Review On Service Culture Based On The Service-Profit Chain

For nearly 10 years, it's output value of service industry only equals to one third of-GDP, much lower than that of some developed countries, such as USA, which reaches 80%.How to incentive service industry and make it speed up is a common focus of many scholars. Despite the fact that there is larger amount of people paying attention to the management issues that service companies facing, service management is still a new lesson to our Chinese, let alone service culture.The author believes one factor, among others,block it's putting forward of service industry is that people may have some wrong ideas on what brings profit. When it comes to profit, many people give no consideration of service quality, commitment and rescue, but only concentrate on cost and price. Guided by this kind of thought, low service quality, lower educated and trained employees and short term relationship with the customers become common in China. Confront these phenomena, this paper is designed on service culture, which the author believes is the fundamental way to deal with the problems that promote the developing speed of Chinese service industry.Service culture is one of the central subjects in recent studies. As early as 1980, Schneider had enlightened the important role that service climate play, for the reason that it has positive effect on the employee behavior. Later research(Benjamin 1985,1988,1992,1995;Heskett 1994;Zeithaml,Berry and Parasuran,1996; Berry 1999,2003; Lytle 1998,2002) had drawn the similar conclusion. Berry, for example, asserted that what made a service company different from others and thus gained long-last competitive advantage are 7 values: innovation, joy, respect, teamwork, social profit, integrity and excellence.Heskett believed that SPC could build a excellent and changing-adapted culture in service firms, but he didn't give any specific discussion on how can this come into effect, nor on what kind of relationship exist among the compromising factors of SPC and SC.For testing its practical effect to the firm, the author introduced an prevailmanagement framework in the western countries------the service profit chain(SPC).The SPC was put forward by several Harvard researchers leading by Professor James Heskett in 1994 and has drawn much attention of the scholars' since then. It builds relationship among employees,customers and business performance, assuming there is direct and strong relationship among internal service quality, employee satisfaction, employee loyalty, productivity and employee retention, service value, customer satisfaction, customer loyalty, and profitability and growth.First of all, the author studied several experimental researches which can be divided into two types, one aimed at testify its reasonability of SPC in the real environment and the other at examine its applicability in an organization. The outcome shows that some of the researches support SPC while the others don't. The author reviewed these literatures critically and then conceptualized some managerial implications which may have some effects on the Chinese service companies.Despite the different research findings, there are some items that are enlightened by almost all the researchers, and service culture is one of them. Service culture can make the whole corporation embrace service-orientation and can create service climate in which everyone believes that providing excellent service to both internal and external customers is his/her own responsibility and sees it as the biggest source of happiness. The author explained how to construct and strength service culture and gave some ideas on incorporating service culture into the daily operation of a firm.There are five chapters in this paper. Chapter 1 states the horizontal cut-throat competition that Chinese service corporations now facing. Facing such situation, gave some suggestions on its development from two aspects: management framework and service conception, the soul of which is to cultivate a kind of atmosphere, making everybody of the company strongly intended to supply excellent service to customers. In Chapter two, the author analyzed deeply and broadly the experimental research the scholars ever did on this framework, then on the ground of this, summarized the features in common and gave some suggestions on putting the SPC work well—Based on your realistic performance, knowing deeply about yourself, including strengths and weaknesses, analyze the history data and construct your own SPC that fits your company best. Another point of this chapter is service culture. Corporate culture had come into the researchers' view from 1980s. During the past 20 years, a lot of great achievement has been drawn in this field. It's by no means the first time that scholars noticed the affections the service culture may has on a corporation's performance, both soft and hard aspects, but it may be the first time that service culture be discussed so deeply within the framework of SPC. The author examined the relationship between the SPC and the SC from the perspective of their components, for instance, how the service orientation works to improve customer satisfaction or productivity.The chapter 3 is on how to construct the service culture and the needs of service culture. While on it's building steps, research findings of Dean and Kennedy was used, who deemed that corporate environment, core values, heros, culture net and convention and celebration were 5 elements of corporate culture. And consistent with Schneider(1995),the author believes the first thing to do is analyze its operational environment and history, thus make a clear understanding of what had ever lead to its prosperous and what ever damaged it. Then the most important step is to instill it's soul values, which by no means is merely the pursue of profit, and then the third step is to make it known by everyone of the company. What can't be missed is to perfect the culture net, using all possible ways and routes to promise the leading role of the soul values. What must be noted is as the service culture itself has a character of innovation, so keep the core value won't do bad to the corporation's creativity but will do it good. And the last step is to audit the SPC and some other dimensions may affect the company's final performance, such as employee job satisfaction, service orientation, service quality, etc. Only by doing so can a firm foresee the changing tendency of a firm and keep it's market-adaptable.Service culture itself has some intrinsic requirements that can be summed as four: service-oriented strategy, seamless organization, effective and reasonable personnel, and excellent-service-supported leaders (Gronroos, 1992).You can find the related content in Chapter 4.The last chapter is conclusion. From all that have been discussed above, it can safely draw the conclusion that:(1) the SPC is a useful way in practical operation, but it can not be said that it will function in any place, any time, cause every corporation has its own features and developing experience which can hardly the same as another company, so the managers (or we should use coordinators) should collect data from it's company, measure it by themselves, and develop it's own "service-profit chain", or maybe "customer orientation-job satisfaction-profit chain".(2)Building service culture is the .fundamental way of gaining competitive advantage. By doing so, a company can be a service-oriented organization and at the same time, possesses a service climate which can thus bring positive customer-oriented employee behavior and then promote employee and customer satisfaction, which according to the SPC, can lead to better customer value and finally making a company has competitive performance. In other words, by constructing a service culture, service firm can positively improve the elements explicated by the SPC, and so make great effect on it's eventually performance. (3)Measure all the elements factors of your own chain continuously. What a company is or what should it be is determined by the customer. So the company should and must always focus on its customers and understand their needs and wants, it's the premise that a company can exist. Only by doing this can a company be market adaptable, and may it foresee the changing tendency and prepare for the probable coming changes.