Measuring Service Performance

Practical Research for Better Quality

Ralf Lisch

• Publisher: Routledge
• Year: 2016
• Print ISBN:
  9781032836966
• eBook ISBN:
  9781317099093
• Topic: Business
• Subtopic: Business General
• Index: Business

In service societies, the tertiary sector has long become the primary sector in terms of GDP and employment. Quality research and testing means better service, and success in the service industries demands quality. Nonetheless, complaints about insufficient, inconsistent or bad service abound. Quality decides on success and failure. Where so much is at stake, management decisions call for systematic research and consumers look for relevant results that provide guidance in complex markets. Research into quality and customer satisfaction gets to the core of a business. However, many so-called studies hardly meet essential criteria of empirical research and deliver artefacts rather than facts. This book puts an end to common misconceptions of quality studies. Measuring Service Performance is an appeal for an approach to quality research that meets quality criteria itself. It is a compelling argument against widespread but rather dubious dealings with measurement, data and statistics. Ralf Lisch calls for a reconsideration of the research process, focussing on content instead of method and adding meaning to results. Because service excellence deserves research excellence. Written in a practical, accessible style, the book offers practitioners as well as market researchers, MBA students and others involved in the service sector a critical analysis and discussion of the essentials of 'Practical Research for Better Quality'.

CHAPTER 1 Introduction

Much has been said about quality. Many authors have tried their hand at an understanding and definition of the nature of quality. Consultants never tire of promising guidance on the road to quality and books offer magic formulas on how to turn a lacklustre performance into quality service. Everybody has some ideas of what makes quality. Nevertheless, almost every day we experience disappointment when despite all promises the provided service quality does not meet our expectations. Even worse, quite often we cannot avoid the impression that the general service level is declining.

No doubt, the demand for quality studies is great. Bosses want to know how competitive the service is that their company provides. Customers look for quality information before they make a decision for one or the other service provider. Consumer organizations claim to safeguard the interests of customers and want to provide related advice. Journalists look for a good story and may jump on some service failure. They have all very different approaches to service quality. Bosses will refer to customers with whom they have talked. Consumers may have talked to their friends who have heard which service provider is good and which one is bad. Consumer organizations claim to know what consumers want and rate service performance like judges. And journalists pick up some service failure, dramatize it and do not hesitate to pillory a whole industry. They will all claim that they have collected sufficient information to make serious statements about service performance and how to improve quality. But sound research looks different.

To avoid possible misunderstandings right from the start, this book abstains from offering any panacea as a quick fix for all service shortcomings. Instead, it goes back to the original meaning of quality. Quality has its roots in Latin ‘qualitas’, which again derives from ‘qualis’ meaning ‘of what kind’. Exactly that is the essential question: of what kind is a specific service performance? Does it meet expectations? Is it just so-so or does it have the certain something that turns an average performance into great service? Quality is the crucial question that determines customer satisfaction and decides on success or failure of service providers. Quality is a management task and a matter of attitude. At the same time, it requires a permanent follow-up by means of Measuring Service Performance – Practical Research for Better Quality.

Applied quality research and testing is a path to sustainable improvement and better service performance. This is not only required by quality management standards like ISO 9001 demanding ‘measurement, analysis and improvement’ but it is a naturally required feedback along the process of service performance. Of course, empirical research is not the only way to get such feedback. There may be gifted managers who have the gut feelings that provide the necessary feedback as well. But being dependent on gut feelings would not only be a rather unsystematic approach, it would also be risky because it lacks reliability and in many cases also validity – criteria that are essential elements of the methodology of empirical research. It makes sense to challenge what the boss presents as his ultimate knowledge about service quality and undertake systematic empirical research. As a matter of fact, the world of the service provider and the world of the customer look rather different. Here, empirical research has an essential function as understandable and reproducible intercultural approach to a reconstruction of service reality.

Of course, quality research can fulfil this important function only when the research approach itself meets essential quality criteria. But exactly these are often – too often – not met. The reasons are manifold. Companies may approach such studies without a thorough understanding of the methodology of empirical research. Perhaps they approach social phenomena with a technical understanding of measurement or they miss the very point that questions in daily conversation are different from questions in a research interview. It may be a rather formal attempt to meet the requirements of the ISO standard without asking what measurement actually means. Or the research and development (R&D) budget is so tight that it does not allow for more than some trivial inquiry. And sometimes, service-related quality research serves more the purpose of an alibi than an epistemological approach to a better understanding of the market position and potentials for future developments. Epistemology from Greek ‘episteme’ and ‘epistasthai’ means to know how to gain knowledge. That is exactly what is needed – an understanding of how to arrive at a better knowledge of service quality.

Creative and methodologically sound empirical research is an essential basis for decision-making and an eye-opener for innovative potential. No doubt, practical research has to compromise sometimes – on budget restrictions or on feasibility. The real world is often not as ideal as described in the textbooks. Nevertheless, this is not an obstacle that prevents meaningful research. There is still enough room for creativity and a huge epistemological potential that just has to be exploited – in the interest of customer satisfaction and for the better of the service provider.

This book will assist practitioners in or related to the service industry to develop a more appropriate methodological understanding in the interest of meaningful quality research. It is about quality as success factor and intended as a critical contribution to a more creative and relevant analysis of the quality of services. The ultimate target is to develop the necessary knowledge that is required to improve service quality and stand out from the crowd – improving the market position as a result of better quality and higher customer satisfaction.

The target group of this book comprises quality managers and market researchers, MBA students and consumer organizations as well as journalists who deal with related studies. At the same time, it provides top managers in the service industry with a better understanding of what quality research can achieve. Furthermore, it offers a critical view of quality studies that time and again come along with the claim to the ultimate truth about service quality.

The text draws substantially on the author’s experience from three sectors. Firstly is theoretical and practical experience from many years of academic research in methods and methodology of empirical research and statistics that resulted in several books and other publications. Secondly, are many years as head of department for the comparative testing of services at Stiftung Warentest (www.test.de), which is Germany‘s best-known consumer organization. During this time, a wide variety of service topics were analyzed in conjunction with the further development of the methodology and methods of comparative testing of service quality. The results of the research work were published in the consumer magazine test. Apart from the great public interest that these publications roused, several projects triggered significant changes to specific service segments. Soccer stadiums were modified after a study about panic safety found substantial shortcomings. Charitable organizations changed their concept after a test of sponsorships for children raised serious doubts about this type of aid to developing countries. The quality of the after-sales service of household items improved substantially after a first test had shown disappointing results. Tests of the quality of advice in pharmacies triggered comprehensive discussions and resulted in changes to the service processes in pharmacies. Market shares changed after an analysis of games of chance. These are only some examples that show how powerful quality research can be. Last but not least, long-term practical management experience in the global service industry has contributed to this book. All three factors together provide the backdrop for the following discourse on practical quality research.

Writing a book about practical research is to some extent a balancing act. The academic world may miss some elaborated details and latest scientific knowledge while those who deal with practical research in the midst of all kind of constraints may deem some topics too demanding. After all, they have to deliver results that are comprehensible and relevant, find acceptance among their recipients and contribute to decision-making.

This book is written for practitioners. Intentionally, it abstains to a large extent from providing mathematical and statistical formulas. While formulas provide a precise, logical and highly efficient language for the description of facts and relations, they also have the potential to frighten readers who do not feel comfortable in the world of mathematics. Furthermore, computers make it largely unnecessary to deal with detailed formulas as long as the meaning and the crucial issues behind statistical models are understood. And this can also be imparted by means of common language.

To avoid misunderstandings and expectations that eventually cannot be met, it shall be highlighted that it is not the idea of this book to provide a handbook of empirical research and statistics. Above all, this book looks at practical research from a methodological perspective. It is about the meaning behind the actual research and the essential distinction between research results as facts and artefacts. This book understands research as a complex decision-making process that targets the reconstruction of social reality. The ultimately decisive factor is the practical relevance of the research results for entrepreneurial action on one hand and consumer behaviour on the other.

Measuring service performance is a complex topic with highly interdependent elements. In the interest of comprehensibility and readability, the structure of the book is to a large extent a reflection of the research process. But before we enter into the methodology and methods of quality research, the next chapter will first provide an introduction into the characteristics of service and the significance of the so-called tertiary sector – which is in developed economies actually the primary sector in terms of employment and GDP. We describe services as people business and look at service performance as a communication process. From there, we develop a distinctive approach to practical research and discuss the various perspectives of quality studies.

The following discussion of research methods will start where every research starts – with some thoughts about the research question and the research design. This makes it necessary to look at the various stakeholders in quality research and the impact of their specific perspective on the research design. Ultimately, it is about the essential question of what reality is. From there it is only a small step to the practical research process and how to manage it. This requires some thoughts on research economy and cost management and also a word on how to integrate research into the organization.

A major part of this book is dedicated to methodological questions. What may appear rather theoretical at the first glance is actually full of practical relevance. It describes research as a process and discusses what it means to ‘measure’. Some common misunderstandings of empirical research as well as basic research requirements will be analyzed before common practical problems like reactivity, the non-response bias, missing data, outliers and their effects on research results are discussed. Furthermore, we deal with the concepts of operationalization, indicators and indexes before we move on to famous scales, rankings, trend analyses and intercultural comparisons as special approaches. Eventually, we are pretty well prepared to steer clear of some treacherous shoals of empirical research.

Of course, almost all research questions deal with a statistical population that is too large to include all its elements in the analysis. That’s why we work with samples and try to generalize the results. This demands a discussion of representativeness, which is one of the most often misunderstood concepts in research. And just because representativeness has become something like the accolade of empirical studies, we remind of the benefits of case studies as an alternative to representative studies. We discuss also the question of how a sample can be drawn and how many cases are actually required in order to arrive at representative and valid research results.

After these methodological considerations, empirical research means data collection. And this comprises much more than the usual survey by means of interviews. We discuss a variety of empirical research methods – those that can be considered classical methods of social sciences as well as some that have been developed specifically for quality research. The crucial point is the understanding that every method constitutes a partly different reality, which makes the decision for an adequate method of empirical research so important.

Once data collection is completed, the researcher will sit before a bundle of interviews, protocols or other records and scratch his head. After all, it was not the intention to add to the complexity of the business situation and to multiply information but to reduce it to its essence. Research is about reducing information under consideration of relevance. We look at basic concepts of data analysis and some statistical models.

Highlighting the issue of relevance of research results, the question arises of how to transfer the findings of a quality study either to the management of a service provider or to consumers. After all, research results without related social action would be rather irrelevant. So the researcher has to consider how to present his research results. How to impart the findings best? How much statistics can the recipients take? And what reaction can one reasonably expect? Depending on the recipients of research results, we deal with different aspects of utilization. In any case, it is about changes to social behaviour.

As a conclusion, the last chapter is an appeal for quality research that meets quality criteria itself. It is a committed call for a reconsideration of quality research that is driven by a widespread but nevertheless inappropriate mechanistic understanding of the research process that focuses on methods instead of contents. It is an outlook on how to realize the knowledge of the book and add meaning to practical research work.

Throughout the book we’ll work with a number of examples for illustrative purposes. They are not specific for a certain sector of the service industry but can easily be generalized and transferred to other sectors. At the same time, the book abstains from providing an ‘ideal’ or ‘perfect’ project. There is none. And reading the following chapters, it will quickly become clear why there cannot be any ultimate project. However, the following pages pave the way to a better understanding of quality research that will ultimately lead to better quality.

Critical readers may raise their eyebrows when they find that most of the examples in this book make use of the male gender – he instead of she. For the sake of political correctness, I would like to state that this is neither intended as an act of discrimination nor does it refer to any supposed gender roles. Instead, it is solely a contribution to better readability. It is at the discretion of the distinguished reader to replace he by she and vice versa.

Before we move on, I would like to express my sincere thanks to everybody who contributed one way or the other to this book. While not everybody can be named, I would like to emphasize at least a few names. A lot of my critical methodological understanding of empirical social research is owed to Jürgen Kriz¹ while I made once my first attempts to practical research under the guidance of Ansgar Weymann who has also kindly written the Foreword to this book. Over many years we have had numerous discussions and worked together in several empirical projects sharing especially the understanding that there is no contradiction between the requirements of practical research on one hand and a methodologically sound research design on the other.

Furthermore, I would like to mention Georg Sieber² with whom I cooperated in a number of projects and who was successful in finding in any research question the psychological component, which often added a captivating perspective to otherwise rather ordinary topics. These projects were the best proof that empirical social research is much more than sometimes rather boring surveys.

Here, also an encyclopedia on research methods and statistics shall be mentioned that I once published together with Jürgen Kriz (Kriz and Lisch 1988). Even 25 years after that book was written, it turned out to be surprisingly up to date and was of great help when preparing this manuscript. The fundamental chapters at the beginning of the encyclopedia, which were written by Jürgen, were especially of great help when writing some parts of this book. Furthermore, Jürgen had a critical look at several chapters of the manuscript despite his busy schedule. For all his support, I would like to express my sincere thanks.

I would also like to thank Martin West, Donna Shanks, Emily Pace, Kristina Abbotts, Christine Muddiman, Charlotte Parkins and the whole Gower team for their support and great cooperation that I enjoyed while working on this project.

Last but not least, I thank my wife, Ting Suk Yuan, for her great support and patience. She is always a curious and critical reader. Her remarks, questions, ideas and recommendations have substantially contributed to this text and helped to improve its readability. I am very grateful for her support.

1 Jürgen Kriz is Emeritus Professor of Psychotherapy and Clinical Psychology at the University of Osnabrück, Germany. Partly overlapping with his clinical chair, he held also chairs in research methods, statistics and philosophy of science at several universities and is still working as senior advisor for research methods in international university projects.

2 Georg M. Sieber is the founder of a psychological think tank under the name Intelligenz System Transfer, Munich, Germany.

CHAPTER 2 Services and Challenges

With all due respect to Mr Ford, his judgement was a bit too optimistic when he allegedly claimed that ‘a business absolutely devoted to service will have only one worry about profits. They will be embarrassingly large.’¹ Also, Mr Shakespeare probably vastly exaggerated in his Comedy of Errors when he let Dromio of Ephesus wail about his fate as service provider: ‘I am an ass indeed; you may prove it by my long ears. I have served him from the hour of my nativity to this instant, and have nothing at his hands for my service but blows. When I am cold he heats me with beating; when I am warm he cools me with beating’ (Act IV, Scene 4). Well, being at others’ service can be tough. Nevertheless, it is a matter of fact that no company will prosper long term without rendering good service. Providing great service is an art that requires an empathetic understanding of social behaviour as well as a permanent drive for improvement on one hand and deserves recognition and appreciation on the other.

Service quality is an essential element of business success. That applies to genuine service companies as well as to manufacturers. At the same time, complaints about poor service are nothing unusual and in some service sectors one cannot avoid the impression that companies try to substitute service quality for lower prices. Germans use the term ‘Dienstleistungswüste’ [service desert], which describes an insufficient dedication to services and related customer requirements. Improved service quality is needed in order to stand out from the crowd of service providers and, in many cases, customers are even willing to pay for better service. Better service quality can pay off.

Service has many facets. Everybody has some experience with services – when going to the hairdresser, into a restaurant, to the doctor, to church, renting a car, moving house, going for vacation, you name it. We live in a service society. We provide services by doing work for someone, assist...

Table of contents

• Cover Page
• Title Page
• Copyright Page
• Contents
• List of Figures
• List of Tables
• About the Author
• Foreword: Service Performance and the Quality of Life
• 1 Introduction
• 2 Services and Challenges
• 3 Framework and Design
• 4 Methodology
• 5 Samples and Generalization
• 6 Collecting Data
• 7 Analyzing Data
• 8 Presenting Results
• 9 In a Nutshell
• Bibliography
• Index