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Part 6 THE BIG PICTURE: CLOSING ALL THE GAPS
Chapter 17 The Financial and Economic Impact of Service Quality <ul><li>Examine the direct effects of service on profits. ...
Objectives for Chapter 17: The Financial and Economic Impact of Service <ul><li>Examine the direct effects of service on p...
Figure 17.1 The Direct Relationship between  Service and Profits Profits ? Service
Figure 17.2 Offensive Marketing Effects of  Service on Profits Profits Market Share Reputation Sales Price Premium Service
Figure 17.3 Defensive Marketing Effects of  Service on Profit Margins Profits Customer Retention Costs Price Premium Word ...
Figure 17.4 Perceptions of Service,  Behavioral Intentions, and Profits Customer Retention Costs Price Premium Word of Mou...
Figure 17.5 The Key Drivers of Service Quality, Customer Retention, and Profits Key Drivers Service Encounter Service Enco...
Figure 17.6   Sample Measurements for the  Balanced Scorecard Innovation and Learning Perspective Customer Perspective Ser...
Service Quality Spells Profits Customer Retention Costs Price Premium Word of Mouth Margins Profits Defensive Marketing Vo...
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The financial and economic impact of service quality

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Transcript of "The financial and economic impact of service quality"

  1. 1. Part 6 THE BIG PICTURE: CLOSING ALL THE GAPS
  2. 2. Chapter 17 The Financial and Economic Impact of Service Quality <ul><li>Examine the direct effects of service on profits. </li></ul><ul><li>Consider the impact of service on getting new customers. </li></ul><ul><li>Evaluate the role of service in keeping customers. </li></ul><ul><li>Examine the link between perceptions of service and purchase intentions. </li></ul><ul><li>Discuss what is known about the key service drivers of overall service quality, customer retention, and profitability. </li></ul>
  3. 3. Objectives for Chapter 17: The Financial and Economic Impact of Service <ul><li>Examine the direct effects of service on profits. </li></ul><ul><li>Consider the effect of service on getting new customers. </li></ul><ul><li>Evaluate the role of service in keeping customers. </li></ul><ul><li>Examine the link between perceptions of service and purchase intentions. </li></ul><ul><li>Discuss what is known about the key service drivers of overall service quality, customer retention, and profitability. </li></ul><ul><li>Present a model called the balanced performance scorecard that allows for a strategic focus on measurements other than financials. </li></ul>
  4. 4. Figure 17.1 The Direct Relationship between Service and Profits Profits ? Service
  5. 5. Figure 17.2 Offensive Marketing Effects of Service on Profits Profits Market Share Reputation Sales Price Premium Service
  6. 6. Figure 17.3 Defensive Marketing Effects of Service on Profit Margins Profits Customer Retention Costs Price Premium Word of Mouth Volume of Purchases Service
  7. 7. Figure 17.4 Perceptions of Service, Behavioral Intentions, and Profits Customer Retention Costs Price Premium Word of Mouth Margins Profits Volume of Purchases Behavioral Intentions Sales Service
  8. 8. Figure 17.5 The Key Drivers of Service Quality, Customer Retention, and Profits Key Drivers Service Encounter Service Encounter Service Encounter Customer Retention Behavioral Intentions Profits Service Encounter Service Encounters Service Quality
  9. 9. Figure 17.6 Sample Measurements for the Balanced Scorecard Innovation and Learning Perspective Customer Perspective Service Perceptions Service Expectations Perceived Value Behavioral Intentions: Operational Perspective Right first time (% hits) Right on time (% hits) Responsiveness (% on time) Transaction time (hours, days) Throughput time Reduction in waste Process quality Financial Measures Price Premium Volume Increases Value of Customer Referrals Value of Cross Sales Long-term Value of Customer % Loyalty % Intent to Switch # Customer Referrals # Cross Sales # of Defections Number of new products Return on innovation Employee skills Time to market Time spent talking to customers Adapted from : R.S. Kaplan and D.P. Norton, “The Balanced Scorecard—Measures That Drive Performance,” Harvard Business Review , January-February 1992.
  10. 10. Service Quality Spells Profits Customer Retention Costs Price Premium Word of Mouth Margins Profits Defensive Marketing Volume of Purchases Market Share Reputation Sales Price Premium Offensive Marketing Service
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