How the Service Profit Chain links customer satisfaction and customer loyalty to a service films growth and profitability?
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 Under a Creative Commons license Open access AbstractThe classic Service-Profit Chain is extended to understand its relevance and usefulness for Telecom Service Industries. This three-tier, two-stage architecture features three major actors: Original Equipment Manufacturers, Telecom Service Providers and End Users. A questionnaire-based survey research was conducted to assess the mutual influence among various attributes like quality, loyalty, satisfaction, profitability etc., by testing statistically a thoroughly-argued set of comprehensive interlinked hypotheses. The findings proclaim that service quality and employee satisfaction provide the major impetus for boosting customers loyalty, satisfaction, and their repurchase behavior. For businesses to remain profitable, the results exhort that these attributes be continually monitored assiduously. KeywordsService quality Employee satisfaction Customer satisfaction Profitability Service Profit Chain Cited by (0)Dr Mohammad Sultan Ahmad Ansari (PMP) is Assistant Professor of Business and Economics with Modern College of Business and Science. The college is affiliated with University of Missouri St. Louis, USA and Franklin University, USA. Dr Ansari was awarded PhD in management and a certified Project Management Professional from Pennsylvania, USA. Dr Ansari is having more than 10 years teaching and 20 years of industrial experience at leadership position with Omantel, Reliance Telecom and State Bank of India (Probationary Officer). Dr. Ansari's core experiences are in Project Management, Strategic Management, Operation Management, Organizational Behavior, Entrepreneurship, and Managerial Economics. Dr. Ansari was associated with industry and having experiences in network planning, telecom wholesale, project management and successfully implemented projects amounting more than 200 Million US$. Represented at International Conferences and having published several research papers in international journals. He has been reviewer for International Journal of Quality & Reliability Management, Emerald Insight. The Research areas include Service Profit Chain (SPC), Operation Management, Emotional Intelligence, Employees Satisfaction and Loyalty, Customer Satisfaction and Loyalty. © 2020 The Author. Published by Elsevier Ltd. What is a Service-Profit Chain?The service profit chain is a representation of the internal service quality in a firm and how it links with other internal service elements to affect revenue growth and profitability. The service profit chain helps managers identify the factors important to improve the profitability as well as the revenue growth. What are the Elements of the Service-Profit Chain?Internal Service Quality - The first link is the internal service quality which includes the internal factors of an organization such as the workplace, employee selection, various tools used for serving customers, and the various employee development programs. Employee Satisfaction - The service quality factors lead to greater employee satisfaction. Employee Productivity - If employees are satisfied in your organization, it leads to increased employee productivity and thus they will be able to provide much better service to the customers. Employee Retention - A satisfied employee is an asset to a company and this satisfaction also prevents the employee from defecting i.e. leads to employee retention. External Service Value - If the above links are nurtured well, they enhance the external service value provided to the customer but if the previous links are not nurtured well it may even weaken the next link. External service value is what a customer feels he is getting for what he is paying, if the gap between customer's expectations and the company's offerings is minimum then the customers feel that they are getting a high service value. Customer Satisfaction - Greater service value leads to greater customer satisfaction. Customer satisfaction is increased by the frequency of good service and also it has to be maintained in order to keep the customers happy and thus the internal employees play a big role in increasing customer satisfaction. Customer Loyalty - If a customer is satisfied with the service provided, it means that if given a chance he will choose the same service again the next time. Customer Loyalty depends on customer satisfaction, research has shown that people who were satisfied and very satisfied showed a significant difference in customer loyalty. The results showed that a very satisfied customer can be as 6 times as loyal as a satisfied customer. Revenue Growth and Increased Profitability - More loyal customers directly lead to faster revenue growth and increased profitability. Good quality of sales leads to more profitability than a high number of low-quality sales. How does the service profit chain link satisfied employees with profit growth?The service-profit chain establishes relationships between profitability, customer loyalty, and employee satisfaction, loyalty, and productivity. The links in the chain (which should be regarded as propositions) are as follows: Profit and growth are stimulated primarily by customer loyalty.
What are the 5 links of the Service Profit Chain?The Service Profit Chain involves customer loyalty, customer satisfaction, employee loyalty, employee satisfaction and productivity.
What is the relationship between satisfaction loyalty and profitability?According to this logic, satisfaction affects loyalty and retention, which in turn increases revenues and lowers operating costs to increase profitability (Johnson, 1998; Reichheld, 1996).
What is customer satisfaction profit chain?The Satisfaction Profit Chain (SPC) is a theoretical framework that helps link attribute-level perceptions, overall customer satisfaction, customer intentions/behaviors, and financial outcomes.
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