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| PUTTING THE SERVICE-PROFIT CHAIN TO WORK |
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| Author(s): HESKETT JL, JONES TO, LOVEMAN GW, SASSER WE, SCHLESINGER LA |
| Source: HARVARD BUSINESS REVIEW Volume: 72 Issue: 2 Pages: 164-174 Published: MAR-APR 1994 |
| Times Cited: 265 References: 1 |
| Abstract: In the new economics of service, frontline workers and customers need to be the center of management concern. Successful service managers heed the factors that drive profitability in this new service paradigm - investment in people, technology that supports frontline workers, revamped recruiting and training practices, and compensation linked to performance. And they express a vision of leadership in terms rarely heard in corporate America: an organization's ''patina of sprituality,'' the ''importance of the mundane.'' The service-profit chain, developed from analyses of sucessful service organizations, establishes relationships between profitability, customer loyalty, and employee satisfaction, loyalty, and productivity. The links in the chain are as follows: Profit and growth are primarily stimulated by customer loyalty. Loyalty is a direct result of customer satisfaction. Satisfaction is largely influenced by the value of services provided to customers. Value is created by satisfied, loyal, and productive employees. Employee satisfaction, in turn, results from high-quality support services and policies that enable employees to deliver results to customers. The authors provide a service-profit chain audit that helps companies determine what drives their profit and suggests actions that can lead to long-term profitability.
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| Document Type: Article |
| Language: English |
| Reprint Address: HESKETT, JL (reprint author), HARVARD UNIV, SCH BUSINESS, CAMBRIDGE, MA 02138 USA |
| Publisher: HARVARD BUSINESS REVIEW, SUBSCRIBER SERVICE, PO BOX 52623, BOULDER, CO 80322-2623 |
| Subject Category: Business; Management |
| IDS Number: MY589 |
| ISSN: 0017-8012 |
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| | | | | | | | | Record from Web of Science® | | | | | | | | | |