CHAPTERS 15

MULTIPLE CHOICE QUESTIONS

1. Service firms often find themselves in a three-cornered fight between:

a. engineering, production, and accounting

b. marketing, finance, and human resources
c. operations, accounting, and marketing
d. human resources, marketing and operations
e. production, finance, and accounting

ANS: D
REF: 413

2. Services that occur without interruption, confusion, or hassle to the customer is

called:

a. seamless service
b. service audit
c. functional service
d. departmental service
e. services marketing

ANS: A
REF: 407

3. __________ is a firm's view toward planning its operations according to market

needs.

a. marketing orientation
b. marketing functions
c. marketing department
d. marketing forecast
e. marketing tasks

ANS: A
REF: 410

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4. __________ the belief that the function of something rather than the experience
it creates should determine its design.

a. marketing orientation
b. marketing functions
c. departmentalization
d. functionalism
e. operation orientation

ANS: D
REF: 407

5. The department within the firm that traditionally acts as an advocate for the
consumer is:

a. finance
b. marketing
c. accounting
d. information systems
e. management

ANS: B
REF: 4

6. The act of dividing an organization into departments that focus on their own set
of activities is called:

a. marketing orientation
b. marketing functions
c. departmentalization
d. functionalism
e. operation orientation

ANS: C
REF: 410

173
7. The departmental and functional seams together in order to help provide flawless
service are:

a. marketing logic
b. finance logic
c. service logic
d. operations logic
e. human resources logic

ANS: C
REF: 413-414

8. Within the industrial management model, firms focus on __________.

a. operations and management

b. customers satisfaction and sustainable profits
c. customer expectations
d. revenues and operating costs
e. marketing and production

ANS: D
REF: 414

9. The new organizational model that focus on the components of the firm that
facilitate the firm’s service delivery system is referred to as:

a. customer perceptions model

b. market-focused management model
c. industrial management model
d. market competencies model
e. attributes-focused management model

ANS: B
REF: 415

10. The Services Triangle framework visually depicts how many key relationships
that comprise the market-focused management approach?

a. 2
b. 3
c. 4
d. 5
e. 6

ANS: E
REF: 416
174
11. Which of the following is NOT a key relationship that comprise the market-
focused management approach?

a. inconsistency of the service strategy with the systems

b. firm’s service strategy must be communicated to its customers
c. firm’s service strategy needs to be communicated to the firm’s employees
d. the customer/service provider interaction
e. the impact of organizational systems upon the customer’s service experience

ANS: A
REF: 417-418

12. Which informal approach helps firms assess their current culture?

a. direct questioning
b. attitude check
c. observational and indirect questioning
d. service audit
e. none of the above

ANS: C
REF: 418

13. Which of the following is NOT an informal approach to provide keen insights into
the values and beliefs of the organization?

a. conduct culture interviews

b. observe what is missing
c. observe objects and artifacts
d. observe current culture as an impartial observer
e. conduct direct question surveys

ANS: E
REF: 420

175
14. __________ stresses cost containment and cost reduction through mass
production

a. marketing logic
b. finance logic
c. accounting logic
d. operations logic
e. human resources logic

ANS: D
REF: 413

15. Each department within an organization is driven by its own internal logic.
Which of the following statements most accurately reflects operations logic?

a. cost reduction can be obtained through mass production

b. "families" of personnel should reinforce one another on the job
c. personnel should be able to break organization rules in the context of serving
the customer
d. customers should be provided with options that enable them to meet their
individual needs
e. recruiting and training are essential in developing existing personnel

ANS: A
REF: 413-414

16. __________ stresses providing customers with options that better enable the
service offering to meet individual customer needs.

a. marketing logic
b. finance logic
c. accounting logic
d. operations logic
e. human resources logic

ANS: A
REF: 413-414

176
17. Each department within an organization is driven by its own internal logic.
Which of the following statements most accurately reflects a marketing logic?

a. cost reduction can be obtained through mass production

b. "families" of personnel should reinforce one another on the job
c. personnel should be able to break organization rules in the context of serving
the customer
d. customers should be provided with options that enable them to meet their
individual needs
e. recruiting and training are essential in developing existing personnel

ANS: D
REF: 413-414

18. __________ stresses recruiting quality personnel and developing training

programs that enhance the performance of existing personnel.

a. marketing logic
b. finance logic
c. accounting logic
d. operations logic
e. human resources logic

ANS: E
REF: 413-414

19. Each department within an organization is driven by it' own internal logic.
Which of the following statements most accurately reflects human resources
logic?

a. cost reduction can be obtained through mass production

b. families of customers should reinforce one another throughout the service
encounter
c. personnel should be able to break organization rules in the context of serving
the customer
d. customers should be provided with options that enable them to meet their
individual needs
e. recruiting and training are essential in developing existing personnel

ANS: E
REF: 413-414

177
20. The use of interfunctional task forces and interfunctional transfers are an attempt
to change the organization's culture through:

a. systems
b. structure
c. people
d. rewards
e. culture-change initiatives

ANS: B
REF: 426

21. Typical approaches to changing the organizational culture by changing the

structure of the organization include:

a. "putting the customer first"

b. changing the orientation
c. interfunctional task forces and transfers
d. bring in outsiders to change the culture
e. revamping the firm's reward systems

ANS: C
REF: 426

22. In the effort to create a more customer-focused organization, one of the

approaches to changing the culture through structure is:

a. utilizing marketing department as a change agent

b. changing the orientation
c. restructuring the firm around the customer experience
d. bring in outsiders to change the culture
e. revamping the firm's reward systems

ANS: A
REF: 426

178
23. Revamping the firm's evaluation and promotion procedures are attempts
to change the organization's culture through:

a. systems
b. structure
c. people
d. rewards
e. culture-change initiatives

ANS: A
REF: 426

24. If XYZ company hires a new manager from outside the firm as opposed to
promoting someone from within, the company may be attempting to change
the culture of the organization through:

a. systems
b. structure
c. people
d. rewards
e. culture-change initiatives

ANS: C
REF: 427

25. Programs such as "putting the customer first" and "change the way you
work" are attempts to change the organization's culture through:

a. systems
b. structure
c. people
d. culture change initiatives
e. mergers

ANS: D
REF: 427

179
26. The culture change program that teaches personnel that essentially "the
customer is king" is called:

a. "change the way we work"

b. "orientation change"
c. 'change the way you work"
d. "customers are your customers"
e. "putting the customer first"

ANS: E
REF: 429

27. The culture change program that teaches "families" of personnel to reinforce
one another on the job is called:

a. "change the way we work"

b. "orientation change"
c. 'change the way you work"
d. "customers are your customers"
e. "putting the customer first"

ANS: B
REF: 429

28. The culture change program that allows personnel to break the rules in the
context of serving their customers is called:

a. "change the way we work"

b. "orientation change"
c. 'change the way you work"
d. "customers are your customers"
e. "putting the customer first"

ANS: C
REF: 429

180
29. The culture change program that teaches personnel to flowchart their activities
and to re-engineer the process to better serve their customers is called:

a. "change the way we work"

b. "orientation change"
c. 'change the way you work"
d. "customers are your customers"
e. "putting the customer first"

ANS: A
REF: 429

30. The cultural change initiative, "change the way we work" is most directly related
to:

a. empowerment
b. enfranchisement
c. re-engineering
d. recruitment
e. training

ANS: C
REF: 429

31. The series of questions that force the firm to think about what drives its profits
is called:

a. blueprinting
b. flowcharting
c. process flows
d. service audit
e. service-profit chain

ANS: D
REF: 420

181
32. Which one of the following service audit questions does not belong within the
profit and growth component?

a. How does the firm define customer loyalty?

b. Does the firm set employee retention goals?
c. Does the firm measure profits from referrals?
d. What proportion of funds are spent on customer retention as opposed to
attracting new customers?
e. When customers do not return, do we know why?

ANS: B
REF: 420-425

33. Which of the following is not a major component of the service audit?

a. profit and growth audit

b. employee productivity audit
c. customer satisfaction audit
d. Servuction system audit
e. leadership audit

ANS: D
REF: 420-425

34. Which of the following service audit question does belong within the employee
productivity component?

a. How does the firm define customer loyalty?

b. Does the firm set employee retention goals?
c. Does the firm measure profits from referrals?
d. How does the firm measure employee productivity?
e. When customers do not return, do we know why?

ANS: D
REF: 420-425

182
35. Which of the following service audit question does not belong within the external
service value component?

a. How does the firm measure value?

b. How is information on customer perceptions of the firm’s value shared within the
company?
c. Does the firm actively measure the gap between customer expectations and
perceptions of service delivered?
d. Is service recovery an active strategy discussed among management and
employees?
e. Are employee aware of internal and external customers?

ANS: E
REF: 420-425

183
SHORT-ANSWER ESSAYS

36. Discuss the concept of seamlessness.

ANS:
 The primary efforts of the service firm should focus on the service delivery
process and on the personnel providing customer services. Creating a seamless
service organization means providing services without interruption, confusion, or
hassle to the customer

REF: 407

37. Briefly discuss the six key relationships depicted in the “service triangle.”

ANS:
(1) Firm’s service strategy must be communicated to its customers. (2) Firm’s
service strategy (commitment to service excellence) needs to be communicated
to the firm’s employees. (3) Firm’s service delivery systems should flow logically
from the service strategy and enhance the service encounter for all involved. (4)
Interactions with the firm’s systems should enhance the customer’s service
experience. (5) Organizational rules and regulations should not be obstacles in
the way of employees wishing to provide great service. (6) Customer/service
provider interaction. Also known as “critical incidents” or “moments of truth.”

ANS: 416

38. Discuss the importance of internal logics.

ANS:
 Internal logics are implicit and explicit principles that drive organizational
performance. Each department's logic is internally focused on departmental
needs and creates seams in the service delivery process. Operations,
marketing, and human resources are types of logics discussed in the text.
Service logic attempts to stitch the departmental and functional seams together
in order to help the firm provide flawless service.

REF: 413-414

184
39. Discuss the importance of organizational culture

ANS:
 In short, organizational culture establishes the do's and don’ts of employee
behavior and provides the basis on which various behaviors can coalesce.
Culture is the shared values and beliefs that drive an organization.

REF: 418

40. Explain the relevance of interfunctional task forces and interfunctional

transfers as they relate to corporate culture.

ANS:
 Both approaches have been used to mesh the logics of different groups and to
allow them to better understand one another. Interfunctional task forces are
problem-solving groups in which individuals with diverse viewpoints work
together and develop a better understanding of one another's perspectives.
Interfunctional transfers are when a employee from one organizational
department is transferred to another to foster informal networks among
departments.

REF: 426

41. Discuss the major objectives of a service audit.

ANS:
 The service audit directs the firm to think about forces that drive its current profits
and suggests strategies that lead to competitive differentiation and long-term
profitability. The key components of a service audit include: (1) profit and growth;
(2) customer satisfaction; (3) external service value; (4) employee productivity;
(5) employee loyalty; (6) employee satisfaction; (7) internal service quality; (8)
leadership; and (9) measurement relationship.

REF: 420-425