A Report About Service Failure And Methods Of Recovery

Terms Of Reference

This report has been commissioned by the group operations director to enable primary decisions to be made regarding future management policy/change in the area of service failure/recovery.

The justification for this report is:

There is a current trend in service failure, resulting in possible unnecessary customer dissatisfaction.

Customers are becoming increasingly aware of their rights and demand increasingly better quality service.

Service recovery techniques have been employed to great effect by other companies and it would be foolhardy to not investigate if these could be utilised by this company.

Contents

Terms Of Reference 1

Contents Page 2

Abstract/Executive Summary 3

Introduction -

1.0 Introduction To Customer Satisfaction 4

3.0 Customer Expectations 4

2.1 100% Defect Free Service? 5

2.2 W.Edwards Deming 5

1. Introduction To Service Failure 5

1.1. The Three Types Of Service Failure 6

1.1.1. Based On Service Ability 6

1.1.2. Based On The Nature Of The Problem 6

1.1.3. Based On The Type Of Service 7

3.2 Service Failure Measureability 7

4.0 The Aim Of Service Recovery 7

4.1 The Benefits Of Service Recovery 7

4.2 Forms Of Service Recovery - Lockwood & Deng 8

4.3 Bell & Zemke 8

4.4 Bitmer Et Al. 9

4.5 Lockwood & Deng - Reliability & Results 9

5.0 Conclusion 11

6.0 Suggestions For Further Research 13

Bibliography 14

Abstract/Executive summary

Although customer satisfaction is one of the ultimate goals of this company it is not always successful in achieving this. Service failures will always occur due to the nature of the business that we are in. This report reviews existing literature on the subject and shows that there have been many different philosophies written on the subject of service recovery, and, recommendations of what should be done when failure occurs. These papers all have a similar goal to be achieved through service recovery - to give ultimate customer satisfaction wherever reasonable to regain repeat trade and generate future business.

There is a focus on the work of Andrew Demind and Ni Deng - their journal article "Can service recovery help when failures occur", Is a valuable source as it gives results of surveys undertaken in hotels where service recovery has been utilized and demonstrates the difference of customer satisfaction both before and after service recovery has been practiced.

In essence, once a service failure has been discovered, a clear strategy to recovery is desirable in order to minimise any risk and maximise recovery. It has been demonstrated that service recovery can have positive results including increased customer satisfaction, loyalty & repeat custom.

The conclusion of this paper is that service recovery is a valuable tool, and should