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MNM1502 Study Unit 5

The document discusses types of service failures customers may experience, different types of complainers, and steps in the service recovery process including anticipating complaints, acting quickly to solve problems, empowering employees, learning from experiences, and determining fail-safe future services to prevent issues. It also outlines dimensions to consider during service encounters like timeliness, apologies, empathy, atonement, and follow-up.

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Kirthi Singh
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68 views23 pages

MNM1502 Study Unit 5

The document discusses types of service failures customers may experience, different types of complainers, and steps in the service recovery process including anticipating complaints, acting quickly to solve problems, empowering employees, learning from experiences, and determining fail-safe future services to prevent issues. It also outlines dimensions to consider during service encounters like timeliness, apologies, empathy, atonement, and follow-up.

Uploaded by

Kirthi Singh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Customer Service

MNM1502

Study unit 5
Managing service-related issues
Service failure

• Service failure can be defined as “a flawed


outcome that reflects a breakdown in
reliability”, or in other words the delivery of
service was below the level of service that the
customer expects
• Two components of service failure
– the way in which the service was presented to the
customer and
– the end result the customer received.
Service failure

• Customer’s level of expectation plays a vital


role in determining the success of the
customer service received

• Customers form their own perceptions, and


therefore it is the organisation’s responsibility
to understand these expectations and how
best to satisfy them
Service failure

• Loyal customers are taught to expect a certain


standard of service quality through extensive
relationship-building strategies

• Customer service employee may slip up and


not meet a customer’s expectations
Types of service failures

• Services do not exist


• Poor service management
• Salesperson does not respond to the
customer’s implicit or explicit needs
• Faulty tangible cues
• Unclear return/refund procedures
Types of service failures

• Unacceptable employee behaviour


• Insufficient data-capturing and administrative
systems
• Purchase price listed is incorrect
• Confusing/misleading marketing
communication
• The product is faulty
Service dimensions during the service
encounter
Types of complaints

• Complaints based on expected outcomes:


– Instrumental complaints are complaints which
are made in an attempt to change the current
situation or state of affairs.
– Non-instrumental complaints are complaints
that are raised but with the customer having no
expectation that the current situation will be
changed.
Types of complaints

• Two sources of service failure complaints:


– Ostensive complaints – complaints made by a
customer that are focused away from the
customer and towards another person/object or
situation.
– Reflexive complaints – complaints that are made
by an individual which are directed at themselves,
thus taking responsibility for being the source of
the problem.
Types of complainers

1. Passive complainers
– Not aggressive and are customers who are
dissatisfied with the organisation’s service but
generally will not voice their opinion.
– Customers believe that communication with the
organisation will be of no use, for several different
reasons including personal values, and they
believe that the time and effort they put into
complaining will not be beneficial
Types of complainers

2. Voicer complainers
– Customers who are generally very loyal to the
organisation and believe their complaints will benefit
the organisation and society at large.
– Valuable to the company, therefore their feedback is
valued and there are channels in place to voice their
complaints.
– Voicers are vocal about the poor service they
received, but because of their loyalty to the company,
they will not speak negatively about the organisation
in public or to friends and family.
Types of complainers

3. Irate complainers
– Are alienated from the organisation and generally
frustrated, and look for every opportunity to spread
negative word-of-mouth to friends and family
about the poor service they received.
– They will complain to the organisation but they are
not brand-loyal and will switch suppliers if
necessary
Types of complainers

4. Activist complainers
– Going public and involving not only friends and
family with negative word-of-mouth, activists are
on a mission to spread the news about their poor
experience to a third party (for instance, the
Consumer Complaints Commission).
– Genuinely believe that that their complaint will
have a positive effect on service recovery, yet they
are viewed as “complaint terrorists” by most
Service recovery

• Anticipate and welcome complaints.
Step 1

• Act quickly to solve the problem.
Step 2

• Empower employees and customers.
Step 3

• Learn from recovery experiences.
Step 4

• Learn from recovery and lost customers.
Step 5

• Determine fail‐safe future services.
Step 6
Steps in the service recovery process
Action Description
Step 1 Anticipate and • Organisations must be open to hearing the opinions of customers
welcome and receiving feedback from them regarding the service they
complaints. received.
• Formal research or informal research
Step 2 Act quickly to • Complaints taken seriously, resolved timeously using organisational
solve the procedures
problem. • A formal procedure could include responding to complaints over the
telephone or by e-mail, whereas informal procedures can be handled
by a salesperson on the sales floor.

Step 3 Empower • Empowering employees with the necessary training and the
employees understanding of how to handle a customer complaint is crucial.
and .
customers.
Steps in the service recovery process

Step 4 Learn from • view complaints as learning experiences and benchmarks not only for
recovery improving service recovery procedures but also as opportunities for
experiences. employees to better their problem-solving skills.

Step 5 Learn from • Asking questions to learn about the situation will assist the
recovery and organisation in determining how important the customer is/was.
lost 1. Identify who the customer is.
customers. 2. Determine the worth of the customer.
3. Determine the costs associated with losing the customer.

Step 6 Determine • Management should always strive to improve on service delivery for
fail-safe both tangible products and intangible/service products.
future
services.
Service dimensions during the service
encounter
Time The quicker an organisation can react to resolving a problem or apologising, the
potentially higher customer satisfaction levels are

Apology Most customers appreciate a personal apology from the sales employee,
showing that the employee recognises the inconvenience caused and gives an
explanation of the cause of the service failure
Empathy A customer must feel that they are receiving individualised attention and that the
employee truly does have empathy with them and the situation

Atoneme Atonement is the “value-added compensation” that customers could expect


nt from the organisation once they have experienced a service failure.

Follow- Follow- up once the service recovery process has taken place. It can increase
up customer satisfaction levels and reduce the likelihood of brand switching
Managing service failure and recovery

• Give a voice to customers


• Take the customer seriously
• Ask the customer
• Customer service training
• Customer complaints strategy
• Gesture of atonement
• Standardise frequent complaint procedures
• Fair treatment from both sides
Handling customer complaints

1. Give your full attention to the customer


2. Give them time to blow off steam without
interrupting them
3. Body language speaks
4. Approach an unhappy customer
5. Apologise and mean it
Handling customer complaints

6. Resolve the problem


7. Assurance
8. Escalate the matter
9. Thank the customer
10. Be sure to follow up

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