on Service Quality Model

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John Sterman
Senior Member
Posts: 117
Joined: Fri Mar 29, 2002 3:39 am

on Service Quality Model

Post by John Sterman »

The paper describing Rogelio Olivas service delivery model, discussed
several weeks ago in this list, has been revised and updated. The
latest version of the paper is available for download, along with the
simulation model and historical data, on
http://www.people.hbs.edu
oliva
esearch/service/esq.html


You can download the paper (in .pdf format), the model (in Vensim
format), the dataset of historical data, and also interactive model
documentation. In this interactive documentation, clicking on any
variable on the right hand side of an equation immediately takes you to
the equation defining that variable. In this fashion you can quickly
navigate around the model and learn how it is structured. The abstract
follows.


Oliva, R. and J. Sterman (2000) "Cutting corners and working overtime:
Quality erosion in the service industry."



The erosion of service quality throughout the economy is a frequent
concern in the popular press. The American Customer Satisfaction Index
for services fell in 1997 to 67.7, down nine percentage points from
1994. We hypothesize that the characteristics of
services-inseparability, intangibility, and labor intensity-interact
with management practices to bias service providers toward reducing the
level of service they deliver, often locking entire industries into a
vicious cycle of eroding service standards. To explore this proposition
we developed a formal model that integrates the structural elements of
service delivery. We used econometric estimation, interviews,
observations, and archival data to calibrate the model for a consumer
lending service center in a major UK bank. We find that temporary
imbalances between service capacity and demand interact with decision
rules for effort allocation, capacity management, overtime, and quality
aspirations to yield permanent erosion of the service standards and
loss of revenue. We explore policies to improve performance and
implications for organizational design in the service sector.


John Sterman
From: John Sterman <jsterman@MIT.EDU>
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