||Improving Service Quality in the Sales Department of an Air Conditioning Manufacturer in Taiwan
||Institute of International Management (IIMBA--Master)(on the job class)
Key Performance Indicators (KPIs)
Failure Mode and Effects Analysis(FMEA)
The AC industry has developed over the last 100 years in Taiwan. However, a detailed study of service quality improvement of Taiwan’s AC manufacturers has not previously been performed. The purpose of this research is to improve service quality in the sales departments of AC manufacturers in Taiwan by using S Company as an example. We first determine the key performance indicators (KPIs) that affect service quality in the sales department of a single AC manufacturer. Then, the Six Sigma methodology and associated approach (define (D), measure (M), analyze (A), improve (I) and control (C)) are applied in the selected department to improve the service performance. The concepts of cause-and-effect analysis and failure mode and effects analysis (FMEA) are also employed to further identify the root causes and determine the priorities for improving the top three service quality issues identified.
Utilizing the Parasuraman-Zeithaml-Berry Model, our statistical data analysis results indicate that Gap 5 existed in the sales department of the selected AC manufacturer. Moreover, the low KPIs of Gap 5 (the KPI values were less or equal to 0.2) were mainly caused by some extreme customers that perceived the service quality levels to be far lower than their expected levels. In addition, Gap 3 was found to be mainly due to the gap between service quality specifications made by the company’s managers and the actual service delivery performed by its front-line service employees.
By using the new KPI approach, the Six Sigma DMAIC approach, and quality management techniques, we have determined the root causes of existing service quality gaps from both service receivers’ and providers’ perspectives, and our proposed methodology demonstrated in what ways the service quality of the selected AC manufacturer can be effectively improved. It is expected that this research can serve as a useful reference for future service quality improvement studies conducted in similar enterprises.
TABLE OF CONTENTS
TABLE OF CONTENTS IV
LIST OF TABLES VII
LIST OF FIGURES XII
CHAPTER ONE INTRODUCTION 1
1.1 Research Background. 1
1.2 Research Motivation. 2
1.3 Research Objectives. 2
1.4 Research Scope and Limitation. 3
1.5 Research Flow Chart. 3
CHAPTER TWO LITERATURE REVIEW 4
2.1 Definition and Characteristic of Service Quality. 4
2.2 Service Quality Assessment. 6
2.2.1 The PZB Model of Service Quality and Its Extended Model. 6
2.2.2 Other Service Quality Gaps Models. 14
2.2.3 The SERVQUAL Scale. 17
2.3 The Effect of Service Quality on Sales Performance. 18
2.4 Six Sigma Approach. 20
2.5 Service Quality Improvement at a Commercial AC Manufacturer in Taiwan. 21
CHAPTER THREE RESEARCH DESIGN AND METHODOLOGY 24
3.1 Research Design and Process. 24
3.2 Questionnaire and Sampling Design. 26
3.2.1 Questionnaire Design for Measuring the Service-Receiver Gap (Gap 5). 28
3.2.2 Questionnaire Design for Measuring Service-Provider Gaps. 30
3.3 Data Analysis. 34
3.3.1 Statistical Analysis. 34
3.3.2 Six Sigma Analysis. 38
CHAPTER FOUR RESEARCH RESULTS 40
4.1 Statistical Analysis. 41
4.1.1 Demographic Analysis. 41
4.1.2 Reliability Test. 43
4.1.3 Analyses of Service Quality Gaps. 44
4.2 Improving Service Quality by Using Six Sigma’s DMAIC Process and Techniques. 60
4.2.1 Define the Problem (Define, D). 60
4.2.2 Measure and Collect Relevant Data (Measure, M). 62
4.2.3 Analyze the Data (Analysis, A). 63
4.2.4 Improvement Strategy (Improve, I). 68
4.2.5 Tracking and Control (Control, C). 69
CHAPTER FIVE CONCLUSION AND SUGGESTIONS 71
5.1 Summary of Statistical Data Analyses Results. 71
5.1.1 Demographic Analysis. 71
5.1.2 Gap Analyses. 71
5.1.3 Other Findings. 72
5.2 Summary of Six Sigma DMAIC Analyses. 73
5.3 Research Contributions. 74
5.4 Limitations and Future Research. 74
Appendix 1: Questionnaire for Consumers 80
Appendix 2: Questionnaire for Managers 89
Appendix 3: Questionnaire for Front-line Service Personnel 101
Appendix 4: Distributor Customers’ Demographic Information Analysis 114
Appendix 5: Managers’ Demographic Information Analysis 125
Appendix 6: Front-line Service Personnel’s Personal Information Analysis 131
Appendix 7: Questionnaire Survey for Nominal Group Technique (NGT) 138
Appendix 8: Questionnaire Survey for Failure Mode and Effect Analysis (FMEA) 140
Akroush, M. N. (2009). Does service quality implementation mediate the relationship between technical service quality and performance: An empirical examination of banks in Jordan. International Journal of Services, Economics and Management, 1(3), 209-232.
Antony, J. (2004). Six Sigma in the UK service organisations: results from a pilot survey. Managerial Auditing Journal, 19(8), 1006-1013.
Antony, J. (2006). Six Sigma for service processes. Business Process management Journal, 12(2), 234-248.
Archana, M. (2005). Service quality assessment of HVAC systems Pvt. Ltd, Bangalore, dealers for carrier range of A/C & R products. Bangalore University, Bangalore.
Biolos, J. (2002). Six Sigma meets the service economy. Harvard Management Update, 7(11), 3-5.
Brax, S. (2005). A manufacturer becoming service provider: Challenges and a paradox. Managing Service Quality, 15(2), 142-155.
BSRIA. (2010a). Chiller Taiwan: A multi client study (Report No. 50823/28). Berkshire, UK: BSRIA Limited.
BSRIA. (2010b). Single packaged Taiwan: A multi client study (Report No. 50823/28). Berkshire, UK: BSRIA Limited.
Chakrabarty, A., & Tan, K. C. (2007). The current state of Six Sigma application in services. Managing Service Quality, 17(2), 194-208.
Chaston, I. (1994). Internal customer management and service gaps within the UK manufacturing sector. International Journal of Operations & Production Management, 14(9), 45-56.
Cronemyr, P., & Witell, L. (2010). Changing from a product to a process perspective for service improvements in a manufacturing company. The TQM Journal, 22(1), 26-40.
Cronin, J. J., & Taylor, S. A. (1992). Measuring service quality: A reexamination and extension. Journal of Marketing, 56(3), 55-68.
Fleming, J. H., Coffman, C., & Harter, J. K. (2005). Manage your human sigma. Harvard Business Review, 83(7), 106-155.
Frei, F. X. (2008). The four things a service business must get right. Harvard Business Review, 86(4), 70-80.
Green Energy Industry Information Net. (n.d.). Retrieved 2010/7/15, 2010, from http://www.taiwangreenenergy.org.tw/Domain/domain-9.aspx
Heskett, J. L., Jones, T. O., Loveman, G. W., Sasser, E. W., & Schlesinger, L. A. (1994). Putting the service-profit chain to work. Harvard Business Review, 72(2), 164-174.
Jain, S. K., & Gupta, G. (2004). Measuring service quality: SERVQUAL vs. SERVPERF scales. Vikalpa, 29(2), 25-35.
JARN. (2010). World air conditioner market. Japan Air Conditioning, Heating & Refrigeration News, 49-89.
Johannsen, F., Leist, S., & Zellner, G. (2010). Six Sigma as a business process management method in services: Analysis of the key application problems. Information Systems and E-Business Management(8), 1-26.
Keller, G. (2009). Managerial statistics. Mason, OH: South-Western Cengage Learning.
Lai, F., Hutchinson, J., Li, D., & Bai, C. (2007). An empirical assessment and application of SERVQUAL in mainland China's mobile communications industry. International Journal of Quality and Reliability Management, 24(3), 244-262.
Liao, J.-S., & Wei, Z.-S. (2008). An introduction to room air conditioning markets. Journal of Energy & HVAC Engineering(50), 37-50.
Lin, W.-K. (2009). Development perspectives and competitive analysis of heating, ventilation, and air-conditioning (HVAC) industry in Taiwan. Electricity Monthly Magazine, 228, 172-179.
Lovelock, C. (1994). Product plus: How product + service = competitive advantage. New York: McGraw-Hill, Inc.
Lovelock, C., & Wirtz, J. (2010). Service marketing: People, technology, strategy (Seventh ed.). Boston: Prentice Hall.
Ma, L.-Y. (2009). The perspectives of global heating, centilation, and air-conditioning (HVAC) markets under economic crisis. Electricity Monthly Magazine, 221, 154-160.
Moss, H. K. (2007). Improving service quality with the theory of constraints (Publication. Retrieved March 1, 2007: http://www.allbusiness.com/company-activities-management/operations-customer/5508402-1.html
Pan, J.-N. (2009). Quality management: Principles and practices (2 ed.). Taipei: Hwa Tai Publishing.
Pan, J.-N., & Cheng, M.-Y. (2008). An empirical study for exploring the relationship between balanced scorecard and Six Sigma programs. Asia Pacific Management Review, 13(2), 481-496.
Pan, J.-N., & Kuo, T.-C. (2010). Developing a new key performance index for measuring service quality. Industrial Management & Data Systems, 110(6), 823-840.
Parasuraman, A., Berry, L. L., & Zeithaml, V. A. (1993). Research note: More on improving service quality measurement. Journal of Retailing, 69, 140-147.
Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1985). A conceptual model of service quality and its implications for future research. Journal of Marketing, 49(4), 41-50.
Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1988). SERVQUAL: A multiple-item scale for measuring consumer perceptions of service quality. Journal of Retailing, 64(1), 12-40.
Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1991). Refinement and reassessment of the SERVQUAL scale. Journal of Retailing, 67(4), 420-450.
Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1993). The nature and determinants of customer expectations of service. Journal of the Academy of Marketing Science, 21(1), 1-12.
Shaw, C.-I. (2009). Improving the service quality of a senior-care facility in Taiwan using quality control tools. Unpublished Master's Thesis, National Cheng Kung University, Tainan.
Shen, L.-H. (2009). Improving the funeral service quality of S Company using quality control tools. Unpublished Master's Thesis, National Cheng Kung University, Tainan.
Singh, R., & Khanduja, D. (2010). SERVQUAL and model of service quality gaps: A framework for determining and prioritizing critical factors from faculty perspective in higher education. International Journal of Engineering Science and Technology, 2(7), 3297-3304.
Slater, S. F., & Narver, J. C. (1994). Market orientation, customer value, and superior performance. Business Horizons, 37(March-April), 22-28.
Tan, B.-I., Wong, C.-H., Lam, C.-H., Ooi, K.-B., & Ng, F. C.-Y. (2010). Assessing the link between service quality dimensions and knowledge sharing: Student perspective. African Journal of Business Management, 4(6), 1014-1022.
Womack, J. P., & Jones, D. T. (2005). Lean consumption. Harvard Business Review, 83(3), 58-68.
Yeh, T.-M., Yang, C.-C., & Lin, W.-T. (2007). Service quality and ERP implementation: A conceptual and emprical study of semiconductor-related industries in Taiwan. Computers in Industry, 844-854.
Zeithaml, V. A., Berry, L. L., & Parasuraman, A. (1988). Communication and control process in the delivery of service quality. Journal of Marketing, 52(2), 35-48.
Zeithaml, V. A., Berry, L. L., & Parasuraman, A. (1996). The behavioral consequences of service quality. Journal of Marketing, 60(2), 31-46.
Zeithaml, V. A., Parasuraman, A., & Berry, L. L. (1990). Delivering quality service: Balancing customer perceptions and expectations. New York: The Free Press.
Zisis, P., Garefalakis, A., & Sariannidis, N. (2009). The application of performance measurement in the service quality concept: The case of a Greek service organisation. Journal of Money, Investment and Banking(9), 21-47.