Fishbone and Pareto Analysis.

Prepared By:
Dipinder Singh Tib
M.Shashikant
Manish Bansal
Atreyee Banerjee
What is service quality ?
Product based approach
User based approach
Manufacturer based approach
Value based approach
Measuring and improving service
quality
Soft measure of service quality ?
These measure can not be easily observed
and must be collected by talking to
customers, employees or others
Hard measures of service quality ?
These relate to those characteristics and
activity that can be counted, timed or
measured thru audits
Tools for analyzing and addressing
service quality problems:
:
• Root cause analysis : Fishbone
diagram
• Pareto analysis
Root-cause analysis:-fishbone
diagram
What is it ?
The Fishbone diagram (sometimes called the
Ishikawa diagram) is used to identify and list
all the factors that are conditioning the
problem at hand.
The process is called Fishbone Analysis
because of the way in which the information
gathered is arranged visually – like the
skeleton of a fish.
 Fishbone Diagram (cause and effect)
3rd Largest Cause Largest Influence
Cause Cause
Cause
Cause
Cause

Cause Cause
Effect
Factors and/or
Cause Cause

categories
Least Influence of Influence
2 Largest factors
nd
Root cause analysis cont…

In this group of managers and staff

brainstorm all the possible reason that
might cause a specific problem.

Then these are plotted on the cause and

effect chart know as fishbone diagram.
Example : (Aircraft delay)
Reasons for delay can be :
1. If passenger tries to board at the last
minute
2. Gate agent can not process the passenger
quickly enough.
3. Late cabin clearance
4. Late food service etc …
 Facilities, Front-Stage Procedures
Equipment Personnel
Delayed check-in procedure
Gate agents cannot
process passengers - Confused seat selection
Aircraft late to gate fast enough - Boarding pass problems
Arrive late - Late arrival - Too few agents Acceptance of late passengers
Oversize bags - Gate occupied - Agents undertrained - Cutoff too close to departure time
- Agents undermotivated
Bypass ticket counter - Desire to protect late passengers
- Mechanical Failures - Agents arrive late at gate
Customers - Late Pushback Tug Late/unavailable - Desire to help company’s income
cockpit crews - Poor gate locations
Late/unavailable
cabin crews Delayed
Departures
Late food service
Late cabin cleaners
Other Causes Late baggage to
aircraft Poor announcement of
Weather departures
Late fuel
Air Traffic
Weight and balance sheet late

Materials, Backstage
Supplies Personnel
Productivity & Quality 9
Pareto Analysis

“80:20 Rule”
 Named after Vilfredo Pareto -an
Italian economist
•He observed in 1906 that 20% of
the Italian population owned
80% of Italy's wealth

•He then noticed that 20% of the

pea pods in his garden accounted
for 80% of his pea crop each year
The Pareto Principle
A small number of causes is responsible for a
large percentage of the effect-
-usually a 20-percent to 80-percent ratio.

This basic principle translates well into quality

problems - most quality problems result from a
small number of causes.

Addressing the most troublesome 20% of the

problem will solve 80% of it.  
The 80-20 rule can be applied to
almost anything
80% of the customers complaints arise from 20%
of your products and services.
80% of the delays in schedule arise from 20% of
the possible causes of the delays.
20% of your products or services account for
80%of your profit.
20% of your sales-force produces 80% of your
company revenues
20% of a systems defects cause 80% of its
problems.
 Pareto Analysis
Creating an array of representative sample
data that ranks the parts to the whole
with the objective to use the facts to find the
highest concentration of quality
improvement potential in the services.
Example
A Pareto chart has the following
objectives:
Separate the few major problems from the
many possible problems so that one can
focus on improvement efforts.
 Arrange data according to priority or
importance.
 Determine which problems are most
important using data, not perceptions.
Shows where to focus efforts.
A New Quality Goal:
Zero Defections
Reichheld and Sasser popularized the term Zero
Defections which they define as keeping every
customer the company can serve profitably.
Keep a track on the use of the service on an
individual account basis.
Root of the problem is customer loyalty.
Building and maintaining loyalty is a system
wide challenge.
So its necessary to get into the bottom of the
problem and make sure they don’t occur.
How Backstage Changes May
Impact Customers
For Example:
At a bank for instance, the decision to install
new computers and printers may improve the
internal quality controls and reduce the cost of
preparing monthly statements.
Front stage Efforts To Improve
Quality
Conduct market research first to
determine how customers may respond.

Communicate the change to the

customers through marketing
communication explaining the benefits
and rationale behind the change.
 Front stage Efforts To Improve
Quality…Example
• When Boeing 707’s replaced propeller-
driven aircraft on Transatlantic routes in
1957, both passengers and airlines
benefitted.
 A Caution on Cost Reduction
Strategies
Effortsto eliminate waste
and reduce labour costs may
prove harmful.

For example-Cutbacks in
front stage staffing either
mean that the remaining
employees have to work
harder and there are
insufficient personnel to
serve customers promptly at
busy times.
Customer driven approaches to
improve productivity.
• Changing the timing
of customer demand

Involving customers
more actively in the
production process

Asking customers
to use third parties.
 Changing the timing of customer
demand
• Customers often complain that the services they use are
crowded and congested, reflecting time-of-day, seasonal ,
or other cyclical peaks in demand.

• During the off peak period in those same cycles, managers

often worry that there are too few customers and that
their facilities and staff are not fully productive.

• By shifting demand away from peaks, managers can make

better use of their productive assets and provide better
service.
 Involve customers more in
production
• When customers perform self service both
the parties get benefitted.

• Encourage customers to place orders through

the web.
 Ask customers to use third parties
• Delegating one or more marketing support
functions to third parties.

• Purchase process often breaks down into

four components: information, reservation,
payment and consumption.

• Services of intermediaries can be availed

such as travel agencies.
 Sensitivity to customers’ reluctance
to change
• Develop customer trust
• Understand customer’s habit and expectations.
• Pretest new procedures and equipment.
• Publicize the benefits.
• Teach customers to use innovations and promote trial.
• Monitor performance and continue to seek
improvements .
 Conclusion
• Enhancing service quality and improving
service productivity are often two sides of
the same coin, which is why we treat them
jointly as a component of the 8Ps of
integrated service management.
• Together, they offer powerful potential to
improve value for both customers and the
firm.