
variations. The important task is to determine these Causes of Variation]
Causes of Variation
1) Assignable Causes
2) Common Causes
• The Central Limit Theorem [See Document “Central Limit Theorem” posted on the
Black Board]
• Control charts and their attributes [Six (6) Attributes: See page 14 of these BBN on
Chapter 6]
• Type I and Type II errors [See Document “Type I and Type II Error” from my
BBN on Chapter 6]
CONTROL CHARTS (Graphical Device to monitor the output of a Process)

[Steps involved in constructing and using a Quality-Control Chart]
1) Decide on some measure of service system performance (e.g., Ambulance

response time or weight of a cereal box) [Competitive Priority?]
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2) Collect representative historical data from which estimates of the “Population
Mean” and “Population Variance” for the system performance measure can be
made. [Remember what we are looking for? Population Mean and Population
Variance]
[By Definition: Variance = Square of the Standard Deviation]
3) Make sure that the process is under statistical control. [Statistical Control
implies that all assignable causes of variation have been removed and, therefore,
the process is stable with respect to its mean as well as standard deviation]
[Please think about and understand this very important step] [See my document
on Statistical Control posted on the Black Board]
4) Decide on a sample size and, using estimates of population mean and variance,
calculate 3-sigma control limits. [3-Sigma Control Limits are for purposes of
illustration only. In real-life, companies use a minimum of 6-Sigma Standard]
[Please see the module on “3-sigma versus 6-sigma Quality” posted on the Black Board]
5) Graph the control chart having two dimensions: [For example, for the “Average
Chart,” we will have these two dimensions: Sample Mean (Vertical axis); and
Time (Horizontal axis).
6) Plot Sample Means (collected at random) on the chart, and interpret the results
as follows:
a) Process in Control [i.e., Sample Means fall within Control
Limits]
b) Process out of Control [i.e., Sample Mean fall outside
See Document “Patterns
Control Limits or a run of five sample means falls either
of Sample Data” posted
above or below the center line). In this case:
on the Black Board.
i) Evaluate the situation
ii) Take corrective action
iii) Check results of action
7) Update Control Chart on a periodic basis, and incorporate recent data.
• Control Charts fall into two categories that are based on the type of performance
measure.
1) Variable Control Charts [record measurements that focus on

continuous variables such as length, weight, or time]. Examples
are Mean or Average charts and Range charts.
2) Attribute Control Charts [record discrete data such as the

“proportional defectives” or the “number of defects or errors per
unit”]. Examples are “p” charts and “c” charts.
Important Attributes of Service Guarantee

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1) Unconditional
2) Easy to understand and communicate
3) Meaningful
4) Easy to invoke
5) Easy to collect
A Service Guarantee promotes organizational effectiveness in several ways:
1) Focuses on customers
2) Sets clear standards
3) Guarantees feedback
4) Promotes an understanding of the service delivery system
5) Builds customer loyalty
Important Components of Quality Development [See Figure 6.12 “Service Quality Ladder”
on page 164 of your text] [It is not really a ladder --- as no sequence is required. Quality
Development is, instead, a dynamic and continuous process]
1) INSPECTION [Quality checked before and after service is delivered] [Reference

here is to the Quality related to Service Elements]
2) STATISTICAL PROCESS CONTROL [Quality assurance before, during, and

after service delivery]
3) QUALITY TRAINING PROGRAMS [Employee empowerment and

responsibility for quality]
4) COSTS OF QUALITY [Quantifying the cost of poor quality] [Prevention Costs,

Appraisal (Detection) Costs, Internal Failure Costs, External Failure Costs]
5) UNCONDITIONAL SERVICE GUARANTEE [Operations and Marketing

focus on one or more service performance measures]
6) QUALITY SERVICE BY DESIGN [Design service process for robustness and

foolproof operations] [SSV; House of Quality, Integrated Framework for
Designing Goods and Services]
7) QUALITY FUNCTION DEPLOYMENT [Define Voice of the customer (Service

Attributes) and Voice of the Engineer (Service Elements) in operational terms]
Service Recovery [A quick resolution to Service Failure --- part of the Responsiveness
dimension of Service Quality]
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• A quick resolution to service failure is an important way to create loyal customers

• A Service Failure can be turned into a Service Delight by empowering frontline
employees with the discretion to “make things right.”
• See Figure 6.13 “Service Recovery Framework” on page 165 of your text that
depicts three stages for service recovery:
[Pre-recovery phase; Immediate recovery phase; and Follow-up phase].
Approaches to Service Recovery
1) The Case-by-Case approach [Each case creates different requirements for

Service Recovery]
2) The Systematic Response Approach [uses a protocol to handle customer

complaints]
3) An Early Intervention Approach [intervene and fix service-process problems

before they affect the customers]
4) Substitute Service Recovery Approach [provide a substitute service from one of

the competitors]
Components of a Control Chart
[Six Components of any Control Chart are listed below] [We will be illustrating Control
Charts in several of my Documents on Control Charts posted on the Black Board]
1) The Quality Characteristics or Variable of Interest (e.g., X-bar, R, p, or c). The

values of the selected variable gathered from sample data are plotted on the vertical
axis [i.e., Y-axis] of the control chart. [Measure of System Performance]
2) A “time” dimension is shown on the horizontal axis [i.e., X-axis] of the control chart.
3) A center line that represents the Population Mean of the quality characteristics (e.g.,
X-bar-bar, R-bar, or p-bar, or c-bar) is plotted on the Control Chart.
4) The Upper and Lower Control Limits [depending upon the level of quality standard
used in the control chart (e.g., 3-sigma standard or 6-sigma standard). For the 3-
sigma quality standard, the Upper Control Limit is established by adding a distance
of 3-sigma to the center line. The Lower Control Limit is established by subtracting
from the center line a distance equal to 3-sigma.
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5) To make the control chart operational, we plot the values of the Variable of Interest
taken from Random Samples.
6) Implicit in any control chart are the concepts of Type I and Type II errors.
[“Type I and Type II Errors” are described in a separate document posted on the Black
Board]
VARIOUS DEFINITIONS AND DIMENSIONS OF QUALITY
“Quality” is a multidimensional concept. We discuss below some of these

dimensions.
• Quality as Excellence: attained excellence in a product or service as “perceived

by the customer.”
• Quality as Conformance to Specifications: All specifications, engineering and

otherwise, must be met by the product or service. [Note: Crosby’s definition of
quality is “conformance to requirements” rather than just conformance to
engineering specifications].
• Quality as fitness for use: the design of the product or service should be
appropriate for the conditions and purposes of the user. This definition of
quality has a strong component of product liability and consumer education,
because the company must correctly asses the knowledge, skill, and intentions of
the Consumer. [Think of Customer Requirements or Customer Attributes]
• Quality as Value for the Price: (Value for money; this definition is user specific).
QUALITY-RELATED PRODUCT CHARACTERISTICS
• Reliability: Often measured as a statistically random variable representing the

mean time between failures (MTBF) for some function of a component or for the
entire system. [Compare this definition to the definition of Service Quality as the
difference between PS and ES]
• Durability: is a concept that applies to products that are generally considered

impossible to repair (e.g., automobile headlight). The measure of quality here is
Mean Time to Failure (MTTF).
• Serviceability: How easily a repair can return a failed product or machine to

functional condition.
• Conformance to Design Specifications: (the product, or service, must be faithful

to the engineering design and other specifications desired by the customer).
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• Performance Standards: (e.g., miles per gallon for an automobile).
• Features: (e.g., sunroof in a car).
• Aesthetics: (Color, size, shape etc.)
• Perceptions: (what impressions do the customers obtain regarding the product

or service? You must have heard the proverb: “Perception is Reality.”)
IMPORTANT ISSSUES RELATED TO SERVICE QUALITY
Context: Service Quality [Issues we must consider with respect to the Service
Providing System on the one hand; and the Customer on the other hand].
[Please try to visualize some service or good producing system while reading these
notes].
Issues Related to the Service Providing System
1) Process
Anything that we do, look at, or deal with consists of a Process (i.e., a series of
actions or steps taken to achieve an objective).
2) Process Output
The output of a process is, essentially, a stream of goods or services (which forms a
Population).
3) Population
The output of an on-going process can be considered a Population that consists of a
defined good or service. [e.g., cereal boxes coming off the production line]
4) Dimensions, Attributes, or Characteristics of a Service or Product

Any item, service or product contained in the Population has many different
dimensions, attributes, or characteristics that can be measured or counted. For example,
the Cereal contained in a Cereal Box has, among others, the dimension of weight. In terms
of a service, an ambulance company must consider the dimension of time.
The service provider must consider several different dimensions or characteristics

while designing the Service or Product. We will, however, consider only one attribute or
characteristics while illustrating various issues (e.g., weight or time) [Again, think of
“Competitive Priorities”]
5) Population Distribution
Management 3121
If our focus is on the Process; and assuming that we are concerned with the
characteristic of weight (e.g., weight of a cereal box coming off the production line), then
we must know the nature (e.g., is it a normal distribution?) and behavior (e.g., is it stable?)
of the Population Distribution of Weight. This means that we must find the values of the
µ
two parameters associated with this distribution: Population Mean ( ); and Population
Standard Deviation ( )σ
µ σ
But, to obtain this information (regarding and ) using the entire
Population will be extremely expensive and time consuming. Thus, we must find
some other way (e.g., use Sample Means Distribution) to calculate the values of these
two parameters (i.e., Mean of the Sample Mean, X-bar-bar; and Sample Standard
Deviation, σX-bar ); and then determine the nature and behavior of the Population
Distribution (in terms of µ and σ) of that characteristics that is of interest to us (in
this case, weight of a cereal box coming off the production line). That is, determine
µ
the estimated values of and σ of the Population Distribution of “weight.” [Think
of Central Limit Theorem]
6) Sample Means Distribution

µ σ
To estimate the values of and , we will take several samples from the
Population and calculate their respective Sample Means. That is, we will determine the
Mean weight of each sample (please do not forget that our variable of interest here is
weight). Then, we will calculate the overall Mean from the means of various samples. [(i.e.,
Mean of the Sample Means Distribution)]
If we now plot the values of these sample means, we will obtain a normal
distribution of the variable “Sample Mean” that has its own Mean (X-bar-bar: X) and its
σ
own Standard Deviation (Sigma sub-X-bar: x ). [These are the two parameters of this
new distribution of Sample Means: X-bar-bar; and Sigma-sub-X-bar]
From the samples taken from the Population, we can also calculate “ranges” within each
sample (Ri). These “range” values will also give rise to a normal distribution with its
σ
own Mean (R-bar) [R]and its own Standard Deviation ( R) [Sigma-sub-R]
7) Relationship between the Parameters of the Population Distribution and the

Parameters of the Sample Means Distribution [Central Limit Theorem]
Central Limit Theorem maintains (see my document on Central Limit Theorem

posted on the Black Board) that there exists a relationship between the Parameters of the
Population Distribution and the Parameters of the Sample Means Distribution. This
Management 3121
relationship enables us to estimate the values of the parameters of the Populations
Distribution as soon as we determine the values of the parameters of the Sample Means
Distribution.
8) Process Output (Population) Distribution and Control Limits [Provider’s Eyes]
Control Limits (UCL and LCL) are, and should, always be associated with the Process
Output. The Process Output Distribution, along with specified Control Limits (Quality
Standard) is what is happening on the side of the Service Providing System. This
performance must satisfy Customer Requirements or Customer Specifications.
The two Control Limits for a 3-sigma quality standard will be given as follows [3-Sigma
Quality Standard has a specific meaning or translation. See the Module “3-Sigma versus 6-
sigma Quality” posted on the Black Board]:
UCL = µ+3 σ
LCL = µ - 3 σ
Issues Related to the Customer [Consumer’s Eyes]
1) The Customer pays for a service or product because he or she has certain needs that
will be met or satisfied by the service or the product.
2) These needs or attributes are defined by some specified levels along each dimension
(think of competitive priorities) that is contained in the service or the product (e.g.,
the Target weight of the cereal box should be 16 Oz) [e.g., the Target time for
Ambulance Response Time should be 10 Minutes].
3) It is in the nature of things that the producer or the service provider cannot produce
at the same level or Target (e.g., not each box can weigh exactly 16 Oz). Hence, the
customer requirements or specifications indicate what is known as “Tolerances”
around a given value of “Target.” Thus, in the case of our example, the
specifications might be given as follow:
Specifications: 16oz ± 0.0001oz

With known specifications, we can always
construct the Upper and Lower
Specification Limits. In our case,
Target Tolerances USL = 16.0001
LSL = 15.9999
Responsibility for the Manager
The manager must design the service or product (and the Providing System) in such
a way that the Control Limits associated with the Process Outcome must lie way within the
Management 3121
Specifications Limits stated or implied by the Customer. This will make sure that no
violations of the required Specification Limits can take place.
***Please remember to associate Control Limits with the Process or Process Output.
*** Please remember to associate Specification Limits with the Customer Requirements.
*** Material on Pages 19 and 20 is a repeat of the material already covered. I did not delete
it --- because, in this case, repetition will not hurt your interests.
SOME OF THE ISSUES ON THE PROVIDER SIDE
1) Everything we do or look at is a Process (a sequential series of actions or action

steps).
2) Every Process has outputs or Outcomes: Process Outcome.
3) For any on-going Process, the Process Outcomes constitute a Population.
4) Every Population can be described or represented by a Distribution.
5) Distributions can be continuous (i.e., underlying variable is continuous) or discrete

(i.e., underlying variable is discrete)
[Continuous: subject to Measurement] [Discrete: subject to counting]
6) Any distribution is defined by its Parameters. [For the normal distribution the two
parameters are its Mean (µ) and its standard deviation (σ). [Please note that sigma
here has no subscript] [Population Parameters]
7) It is possible to take Samples from the process (i.e., the Population) and then
calculate their respective Means (Xi). These sample means will give rise to a normal
distribution (Sample Means Distribution]; and this distribution will have its own
Mean (X-bar-bar) [X]; and its own standard deviation (Sigma-sub X-bar)).
[Please pay careful attention to various notations]
*** Before taking samples. Make sure that the Process is STABLE both with
respect to its Mean and Std. Deviation. [Statistical Control] [Assignable Vs.
Common Causes]
*** Before taking Samples, make sure that the Process is Capable of meeting
both the Target and the Width requirements represented by Customer
Specifications. [Issues of Cp and Cpk]
*** Draw a Control Chart [Attributes of a Control Chart] [Issue of Quality
Standard]
Management 3121
8) Central Limit Theorem establishes a relationship between the parameters of the
Population Distribution and the Sample Means Distribution.
9) From the samples taken from the Population (see item 7 above), we can also
calculate “ranges” within each sample (Ri). These “range” values will also give rise
to a normal distribution (Range Distribution) with its own Mean (R-bar) [R]and its
own Standard Deviation (σR)
10) Same arguments and steps apply when we consider Attribute Control Charts [p-
Chart and c-Chart]
11) Somehow, we must get to know the Process Outcome Distribution (i.e., Distribution
of the Population) along with its two Parameters (i.e., µ and σ)
12) We can then calculate, with a given quality standard (e.g., 3-Sigma quality or 6-
Sigma quality), the UCL and the LCL of the Process Outcome Distribution.
SOME OF THE ISSUES ON THE CUSTOMER SIDE
1) Record “Specifications” regarding a Product or Service. Each product or service

will have many dimensions and the customer will record specifications along each
desired dimension (e.g., weight, calories, sugar content, etc.)
2) These specifications can be descriptive or quantitative. If quantitative, each
specification will specify a TARGET and TOLERANCES. Thus, we will have an
Upper Specification Limit and a Lower Specification Limit. [See page 18]
3) The customer wants a service process in which “Perceived Service” exceeds

“Expected Service”.
LIST OF POSTED DOCUMENTS ASSOCIATED WITH CHAPTER 6 [Please don’t be

overwhelmed. Each of the following Modules is essentially a Summary of the concepts
covered in Chapter 6. This material, if you really grasp it, will be helpful to you in all the
remaining Chapters of this text; in several other courses; and in enhancing your analytical,
perceptive, and creative skills].
1) Chapter 6.6: An Overview of Service Quality.
2) Chapter 6.7: Areas under the Normal Curve.
3) Chapter 6.8: Meaning of “Chance” in the Context of a Normal Distribution.
4) Chapter 6.9: Standard Deviation and Variance: 4 Cases.
5) Chapter 6.10: Achieving Statistical Control.
6) Chapter 6.11: Building Control Charts plus Summary Table.
7) Chapter 6.12: Control Charts Diagrams and Sample Means Distributions.
8) Chapter 6.13: Patterns of Sample Data in Control Charts.
Management 3121
9) Chapter 6.14: Four Control Charts and 6-Sigma Quality.
10) Chapter 6.15 “3-Sigma” Versus “6-Sigma Quality.”
11) Chapter 6.16: Central Limit Theorem.
12) Chapter 6.17: SERVQUAL- 22 Statements.
13) Chapter 6.19: QFD-House of Quality: Service Example.
14) Chapter 6.20: Type I and Type II Errors.
15) Chapter 6.21: Taguchi’s Quality Loss Function.
16) Chapter 6.22: Values of Constant Table.
17) Chapter 6.23: Building Range and X-bar Control Charts-An Illustrative Example.
18) Chapter 6.25: Costs of Quality.
19) Chapter 6,26: Quality GAP Model: A Modified Figure.
20) Chapter 6.27: A SIMPLIFIED VERSION OF EXPLAINING THE TWO
CAPABILITY INDEXES [Cp and Cpk][Your text covers this material in Chapter
7]

Fitzsimmons 8-Chapter 6.1-Black Board Notes-Service Quality-Fall 2018

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Fitzsimmons 8-Chapter 6-Blackboard Notes (Service Quality) 1

1) Five Dimensions of Service Quality: [Reliability, Responsiveness, Assurance,

2) Responsiveness [The willingness to help customers and to provide prompt

*Willingness to help Customers

3) Assurance [The Competence (required knowledge and skills), and Courtesy of

Assurance: ***Projecting an image that the service provider has best

Competence: Required Knowledge and Skills.

Courtesy: Politeness; Respect; Consideration; Friendliness.

4) Empathy [The provision of Caring and Individualized attention to customers]

Caring and Individualized Attention to Customers

5) Tangibles [The Clean Appearance of physical facilities, equipment, personnel,

TANGIBLES Clean Appearance of Physical Facilities, Equipment,

*****Desired Outcome: PS should be greater than ES [PS > ES]

Expected Versus Perceived Service Quality [SERVICE GAP]

Dimensions of Expected Perceived Service Quality

• “Customer Satisfaction” Survey is an instrument for measuring “Overall”

***** “Customer Satisfaction” Survey measures Overall service quality.

• Customer Satisfaction [Measured by GAP 5] is dependent on minimizing Gaps 1

Gap 1 (Market Research Gap) [Understanding the Customer] [What

Gap 2 (Service Design Gap) [Understanding Service Quality in terms

Gap 3 (Conformance Gap) [Actual service does not meet service

Gap 4 (Communication Gap) [Lack of adequate information provided

Measuring Service Quality [SERVQUAL Instrument: A tool to measure the five

Used in marketing surveys to compare service quality with a competitor

Used to identify a poor-quality unit for firms having multi-site services

Walk-through Audit (WtA)

Comparison of Customer Satisfaction Survey with a Walk-through Audit

The Walk-Through Audit as a Diagnostic Instrument

Service Quality by Design [Build-in Quality]

1) Incorporation of Quality in various elements of the Service Package

3) Poka-Yoke Methods (Failsafing)

• Poka-Yoke, translated roughly as “mistake-proofing,” refers to devices or methods

Service Provider Errors [The three T’s of Service Design]

1) Task [use of a French fry scoop] [Task Poka-Yoke]

4) Quality Function Deployment [How best to deploy resources to insure quality]

• A process called “Quality Function Deployment” is used to provide customer input

Do you remember Gap 2 “Design Gap” in the Service Quality Gap

Customer Expectations (regarding the five dimensions of Quality) [VOICE OF THE

• The House of Quality provides a framework for translating Customer Attributes

Translation: Meet or exceed Customer Expectations in terms of Reliability,

• Please see my notes on “House of Quality” contained in a separate document posted

Achieving Service Quality

• Quality-inspection intervention between the customer and the contact employee is

Four categories of “Cost of Quality” identified by Joseph M. Juran: They are:

Statistical Process Control

• The concept of Statistical Control [Obtaining a state of control in any process to

CONTROL CHARTS (Graphical Device to monitor the output of a Process)

1) Decide on some measure of service system performance (e.g., Ambulance

1) Variable Control Charts [record measurements that focus on

2) Attribute Control Charts [record discrete data such as the

Important Attributes of Service Guarantee

A Service Guarantee promotes organizational effectiveness in several ways:

1) INSPECTION [Quality checked before and after service is delivered] [Reference

2) STATISTICAL PROCESS CONTROL [Quality assurance before, during, and

3) QUALITY TRAINING PROGRAMS [Employee empowerment and

4) COSTS OF QUALITY [Quantifying the cost of poor quality] [Prevention Costs,

5) UNCONDITIONAL SERVICE GUARANTEE [Operations and Marketing

6) QUALITY SERVICE BY DESIGN [Design service process for robustness and

7) QUALITY FUNCTION DEPLOYMENT [Define Voice of the customer (Service

• A quick resolution to service failure is an important way to create loyal customers

Approaches to Service Recovery

1) The Case-by-Case approach [Each case creates different requirements for