Chapter 01 – The Customer Service Profession
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also well informed about the price, quality, and value of products and
services.
o This has occurred in part through the advertising and publicity by
companies competing for market share and by the activities of
consumer information and advocacy groups that have surfaced.
• Hence, all business owners find that they have to continually prove the worth
of their products and services.
o They must provide customer satisfaction or face losing customers to
competitors.
V. The Customer Service Environment
A. Components of a Customer Service Environment
• The six key components of a customer service environment are the
customer, organizational culture, human resources, products/deliverables,
delivery systems, and service.
o With the exception of the customer, all of these factors are under the
control of the service provider and staff.
B. The Customer
• The central component in a customer-focused environment is the customer.
o All aspects of the service organization revolve around that crucial entity.
External Customers
• External customers are those people outside the organization who
purchase or lease products and services.
o This group includes vendors, suppliers, people on the telephone,
and others not from the organization.
Internal Customers
• Internal customers are people within the organization who either require
support and service or provide information, products, and services to
service providers.
o Such customers include peers, co-workers, bosses, subordinates,
and people from other areas of the organization.
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C. Organizational Culture
• Organization culture includes an element of an organization that a customer
encounters.
• Typically, culture includes the dynamic nature of the organization and
encompasses the values and beliefs that are important to the organization
and its employees and managers.
D. Human Resources
• Human resources refer to the employees of an organization.
• To make the culture work, an organization must take great care in recruiting,
selecting, training and retaining qualified people.
E. Deliverables
• The fourth component of a service environment is the deliverables offered by
an organization.
• A deliverable may be a tangible item manufactured or distributed by the
company or a service available to the customer.
• There are two potential areas of customer satisfaction or dissatisfaction:
F. Delivery Systems
• In deciding on delivery systems, organizations examine the following factors:
o Industry standards
o Customer expectations
o Capabilities
o Costs
o Current and projected requirements
G. Service
• Stated simply, service is the manner in which employees treat their
customers and each other as they deliver their company’s deliverables.
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VI. Addressing the Changes
• With all the changes, developing strategies for providing premium service that
will attract and hold loyal customers has become a priority for most
organizations that value knowledge, educations, and employee training.
• In the past, organizations took a reactive approach to service by waiting for
customers to ask for something or by trying to recover after a service breakdown.
o In today’s economy, a proactive approach of anticipating customer needs is
necessary and becoming common.
• To excel, organizations must train all employees to spot problems and deal with
them before the customer becomes aware that they exist.
• If a service breakdown does occur, managers in truly customer-focused
organizations should empower employees at all levels to do whatever is
necessary to satisfy the customer.
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Class Activities and Sample Assignments
1. Read chapter one. (LO 1-1 through 1-6)
2. Ask students to get into discussion groups to discuss their best and worst
experiences with customer service. (LO 1-1)
3. Ask students to get into discussion groups for onsite/on-ground courses, and
discuss any of the questions you choose from the discussion opportunities section
below. (LO 1-1 through 1-6)
4. Ask students, either alone or in teams, to visit a retail store. After visiting the store
for at least 15 minutes, ask them to write a report or prepare a presentation
addressing how well the company met each of the components of a customer–
focused environment and what can be done if they need to make improvements.
(LO 1-5, 1-6)
5. Ask students to bring in a recent newspaper or magazine. Ask students to put
themselves in groups or 5 or 6. Then, using their articles, find at least four examples
of socioeconomic, demographic, consumer behavior and economy articles that
might impact customer service. Have them ready to present a summary of their
articles and a description of how customer service can be impacted as a result of
the found article. Divide students into equal groups (three or four people per group,
depending on the class size) and give each group a marker and sheet of newsprint
(flipchart paper) to use as they participate in the activities noted herein or in those
that you develop. (LO 1-2, 1-3, 1-4)
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Discussion Opportunities
1. In what specific ways do you see technology impacting customer service? (LO 1-4
and 1-5)
2. Which of the demographic changes discussed in the chapter has the greatest
impact on customer service, in your opinion? Why? (LO 1-2 and 1-3)
3. What does great customer service mean to you? (LO 1-1)
4. Give examples of companies you think focus on all six areas of the customer-
focused environment. Describe how you think the company meets all of these areas
(LO 1-5)
5. This chapter discussed learning organizations. How can individuals contribute to
this ideology? (LO 1-6)
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In the Real World Notes
Every chapter has an opening, real world example of customer service. This section in
the instructor’s manual will address the opening and give suggestions on initiating class
discussion.
Retail—Zappos.com
This opening discussed about Zappos.com. It was established as ShoeSite.com but
soon changed to Zappos, or “shoes” in Spanish, and grew to be the Internet’s largest
shoe store with sales of $1.6 million by 2000 and $8.6 million in 2001. Zappos is
committed to its customer. There are many elements of the Zappos culture that make it
one of the most popular retail sites on the Internet. One of these is the people who work
for Zappos. Another cultural element contributing to their success is the current 365–
day, 100% satisfaction guarantee, no-questions-asked free return policy. One of the
points you can discuss with this opener is the fact Zappos created a different kind of
workplace, which results in the better customer service. In other words, the internal
policies of the company actually helped create the great customer service.
The questions and possible answers for this situation are as follows:
1. From a service perspective, how does this organization differ from other online
companies that you have dealt with or have heard about?
2. What do you believe are the strengths and weaknesses of this organization? Why?
3. How do you feel that Zappos compares to some of its major show and product
competitors (e.g., Foot Locker, J.C. Penney, ShoeBuy.com, The Gap, and DSW)?
1-20
4. What role do you think the CEO’s approach to creating an informal and fun
corporate culture plays in the service attitude of employees?
5. As a consumer, would you now consider using Zappos in the future? Why or why
not?
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Work It Out Notes
Every chapter has several Work It Out sections which ask the students to think about
the material a bit deeper and relate it to their own life. This section will provide notes for
class discussion for each of these Work It Out topics.
Work It Out 1.1—Improving Service Quality
This box asks students to list some of the changes related to service that students have
personally witnessed in the business world. Are these changes for better or worse?
Students may cite not being able to get a hold of an English speaking person when
calling for technical help or too many buttons to press to speak with a real person, but
they may also cite the ability to order things online, live chat and other features for a
better customer service experience.
You can facilitate a discussion here on how companies can remedy the things about
customer service which have gotten worse. In other words, ask them to come up with
solutions, too.
Work It Out 1.2—Personal Exposure to the Global Trend
This box helps students recognize the impact that the global trend of change in values
has on them and their family as consumers. Students are asked to list five major
products that they are their family members own, along with their country of origin. Most
likely, students will find 10-15 different places.
Work It Out 1.3—Who Are My Internal Customers?
This Work It Out question asks students to think about internal versus external
customers. Ask students to get into groups and identify their internal customers in their
current or past job. You can start by telling students that they are the external
customers, whereas your program chair, dean, financial services department,
registration department and other faculty would be considered internal customers. Every
job likely has both external and internal customers.
Work It Out 1.4—Types of Service
To complete this exercise, ask students to work in groups and brainstorm types of
“service” that are provided to external customers. Then, on the board or a flipchart, have
them write the top ten things they came up with and then engage in a class discussion
on each. You can point out here that the intangibles are sometimes more important than
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the tangibles. For example, if a contractor remodels your bathroom, the service
provided, including the timeliness, quality of work, and clean-up, is often as important as
the work performed.
Work It Out 1.5—Attracting and Training Employees
This box looks at some of the things companies use to attract good quality workers
besides compensation. In a down economy, companies generally have to offer less to
attract people but often do provide attractive benefits to keep current people happy.
Things such as signing bonuses, relocation packages, telecommuting and flextime
options are the norm, while on the extreme; some companies provide day-care services
and concierge service to employees.
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End-of–Chapter Material Notes
Key Terms
• Broadband Internet access (p. 14)
• Business-to-business (B2B) (p. 20)
• Cottage industries (p. 8)
• Customer-focused organization (p. 7)
• Customer relationship management (CRM) (p. 7)
• Customer satisfaction (p. 30)
• Customer service (p. 6)
• Customer service environment (p. 30)
• Deliverables (p. 36)
• Delivery system (p. 36)
• Deregulation (p. 21)
• Downsizing (p. 15)
• E-commerce (p. 27)
• External customers (p. 31)
• Globalization (p. 20)
• Human resources (p. 33)
• Insourcing (p. 21)
• Instant messaging (p. 14)
• Internal customers (p. 31)
• Learning organizations (p. 37)
• Networking (p. 15)
• North American Free Trade Agreement (NAFTA) (p. 22)
• Offshoring (p. 21)
• Onshoring (p. 39)
• Organizational culture (p. 32)
• Outsourcing (p. 21)
• Product (p. 6)
• Service economy (p. 9)
• Service industry (p. 6)
• Service recovery (p. 37)
• Service sector (p. 8)
• Skype (p. 14)
• Small Business Administration (SBA) (p. 38)
• Social media (p. 14)
• Telecommuting (p. 14)
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Review Questions
1. What is service?
2. Describe some of the earliest forms of customer service.
3. What are some of the factors that have facilitated the shift to a service economy?
4. What have been some of the causes of the changing business environment in
recent decades?
5. Describe the impact of a company’s culture on its success in a customer-focused
business environment.
6. What role does the human resources element of the customer service environment
play in customer satisfaction?
Chapter 01 – The Customer Service Profession
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Education.
human resources aspect in recruiting, hiring and training is important to creating
satisfied customers.
Collaborative Learning Activities
1. Walk around the room as this discussion takes place to insure students stay on
topic. Ask probing questions to each group as you walk around, such as:
• Do you think schools provide good customer service?
• How can schools get better (while staying in budget) at providing good
customer service?
• Who should be responsible for the success of schools?
2. Walk around the room as this discussion takes place to insure students stay on the
topic and answer the following questions:
• Based on what you read in this chapter, what factors might be affecting survey
recipients?
• How do the statistics shown in this study analysis potentially impact service
organizations?
• How do you see these responses personally impacting you in the future?
3. Walk around the room as this discussion takes place to insure students stay on the
topic and answer the following questions:
• What additional competencies do you feel are necessary to be successful
when working with customers?
• Do you believe each of these competencies is crucial or not?
Face to Face—Getting Ready for New Employee Orientation at PackAll
This situation asks the student to imagine they have been hired at PackAll and are
about to attend an orientation. The orientation will address service culture, policies and
procedures, techniques for handling customers, and specific job skills and
requirements. The following questions are asked of the students:
1. What interpersonal skills do you currently have that will allow you to be successful
in your new position?
2. What general questions about handling customers do you have for your
supervisor?
3. If a customer asks for a service that PackAll does not provide, how will you handle
the situation? Exactly what will you say?
The answers will vary depending on the student. Consider asking students to work on
Chapter 01 – The Customer Service Profession
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this by themselves, then share answers with small groups. The most interesting
question is number three, as it concerns how situations are handled when someone has
not been trained. Ask students to share strategies used in their current jobs to handle
customers who are difficult or challenging.