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The management of internal service quality (ISQ) has been an issue for the past two decades. There remains a need to compare and evaluate gap-based and perceptions-only measures of perceived quality in this context.
This article looks at a recent study that tested the two approaches both in terms of their theoretical underpinnings and in the light of practical considerations regarding the design of measurement systems. The study focused on three key questions:
- How reliable and valid is a gap-based measure of ISQ?
- How reliable and valid is a perceptions-only measure of ISQ?
- What are the benefits and limitations of each approach?
How reliable and valid is a gap-based measure of ISQ?
The study confirmed the reliability and validity of the gap-based measure approach to ISQ. One of the widespread criticisms of the gap-based measure is that external customers tend to inflate expectations-scores based on social norms. This study identified generally high-expectation levels, suggesting that, in the same way as external customers, internal customers may be prone to expectation inflation too. However, our findings contrast with an earlier study that reported lower and more varied internal service expectations compared with many external service studies.
This suggests that the problem of inflated expectations-scores occurs in some internal customer services but not in others. Therefore, we cannot make generalisations regarding the danger of expectation inflation in internal service contexts.
Another argument has it that, in external customer contexts, gap-based measures have higher diagnostic value than perceptions-only measures, and that difference scores can better pinpoint areas of deficiency within an organization. The results from this study suggested that this is also true in internal services: our data revealed significant differences in the order of internal service items and factors based on gap-scores as opposed to perceptions-scores. In these cases, the gap-scores are likely to be the more useful measure in terms of identifying improvement priorities, since they enable managers to target improvements in those aspects of service where internal customer expectations are high.
The respondents in this study had never before participated in a survey of their views on ISQ. A priority for management therefore was to gain some understanding of these customers' expectations as well as their perceptions, and clearly, the gap-based measure provided richer information in this respect. Moreover, regular monitoring using gap-based measurement would facilitate an understanding of changes in both expectations and perceptions over time. This is particularly important in industries where expectations are poorly understood – a common problem in internal services where there has been a dearth of research into internal customers.
In external customer contexts, the gap-approach is particularly pertinent in turbulent competitive arenas where customer expectations are highly dynamic and constantly changing in response to new competitive offerings. In this respect, internal customer relationships are expected to be more stable than external customer relationships and therefore, there may be less of an imperative to use gap-based measures in internal services. Indeed this was true of the internal services in this study: the working environment was stable, staff turnover was low, and many of the employees had worked there for many years. However, the managers who are implementing the measurement system must judge the turbulence of the internal service market. In organizations where there has been significant organizational change, high staff turnover, and general disruption to service activities and processes, it may well be necessary to measure changes in internal customer expectations as well as their perceptions.
“The more turbulent the organizational environment and the less stable internal customer expectations are, the greater the need to separately measure expectations and quantify the expectation-perception gap.”
How reliable and valid is a perceptions-only measure of ISQ?
The perceptions-only measure marginally outperforms the gap-based measure in terms of reliability and validity. When the focus of study is on the prediction of related constructs, the perceptions-only approach appears to be particularly strong. Furthermore, the practical advantages of the substantially reduced questionnaire length inherent in the perceptions-only measure, compared to the gap-approach, are a factor and should be recognised as such. In this study, staff “survey fatigue” was not a problem: the respondents cooperated well with the survey process; in fact, many were pleased to be given the opportunity to express their views on e-procurement service provision. However, in internal services where there is more reluctance to engage, for example, due to previous participation in surveys or a perception that feedback does not result in improvement actions, questionnaire length will be a more significant issue and the shorter perceptions-only questionnaire may be advantageous. Indeed, in organizations where expectations are considered to be relatively stable, it may only be necessary to measure expectations separately once every three years. This could reduce the likelihood of boredom setting in during questionnaire completion, thus improving response rates and heightening confidence in subsequent data analysis.
However, this study has also highlighted some of the drawbacks of the perceptions-only measure, in particular, the risk that adopting a perceptions-only measure of ISQ can result in the misdiagnosis of improvement priorities. For example, using perceptions data from this study, an operations manager would have likely focused improvement efforts on visual appeal, loaded catalogues, and loaded suppliers, despite the fact that gap-scores indicate that timely training, appropriate training, and ease of navigation all have significantly larger gaps between what is expected and what is being delivered. Indeed the internal customers' expectations of the latter items were consistently higher than their expectations of visual appeal, loaded catalogues, and loaded suppliers. Thus, prioritising improvements based on the gap-measure might have more of an impact on internal customers' perceptions of quality than prioritisation based on the perceptions-only measure.
Furthermore, when ISQ is measured longitudinally and performance trends are analysed, the perceptions-only measure is limited in that it does not enable managers to interpret sudden or unexpected changes in internal quality. For example, if perceived internal quality is in decline, the perceptions-only approach fails to reveal whether this is due to reduced internal service levels or a rise in expectations.
What are the benefits and limitations of each approach?
There is clearly a trade-off between the data richness and diagnostic value of the paired-statement gap-approach, compared with the marginally higher reliability, validity and significant collection efficiencies gained from the single-statement perceptions-only approach. If the development of a shared understanding of internal customer expectations is a managerial priority, then the gap-approach will provide data that can be used to help internal suppliers understand how customer expectations vary between different aspects of service and change over time. The more turbulent the organizational environment and the less stable internal customer expectations are, the greater the need to separately measure expectations and quantify the expectation-perception gap.
However, the pragmatic advantages of the perceptions-only approach, with substantially reduced questionnaire length, are significant and should not be under estimated in internal service environments. The attitude of internal customers towards the measurement process can have a major impact on their commitment to the process, their willingness to engage and their generosity in making time for the questionnaire completion. This will in part depend upon whether similar surveys have taken place in the past, and the perceived outcomes of these endeavours.
Ultimately, the choice of method must depend on the managerial purpose of the internal quality measurement system. This moves the debate on measuring ISQ away from evaluations of the effectiveness of gap-based versus perceptions-only approaches, and towards consideration of the operational contexts in which each approach might be appropriate.
January 2011.
This is a shortened version of “Measuring internal service quality: comparing the gap-based and perceptions-only approaches”, which originally appeared in International Journal of Operations & Production Management, Volume 30, Number 12, 2010.
The authors are Alistair Brandon-Jones, and Rhian Silvestro.