‘Service should be hi-tech and hi-touch’

A Parasuraman, who holds the James W McLamore chair in marketing at  the Univeristy of Miami School of Business, has devoted the lion’s share of his career to researching the quality and delivery of service offered by companies to their customers.

He, along with Leonard Berry and Valarie Zeithaml, developed SERVQUAL, a service quality framework, in the mid-80s.

In Mumbai  recently to speak at a conference organised by Custommerce, a think tank whose board he is on, he discussed with DNA’s G Seetharaman the folly of companies in assuming their customers’ needs and using technology to improve service. Excerpts:

You mentioned in your studies that there is a huge gap between how companies look at the service they render and how customers look at the same. Are companies waking up to this?
The gap I refer to is the disconnect between customers’ actual service expectations and what companies apparently assume those expectations to be. Ironically, while most customers would be satisfied if companies just deliver the service basics correctly (eg, being courteous to customers, providing the service exactly as promised and on time, etc), companies seem to ignore the basics while at the same time adding service “bells and whistles” that may be meaningless — if not annoying — for customers who aren’t even getting the basics. For instance, what is the point
in a bank having an attractive lobby with potted plants and plush carpeting when the bank personnel are incompetent,
unprofessional and constantly making mistakes?

Could you give us examples of a global company and an Indian one that have successfully bridged the gap and how?
A highly successful global company that believes in — and consistently delivers — excellent customer service is FedEx. Its basic business philosophy or motto is “People-Service-Profit” (PSP for short). PSP is well-ingrained and constantly reinforced in the company’s corporate culture. An Indian company that I consider to be an excellent service provider is Kingfisher Airlines.

How effective are the measures developed to gauge the efficiency of a service offered by a firm?
Customer metrics that companies rely on to assess their service are dominated by easy-to-measure, outcome-focused metrics — the average time taken to answer a phone call; the number of customers served per hour; etc. Although such metrics can offer useful insights when tracked over time and across companies, they are primarily efficiency-driven rather than customer-driven. Customers’ assessments of their overall experience with a company are influenced heavily by the quality of their interactions with companies.  Companies who are truly customer-focused should augment outcome-oriented metrics with process-oriented ones, even if the latter may not be as readily available and quantifiable. For instance, systematically listening to and/ or observing a representative cross-section of customer-
employee interactions will provide more insightful information about the level of customer service than will merely monitoring the duration of such interactions.

How have Indian firms grown in terms of attitude to customers and importance attached to customer service?
At a macro level, increased competition and globalisation have, I believe, increased the sensitivity of Indian companies to customer service. However, just as in other countries, I think the emphasis on and level of customer service likely varies among companies.

You spoke of instances when companies do things they perceive their customers want, when the latter actually don’t. How do you solve this in a heterogeneous country like India?
As I mentioned in my response to one of your earlier questions, companies — with perhaps good intentions — invest in so-called service enhancements that don’t really do much for their customers, especially when the customers’ basic service expectations are not being met. For instance, a major high-end hotel in Madrid, Spain where I stayed several years ago, had an attractive “pillow menu” that offered guests a choice of nine different types of pillows. Yet, during my stay at this hotel, a series of critical failures with the basic service (eg, failure to provide a wake-up call at the designated time) marred my overall experience. This hotel was incurring a great deal of expense, presumably to pleasantly surprise guests with the choice of pillows. Unfortunately, when customers’ basic service requirements are unmet, so-called service enhancements a la pillow menus are more likely to aggravate rather than to delight.
It is true that tastes and preferences may vary across different regions, socio-economic strata, etc. However, this is all the more reason for companies to study their customers carefully to understand their expectations, and variations in those expectations. Rather than assuming what’s best for customers and using a “one size fits all” approach, companies should segment customers then make strategic choices about which segment(s) to cater to.

An important area of your current research seems to be the role played by technology in all of this. Have companies put technology to good use while serving their customers?
Unfortunately, many companies equate “technology” with “cost savings.” The right technology, if properly deployed, can indeed lead to economic efficiencies. However, when it comes to service delivery, a sole focus on cost reduction and on technology as a conduit for achieving that reduction is tantamount to being penny-wise and pound-foolish.  For instance, online retailing, online banking and other such self-service technologies are potentially cost-effective for companies and convenient for customers as well. On the other hand, research shows that there are segments of customers who feel intimidated by technology-based self-service systems; and, even customers who are comfortable interacting with such systems do want access to human servers when something goes awry with the technology-based transaction. Thus, depending on the nature and composition of a company’s target market, it should have an appropriate mix of hi-tech and hi-touch for excelling in the marketplace.

Is technology in a sense acting as a middleman between the company and the customer?
If by “middleman” you mean “link,” then technology does act as a middleman. The Internet, arguably the most ubiquitous technology of all, offers opportunities for a rich variety of interactions between customers and companies. However, companies that view technology as a buffer for shielding them from customers, and as a perfect substitute for personnel that serve customers, are being short-sighted.