Statistical Process Control applied in the Cruise Line Service

1. SPC applied in the Cruise
Line Services
MANAGEMENT OF BUSINESS OPERATIONS
FALL 2013
IOANNIS MIKEDIS

2. Agenda
 The Service Economy
 The Characteristics of Service
 What is SPC
 Examples of SPC in the Hotel and Leisure Industry
 Benefits of applying SPC
 Drawbacks from applying SPC
 Tools for Service Design
 A look to the past
 A look to the present
 A look to the future
 Conclusions

3. The Service Economy
 The service economy worldwide is a 48.6 trillion dollar sector
 The Hotel and Tourism industry contributes 2.1 trillion dollars
 Cruise industry direct expenditures with U.S.-based
businesses was $18 billion in 2010
 Cruise industry direct expenditures with European-based
businesses was €15 billion in 2012

4. The Characteristics of Service
 Services are intangible.
 Service outputs are variable.
 Services have higher customer contact.
 Services are perishable.
 The service and the service delivery are inseparable.
 Services tend to be decentralized and geographically dispersed.
 Services are consumed more often than products.
 Services can be easily emulated.
 Services are created and consumed simultaneously.

5. Service Design
SERVICE CONCEPT
SERVICE PACKAGE
PERFORMANCE SPECIFICATION
DESIGN SPECIFICATION
DELIVERY SPECIFICATION
SERVICE DELIVERY
CUSTOMER
SERVICE PROVIDER
Desired Service Experience Target Customer
Physical Items Sensual Benefits
Psychological
Benefits
Customer
Requirements
Customer
Expectations
Activities Facilities
Provider
skills
Cost & Time
Estimates
Schedule Deliverables Location
CRUISE LINE SERVICE CONCEPT
SERVICE PACKAGE BY CRUISE DESTINATION
COMPANY QUALITY STANDARD – FIVE STAR RATING
HOTEL, F&B, ACCOMMODATION, SHOPS,
ENTERTAINMENT, SHORE EXCURSIONS, MARINE,
TECHNICAL POLICIES AND OPERATING PROCEDURES
TRAINING, INTERNAL, EXTERNAL & SECRET PASSENGER AUDITS
AN EVERY DAY
MEMORABLE EXPERIENCE
C.R.U.I.S.E.
PASSENGER CRUISE LINE
PROVIDE AN AFFORDABLE
LUXURY EXPERIENCE
45 TO 65 UPPER MIDDLE
CLASS
Food venues
Local cuisine flavors
Wine list
Shopping
Spa treatments
Entertainment
Enrichment themes
Lectures
VIP Club benefits
FIVE STAR STANDRD
A UNIQUE MEMORABLE
EXPERIENCE EVERY DAY
Daily Activities
Shore excursions
Open Deck and public
spaces
Show lounges
Bars, Shops, Casino
F&B, Accom,
Hotel
personnel
training
Budgets & Performance
target set by cruise and by
itinerary group
Schedule Deliverables Location

6. What is SPC
 A statistical procedure utilizing control charts to determine if
any part of the production process is not functioning properly
and may lead to poor quality.
 Control charts.
 There are control charts for attributes and for variables.
 Examples of attributes of control charts are p-charts and c-charts.
 Examples for variables are mean ( 𝒙) and range (R)

7. Examples of SPC in the Hotel and
Leisure Industry
 Ritz-Carlton
 Competence
 Courtesy
 Credibility
 Security
 Access
 Communication
 Knowing the customer
 Tangibles
 Reliability
 Responsiveness

8. Benefits of applying SPC
 Industry awards
 Higher yields
 Higher customer satisfaction
 High repeat customer rate

9. Drawbacks from applying SPC
 Collection and evaluation of measurements
 The industry does not have service-quality benchmarks
 Need to involve the total organization echelon
 Defining what exactly it is that you are measuring

10. Tools for Service Design
 Guest questioners
 Quality audits
 Management reviews
 Training
 Score Card.

11. Tools for Service Design – Guest
Questioner

12. A look to the past – SS Normandie

13. A look to the past – SS Normandie

14. A look to the present

15. A look to the present

16. A look at the present
 cabin.htm

17. A look to the future – Project Freedom

18. A look to the future

19. Conclusions
 The Cruise Industry is following in the steps of the land
based Hotel Industry (for now)
 The use of methods for scientifically determining the
accuracy in the delivery of the experience is a must
 Statistical Process Control offers tools which can transform
the company into a quality generating machine

20. Thank You