Examining competitive priorities and competitive advantage in service organisations using Importance‐Performance Analysis matrix

Daniel Indarto Prajogo · Peggy McDermott

70 citations0/0 files storedManaging Service Quality

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Customer Service Quality and Loyalty Quality and Supply Management Management Systems and Quality Improvement

Abstract

Abstract Purpose – This paper aims to examine the ten competitive dimensions of service in terms of relative importance and contribution to business performance, using the Importance‐Performance Analysis (IPA) matrix. Design/methodology/approach – Empirical data for this study was drawn from 190 managers of Australian service organisations, with primary responsibilities related to day‐to‐day corporate operations. The targeted service organisations encompassed various sectors, including: transportation, communications, banking, insurance, health care, education, wholesale, retail, and professional services. Findings – Based on the four quadrants of the IPA matrix, the results suggest that customer retention and productivity need to be maintained, while innovation and speed may receive a lower priority. Brand image and cost‐effectiveness fall into the areas which need improvement, while quality by conformance and delivery are identified as "potential overkillers". Furthermore, this paper tests the difference between high‐ and low‐performing firms and shows that low‐performing firms generally place a similar level of importance on the ten competitive dimensions as high‐performing ones, yet are not successful in converting what is important into performance. Research limitations/implications – This paper contributes to strategic management in service organisations by mapping the level of importance of the ten competitive dimensions of service against their effectiveness in improving business performance. Practical implications – The findings could help firms identify the competitive dimensions within their organisation that are effectively‐resourced, under‐resourced, or over‐resourced and provide guidance for, "fighting the good fight". Originality/value – This paper contributes to knowledge by identifying the competitive priorities held by service firms and their effectiveness in improving business performance.

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References

1994Competing for the Future 1977Importance-Performance Analysis 1990Delivering quality service: balancing customer perceptions and expectations 1979Quality Is Free: The Art of Making Quality Certain 1985Restoring Our Competitive Edge: Competing through Manufacturing.1997Innovation in services 2003Customer repurchase intention 2004The Four Service Marketing Myths

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