Gap Model of Service Quality- 5 Gap Model of Service Quality With Examples

Gap Model of Service Quality- 5 Gap Model of Service Quality With Examples. Gaps Model. Service Quality Gap Model. Service Quality Gaps. Gaps Model. 5 Gaps of Service Quality. Gap Model of Customer Satisfaction.

Gap Model of Service Quality

The gap model of service quality refers to the five gaps model that describes gaps in service quality of the organization’s customer experiences and service quality. In 1985, four scholars, namely A. Parasuraman, Valarie Zeithaml, and Leonard L. Berry, introduced the gap model of service quality in the journal of marketing manuscript titled “A Conceptual Model of Service Quality and Its Implications for Further Research.” It is also known as the service quality gap model.

This model articulates the gap between customers’ expectations and the service provided by the organizations. It assists service-providing companies in identifying customer satisfaction in different stages of the service delivery process. The service quality will be high when the customers’ perception meets the expectation, but the quality is low when the customer’s perception cannot meet the expectation.

Gap Model of Service Quality- 5 Gap Model of Service Quality With Examples. Gaps Model. Service Quality Gap Model. Service Quality Gaps. Gaps Model. 5 Gaps of Service Quality. Gap Model of Customer Satisfaction.
5 Gap Model of Service Quality

Servqual Gap Model

SERVQUAL Model evaluates the gaps between clients’ expectations and perceptions of service quality with five major service dimensions: reliability, assurance, tangibles, empathy, and responsiveness. The Servqual model of service quality assesses the customers’ expectations and perceptions; therefore, many scholars call it the Servqual gap model. Hence, many service-providing companies utilize the gaps model to identify and improve the clients’ satisfaction. The Servqual gap model, also known as the five gap model of service quality, represents a customer-satisfaction framework. However, the Survqual model is also known as the five dimensions of service quality.

5 Gap Model of Service Quality

The 5 Gaps in Service Quality are
  1. Knowledge Gap
  2. Policy Gap
  3. Communication Gap
  4. Delivery Gap
  5. Customer Gap

5 Gap Model of Service Quality With Examples

Gap- 1. Knowledge Gap

The knowledge gap in service quality refers to the gap between customers’ expectations of the company and its action of providing that service. It identifies what customers want from the industry and what the company typically offers to the customers. This gap can grow if management doesn’t focus on the customer’s expectations thoroughly.

Many reasons can increase the knowledge gap, for example:

Firstly, the knowledge gap in service quality increases when the industry does not carefully focus on what customers expect. Secondly, the knowledge gap increases due to a lack of upward communication and customer interaction. Thirdly, the insufficient market analysis also raises the knowledge gap.

The additional reasons for increasing the knowledge gap:

  • Less focus on relationships.
  • Failure to understand customer complaints.
  • Lack of interaction between management and customer.
Example of the Knowledge Gap in Service Quality

The user of Netflix wants to see the upcoming movie trailers on the Netflix official website. However, Netflix shows only the movie list on the site without knowing the customer’s expectations.  So, Netflix would suffer this gap if it did not provide the upcoming movie trailers on the site. Netflix change management certainly fulfills the gap between customer perception and expectation in order to achieve competitive advantages.

Gap 2: Policy Gap

The policy gap is the difference between management perceptions of the customer needs and the translation of those perceptions into service delivery policies and standards. This policy gap appears because of the dissimilarity between what the customer wants and what management provides for the customers.

Many reasons can grow the policy gap, for instance:

Firstly, the policy gap in service quality rises when the company has an insufficient commitment to service quality. Secondly, the lack of task standardization extends the policy gap. Moreover, the lack of goal setting raises this gap.

The additional reasons for increasing the policy gap:

  • Shortness of customer service standards.
  • Inadequately described service levels.
  • Failure to continually update service level standards.
Example of the Policy Gap

Netflix will suffer from the policy gap if it uploads the upcoming movie trailers after releasing the movie. People want to watch the movie trailer before releasing the film. So, Netflix should be more responsive to the customers and commit to uploading the film trailer soon.

Gap 3: Delivery Gap

The delivery gap is the dissimilarity between the standard of the service delivery policies of the company and the actual delivery of the service. The delivery gap in service quality arises when the company cannot maintain the standard of products and services provided to customers. This gap may occur because of the communication gap, poor technology, and inappropriate supervisory on productions in the industry.

This gap occurs because of many reasons in the industry, for example;

Firstly, the lack of teamwork to deliver services or products triggers an increasing delivery gap. Secondly, the employee’s lack of knowledge about the product or service grows the delivery gap. Thirdly, the insufficient human resources extend this gap.

The additional reasons for increasing the policy gap:

  • Role ambiguity and role conflict are unsure of your remit and how it fits others.
  • Poor employee or technology fit – is the wrong person or system for the job.
  • Inappropriate supervisory control or lack of perceived control – too much or too little control.
Example of Delivery Gap

Netflix may experience this gap if it uploads a lower video quality film. The customers prefer to watch films with high-quality regulations like HDR. However, Netflix streams films with 4K at 2160p, which reduces the delivery gap.

Gap 4: Communication Gap

The communication gap refers to the difference between what the company advertises about the products and what the customer gets delivered. It occurs when the company cannot provide services or products according to the commitment. It is a very important dimension because it may lead to customer disappointment.

This communication gap occurs because of many reasons in the industry, including;

  • Over-commitment.
  • Lack of integration between communication and production department.
  • Inadequate communications between the advertising teams and the operations department.
Example of Communication Gap

Netflix may suffer this gap if it is unable to telecast the HDR video that it promised to offer. So, Netflix should not commit to customers if they cannot stream HDR video on the site.

Gap 5: Customer Gap

The customer gap is the difference between customer expectations and perceptions of the service. This customer gap might appear if customers cannot understand the importance of the services and products. The customer gap also arises when clients misunderstand the service quality. Many organizations are not conscious of this gap; therefore, they are losing many customers overnight.

Conclusion

The five gaps in the service quality gap model are Knowledge, Policy, Communication, Delivery, and Customer. The five gaps model of service quality is known as the Gap model. The gap model of service quality analyzes gaps and problems between organizations and their customers. Customer gratification will come out if the industry adopts the gap model diagram, which is a very important factor for continual improvement as well as the business. Therefore, the service provides industries like hospitals, hotels, restaurants, entertainment & recreational companies, and education and tourism agencies focus more on the gap model to improve customer satisfaction. For example, the Global Assistant Education Consultant concentrates on the gap model to gratify their prospective and existing customers.

5 Gaps Model of Service Quality or Servqual gaps model. The 5 Gaps of Service Quality are 1. Knowledge Gap, 2. Policy Gap, 3. Communication Gap, 4. Delivery Gap, and 5. Customer Gap.

Red Ocean & Blue Ocean Strategy Examples & Difference in 2022

Red Ocean Strategy and Blue Ocean Strategy Examples & Difference in 2022. Difference Between Blue ocean and Red ocean strategy. Examples of Red Ocean and Blue Ocean Strategy. Also, Blue Ocean Strategy Four Action Framework.

Red Ocean Strategy

Red ocean strategy refers to the traditional marketing strategy to compete with the competitors. It is demonstrated when many companies compete to achieve a competitive advantage in the existing market. These companies contest in the same marketplace to beat their opponents. Red ocean strategy influences the company to provide better service to buyers. It mainly focuses on the existing customers and buyers rather than creating new customers. So, they provide better services and products to attract customers.

Characteristics of Red Ocean Strategy

Firstly, the red ocean strategy focuses on competing in the existing market. So, multiple companies compete with each other to achieve competitive advantages. The marketing team pursues both product cost and differentiation to beat other companies. Additionally, the company is intended to provide better service to buyers. Finally, they more attention to the current customers instead of looking for new clients.

For example, Malaysia and Air Asia Airlines follow the red ocean strategy to beat their competitors.

Red Ocean Strategy Examples

Air Asia is a renowned airline company in Malaysia. It always tries to compete with other airline companies in Malaysia, for example, Firefly, Malindo, and Malaysia Airlines, to achieve competitive advantages. Air Asia offers low prices in domestic and international flights to beat the competitors. On the other hand, Malaysia Airlines also reduce the price to beat Air Asia. So, they fight each other in the same marketplace. It is a real-life example 0f the Blue Ocean Strategy.

Suppose we infer these giant companies with sharks and the marketplace with the ocean. So, imagine what will happen if all these sharks fight with each other. The ocean gets bloody due to the fierce fight of sharks.

Advantages of Red Ocean Strategy

Firstly, the market has already existed, so no need to create a new marketplace.

Secondly, the services and products have good demand by the customers. Many customers want the products; so, the new companies can utilize the existing consumers.

Additionally, the company can recruit skilled employees easily who have deep experience in the sector.

Finally, the new companies can get ideas on how to improve the business from their competitors.

Disadvantages of Red Ocean Strategy

Firstly, The competitors are experienced in this market so difficult to beat them.

Secondly, the company needs to focus on cost and differentiation, which is difficult for a new business.

Blue Ocean Strategy

Blue ocean strategy refers to the uncontested marketing policy that focuses more on the innovation to reinvent the business than the head-to-head competition.  W. Chan Kim and Renée Mauborgne together introduced the Blue ocean strategy in 2005. It is a simultaneous process of opening a new business market and creating new demand; therefore, competition is irrelevant.

Blue Ocean Strategy Examples

There are several examples of the blue ocean strategy worldwide. Many industries had accepted it to get benefits, such as Netflix, Canon, iTunes, Cemex, Philips, NetJets, Curves, JCDecaux, Quicken, Polo Ralph Lauren, etc. iTunes solved the problem recording industries when it started the business. Before launching iTunes, consumers download a song illegally from the internet platform. ITunes’s blues ocean strategy created a new way of selling music legally, where consumers and artists became mutually benefited. They managed to make a new category of music selling through digital music platforms for listeners. Still, it is dominating the marketplace of music platforms for years.

Netflix organizational change is the most appropriate example of the Blue Ocean strategy. Netflix changed its business model to create an uncontested new market. It is one of the most successful companies that accept the blue ocean strategy to achieve competitive advantages.

For example, Netflix, Canon, and iTunes follow the blue ocean strategy to achieve the competitive goal.

Blue and Red Ocean Strategy Examples

For example, you put some sharks in a pond. Now, they are fighting each other. The sharks are trying to kill others. A few hours later, you can see the water has been red for the shark’s blood. We can infer this pond to the red ocean where many companies are competing with each other.

On the other hand, you put a shark in a separate pond. There is no other shark that can fight, so the water is blue and fresh. We can infer it to the blue ocean strategy where only one company controls the marketplace.

Red Ocean Strategy vs. Blue Ocean Strategy. Difference Between Red Ocean and Blue Ocean Strategy. Difference Between Red Ocean and Blue Ocean Strategy. Red Ocean vs Blue Ocean Strategy.
Red Ocean vs Blue Ocean Strategy

Red Ocean vs. Blue Ocean Strategy

Red Ocean Strategy
Blue Ocean Strategy
The contest is in the same market. Create an uncontested new market.
Many Companies compete with each other in the existing market. One Company dominates the new Market.
Beats competitors. Competitors are irrelevant.
The company pursues both cost and differentiation. The company chooses between cost and differentiation.
Make the value-cost trade-off. Break the value-cost trade-off.
Capture new demand. Exploit existing demand.
Focus on rivals within its industry. Focus across the alternative industry.
Intend to provide better service to buyers. Redefine the buyer group.
Focus on current customers. Focus on new customers.
The market is already established. Need to make the new market.
For example, Ryanair and Air Asia Airlines. For example, Netflix, Canon, and iTunes.
Difference Between Red Ocean and Blue Ocean Strategy
Red Ocean Strategy and Blue Ocean Strategy- Difference Between Red Ocean and Blue Ocean strategy. What is the Blue ocean strategy? What is the Red Ocean Strategy? Blue and Red Ocean Strategy. Examples of Red Ocean and Blue Ocean Strategy.
Difference Between Red Ocean and Blue Ocean Strategy
 1. Focus on Current Customers vs. Focus on New Customers

Most industries focus on attracting existing customers to sell more products and services in the red ocean strategy. Thus, they focus on the current customer to make a benefit by selling products and services.

In contrast, in the blue ocean strategy, the industry tries to change the business pattern to yield something new for the customers. The company also broadens the business area to develop new products or services; therefore, customers are irrelevant here. Thus, this strategy allows the company to focus on business patterns rather than customers.

2. Compete in Existing Markets vs. Create New Markets

From the red ocean strategy perspective, the industry is doing business with the customers where some industries gain more clients, and some other sectors lose clients. They are doing business among the same customers and competing with each other to get more customers. The company will earn more money if it can bring more customers to its umbrella.

The blue ocean strategy never suggests the company compete because it makes a new uncontested marketplace. The product and service are unique; therefore, no company will come to compete with you. So, this strategy creates an uncontested market to serve its customers.

3. Beat the Competitor vs. Make the Competitor Irrelevant

The competition must exist in the marketplace of the company that follows the red ocean strategy. They compete with each other to sell more products and services to increase profit margins. So, they always intend to beat the competitors through marketing policy, product quality, and services.

The blue ocean strategy makes the competition irrelevant because they need not compete with other industries to sell products and services. It makes a new marketplace for the industry.

Key Points of Blue Ocean Strategy

The eight key points of the Blue ocean strategy are as follows;

  1. It’s grounded in data.
  2. It pursues differentiation and low cost.
  3. Blue ocean creates an uncontested market space.
  4. It empowers you through tools & framework.
  5. Blue ocean strategy provides a step-by-step process.
  6. It maximizes opportunity while minimizing risks.
  7. Blue ocean also builds execution into strategy.
  8. It shows you how to create a win-win outcome.
Blue Ocean Strategy Four Action Framework

Chan Kim and Renée Mauborgne developed the four action framework to destroy the trade-off between low cost and differentiation and rebuild an industry’s strategic logic. The four Actions Template determines whether the investment money is properly used to maximize consumer gain and minimize consumer pain. It also assesses the gains that matter with this template and the pains that matter for your product. It is the best way of getting the most benefit with the least price within the total product market.

Four Action Framework Examples
Blue Ocean Strategy Four Action Framework
Figure 3: Blue Ocean Strategy Four Action Framework

How to Use Four Action Templates

Eliminate

Firstly, you have to identify the factors of the industry that need to be eliminated because of defectiveness. Find out the elements where you give significant investment and effort but getting very little output. These factors can also be made more contributions in the past but are now useless, so you need to eliminate them because of becoming obsolete.

Reduce

Secondly, you need to identify factors that are unnecessary for the industry and cannot correctly benefit the industry. These factors are well below the industry’s standard. For example, the higher cost of manufacturing can reduce the product.

Raise

These are the significant factors that need to be increased to fulfill the industries well above standards. For example, to exceed the customer’s challenges, the company needs to rebuild the features.

Create

These are the new features that the company never provided. To create these new features, you need to investigate the customer’s desire to fulfill them. The industry also can create new products or offer unique services for consumers in an innovative way. It will help the company to create a new marketplace distinguished from the competition.

Conclusion

In short, Red ocean strategy refers to competing for the existing marketplace, where the blue ocean strategy denotes making a new uncontested marketplace. Based on the discussion, it is safe to say that the blue ocean is a better way to bring fewer risks, more success, and increased profits. In addition, the four action templates appear as the best solution to identify the industry’s investment is properly or not. Hence, the blue ocean strategy and the four action framework have become innovative business innovations.