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Customer-Focused Service Guarantees and Transparency Practices (2018)

Chapter: Chapter 5 - Combined Role of Service Guarantees and Customer-Focused Transparency

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Suggested Citation:"Chapter 5 - Combined Role of Service Guarantees and Customer-Focused Transparency." National Academies of Sciences, Engineering, and Medicine. 2018. Customer-Focused Service Guarantees and Transparency Practices. Washington, DC: The National Academies Press. doi: 10.17226/25078.
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Page 40
Page 41
Suggested Citation:"Chapter 5 - Combined Role of Service Guarantees and Customer-Focused Transparency." National Academies of Sciences, Engineering, and Medicine. 2018. Customer-Focused Service Guarantees and Transparency Practices. Washington, DC: The National Academies Press. doi: 10.17226/25078.
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Page 41

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40 Although only eight of 22 surveyed transit agencies had both a service guarantee and customer-focused transparency practices, the objective of this synthesis was partly to understand how these two practices may or may not work together as part of a transit agency’s efforts to be more customer focused. Some noteworthy findings were uncovered when data from the section of the survey on service guarantees were compared with data from the section on customer-focused practices. For instance, in both sections, transit agencies were asked similar questions about why they implemented the customer-focused practice (service guarantee or customer-focused transparency). Transit agen- cies were asked to rank a set of predetermined options. Comparison of responses in both sections of the survey are provided in Table 17; reasons are sorted in order by the most often ranked first to the most often ranked last. The comparison reveals a high level of similarity between the reasons for implementing service guarantees and the reasons for implementing customer-focused transparency; in particular, increasing customer confidence, improving public perceptions, and relating both practices to a broader strategic plan or quality commitment were all ranked in the top five for both practices. However, customer-focused transparency was more likely to be requested by a third party— either through external mandate or through a board or other oversight body. Service guarantees were more likely implemented as a temporary solution to respond to an existing service problem. Transit agencies were also asked to report the perceived benefits of both service guarantees and customer-focused transparency using a five-point scale, with values from “strongly disagree” to “strongly agree.” When comparing the number of agreement responses (either moderately or strongly agree) for benefits associated with service guarantees to the number of agreement responses for benefits associated with customer-focused transparency, several noteworthy results were found (see Figure 15). The data suggest that although both service guarantees and customer-focused transpar- ency benefited agencies in similar ways, transparency provided more benefits in the form of an improved transit agency image with elected officials, the media, and the general public. Customer-focused transparency appears to be more focused on increasing the satisfaction and confidence of a transit agency’s amalgamated stakeholders through regular improvements in average performance. Improvements in performance (e.g., increased service reliability) effected through the power of performance reporting will likely be long term and sustainable. Service guarantees, on the other hand, do not deal with average performance but are directly tied to a specific individual’s experience on a particular transit trip. Service guarantees are focused C h a p t e r 5 Combined Role of Service Guarantees and Customer-Focused Transparency The main reasons for implementing service guarantees AND customer- focused transparency were • Increasing customer confidence; • Improving public perception; and • Enacting a strategic plan or customer commitment.

Combined role of Service Guarantees and Customer-Focused transparency 41 on increasing the satisfaction of individual riders—particularly after they experience a service problem. Although service guarantees may motivate improvements in service because of the potential financial penalty associated with customer remuneration, service guarantees alone may not be enough to effect long-term, sustainable improvements in service. Transparency itself likely has little direct effect on customer satisfaction after a service prob- lem. However, as previous research has suggested (e.g., Lidén 2004), service guarantees with remuneration can substantially increase customer satisfaction after a service problem. Ultimately, the question of how service guarantees and customer-focused transparency interact to influence customer satisfaction (in the short and long term) requires additional research. Reason Service Guarantee Rank Transparency Rank Average Rank To increase customer confidence 2 1 1.5 To improve public perception 1 4 2.5 Part of a strategic plan or quality commitment 3 2 2.5 Requested by board (or other oversight body) 7 3 5 Temporary; in response to service problems 4 8 6 To increase ridership (more passenger trips) 5 7 6 Requested by public 6 6 6 External mandate 9 5 7 Table 17. Comparison of ranked reasons for implementing service guarantees and customer-focused transparency. Increased fare revenue Brought new customers to the transit agency Increased ridership Improved customer satisfaction Helped the transit agency improve service quality Improved the transit agency’s employees’ commitment to customer service Improved the transit agency’s image with the general public Improved the transit agency’s image with elected officials Improved the transit agency’s image with the media Customer-Focused Transparency Service Guarantee 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Figure 15. Comparison of level of agreement with perceived benefits for service guarantees and customer-focused transparency. Note: The percentage agreements do not represent equal quantities (14 transit agencies had service guarantees, and 17 transit agencies had customer-focused transparency).

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TRB's Transit Cooperative Research Program (TCRP) Synthesis 134: Customer-Focused Service Guarantees and Transparency Practices documents the nature and prevalence of customer-focused practices among transit providers in North America and supplements the discussion by including information from European transit providers.

A growing number of North American public transit agencies have adopted service guarantees or transparency practices as part of a customer-focused service strategy. Service guarantees describe the level of service customers can expect and the procedures they may follow if standards are not met. Transparency practices might include reporting performance metrics as online dashboards or report cards on the agency’s website. Currently, there is little existing research on these practices and experiences among U.S. transit providers.

Update June 29, 2018: Page i of the synthesis omits some of the authors. The correct author list is as follows:

Michael J. Walk

James P. Cardenas

Kristi Miller

Paige Ericson-Graber

Chris Simek

Texas A&M Transportation Institute

Austin, TX

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