Report into Enhanced employee productivity and satisfaction

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The report studies about how the knowledge management strategies will help on improving the customer service quality within the organization with employee productivity and satisfaction.

The Report will discuss this area based on the following two sub titles,

Internal service quality indirectly talks about the contribution from the employees towards the customer satisfaction or service quality of the origination

Internal service includes operations, processes and activities which influence the work and behavior of employees in service organizations. The Internal service quality impacts on the level of employee satisfaction of the service component. The main point to note in this is that, employee satisfaction is a key determinant of the end results of the chain, customer satisfaction, loyalty, profits and growth. To deliver high levels of customer satisfaction, organizations must identify, measure and manage the internal elements that produce it.

The service value chain identifies employee satisfaction as a key component of customer satisfaction. Employees can be considered internal customers as they are supplied with goods and services by others in the organization. As such, only by satisfying the needs of internal customers, service companies could enhance their ability to satisfy the needs of external customers (Berry and Parasuraman,1998)

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The key influencing factor of external performance is the interaction between service components and customers. It is claimed that the quality of external service is greatly influenced by the interaction between internal service components, in other words, interaction between internal customers. According to Lewis and Entwistle (1990); "If these internal customers are unsatisfactory, the external customer may end up dissatisfied, complaining, and see the fault as lying with the customer-contact employee".

Employee Empowerment helps to improve employee interaction and satisfaction, when individuals are empowered they assume roles of both a work producer and quality assuror, in other words, they take full responsibility for the quality of the work undertakes by themselves as individuals or as members of a team.

Empowered employees require a clear shared vision of their organization, and will align their behaviors and practices to that vision. Building a shared understanding of values that underpins that vision provides a mechanism through which employees can assess alternative decision options (Jarratt,Ardagh and McLean 1999). A well-written code of conduct strengthens corporate ethical behavior by clarifying standards of behavior when undertaking company activities. These guidelines promote ethical decision-making at all levels of the organization (Verschoor 1997). Kaptein and Wempe (1998) argue that while it is important to sanction unethical or inappropriate behavior, not all actions should be verified by management. The code should empower employees rather that act as a sanctioning vehicle; it should encourage joint responsibility rather than fear of retribution. The authors argue that successful implementation will be dependent on trust and confidence of management in its employees, anticipating key problem areas, relevance of the code to the specific organization, and support of top management through development of a moral climate.

Influence of Employees on Service Quality

Both high quality products and good quality service can be strategic competitive advantages that have HR dimensions. W.Edwards Deming, an American quality expert, argued that getting the job done right the first time through pride in craftsmanship, excellent training, and an unwillingness to tolerate delays, defects and mistakes is essential to production. However, attempts to improve quality have worked better for some firms than for others.

In many organizations particularly in the service sector, service quality is affected significantly by the individual employee who interacts with the customers. At least there of the five dimensions service quality shown in below figure of the SERVQUAL model later discussed in detail in this chapter, are HR influenced.

Figure - 3 Five Dimensions of Service Quality

The empirical results of E. Babakus et al. (2003), suggests that top management commitment to service quality, as manifested by frontline employees' appraisal of training, empowerment, and rewards, has a significant effect on their perceptions of service performance. The influence of management commitment to service quality on service performance is mediated by frontline employees' affective commitment to their organization and job satisfaction. One way to achieve good service is to have motivated na d effective people within a service organization, hence one of the elements in focus will be a discussion of the internal dimension of service quality and customer satisfaction.

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The SERVQUAL tools advocated by Parasuraman et al. are used to measure the current level of service quality and satisfaction using five service dimensions which are; Reliability, Responsiveness, Empathy , Assurance and Appearance. The study reveals that there is a significant relationship between customer satisfaction and the implementation of service quality. The findings also suggest that the reliability dimension of SERVQUAL consist of three elements, namely a fault-reporting centre, response time and restoration time which have a strong correlation with customer satisfaction.

How these things can be applied to Knowledge Management :

By implementing knowledge management theories among the organization , it streamlines the business processes within the organization since everything will be documented and everybody will be noticed and acknowledged about what's happening in the organization . one of the main issues in the insurance industry is Customer complaints about insurance agents knowledge . they used to complaint saying that most of the agents are not aware about the procedures and the benefits about on the life insurance policies, and claiming procedures. When the Knowledge management strategies have been implement within the organization then it will help to aware of the procedures within the organization.

As mentioned above Employee is the main factor which helps improving the customer satisfaction. Indirectly these strategies help improving the service quality within the organization and to gain the market share and to cope up with the competitive advantage.

Discovering the way people work possibly changing the way they work for the better is something that knowledge management will address. The knowledge management programs are effective in improving the customer service , so the organization should spend more time on improving these methods to gain the advantage.