MINISTRY OF EDUCATION & TRAINING UNIVERSITE LIBRE DE BRUXELLES HO CHI MINH CITY OPEN UNIVERSITY SOLVAY BRUSSELS SCHOOL
MQM2
Nguyen Thi Hoang Yen
ESTABLISHMENT OF SERVICE STANDARDS MANUAL for PASSENGER SERVICES at TAN SON NHAT AIRPORT
FINAL REPORT
MASTER IN QUALITY MANAGEMENT
Tutor’s Name: Dr Jacques Martin
Ho Chi Minh City (2010)
Trang 2List of Tables Table | The Number of Airlines operating at Tan Son Nhat airport 2000 - May 2010 Table 2 The volume share of Vietnam Airlines at Tan Son Nhat airport 2000 - May 2010 Table 3 The number of Ground Services Providers at Tan Son Nhat airport
Table 4 The Number of Customers shares between TIAGS-SAGS-Jetstar
in Passenger Services Providing at Tan Son Nhat airport
Table 5a Critical differences between Production of Services and Manufacturing in Characteristics
Table 5b Critical differences between Production of Services and
Manufacturing in Process Approach Table 6 TIAGS Range of Ground Services
Table 7 The Market share of TIAGS in Ground Services Providing at Tan Son Nhat airport
List of Figures
Figure | Airlines Customers at Tan Son Nhat airport 2004 — 05/2010 Figure 2 Eva Air — Quality Performance Result
Figure 3 Singapore Airlines — Quality Performance Result
Figure 4 China Airlines — Quality Performance Result
Figure 5 Air France — Non-conformity Rate
Figure 6 Vietnam Airlines — Quality Performance Result — Check-in aspect
Figure 7 Vietnam Airlines — Quality Performance Result — Boarding aspect
Trang 3Page 2/69 Final Report Table of Content Preliminary Section cssssssssssscsssscercecsscacsnssvenssassarssorersnsnssnssescssssseseonars 4 lân co 4 11 Introduction of Airlines industry: .ciccccsssecsetvencceevevecccesssseees 4 12 Introduction of ground handling services, especially passenger services6
13 The necessify oƒ service standards establishment 9
2 Infroduction of the final repOTT ‹ + sceeenehrererkeire 11 21 J@C VỆ: vn HH KH kg 0k T0 k2 .Tg 11 2.2 SCOPE? seecccsssecscccssnsvesesessseveresensesecsesesanseeeseeseceseeseeaecseauenseneees 11 2.3 Methodology vee ll 2.4 Structure oƒ the report „ L2 Main Section <<<<<see< we 14 Chapter 1: Theory Íoundation - ca cà Sen Hư 14 II go on 14
2 Quality Management System (QMS) overview l§ 21 Defining Quality and Quality Management System .- l§ 2.2 Explanation oƒthe QMS Model- «cc<crse LỒ 2.3 Eight basic gquality management pFiHCIDÏ6S ec«eeeeeretee 18 3 _ Customer Service Management (CSM) ~e 22 3.1 Defining Service .à cà HH ng HH g3 1114 1112k tr n0 22 3.2 CustOmer servVÌCe Si4HQFỔÌY nen 26 4 The relationship between the two sysfems 30 41 The role of the QMS: seevere 30 42 The role oƒ the CSM „ 31
Chapter 2: Introduction of TLAGS 32 1 General introduction 32 1.1 The formation and deVeÏlODIIGHI sgk kg rên 32 [8.120.205 34 1.3 CHSIOHFS se we 35 2 _ Service qualify aspect 36 P9» 36
Figure 1; Airlines Customers at Tan Son Nhat airport 2004 — 05/2010 37
2.2 Service Quality Performance Result icccecscveccessscisscssccsersesseentees 37
Chapter 3:ProposaÌ OỂ - 2s HH7 HH 8 46 Service Standards Manual << kg ng nh HH 46 II Methodology 46
1.1 Theory foundation of QMS (Quality Management System) and CSM
(Customer Service Management _ chen th triiree 46
Trang 41.2 SLA (Service Level Agreement) and AHM (Airport Handling Manual)
PA 2o TT —
2.1 MGLHOẢ ung tt 10
2.2 Criteria for EƒJective Service StandAardy c.< 3 Description of Passenger Departure Handling Services 3.1 CheCk-IH! DFOC€ÌHP QQ HH HH ng km nh 3.2 Boarding procedure
Trang 5Page 4/69 Final Report
Preliminary Section
For the purpose of applying the knowledge that I has gained from the MQM program of OU-SBS as well as the experiences accumulated to daily working at the company I work for — TIAGS (Tan Son Nhat International Ground services), the following final report suggests the proposal of service standards manual established for Passenger services at Tan Son Nhat airport
1 Rationale
11 Introduction of Airlines industry:
Transportation in general and Civil Aviation in particular play an important role in the National economy as well as the Global economic development There are about 2 billions passengers traveling yearly Airlines industry will make around 530 billions USD annually, though the world economic crisis has affected terribly
and the turnover in 2009 just attained 455 billions USD!
(Source: www.jata.org)
After 50 years of operating, the Civil Aviation of Vietnam has achieved the basic developments which contributes to the whole social economic development in
Vietnam
Up to the year of 2000, there are 18 airlines operating at Tan Son Nhat Airport With the opening market policy, more and more airlines come and join in Vietnam market with Tan Son Nhat Airport is the largest port for operating
Trang 6At present, the number of airlines operating at Tan Son Nhat airport has been increased rapidly: Area Number of airlines Year 2000 May 2010 International aspect 18 47 Domestic aspect I 7 Table 1: The Number of Airlines operating at Tan Son Nhat airport 2000 - May 2010 2
(? Source: TLAGS Marketing data)
Generally, the airlines have the trend of acceding to international airlines alliance in order to expand the routing and destination; or merging into the larger one to raise the competitive competence
Namely, there are 3 alliances dominating the International market - OneWorld,
Skyteam and Star Alliance — which attract and associate the well-known airlines As the result, they hold approximately 86% market share in the Airlines Industry
in the world Ÿ,
On the other hand, in Domestic market, it has been changed from the monopoly
status to the opening market There is a strong trend of merging the airlines to speed up the operational competence, such as: Pacific Airlines becoming part of Jetstar Airlines in 2008 and renamed Jetstar Pacific Airlines, VietJet Air sold 30%
shares to AirAisa in Apr 2010 to enhance the capital to join in Domestic market *
34 :
(” Sources: www.oneworld.com; www.staralliance.com; www.skyteam.com, www.jetstarpacific.com, www.vietjetair.com)
Consequently, the following table shows the volume share of Vietnam Airlines at Tan Son Nhat airport as an example of competition:
Trang 7Page 6/69 Final Report Area Volume share of Vietnam Airlines Year 2000 May 2010 International aspect 46% 43% Domestic aspect 85% 75% Table 2; The volume share of Vietnam Airlines at Tan Son Nhat airport 2000 - May 2010 °
(° Source: Vietnam Airlines Service Marketing data)
In conclusion, it is understood that a high competition between the airlines in market share with multiform competitive strategies and the airlines try to assert themselves by genuine values to exist and develop
1.2 Introduction of ground handling services, especially passenger services
In order to evaluate and rank the airlines which is proudly prized The Airline of The Year, it bases on the 3 main aspects: Ground services (or Airport services), Onboard product and Cabin service Thus, Ground services, which hold the high density, play an important role in overall quality of an airline and it is the strong competitive point between the airlines °,
(° Source: Skytrax World Airline Award — Annual Results Report)
Accompanied with the competition of the airlines, it also leads to the strong competition between the Ground services providers There even get freer for the airlines to choose the professional ground services provider or perform by themselves at the airport Consequently, it has been broken out the competition in the Ground services providing market:
Trang 8Number of Ground Year 1996 | 1997-2003 | 2004-2006 | 2006-May 2010 services Providers 1 2 4 6
Table 3: The number of Ground Services Providers at Tan Son Nhat airport ?
(’ Source: TIAGS Marketing data)
In airlines industry, Ground services include a number of services, from outside to
inside the terminal, with tangible or intangible outputs, such as:
> Station management and Administration services > Passenger services
> Aircraft servicing and Ramp Handling
> Specialty Training
Among these Ground services, Passenger Services has the largest density in
perceived quality of airlines customers in the view of Business-to-Business and
absolute density in perceived quality of passengers in the view of Business to
Customer Namely, passenger services are:
- The inputs for the rest processes and services The service quality delivered out of passenger service processes influent directly to the whole chain of ground services
- The Subject that Passenger Services deal with is human which affect to service quality through the customers’ perceptibility
Trang 9Page 8/69 Final Report
Handling passengers from the check-in procedure, through boarding process and finally onboard the aircraft It does not include the CIQ procedure (Custom , Immigration Quarantine) - Arrival Handling: Handling passengers from the incoming aircraft to the terminal and then to leave the airport - Transit/transfer Handling
Tan Son Nhat airport is the transit/transfer point between the three airports Handing passengers from the Arrival and to the Departure Handling
- Lost and &Found
With unexpected situation that the baggage does not arrive with the passengers, Lost and Found service will do the task of tracing and returning the baggage to the
passenger as soon as possible
Practically, TIAGS (Tan Son Nhat Int’] Airport Ground Services) — the subject company of this final report which is introduced in the main section, chapter 2 — had enjoyed the monopoly in Ground services providing at Tan Son Nhat airport
from the time of birth in 1993
In 2004, the first competitor joined this market named SAGS (SaiGon Airport Ground Services) With the advantage as the host company belongs to Sai Gon
Airport Authority, right from the beginning, SAGS wrested 3 over 24-customer
airlines from TIAGS and has attracted the incoming low cost airlines
Trang 10Up to May 2010, there are 3 Passenger Services Providers (among 6 Ground
Services Providers) operating at Tan Son Nhat airport with the market share as follow: Company Number of customers 2004 2005 2006 2007 2008 2009 | 05/2010 TIAGS 24 25 21 22 22 22 24 SAGS 0 10 15 16 18 19 20 Jetstar 0 0 1 3 3 3 3
Table 4: The Number of Customers shares between TIAGS-SAGS-Jetstar in Passenger Services Providing at Tan Son Nhat airport 8
(Source: TIAGS Marketing data)
In order to improve service quality for passenger services, it is necessary to plan,
do, check and act step by step, with the essential area first, then continue PDCA
for the rest This is the reason why the author would like to approach Passenger
Departure Handling Services first for its core basic service
1.3 The necessity of service standards establishment
With the intangible characteristics, it is extremely difficult for service provider to
understand, translate and meet the customers’ needs in the right way in term of
satisfying customers Thus, there always exists the Gap between Quality Expected
and Quality Perceived
Therefore, the service provider has to study continuously to narrow the Gap as
much as possible
It is said “The more the service is complex and intangible, the more the customer
try to catch on to the perceptible criteria” It means that service quality delivery
Trang 11Page 10/69 Final Report
will have the high competence to reach customer’s requirements as much as it is
standardized in detail
Based on technology and service quality classification, the airlines are ranked
starts at the lowest point as One star standard up to Five star standard Based on
ticket fare strategy, they divided into Low Cost airlines and Traditional airlines With the clarified business strategy of servicing traditional airlines, TIAGS is the service provider for the airlines which ranked at the top of the world, such as:
Cathay Pacific Airways, Singapore Airlines, Air France, Korean Air, Thai Airways, Lufthansa, Eva Air, etc
Progressively, more and more airlines concentrate on customer service For
example: Air France with Seven Ballies, Singapore Airlines with SPS All Star
Team, China Airlines with 4Must, Eva Air with White Program, etc All of these
requirements can be divided into groups of service standard that encourage the contact personnel to express their concern to customers in word and deed It is faithful to the spirit “Service straights from the heart”
For the above analysis, Ground Services and particularly Passenger Services are the core services competency of the airlines And only with the services standardized, the service quality would be stable
Thus, it is time to establish a service standard manual in order to build up a
foundation of Passenger services It is even useful for the purpose of training, controlling, measuring and improving Passenger services
Trang 12
Le Introduction of the final report 21 Objective:
With the reasons analyzed above, this final report is aimed to establish a service standard manual for Passenger Service at Tan Son Nhat Airport
2.2 Scope:
The final report is carried out for applying at Tan Son Nhat airport which TIAGS
is the subject company
In which, the service standard manual specifies the hard standards and soft
standards that follows closely the Passenger Handling processes, focusing on
Departure Services
2.3 Methodology
a Theory foundation of OMS (Quality Management System) and CSM
(Customer Service Management)
Trang 13Page 12/69 Final Report The more the foundation is reliable, the more the house is stable The QMS plays an important role in setting up a body spine on which the CSM exist and develop b, SLA (Service Level Agreement) and AHM (Airport Handling Manual)
o SLA (Service Level Agreement): is an agreement signed between
TIAGS and each airlines customer that specifies the service level
requirements providing for the airlines customer at Tan Son Nhat
Airport
o AHM (Airport Handling Manual): is a manual which translates SLA into service criteria to be applied at Tan Son Nhat Airport
C Evaluation criteria in Airlines industry
Beside SLA and AHM, each airlines customer owns the evaluation system to
control and measure service perceived
Moreover, there exists an industrial international organization that independently
compares and ranks the service standard of all the registered airlines in the World These evaluation criteria will be support to the proposal service standard manual in term of useful guideline
24 Structure of the report
For the purpose of ensuring the logical and practical requirements, this final report would be introduced in 3 sections as follow:
Preliminary section: clarify the rationale; define the objective, the scope and the methodology of the report
Main section: include 4 chapters:
Chapter 1: Theory foundation
With an overview of the QMS and the CSM, this chapter brings out how these two systems link together to define the service standards
Trang 14Chapter 2: Introduction of TIAGS
It would be nice to have a chance to introduce TIAGS through the background,
progressing status with Quality Performance Result (QPR) analysis Chapter 3: Proposal Service Standard Manual
Here is the central part of the final report Once again, it affirms the methodology which applied to establish the service standards manual
The structure of the proposal manual would be introduced in division of hard and
soft standard, pulled out from the Departure Passenger Handling Processes
Chapter 4: Further recommendations
In order to support for the persuasiveness and application of the proposal service manual, chapter 4 suggests the follow up actions that need to carry out at the time of approval
Supplementary section: enclose the References and the Appendices
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Main Section
Chapter 1: Theory foundation
1 Introduction
Service quality is even more difficult to define than product quality Although services and production share many attributes, services have more diverse quality attributes than product This often results from wide variation created by high
customer involvement ?
( S Thomas Foster, Jr - Boise State University, Managing Quality, 2001,
Prentice Hall, Inc., Upper Saddle River, New Jersey 07458, Pg.6)
Indeed, for service, quality specifications come from multiple simultaneous
sources, including the company and the individual customers The company
presents specifications as standard operating procedure Customer presents specifications based on their personal expectations Misalignment between company and customer specifications for the service process leads to dissatisfaction, even when the process goes exactly as it was designed
It does not mean service quality cannot be controlled because what we can
measure, we can manage Thus, the essential issue is to translate a generic service
quality into a specific service standard
Based on the Quality Management and Customer Service Management theory, this chapter aimed to approach the relationship between the Quality Management
Trang 16System (QMS) and the Customer Service System (CSM) through their models, basic principles and components Thence the desire result would be the mode in which the process approach principle as well as other Quality Management principles associates with hard and soft standard in CSM
2 Quality Management System (QMS) overview
21 Defining Quality and Quality Management System
Basic concept, according to Quality’s definition in ISO 9000: the degree to which a set of inherent characteristics fulfils a need or expectation that is stated, generally implied or obligatory
It can be understood that quality is not merely “good” or “bad, “nice” or “ugly”,
quality means satisfying the requirements
With management view, Quality is not something separate or autonomous in the
management of an organization As quality is a strategic objective that is established to fulfil the needs and expectation of the interested parties, it is in fact
the same thing as the main corporate objective of any organization Quality is a
part and parcel of the strategy of the organization
Therefore, the quality management system is the management system that enables the organization to fulfill its vision and mission
Practically, the quality management system set up to increase benefits, includes: > Increase the competitive competence of the organization;
> Enhance the customer’s satisfaction; > Reduce the operation cost;
> Increase the employees’ motivation in better working environment
Trang 17vờ Page 16/69 Final Report ' With the above benefits, an actually effective QMS build a strong and sturdy organism on which all the parties associating in mutual beneficial relationship and reach to the harmonic development
22 Explanation of the QMS Model:
The QMS can be expressed under a number of quality models This chapter prefer
to demonstrate the IS09000 QMS model as follow: Continual improvement of the quality management system Management HHH 77 responsibility Rescue pera management analy improvement `: Customers —————— Satislaction Customers Output J Product Product | Key ——_ Value-adding activities ——— Pm information flow
In order to understand the ISO 9000 Quality Management System Model, there are 2 directions: go from the left to the right and go into the circle
Trang 18This model starts from the Customer requirements As Peter Drucker said “We
only exist through our Customers” It means that if we have no customer, we do
not exist These customers’ requirements constitute the main input into the system,
are transformed by the system and then the Output come out of the system The Output may be product or service transferred to the customers and aimed to give
satisfaction to the Customers
In any QMS model, Customers always stand at the beginning and at the end
Inside the organization, there are 4 main elements
> Management responsibility: Management also means Top Management That represents what is the role/responsibility of the Top Management in the system The movement in the system comes from the Top Management In order word, no impeller started by Top Management, nothing can
happen Top Management drives the system
> Resource management: In order to keep the system alive, we need and
have to provide the resources (people, equipment, etc), which are necessary
to operate the system, and of course the Top Management is the person who
can decide to provide the resource
> Product realization: is what we do with the resource in order to produce
The product that can be physical or intangible is the main thing out of the activities of the system And this output goes to the Customers
> Measurement, analysis, and improvement: It is necessary to measure
what we have done because no measure no control From analyzing the measurement result, which defines what is right what is wrong, we can propose the improvements Finally, it goes back to the Management
Responsibility decision The result from these activities is intergraded by the Top Management and starts again Turn around and around This is the loop of continual improvement
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In summary, the organization gets information from the Customers Based on this,
the engine starts by Top Management, uses the resource into production, transform product to the customers, at the same time we do the measurement
23 Eight basic quality management principles
Each model owns its operating principles, which implies the spirit and even
answer generally for the question how to establish and maintain the QMS For the QMS based on ISO9000, Eight basic quality management principles are: Customer focus Leadership Involvement of people Process approach System approach to management Continual improvement Factual approach to decision making VV VV VV V WV Mutual beneficial supplier relationships Customer focus
Organizations depend on their customers and therefore should understand current
and future customer needs, meet customer requirements and strive to exceed
customer expectations
Customers are the reason for which organizations exist All organizations provide
something to others Customers are not simply purchasers but any person who receives a product or service Customer focus means that work must be organized as a process that answers customers’ needs so that to make satisfied customers All
Trang 20processes in the organization must possess a customer focus and everyone in the organization must be customer-focused
Leadership
Leaders establish unity of purpose and direction for the organization They should create and maintain the internal environment in which people can become fully involved in achieving the organization’s objectives
Leaders exist at all levels of the organization They are not simply at the level of the top management Every team has a leader And every member of the organization must be inspired by the values promoted by the leaders The culture, vision, values, beliefs and motivation in an organization arise from the leaders Good leadership aims at bringing about a set of shared values
Involvement of people
People at all levels are the essence of an organization and their full involvement enables their abilities to be used for the organization’s benefit
This principle means that the management of an organization should use the knowledge and experience of its personnel and encourage them to make a
contribution to the success of the organization It implies that management should
be open, participative and based on trust Process approach
A desired result is achieved more efficiently when related resources and activities are managed as a process
All work is a process because it uses inputs and transforms them into outputs All
processes must add value to the input A process is effective when the results obtained are the ones required to fulfill the organization’s objectives If it is not
Trang 21Page 20/69 Final Report
effective and does not add value, it must be scrapped or re-engineered The process approach to management is therefore not simply converting inputs into
outputs but managing processes that have a clearly defined objective, that are designed to achieve these objectives, that produce outputs satisfying the interested
parties, that are measured, reviewed in order to improve process efficiency
System approach to management
Identifying, understanding and managing interrelated processes as a system that contributes to the organization’s effectiveness and efficiency in achieving its objectives
Taking a system approach to management means managing the organization as a system of processes so that all the processes fit together, the inputs and outputs are connected, resources feed the processes, performance is monitored and indicators transmit information about the performance so that all parts of the organization work together to achieve the objectives
Continual improvement
Continual improvement of the organization's overall performance should be a permanent objective of the organization
This principle means that everyone in the organization should continually question
its performance and seek ways to reduce variation through better methods for doing things, and to enhance the organization’s capability
Factual approach to decision making
Effective decisions are based on the analysis of data and information
The factual approach to decision-making leads the organization to take certain actions The facts are obtained from observations Therefore reliable mechanisms
Trang 22for collecting facts, methods for interpreting facts and producing the relevant
information to make decisions are needed Mutual beneficial supplier relationships
An organization and its suppliers are interdependent and a mutually beneficial relationship enhances the ability of both to create value
Just like organizations depend on their customers, they also depend on their
suppliers Suppliers provide the materials, resources, services, information that
feed the organization’s processes They represent a big part of the inputs If these
inputs are not controlled, the processes cannot deliver the expected results These
supplier-customer relationships make up the quality chain
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3 Customer Service Management (CSM)
31 Defining Service
a Service, What is it?
There abound in definition of service, from a various researchers and specialists of
service field But most people will agree with the definition given by the British
magazine The economist that “Service is anything sold in trade but cannot be
dropped on your foot”
b Critical differences between Production of Services and Manufacturing > In Characteristics Characteristics Explanation of service Characteristics of goods
Tangible Intangible - Service cannot be inventoried '- Service cannot be patented
' Service cannot be readily displayed or: : communicated
_- Pricing is difficult
Standardized Heterogeneous |- Service delivery and customer satisfaction
| depend on employee actions
¡- Service quality depends on many | uncontrollable factors
- There is no sure knowledge that the service | delivered matches what was planned and
| promoted
Production ' Simultaneous - Customers participate in and affect the
separate from production and transaction
consumption _ consumption '- Customers affect each other
Trang 24- Employees affect the service outcome ` ˆ
- Decentralization may be essential
- Mass production is difficult
| Non-perishable | Perishable - It is difficult to synchronize supply and Ị demand with services ị f - Services cannot be returned or resold ; Table Sa: Critical differences between Production of Services and Manufacturing in characteristics > In Process approach PRODUCTION SERVICES Vertical process Horizontal process Principal Activities Support Activities Support Activities Contact Personnel Distribution ⁄ CUSTOMERS CUSTOMERS
(Source: G.Tocquer — Mr Langlois)
Trang 25Page 24/69 Final Report Production Service =”
All product activities to distribute to ~ Support activities and contact the Customers take place in vertical personnel almost taken place at the
line same time (in horizontal line)
Manufactured in a repetitive way and Produced at the request 7
Manufactured without any contact Realized in contact with the
with the Customer Customer
Produced in great number of copies Unique Everything held in real time
Stockable Exist only at the time of realization
Adapted with the time ~~ Adapted immediately
Table 5b: Critical differences between Production of Services and Manufacturing in Process Approach
€ An expended marketing Mix for Services
The term marketing mix refers to the primary elements that must be attended to in order to properly market a product or service The marketing iuix for physical goods is generally accepted to be made up of four parts - the 4 P's - namely:
Product, Price, Promotion and Place With services included there are three other namely: People, Process, Physical evidence that makes it the 7P's
People All human factors who play a part in service delivery and thus influent the buyer’s perceptions; namely, the firm’s personnel, the customer, and
other customers in the service environment
Physical evidence The environment in which the service is delivered and where
the firm and customer interact; any tangible components that facilitate performance or communication of the service
Trang 26_ Process The actual procedure, mechanism, and flow of activities by which
the service is delivered — the service delivery and operating system
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3.2 Customer service standards
Like any system of management, the CSM system operates as a loop in which the
evaluation and improvement system always exist for the purpose of being continual judgment by the Management Specially, the customer service standards which includes hard and soft standards are the soul of the CSM system as they are the origin and basis component
a Purposes
Customer Service Standards aimed to convey four purposes:
> Standardized Performance: First and most elementary purpose is that
Customer Service Standards are the obligatory requirements for the service handler performance They even create the sidelines that allow the service
handler express their manners within the standardization and keep them do
not deviate from the customer service orientation
PR: They are a powerful way of shaping the image that the Customers have
of the company '*
Evaluation: They are also great management tool for measurement how
well each person in the company meets the levels of service to which it
aspires '*
Training: Last but not lease, they are the foundation for the company
conducts the training which provides the input standardized human
resources for the operation processes
(''> Sources: Karen Leland and Keith Bailey, Customer Service for Dummies,
3" edition, Wiley Publishing Inc., Chapter 7, page 111.)
Trang 28b, Components
Parasuraman, Zeithaml, and Berry (1985) recognized the idea that service quality
is a function of the expectation — performance gap It named Servqual Model or also called Gap model According to this theory, it has five generic dimensions or
factors are:
> Tangibles: Physical facilities, equipment and appearance of personnel
> Reliability: Ability to perform the promised service dependably and
accurately
> Responsiveness: Willingness to help customers and provide prompt
service
> Assurance: (including competence, courtesy, credibility and security)
Knowledge and courtesy of employees and their ability to inspire trust and
confidence
> Empathy: (including access, communication, understanding the customer) Caring and individualized attention that the firm provides to its customers To concretize the Servqual model into service standards, m generally, Customer Service Standards can be wrapped up in 2 groups of standards: hard standards and
soft standards
b.1 Hard standards: are the physical elements that can be measure by the measured tool
> Time:
It shows a period of time standardized for the service delivery
Trang 29Page 28/69 Final Report Waiting time often comes at the beginning of the service process and can have a “halo” or “pitchfork” effect on how customers view the rest of the service
encounter; that is, whether customers view the rest of the service with either a favorable or highly critical eye depends on how they view their up-front wait l6, (6 Source: Richard D.Metters, Kathryn H.King-Metters, Madeleine Pullman, Steve Walton; Successful Service Operations Management, 2nd edition; Thomson Corp South-Western; Chapter 14, page 278)
> Facilities
They are the essential equipments and tools which support for the service handler
in term of constituting the service pack delivery
Started from the management of facts: to make tangible the intangible To develop by the mean of the physical support a set of positive “meanings” or symbols which constitute a true policy of communication intended for the improvement of the
service perception by the customer 7
(Ï Eiglier and Langeard)
> Basic of workforce
These criterions arise from the company’s view but affect to the Customers’ service perception As Customers, they may not concern how many staff working
at a certain time However, in order to evaluate service quality, the Customers look
for the Responsiveness that means the availability, willingness and readiness at the Customers’ needs and provide a fast service
b.2 Soft standards: are the human-being elements that create the image at the Customer about how customer-oriented of the company through the contact
personnel
Trang 30> Grooming:
It is also defined as appearance, outward or visible aspect of the contact personnel and can be expressed by the tidiness and aesthetic of clothing, physiognomy,
hairstyle, makeup, etc
> Attitude
It involves politeness, respect, consideration, and friendliness of contact personnel
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4 The relationship between the two systems
41 The role of the QMS:
a Defining the process and the procedure
The QMS permits to define the necessary processes and eliminate the unnecessary
ones For implementing the process, a number of procedures are built which clarify step by step for conducting the task in operation
In detail, a procedure answers for the question Who does What, by When and Where, for Why and How to do this task It is understood as the principle SW1H
in the QMS
b Defining the requirements and necessary resources
Based on the process and procedure, the organization defines the requirements and resources needed
For requirements, they can conclude employee competency, method for management, operating, measurement and evaluation
For necessary resources, they involve human resources, equipments, tools and material for operating
Ẵ Effectiveness evaluation
The QMS attaches special important to the effectiveness of the system Thus, once
a procedure established, it must be obligated under control
That means the QMS not only evaluate the effectiveness of the whole process but also each step of the procedure
Trang 3242 The role of the CSM
The CSM plays the role of defining the standards for service quality in order to
reach the Customer requirements
It implies the association between the elements WHO, HOW of the QMS and the
Service Standards of the CSM as follow:
' Who-How | — Defining Service standards
WHO - Who are the appropriate employee
- What level of competency needed to select the employee
- | What and How well the skill required
- Which characteristics required to adapt the job/task (b
means of attitude, behaviour, manner, etc)
- How well the appropriate appearance of the contac
personnel to satisfy customer oriented set by the company
HOW What physical evidences required (equipments, tools, |
signage, etc.)
- How long does each step of the procedure assign
How many employees needed at minimum
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Chapter 2: Introduction of TIAGS
1 General introduction
LI The formation and development
Tan Son Nhat International Airport Ground Services (TIAGS) — a Stated-owned
company and a subsidiary of Vietnam Airlines Corp.- was established in 1993
TIAGS has pioneered ground-handling services at Tan Son Nhat International
Airport with wide range of services
Formerly, TIAGS just organized as a mediuin firm which included the 2 front line
departments and the essential 3 back office departments Up to now, TIAGS’s organization has 11 departments with nearly 1500 employees
In 2000, TIAGS has built the ISO 9000 for its Quality Management System
(QMS) And recently, TIAGS has conversed successfully to version ISO 9001:
2008 in May 2010
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1.2 Range of services
TIAGS offers full range of ground handling services at Tan Son Nhat airport,
especially specializing in: Or No Range of Services Specialized Services 1 Station management and | Flights operation assistance Administration services | Irregularity operational support Liaising with various airport authority Load control Station representative and supervision 2 Passenger services Departure Services (Check-in and Boarding) Arrival Services Transit/Transfer Service Lost and Found Services 3 Aircraft servicing and | Aircraft Loading/Unloading Ramp Handling Baggage sorting and transportation Cabin cleaning Crew transportation
GSE (Ground service equipments), push back
and tow tractor Unit Load Device control Toilet and Water service 4 Specialty Training On job training Corporate training
Table 6: TIAGS Range of Ground Services
With the open market policy in airlines industry, particular at Tan Son Nhat airport, more and more Ground Service Providers come and join the market
Trang 36Consequently, the strength of monopoly had been enjoyed for many years by
TIAGS was no more lasting Thus, TIAGS’ statistic gives a convincingly evidence for the strong competition between the Ground Services Providers’ market share: Market share of TIAGS Year 1996 May 2010 in Ground Services Providing 100% 25%
Table 7:The Market share of TIAGS in Ground Services Providing at Tan Son Nhat airport 8
(Source: TIAGS Marketing data)
1.3 Customers
It divided into 2 kinds of customers > Airlines customers
Customers who are the airlines have the flight plot to the airport of Tan Son Nhat
International Airport in scheduled routine These are the current and potential customers using the services of TIAGS At present, TIAGS provides ground
services for 24 airlines customers, including the most famous airlines, such as:
Singapore Airlines, Cathay Pacific Airways, Air France, Malaysia Airlines,
Korean Air, Lufthansa, Eva Air, China Airlines, Thai International Airways, etc In which, Vietnam Airlines is the parent company as well as the main customer with nearly 60% market share at Tan Son Nhat airport
Besides, TIAGS also serves the airlines who operate charter flights with
commercial reasons, technical reasons, humanitarian reasons, aid, and emergency aircraft flights and special (VIP) flights for the senior team of countries within the
framework of diplomacy > Passengers
Trang 37Page 36/69 Final Report This kind of customer is the passengers who use airlines services for transportation, This is the special end-user of ground handling services, especially of Passenger services
2 Service quality aspect
Among Ground Services, as analyzed in the previous section, Passenger Services are the initial input and even the core basic services for the whole chain processes as well as the core competitive competence between the providers
Hereinbelow, this report would like to go into the details of Passenger Services
aspect
21 Context
Since 2004, TIAGS had the first competitor which was established by Tan Son Nhat Airport Authority — called SAGS (Saigon Airport Ground Services) SAGS Company has the host position and empowerment to handle full range of services at Tan Son Nhat International Airport
In 2005, Qantas invested in Pacific Airlines and tried their effort to expand the business under the new name Jetstar Pacific The first step is to set up the carrier as the budgeting airlines, the next step will continue with other services development such as ground handling, aviation training In 2007, Jet star Pacific
started providing ground handling services for some international low cost carriers
Therefore, TIAGS have has competed in the local market with two current SAGS and Jetstar Pacific In the next coming year, TIAGS have certainly faced with many other competitors due to the pressure of open policy for international ground
handlers in Vietnam market
Trang 38
The following figures express the partition of passenger services market at Tan Son Nhat airport for 2004 - 05/2010
Airlines Customers at Tan Son Nhat airport
2004 2005 2006 2007 2008 2009 May-10
BITIAGS NSAGS fal Jetstar
Figure 1; Airlines Customers at Tan Son Nhat airport 2004 — 03/2010
Within the context of narrowing down market share, what the airlines customers say about Service Quality Performance
22 Service Quality Performance Result
Eyery six months, TIAGS has carried out the Quality Performance Survey to
collect the airlines evaluations on full range of service delivery
Especially for Passenger Services, each airline has their own evaluation through passengers conducted by Airlines Head Quarter This Quality Performance Result (QPR) accumulated to the Management By Objectives (MBO) of the airlines and also used for ranking the airports among the worldwide flight routings
Trang 39Page 38/69 Final Report The following charts aimed to demonstrate and analysis the Quality Performance i Result of the five main and most important airlines customers of TIAGS for the period 2007 - Mar2010 Thereby, a lively picture of Passenger Services Quality of
TIAGS expressed
The five airlines are: Singapore Airlines, Eva Air, China Airlines, Air France, and Vietnam Airlines
For reference, according to Skytrax” — World Airlines and Airport Quality Advisors — The ranking of Airlines of the Year 2009 show the positions of the five airlines (among 167 airlines on over the World) as follow: Airlines Rank Singapore Airlines 2 | Eva Air 12 China Airlines 17 Air France 43 Vietnam Airlines 49 whe
( Skytrax is a United-Kingdom based consultancy, the public face of Inflight Research Services It conducts research for comercial airlines It carries out
international-traveller surveys to find the best cabin staff, airport, airline, airline lounge, in-flight entertainment, on-board catering, and several other elements of
air travel Apart from these surveys, Skytrax has an airline forum where passengers give other potential passengers the feel of an airline before choosing to fly with them They also have flight reviews, flight checks, and satisfaction
surveys They are best known for their annual World Airline Awards!) and World Airport Awards.)
Trang 40EVA AIR - QUALITY PERFORMANCE RESULT QUIL/2008 QIV/2008/ Q1/2009 ¡ QII/2009 ¡ QIH/2009 ¡ QIV/2009; Q1/2010 ;¡ OI/2010 ge 82! 82 82 82 82 82 82 82 rformance 82.2! 82 82.8! 82.5 81.2! 83! 82.91 83.5 EVA AIR - QUALITY PERFORMANCE RESULT “a —— Target —il- Performance
80 a = ¥ etic ca keo | tp hat San 1 - serials : es ca i r ee ¬
QII1/2008 QIV/200§ O1/2009 QIE2009 QTIV2009 QIV/2009 Q1/2010 QU/2010
_ Figure 2: Eva Air — Quality Performance Result
(Note: Quarter 1/2010 just include April and May2010)
7
iF ~ 7 over 8 quarters achieved the target and one of them felt + The trend is fluctuate unpredictably
- The disparities are little, from 0.2 to 2.3 point