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All economic activities whose output is not a physical product, is generally consumed at the time it is produced and provides added value in forms (such as convenience, amusement, timeliness, comfort or health) that are essentially intangible concerns of its first purchaser

Health Care Professional Services Financial Services

hospital, medical practice, dentistry, eye care
accounting, legal, architectural banking, investment advising, insurance restaurant, hotel/motel, bed & breakfast, ski resort, rafting airlines, travel agencies, theme park



hair styling, pest control, plumbing, lawn maintenance,

counseling services, health club

Source: A. Parasuraman, V.A. Zeithaml, and L. L. Berry, A Conceptual Model of Service Quality and Its Implications for Future Research, Journal of Marketing 49 (Fall 1985), pp. 4150.

intangibility: difficult to sample and to evaluate inseparability: difficult to separate services from the service provider; mainly direct sales; staff are essential to the delivery of quality services heterogeneity: virtually every service is different; very difficult to standardize quality perishability: those not sold can not be stored fluctuating demand: demand for some services fluctuates by season, or even by time of day.

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Services cannot be inventoried Services cannot be patented Services cannot be readily displayed or communicated Pricing is difficult

Service delivery and customer satisfaction

depend on employee actions Service quality depends on many uncontrollable factors There is no sure knowledge that the service delivered matches what was planned and promoted

It is difficult to synchronize supply and demand with services Services cannot be returned or resold

1) End-user Services can be classified into the following categories: Consumer: leisure, hairdressing, personal finance, package holidays. Business to business: advertising agencies, printing, accountancy, consultancy. . Industrial: plant maintenance and repair, work wear and hygiene, installation, project management.

2) Service Tangibility The degree of tangibility of a service can be used to classify services: Highly tangible: car rental, vending machines, telecommunications. Service linked to tangible goods: domestic appliance repair, car service. Highly intangible: psychotherapy, consultancy, legal

3) People-based Services Services can be broken down into labourintensive (peoplebased) and equipment-based services. This can also be represented by the degree of contact: People-based services - high contact: education, dental care, restaurants, medical services. .Equipment-based -low contact automatic car wash, launderette, vending machine, cinema.

4) Expertise The expertise and skills of the service provider can be broken down into the following categories: Professional: medical services, legal services, accountancy, tutoring. Non-professional: babysitting, care taking, casual labour

5) Profit Orientation The overall business orientation is a recognized means of classification: Not-for-profit: The Scouts Association, charities, public sector leisure facilities. Commercial: banks, airlines, tour operators, hotel and catering services.

Service as a process Do it right the first time Speed! Speed!! Speed!!! Keeping customers perspective always!

The customers judgment of overall excellence of the service provided in relation to the quality that was expected. Process and outcome quality are both important.

Ability to perform the promised service dependably and accurately. Knowledge and courtesy of Assurance employees and their ability to convey trust and confidence. Physical facilities, equipment, and Tangibles appearance of personnel. Caring, individualized attention the Empathy firm provides its customers. Responsiveness Willingness to help customers and provide prompt service.


In groups of five, choose a services industry and spend 10 minutes brainstorming specific requirements of customers in each of the five service quality dimensions. Be certain the requirements reflect the customers point of view.

Reliability: Assurance: Tangibles: Empathy: Responsiveness:

SERVQUAL Attributes


Providing service as promised Dependability in handling customers service problems Performing services right the first time Providing services at the promised time Maintaining error-free records

Employees who instill confidence in customers Making customers feel safe in their transactions Employees who are consistently courteous Employees who have the knowledge to answer customer questions



Keeping customers informed as to when services will be performed Prompt service to customers Willingness to help customers Readiness to respond to customers requests

Giving customers individual attention Employees who deal with customers in a caring fashion Having the customers best interest at heart Employees who understand the needs of their customers Convenient business hours Modern equipment Visually appealing facilities Employees who have a neat, professional appearance Visually appealing materials associated with the service


Customers have different expectations re services or expected service Desired service customer hopes to receive Adequate service the level of service the customer may accept DO YOUR EXPECTATIONS DIFFER RE SPUR and CAPTAIN DOREGO?

Figure 3-1

Dual Customer Expectation Levels

(Two levels of expectations)
Desired Service Zone of Tolerance

Adequate Service

Figure 3-3

Zones of Tolerance VARY for Different Service Dimensions

Desired Service

Level of Expectation

Zone of Tolerance
Adequate Service

Desired Desired Service Service Zone of Tolerance Adequate Adequate Service Service

Most Important Factors Least Important Factors Source: Berry, Parasuraman, and Zeithaml (1993)

Figure 3-5

Factors that Influence Desired Service

Enduring Service Intensifiers

Desired Service Personal Needs Zone of Tolerance

Adequate Service

Personal needs include physical, social, psychological categories Enduring service intensifiers are individual, stable factors that lead to heightened sensitivity to service This can further divided into Derived Service Expectations and Personal service Philosophies

Figure 3-6

Factors that Influence Adequate Service

Transitory Service Intensifiers
Desired Service Zone of Tolerance Adequate Service

Perceived Service Alternatives

Self-Perceived Service Role

Situational Factors

Transitory service intensifiers temporary a computer breakdown will be less tolerated at financial year-ends Perceived service alternatives Perceived service role of customer Situational factors

Figure 3-7

Factors that Influence Desired and Predicted Service

Explicit Service Promises Implicit Service Promises Word-of-Mouth

Desired Service Zone of Tolerance Adequate Service

Past Experience

Predicted Service