The Service Matrix - Capability vs Delivery

Market research can identify which are the most important service dimensions from the Clients' perspective. This helps to focus the time and resources involved where the greatest impact can be obtained. Market research should also seek to clarify the firm's comparative performance.

Identifying Performance 'Gaps'

The process of identifying performance gaps on service-related issues is best effected by interviewing or surveying Clients. They are first asked to rate the firm's performance on the service dimensions out of a maximum 10 points. They are then asked to rate one or two competitors on the same performance factors. Then they are asked to similarly rate the importance of each factor, regardless of supplier. This enables a matrix to be created showing how the firm and competitors performed against the same factors. Using this matrix approach, such as the one illustrated in Figure 4.1, the results can be plotted and can reveal for some firms that 'service enhancement' can be self-funding. If a large number of dimensions fall in the 'over-delivery' box, project task teams can generally find ways of saving costs without a significant adverse effect on Client service performance. These savings can fund improvement in other areas. For example, the logistics sector does not provide Clients who simply want a package delivered with superior vehicles; they use the asset saving to fund superior IT systems for those that want tracking information. Many professional services firms spend considerable sums in creating and mailing newsletters, but have not established Client reaction or preferences.

The Performance 'Gap'

For each service element, the research should ideally identify:

• the standard of performance that is acceptable and what is regarded as 'added value';

• where the firm does not meet the standard;

• which other firms and competitors are meeting or exceeding the two levels of standard.

Service Matrix

Figure 4.1 Service Matrix

There are many ways to obtain this type of information. The best research approach is based on detailed face-to-face interviews with a variety of people within the Client's Decision Making Unit (DMU). This gives greater insight into the 'prism of activity' that ultimately creates Client satisfaction and loyalty.

Law firm Mills & Reeve (M&R)[1] is careful to establish how Clients want their work to be managed and delivered. Some Clients have given feedback that they are receiving a '5 star' service, but only have the budget for a '3 star' service. In such cases, M&R redesigns and re-engineers its offering accordingly to maintain margins.

Aspects of Service

As an example, here is a list of basic aspects of service used to rate insurance companies:

• Claims payment - efficiency and integrity.

• Developing our book - enterprise and active support.

• Insurance cover - fitness for Client needs.

• New business - efficiency in providing quotations.

• Policy documentation -usability and timeliness.

• Renewals process - efficiency and fairness.

• Underwriters - professional capabilities.

Using Maslow's Hierarchy of Needs to Explain Client Satisfaction

[2]

For every industry it is clear that a 'hierarchy of needs' exists, the key to development of enhanced Client satisfaction can be likened to satisfying 'basic' levels of need fully before addressing the upper levels. This hierarchy was first conceived by Abraham Maslow Although created some time ago, the model is still considered by experts as appropriate in all markets.

The five stages in Maslow's original* model are as follows:

1. Biological and physiological needs - the basic life needs - the lowest needs to be satisfied before moving to the next point below.

2. Safety needs - security, protection.

3. Belonging and love needs - affection, family, relationships, work group.

4. Esteem needs - achievement, responsibility, status, reputation.

5. Self-actualisation needs - personal growth and fulfilment.

Examples in different sectors are shown in Table 4.2. In parallel with the original needs model, Customers and Clients only move up the hierarchy when the current level of satisfaction is met.

Table 4.2 Hierarchies of Needs

Satisfaction level

Original*

Consumer

Industrial

Professional Services

Satisfaction level

Highest

Self-

actualisation

Partnership

Joint ventures

Client

advocates and referrals

Enchanted

Esteem

Category champion

Tailored products

Repeat business

Delighted

Average

Belonging and Love

Value

Augmented products

Value added

Satisfied

Safety

Quality products

Value added

Specialist services

Indifferent

Lowest

Biological and Physiological

Distribution

Core

Core practice areas

Alienated

Many firms, in an effort to be seen as 'leading edge', spend too much time and wasted resources focusing on the upper echelons of these hierarchies before attending to the lowest levels. Meanwhile, their Clients are judging them critically on some of the simple issues - accuracy of order fulfilment, response (speed) to basic enquiries, sector understanding, quality relationships and so on.

  • [1] See feature later in this chapter.
  • [2] Adapted from the Journal of Psychology/Abraham Maslow's Theory of Motivation and Personality, first published in 1954.
 
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