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Weatherhead Doctor of Management Programs
Show moreThe question this study set out to answer was: what are the drivers of customer satisfaction and loyalty for “elite” airline flyers, in face of the unprecedented decline over the last three years (as indicated by the number of flight delays and cancellations) in the most tangible aspects of customer service. I asked this question because I wanted to find out how the flyer’s sense of elitism and loyalty to the airline could be maintained in the face of terrible service delivered by the airlines. This knowledge would be important for airlines to know inasmuch as this elite group is a major segment of the 2% of an airline’s passengers that contribute 70% of the airline’s profits. The study took place at a time when air travel in the US was extremely stressful due to numerous air traffic control delays resulting in delayed or canceled flights, crowded terminals and poor service in general. The Process To address this question I worked from the framework of the “Service Profit Chain,” fully developed by Heskett, Sasser and Schlesinger in 1994 to help understand the sources of profitability and growth in labor-dominant service firms. Within this framework I focused on two links in the chain, customer satisfaction and customer loyalty. I also reviewed the literature on customer satisfaction, customer loyalty, service recovery, and airline statistics. I utilized a criterion based sampling approach that focused on individuals. The target group was made up of frequent flyers who are current members of the airline clubs. To obtain information on their experiences with experiencing service over an extended period of time. Findings and Conclusions The study uncovered an interesting paradox. The literature informs us that total satisfaction is necessary to achieve high levels of loyalty, yet loyalty is occurring between the elite flyers and the airlines in the face of poor service. The study revealed that an explanation for this phenomenon was the recognition of a mode of satisfaction, satisfaction-as-resignation, which relates to lower satisfaction levels, equating to lower expectations of service. This is due to a change in customers’ subjective framework for evaluating the service received. The subjective change was directly caused by the chaos in the air travel system, which has conditioned elite flyers to be satisfied with a lower level of service, thus lowering their expectations of what constitutes excellent service delivery; hence, satisfaction-as-resignation. The study identified four broad categories of activities that affect expectations: individual interactions, developing trust through accurate information; deference to elite flyers status through space, comfort and personal security; and service recovery. The airlines have developed processes and practices in these four areas which, when applied, reinforce the elite flyer’s feeling of elitism. When the feeling of elitism is reinforced, feelings of satisfaction are developed with the actual level of service delivered at that point in time, resulting in elite flyers strengthening their loyalty to the airline in the satisfaction-as-resignation environment. This was especially true in a service recovery situation. When the airline solved a problem in a way that recognized the elite flyer’s status, it created a stronger bond of loyalty between the elite flyer and the airline. Based on the findings the study concludes with a number of recommendations in each of the four categories for the airlines, which are designed to further increase the loyalty of this profitable customer segment in the face of poor service delivery, as well as recommendations for further research in this area. Examples of the recommendation are: Airlines should · Take advantage of opportunities to use technology to deliver more differentiated value to their elite flyers. Specifically, the airlines should invest in well thought out, robust, scaleable and fully functional infrastructure and business processes to deliver the elite flyer experience. · Create better service recovery programs that catch all possible service errors. · Provide larger and more comfortable clubrooms with more working and quiet space. · Keep the clubrooms spotless. · Add security features to clubrooms. Further research of this nature can be conducted in other service industries in the area of technology intermediated services.
Doctorate of Management Programs
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