AN INVESTIGATION INTO THE APPLICATION OF SERVICES MARKETING CONCEPTS AT CHRISTIAN CHURCHES IN THE NETHERLANDS

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1 AN INVESTIGATION INTO THE APPLICATION OF SERVICES MARKETING CONCEPTS AT CHRISTIAN CHURCHES IN THE NETHERLANDS MA in Marketing Management Course Bruno Tunderman

2 An investigation into the application of services marketing concepts at Christian Churches in The M A I N M A R K E T I N G M A N A G E M E N T C O U R S E Table of Contents ABSTRACT... 3 INTRODUCTION... 5 About New Wine... 5 About the Author... 6 Environment... 7 Problems at hand Purpose and objectives LITERATURE REVIEW...14 Overview Services Marketing Framework Strategic Marketing Planning Services Marketing or a market-aware Service Delivery Organization Customer Orientation Service Development HRM and Service Delivery with voluntary workers Technology Innovation Quality Management Complaint Management Service Recovery Management Operating Model Church marketing initiatives Bruno Tunderman, student ID Page 1

3 RESEARCH METHODOLOGY...58 Positivism Social Constructionism Qualitative Research Design Observation Focus Groups Analyzing texts and documents Recording and transcribing Interview Questionnaire Candidates Analysis RESEARCH FOR PRIMARY DATA...70 Arenda Haasnoot PKN Geldermalsen Wim Stoorvogel - VBG Willem Smouter NGK Apeldoorn Gert Jan Brienen CGK Hoofddorp Norman Viss NGK Heemstede Strategic planning and profile Orientation Service Development HRM/voluntary workers Technology Innovation Quality management Complaints and service recovery Management and Leadership CONCLUSIONS & RECOMMENDATIONS...88 Previous Studies and Research Primary Field Research BIBLIOGRAPHY...99 APPENDICE A CURRICULUM VITAE APPENDICE B DISSERTATION PROPOSAL Title The Issue Objectives Overview Research Outcomes Planning APPENDICE C STUDENTS LOG APPENDICE D PERSONAL REFLECTIONS Bruno Tunderman, student ID Page 2

4 ABSTRACT In the last 30 years, Churches throughout the Western World have seen an enormous decline in Church visitors and loyal, committed members. Growth has been enormous after the early years right after Jesus death, became state religion in Europe but things went wrong after World War II and individualism and secularization took control over the social position of Christian Churches. Also in The a similar trend is noticed. Despite the fact that 6 out of 10 people in The still claim to be religious in some way, only about 11% of the total population attends weekly services or sermons. Churches in The therefore in many cases closed or merged with similar cultured Churches. Since people still have this religious awareness and spiritual needs to fulfil, Churches are losing market-share against new spiritual movements like New-Age, Sects and cults and other activities. If nothing happens Churches will furthermore experience decline and they eventually might look at discontinuation. Christian Churches therefore are facing a strategic issue. Churches might struggle with heavy doctrine, a boring image, lack of renewal, lack of leadership and lack of strategic concepts and implementation, the purpose of this study therefore, is to investigate the understanding and applicability of services marketing concepts within Christian Churches in The. Based on existing general services marketing literature, a theoretical framework has been created to benchmark earlier marketing studies and research within this specific area. Analysis of the conducted marketing studies learned that services marketing concepts, or marketing concepts in general, were often misunderstood by the interviewees and Church leaders. Their perception of what marketing really is, did not break-free from shampoo advertisements and logo design. By creating the theoretical framework covering a comprehensive holistic approach for service delivery and translation into Church context, a new way forward was found in the investigation research of services marketing applicability within Churches. Bruno Tunderman, student ID Page 3

5 By using an in-depth qualitative interview methodology I have been able to identify the understanding, acceptance and partially already existing application of services marketing concepts at today s practices within Christian Churches in The. But besides this recognition I also discovered lack of leadership, capabilities to implement vision and mission, connecting programs and actions with target groups, innovation and renewal of service delivery, quality measurement and improvement. Application of services marketing concepts in Christian Churches in the is in fact feasible and possible however external help with respect to implementation is needed. This dissertation including the abstract contains words. Bruno Tunderman, student ID Page 4

6 INTRODUCTION About New Wine New Wine is one of the stakeholders that might benefit from this study originally founded in the beginning of the 1980s by David Pytches, Vicar of St. Andrews, Chorleywood, United Kingdom. Through a growing friendship of David with John Wimber, founder or the Vineyard Church in the USA, he realized that one of the keys for success and revitalizing the Church was to equip the ordinary Church with ministry through the gifts and power of the Holy Spirit. John visited David s church, and held various public conferences which stirred up great hunger and interest from Churches across the nation. David began a series of one day conferences in St Andrew's for Church leaders, and in 1987/8 residential mid-week conferences at Swanwick (UK). They looked to David for leadership and St Andrews as an example of a local Church, joyfully transformed by the Holy Spirit and engaging in effective mission in a contemporary way. This evolved to internationalization of New Wine whereas Dick Westerkamp, today s chairman of New Wine has adopted New Wine s strategy and philosophy as from Dick Westerkamp is the vicar of the Dutch Reformed Church (NGK) in Houten where many innovations have been seen through the years after engaging into the New Wine organization. As of today New Wine has held 14 Leaders Retreats since 2000 and weekend conferences. In 2004 they held three week-end conferences & their first Summer Festival, which attracted 1,400 people to attend. The next summer conference is planned for July 2010 where more than 2,500 people are expected. New Wine is a network of churches and believers across all denominations who share the same values of worship, teaching and ministry. It is a mission led organization with a vision to see the nation changed through Christians and churches being filled with the Spirit, alive with the joy of knowing and worshipping Jesus Christ, living out his Word, and doing the works of the Kingdom of God. The organization seeks fulfilment of this vision by working with church leaders, hosting summer conferences for all ages, offering training through events and resources, and providing accredited qualifications in Kingdom Theology. Bruno Tunderman, student ID Page 5

7 About the Author Bruno Tunderman, the author of this MA in Marketing Management dissertation, is an active member of the earlier mentioned Dutch Reformed Church in Houten as of 1997 together with his beloved wife and two children. He has been involved in and personal witness of the amazing growth this Church has gone through during the last 20 years. The Church has started in 1985 with 20 people and has evolved into today s lively and exiting community of more than 1,300 members in contradiction to the general trend of Dutch traditional Churches in decline. Within these 1,300 members there is a majority group of young people between the age of that represents approximately 45% of the total community. Bruno s background is in the ICT industry where he has been working for almost 20 years in the area of sales and marketing. He also holds a Nima-C marketing degree and has developed a specialist s area into business development of new technology ICT propositions. Within his expertise he has seen many introductions of new technologies fail because of lack of strategic marketing planning. It is within his experience that marketing seemed to be on a level of just communications whereas within his perception it needs to be a fully integrated part and leading driver of a total comprehensive business strategy. In many cases he learned that management within especially ICT organizations, do not or at least at a very low scale, engage into marketing on a strategic level. Or if they do so, they seem to lack discipline to hold on to their strategic choices and keep focused on the strategic plan s and planning, defined value propositions and target markets. In order to be able to make a significant change to this, he started his own marketing consultancy agency Ecotel Business Solutions in As of then he has been contracted for several business development assignments and freelance contracts by a variety of ICT vendors and system integrators. Since many major often international corporations like Philips for instance tend to only work with fully accredited academics, he felt he would need to obtain his master s degree in marketing in order to be able to actually address and engage into management teams at strategic level within large corporations. This has basically became the driver for joining the Birmingham City University Part Time MA in Marketing Management course where a degree in Nima C is seen as an equivalent to the CIM program. Bruno Tunderman, student ID Page 6

8 Environment Since the beginning of time people have been looking for answers to questions for all kind of problems, enhancements, inventions and even things that are far beyond imagination. Looking for answers in physics but also in emotional and mind cracking situations. Let s look at, for instance, the existence of The Earth itself. That has been a subject for study and investigations for as long as we know time exists. A very appealing example of people looking for answers, but still were not able to find any, are the ancient Egyptians. Burying their Pharaohs with all kind of gifts and treasures just to make sure they will be taken care of in their after-life. Throughout the ages, people have been creating ways in order to understand their existence and reasons for just being here on the face of the earth. Many different kind of spiritual and religious activities have come up and gone away through time in all kind of forms and variances. One of the most well known, before our yearcalendar starts, is the People of Israel. Many manuscripts have been found proving their existence and history. These manuscripts have been integrated into the Jewish society and became their primary organizational fundamental structure where many religious traditions have been remained and recognized by many, many people. Who, for instance, is not familiar with the story about the Ark of Noah, the world wide flood and Noah saving his family and all pairs of animals (male and female). The actual Ark of Noah is believed to be found and discovered by Ron Wyatt an American archaeologist. On June 20, 1987, the Turkish government officially dedicated "Noah's Ark National Park," after a Government commission verified the investigative work on the site by American, Ronald E Wyatt and independent work by Turkish scientists and archaeologists. 1 Naval expert and engineer Tim Lovett investigated the science behind the claimed found Ark of Noah and wrote a book on it (2008), Noah's Ark: Thinking Outside the Box." In his book he tries to look at the science behind the Ark and tries to deduce whether it was practically possible for a man in Biblical times to construct such a ship. Lovett s conclusions are that the Ark of Noah actually might be true story. 1 Bruno Tunderman, student ID Page 7

9 The Jewish belief was one of many believes in those days. Many cultures had their own forms and expressions calling on to something beyond belief or something supernatural. It s within this traditional and pretty tight Jewish environment, mostly dominated by heavy doctrine, a new movement arise in the form of Jesus Christ. He began His teaching and preaching in this environment, where also many other competitive religious activities were manifest and spend about 3 years with His disciples. Many people would know that He is been crucified by the Jewish counsel of high priests because He was perceived to be a threat to the traditional Jewish institute. Now as we know in pretty much every institute, organization or whatever kind of structured model of people working or being together, there is also a hunger for power which certainly will have played it s part in what made the Jewish counsel decide to crucify Jesus. After His dead, resurrection and descending of the Holy Spirit, Acts 2: 1-4, A huge growth of the belief in Jesus Christ has been seen. The first Church was called The Fellowship of the Believers. And in Acts 2: we read, Jesus disciples spread his teaching all over the surrounding countries. Hundreds of thousand followers joined in. In the year 380, Christianity as it has been named after Christ, was declared to be the state-religion by the government of Rome within whole of Europe. Also within The the so called believe in The Holy Trinity; Father, Son and Holy Spirit, found its way and became the basis for the Catholic Church. Years passed until the reformation by Luther in 1517, followed by Calvin heading up around 1568 where reformed Churches started having their activities. This was the beginning of a series of differentiations and breakings within the so called Protestant Churches and denominations in The. Today we can differentiate, amongst others, the following mainstream denominations: - Catholics; - Reformed Community; - Reformed Released; - Protestant Churches (PKN); - Christian Reformed Church (CGK); - Dutch Reformed Church (NGK). Bruno Tunderman, student ID Page 8

10 The Dutch Central Bureau Statistiek (Central Agency of Statistics) is regularly surveying the Dutch population and asking them whether they believe in something and if so, what mainstream denomination they would associate themselves with. The data investigated in 2005/2006 has given the following overview: Mainstream Religions in The, 2005/2006 Translated clockwise: None, Catholic, Protestantism, Islam, Misc., source: CBS The same survey also investigated the intensity of Church visits. It appeared that 6 out of 10 Dutch people would consider themselves as being religious. 58% would recognize themselves being part of some Church which reflect to approximately 9 million people. Bruno Tunderman, student ID Page 9

11 The survey also concludes that from this 9 million people only 20% regularly pays a visit to Church meetings or sermons. This reflects to 1,8 million people. Within this group the Protestantism is the most loyal group with respect to attending meetings and sermons. Almost 33% pays their visits once every week or more often even. Only 7% of the Catholics visits the weekly mass. 57% of them are never or seldom going to Church. Participation into religious meeting/sermons, 2005/2006 Translated top-down: weekly, not weekly, seldom/never, non-religious, source: CBS Bruno Tunderman, student ID Page 10

12 Problems at hand These figures have to be looked into with respect to developments of at least the last 30 years. CBS has also put data together that reflects this timeframe: Religious activities developments Year Dutch Ref. Reformed PKN Catholics Misc. None Adapted from source: CBS Now these figures clearly show a dramatic decline in Church associated members. In else, they are facing a strategic problem. If they do nothing the decline will continue and eventually might lead to discontinuity. From a marketing perspective we could look upon these different kind of believes or religious activities as differentiated services. The actual product or service is the total combination of message, doctrine, teaching and being a community where people with the same sort of understanding between each other, become market segmented groups. Between those different religious activities one could recognize suppliers where the actual believers would be customers. The product offering itself contains many different items which all together will create an overall experience. Kotler & Armstrong (2006), Principles of Marketing, described this as the onion model where a product or service is the combination of the Core Product in terms of features and benefits, the Actual Product is the physical delivery and the Augmented Product refers to overall product experience. Kotler (2006), Principles of Marketing Bruno Tunderman, student ID Page 11

13 If we look to the product offering or rather service offering because of the intangibility of the product/service, we might want to look for different kind of marketing strategies than with regular tangible products. Shostack (1977) has developed a continuum for product/services varying from very tangible to very intangible. We can put the religious activities in the utmost right corner, i.e. a very intangible products/service. In her review she actually breaks free from product marketing and introduces a differentiation towards services marketing. Within the literature review I will therefore look for applied marketing strategies with respect to services marketing. Also confirmation of Churches being a service industry is found in the Santos & Mathews survey (2001). In their article they address the service offerings from Churches as being intangible, they have a high degree of consumer involvement and personal participation therefore consumption is inseparable with production. This will be the starting point for the secondary research that I will describe in Chapter 2; the literature review. Based on existing services marketing theories I will create a relevant and applicable framework of services marketing concepts. Using this framework I will be able to benchmark existing services marketing initiatives and the extent of their application within Church organizations. Bruno Tunderman, student ID Page 12

14 Purpose and objectives This study s purpose is to provide organizations like New-Wine with insights into possibilities to apply services marketing concepts at Christian Churches in The. New-Wine s mission is to equip Churches to grow. Before this study they referred to growth in a spiritual way. The outcome of this study might not only lead to improvement of overall qualitative growth but also to quantitative growth. The study objectives are to: 1. Investigate the understanding of marketing theoretical models by Church leaders and to what extent they are applicable to Churches. Once it is clear that they do, the second objective is: 2. To investigate the possibilities of actually implementing and integrating marketing concepts into their daily practice. The third and ultimate objective will be: 3. To have a starting point for discussions to put a stop to the decline and start thinking of growing again and offer modern and attractive Church communities. The first part of this investigation will be to create a relevant theoretical marketing framework based on mainstream services marketing literature. Based on this framework I will be able to benchmark previous marketing research initiatives within Churches and Churches in The in particular. The second part will be to collect primary data based on the framework to discuss the extent of acceptability and usability of this framework. This will be done by in-depth interviews with mainstream Church leaders in order to investigate possibilities, limitations and ways of innovation. At the end of this study conclusions and recommendations will be made for further research. Bruno Tunderman, student ID Page 13

15 LITERATURE REVIEW Overview Within this chapter, the existing literature with respect to services marketing concepts, will be critically investigated and a benchmark framework will be created. Based on this framework, previous marketing initiatives with regard to religious activities can be benchmarked and research that is still needed to be done can be held against this framework. Based on general accepted service marketing concepts I will be able to critically examine and check all marketing initiatives for consistency with the created services marketing framework. They will also be checked for acceptance within the Church communities, the extent of their understanding and capabilities for implementation because of the sensitive characteristics within this specific area. Finally there will be a highlight of issues to be explored for the primary research. Bruno Tunderman, student ID Page 14

16 Services Marketing Framework Strategic Marketing Planning Before actually engaging into any kind of marketing activity in whatever business area, there has to be a process of strategic marketing planning says Jain (2004), in his management textbook, Marketing: Planning & Strategy. He describes the process of strategic marketing planning as: Planning is essentially a process directed toward making today s decision with tomorrow in mind and a means of preparing for future decision so that they may be made rapidly, economically, and with as little disruption to the business as possible. In other words, planning is essential in making the right choices depending on where you want to be in the future spanning a certain timeframe, but keeps a close eye on today s business in order to maintain a maximum of current status. The planning process itself is the first activity from a strategic marketing point of view creating an organization s strategic profile. This strategic profile will contain: - Mission; - Vision; - Business definition; - Objectives. In this strategic profile it is therefore defined who we are, where we are today, where we want to go to in a certain timeframe and how we will get there. To define the business definition professor Derek Abell (1980), has written a book; Defining the business : the starting point of strategic planning. In this book Abell presents a three dimensional, relational model of a combination of functions/ needs from a customer perspective, targeted customer groups and technologies or deliverables a company has to offer. Bruno Tunderman, student ID Page 15

17 Abell (1980), Defining the business: the starting point of strategic planning This model will apply to all kinds of businesses including Churches. The customer groups are representing the Church members, both existing and prospective, the needs reflect what they are actually looking for in terms of service expectations and the technology reflects the ways service delivery from a Church perspective can take place. Hamel and Prahalad (2006) recommend spending more time on strategic thinking than most organizations currently do. On an average companies do not spend more than 2,4% of their time on corporate strategic vision for the future. At some corporations it is even less than 1%. They argue that for anticipating on future developments companies should learn how to think differently, not to neglect but to forget what has been. The extent in which companies are able to rethink the future will determine their rate of success. This is a difficult process, he who built the past might have great temptations to protect it. To gain insight and preparation for the future they recommend three essential questions to be addressed: - Do the needs of our customers change within the coming 3, 5 or 10 years? - What do we need in order to fulfil those needs? - What do we need to do to change our interface and interaction with our customers? Within Churches where traditions and values from the past are almost holy, this will be a shocking but necessary change and it would be highly interesting learning whether it would be seen as feasible or not. Bruno Tunderman, student ID Page 16

18 Services Marketing or a market-aware Service Delivery Organization After having defined a strategic profile every business should then organize their strategic plan and create a delivery organization, whether this contains pure goods or products, services or combinations. The marketing function of pure product or good manufacturing against services is for sure different. Santos and Mathews (2001) described loads of studies and academic research literature available on services marketing concepts and their main differences with product marketing. Within all kind of industries like healthcare, education, financial services, concert events, etc., studies have been done to identify and describe the four main differentiations in characteristics of services accepted by many marketing scholars being the intangibility, inseparability, heterogeneity and perishability of services compared to products (Gronroos 2000). Physical products are a bundle of features embedded in the ready-made product. Services however are different, they are processes, where no preproduced product to be marketed and consumed exists, (Gronroos 2007). In the 2007 edition of his book Service Management and Marketing, he argues that the marketing department also needs to operate differently. Where traditional marketing departments of product related companies manage the selling or promotion of products, within a service delivery organization management should have market-awareness in order to supply an optimized real-time experience. Vargo and Lusch (2004) do not agree with the characteristic differentiations between services and products. They argue that marketing scholars have created their own sub-discipline of services marketing and that, from a customer point of view, differentiation in characteristics is not possible. Products and services and their perceived quality by customers has everything to do with their overall experience, perceived added value and satisfaction of needs. True value can only be created in co-production with the customer. Any organization, therefore also Churches can only make value propositions. Customer interaction would be needed to achieve true value according to Wind and Rangaswamy (2000). Services marketing does not need to break free from product marketing, but all marketing should break free from manufacturing. Validating a marketing initiative for application within Church environments would therefore needed to be seen as an activity to create a marketaware service delivery organization rather than a selling or promotional activity. Bruno Tunderman, student ID Page 17

19 So how to build a market-aware service delivery organization? Issues that needs to be addressed and organized will be made clear by using a framework of elements to cover. As said strategic planning and creating a strategic profile is step 1. General services marketing literature from Palmer (2008), Wilson (2008), Lovelock et al. (2007), Gronroos (2007), Gillmore (2003) and Bateson et al. (1999) describe corresponding and consistent services marketing issues that needs to be addressed by any service delivery organization in order to achieve a sustainable and successfully market position. Since these issues apply for every service delivery organization who would like to become more market-aware, it makes sense to investigate these services marketing issues and their applicability within Churches as well. The most important issues that also have a relevant relation into Church service delivery are: - Customer Orientation; - Service Development; - HRM and Service Delivery with voluntary workers; - Technology; - Innovation; - Quality Management; - Complaint Management and Service Recovery; - Management. Since issues like pricing, productivity, demand capacity, promotion, competition strategies and distribution are not relevant at all or less relevant from a Church service delivery and strategic development point of view, they are out of scope in this research study and therefore not part of the strategic framework. Bruno Tunderman, student ID Page 18

20 Customer Orientation From a service marketing management point of view Alan Wilson wrote a book together with Zeithaml and Bitner, Wilson et al. (2007) Services Marketing, Integrating Customer Focus Across The Firm. In this book he very well describes how an organization should operate in order to become a customer focused service delivery organization. He gives a description of the GAPS model of Service Quality. It is his belief that there are multiple gaps between customer service expectations and the actual quality of service delivery. These gaps are caused by: - Not knowing what customers really expect; - Not applying the right service designs and development standards; - Not delivering the service against these designs and standards; - Not matching the delivery performance to promises made. Bruno Tunderman, student ID Page 19

21 IDENTIFY CUSTOMER NEEDS The first step heading up to be a market-aware or customer focused service delivery organization will be to carefully and utterly conduct a customer survey to clearly identify what the needs of our customers are. In other words reflecting to Churches; why do people come here? And what are they looking for? What do they perceive to be the added value they might get by joining the community? Lovelock et al. (2007) also describe the identification of customer needs as step 1 within his strategic services marketing framework: Source: Lovelock et al. (2007), Services Marketing, people, technology, strategy, Prentice Hall, New-Jersey Bruno Tunderman, student ID Page 20

22 CULTURE CHANGE This market-awareness and customer-need-driven approach immediately affects the total service delivery throughout the entire organization from top to bottom as Bateson et al. (1999) describe in their book Managing Services Marketing. Being a real-time experience a total coordination must take place from manager to receptionist, or if we look at this within a Church perspective from vicar or pastor to coffee-lady, from music-band to welcome committee. Interpretation of customer needs therefore is mandatory for all people involved and will play a critical role in communication from strategy, vision and mission to actual service delivery on all levels. If we can achieve market-awareness or customer orientation throughout the entire organization we achieve more than just implementing marketing concepts by marketing guru s. But as Bateson describes this requires a change in the dominant culture of the organization, away from operations and toward market-awareness. In a Church perspective this might be moving away from boring doctrine to modern attractive worship and interactive teaching. As Bateson et al. describe, this will mean a culture change being caused by three components; structure, systems and people. The model looks like this where correlation is made clear between the three components and the outcome regarding culture: Source: Richard B. Chase and Robert H. Hayes, Beefing up operations in service firms, Sloan Management Review (Fall 1991): p Structure is clearly reflecting the way the organization is currently organized and operates. Systems reflect processes and information exchange. The combination of changes within structure, systems and or people will have an outcome in change of culture. The difficult part is to control the changes and manoeuvre it the way you want. Bruno Tunderman, student ID Page 21

23 Service Development SERVICE DELIVERY DEVELOPMENT PROCESS In order to comply to customer needs, service delivery should be optimal aligned with those needs. Wilson (2007) describes a 6-step process starting with the customer need identification process up to adding evidence of delivered service. Step 1: Identification needs Step 2: Segmentation Step 3: Value proposition from a customer point of view Step 4: Mapping of customer contact interaction Step 5: Link customer contact interaction with supported functions Step 6: Adding evidence of delivered service One important item he addresses is to actually blueprint the whole process. By creating the blueprint it will become more visible in what way service delivery will comply to customer needs using the right standards and designs. If we take this to Church environments it might look like this: Step 1: Why would someone visit Church or join a Church community? Step 2: What groups are we serving? Children, teenagers, young adults, adults, elderly, singles, couples, families, boys, girls, foreigners? Step 3: Create a value proposition for every to be serviced group Step 4: How will the differentiated services be delivered at contact interaction points and moments? I.e. Services during the week, evenings, Sundays, style of services, worship, teaching, prayer services, etc. Step 5: Combine every service offering with appropriate support, i.e. a modern service might need a groovy worship-band and dance or drama. Step 6: Ask for confirmation of service delivery afterwards, feedback and evaluation. Bruno Tunderman, student ID Page 22

24 SERVICE SUPPLY CHAIN This is the total process in which the actual quality of the delivered service will be set. Wilson (2007) argues that driven from internal service quality (in other words, how well are we internally doing), employees will either be more or less satisfied. If they are satisfied they will be able to deliver a higher quality of retention and productivity leading into higher service value. When higher service value is achieved customer satisfaction will follow generating customer loyalty and sustainability. Looking at a Church perspective this means that everyone, involved in the process of service delivery, will contribute to the overall service delivery quality and sustainability of people joining and staying within the community. Since most Churches will only work with professional staff on pastor or vicar level, they tend to work with many voluntary workers, creating another issue being skills, knowledge and competencies of people involved. Bruno Tunderman, student ID Page 23

25 HRM and Service Delivery with voluntary workers True added value from a customer point of view comes from creating a sustainable relationship, Palmer (2008). Companies should ask themselves Why should a customer want a relationship with us?. If we relate that to Churches we can ask exactly the same question. Santos and Mathews (2001) refer to caring, sensitivity, sympathy and reassurance to focus on during service delivery but how can you demand this from voluntary workers? What system brings added value throughout the chain including added value for every single individual part of the chain? Wilkinson (2006) describes the supply chain as a business network, a complex, adaptive, selforganizing system. They comprise interacting people and firms that respond to each other and to the broader environment in which they operate. There is no network leader or captain in charge directing who should do what when and how. Instead, the overall structure and behaviour of the network arises in a self-organizing bottom-up manner from the micro interactions taking place and the overall or macro patterns of behaviour in turn exert a top-down effect on the micro interactions taking place. Naturally this is a highly theoretical and conceptual approach but what it does bring is awareness on all levels of people involved that everyone will contribute to the overall service delivery quality. In fact this is a very Christian point of view. If we look at 1 Corinthians 13: it says: For as the body is one, and hath many members, an all the members of that one body, being many, are one body; So also is Christ. For by one Spirit are we all baptized into one body, whether we be bond or free: and have been all made to drink into one Spirit. In other words from this point of view; all parts are of one body, the body of Christ, all contributing and adding value to each and every other part of the body. 1 Corinthians 13:26 says: And whether one member suffer, all the members suffer with it; or one member be honoured, all the members rejoice with it. Working with voluntary workers based on this vision, brings a joined mission but will nevertheless need the right skills and competencies. Since a professional HRM department mostly will not exist we need to work with a skill-matrix where everyone can express his or hers skills, competencies and willingness to contribute to a certain extent. Naturally this skill-matrix needs to be controlled and managed by staff members. Bruno Tunderman, student ID Page 24

26 Technology The use of technology support is reflecting usage of internet, , webcasts for sharing of video and audio, blogs, twitter and others. Also this is an area of importance regarding to Churches because this also requires high skilled and specialist technical voluntary people. In order to offer modern services for i.e. disability people, the use of internet is becoming more and more important. If services can be put on the internet or even better, uploaded via a life-stream audio & video broadcast, people all over the world would be able to virtually join the community service and take part in the service delivery experience. Naturally such an implementation will affect costs of technology and skilled personnel. A question Churches might want to ask themselves; are we able to implement these kind of technologies? Rather than are we willing to do this? A recommendation to include in the services marketing framework would be, consideration of implementing these technologies. An alternative might be to offer technology services from organizations like New-Wine. Also this could be addressed in the survey with Church leaders to make adoption and usage of this technology more easy and applicable. Bruno Tunderman, student ID Page 25

27 Innovation Once created the service delivery blueprint there will be a need for constant change and improvement in order to keep up with external developments and changes within the operations environment. Rapid growth of segmented groups (children, elderly people), new technologies, lifestyle, music, etc. will effect service delivery. This is why innovation is crucial to any kind of service delivery organization. Palmer (2008) describes a service lifecycle containing well known 5-stages: - Introduction; - Growth; - Maturity; - Saturation; - Decline. Palmer is in favour of using this model although the model is purely conceptual and will probably not be suitable for short-term actions but it will create awareness on a strategic level, that every service will last only for a certain amount of time and that they will need innovation in order to offer sustainable value. Just innovating will not be sufficient. Innovation also means change. And change is a common frightening issue. Accepting and adopting change, new attitudes and behaviour is like penetrating a new market with a new product. Bruno Tunderman, student ID Page 26

28 Rogers (1962) has developed a well known model for adoption called The innovation adoption curve : Rogers (1962)),The innovation adoption curve, Diffusion of Innovations, The Free Press, New York, USA This model shows that when introducing new technologies, new products or change into the marketplace, the innovators and early adopters will always take the lead in adopting the change. They represent 15% of the total marketplace and according to Geoffrey Moore s ( ) Crossing the Chasm, it s the key to reach those target-groups, get the opinion leaders committed and cross the chasm to the early and late majority to effectively get full innovation adoption. Whenever Churches engage into change or innovate their service offerings it would be recommended to use these models because of their basics on social behaviour characteristics of people. Look for the innovators and early adopters, get them committed and boost further change and adoption through them. Bruno Tunderman, student ID Page 27

29 Quality Management After implementation of strategic marketing planning, organizational structures and the actual service delivery organization, there will be a need for measurement & monitoring of service delivery quality. The overall well accepted model for measuring and evaluating service delivery quality is SERVQUAL developed by Parasuraman et al. (1998). By measuring the experience in service delivery from customers and changing or optimizing the operating model we will be notified where to act and where to change in order to ultimately comply. Originally based on 10 service dimensions they refined it to five dimensions: tangibles, reliability, responsibility, assurance and empathy. By measuring 22 items and calculating a score between expectations of service delivery and evaluation of the actual service the total amount of customer satisfaction can be given and compared. In the second part of the literature review I will investigate the academic research done by Santos and Mathews (2001) and their expanded work on the SERVQUAL model for application within Churches. In general, application of the SERVQUAL model will imply careful usage and consideration or customization of the set of determinants and attributes. Gronroos (2007) argues that interpretation of expectations of service delivery quality and the actual service delivery could be extremely difficult. How can you measure expectations against perceived quality when they occur at the same time? Will your expectations not be influenced by the actual service delivery? To make this more easy Cronin & Taylor (1992) created the SERVPERF model to measure perceived service performance only. This way of measuring is much easier to administer and analyzing data. The key for implementing the SERVPERF model will be to monitor customer satisfaction, or if we translate that to Church environments survey attendees for their satisfaction of delivered service. A person is either satisfied or not with the service delivered. As stated by many academic marketers (Palmer 2008, Lovelock 2007, Gronroos 2007, Bateson 1999, Berry 1980, Schlissel 1977) true value of services will be measured by experiencing and evaluation of the overall quality of service, products and their perceived added value versus the price that has been paid for. Bruno Tunderman, student ID Page 28

30 Now although pricing within Churches is not really an issue while payment is also voluntary, we can measure the overall perceived quality by 7 components, Gronroos (2007): - Professionalism and Skills, a Church visitor will realize that voluntary workers, systems, technology (sound, light, beamer, heating, etc.) teaching, worship, etc. have the knowledge and skills to contribute in a best effort to fulfill everyone s needs; - Attitudes and Behaviour, a Church visitor will feel that everyone taking part in the service delivery is concerned and personally interested in their wellbeing in a friendly and spontaneous way; - Accessibility and Flexibility, a Church visitor will feel that service delivery, location, service hours, people and operational systems are designed to operate in a way that is easy to get access to and prepared to adjust to (almost any) demands and wishes of visitors in a flexible way; - Reliability and Trustworthiness, a Church visitor must know that whatever happens they can rely on service delivery people and their performance, with the best interest of the visitors at heart; - Service Recovery, a Church visitor realizes that when something goes wrong, service delivery will take immediate action to keep control of the situation and find appropriate resolutions; - Services location, a Church visitor will feel that the physical surrounding and environment of the service encounter support a positive experience of the service delivery; - Reputation and Credibility, a Church visitor believes that the service provider can be trusted and provides profound teaching and that it stands for high quality and values which can be shared amongst everyone. This list is not exhaustive but could be used for managerial principles. There is however no empirical proof that these quality characteristics are applicable for Churches. Until 1996 there has not really been a way forward in academic literature or empirical studies actually using this quality model. Identifying and measuring the metrics still proved to be extremely difficult. Bruno Tunderman, student ID Page 29

31 The work of Christian Schwarz (1996, 2007) a German theologist has really meant a breakthrough on empirical studies for quality measurement of Churches. His work spreads over Churches across 70 countries around the world. Although Schwarz is not a marketer he has developed a methodology based on marketing principles by conducting quantitative field research within the Churches. Therefore his work does provide the necessary significance and validity of his statistics. The research of Schwarz covers 8 quality characteristics to identify the quality and potentials of a growing Church: - empowering leadership; - gift-based ministry; - passionate spirituality; - effective structures; - inspiring worship services; - holistic small groups; - need-oriented evangelism; - loving relationships. His research contains questionnaires that needed to be filled in by a minimum of 30 Church members in every Church. Their answers score on a T-scale with an average value of 50 and determines a quality index per question and aggregates on quality characteristic level. One of his major findings was that without any exception, every Church that has an overall score of 65% or more on all of the quality characteristics with a certainty of 99,4%, was growing. Since his work is aimed at Church communities it would be interesting to see whether this quality framework is used and frequently applied in order to investigate a Church current situation and when applied repeatedly, its progression. This quality framework will therefore play a significant part in the overall strategic framework and will be investigated for its application within Christian Churches in The. Bruno Tunderman, student ID Page 30

32 On other method of measuring & monitoring Quality on key performance indicators is the Balanced Scorecard, developed by Norton & Kaplan (1992): Norton & KIaplan (1992), The Balanced Scorecard, Measures That Drive Performance The general idea is that business strategy and mission is in the centre of all activities. 4 Perspectives are the drivers for improvement: - Financial; - Internal processes; - Customer; - Learning & growing. The balanced scorecard contains for every perspective, key performance indicators with minimum requirements or objectives. The objectives are measured to see actual status in a dashboard like style. In this way the organization will have a very quick insight in status quo and problem areas. Due to the iterative concept of this balanced scorecard model it s a way to create a continued model for learning, improving and customer alignment in an effective way. In principle the balanced scorecard is a very good model although it is very complex to implement. With regard to implementation of service marketing concepts in Churches it might be a bridge too far. Bruno Tunderman, student ID Page 31

33 Complaint Management COMPLAINTS AS VALUES ASSET Service failure and complaint management are frightening issues to deal with. Bateson et al. (1993) mentions a couple of terrifying facts about service failure: - For every complaint there are 19 others who did not bother to complain; - There are 12 positive experiences needed to overcome 1 negative one; - A negative experience is spread like fire, 9 or 10 individuals will hear about it against only 5 with a positive experience; - More than half of all efforts to minimize a negative experience will actually reinforce negative reactions resulting in even more dissatisfaction. These facts show the essence of service failure problems. On the one hand you do want to know them but on the other hand it s difficult to overcome them. Fact is complaints and service failure is inevitable. The nature of service delivery and failure is bound to occur. So do not try to avoid but try to minimize the risk of both service failure at itself and manage complaints when you get them. A complaining customer is a value asset according to Bateson. Complainers are telling the organization that is has some operational or managerial problems that need to be corrected. They are in fact giving the organization a free gift, like a consultants diagnose without the fee. Encouragement of complaints is valuable also in Churches. How many people left the Church without anyone knowing why? The difficulty really lies in the complaint management process. How to get the complaint but not discourage the people involved? For instance if the music-band is playing too loud, see to it that there is a complaint process in where intermediaries are the barrier for people involved. Bateson puts in a flowchart to manage this process: Bateson et al. (1999), Information flows within consumer complaints, Managing Services Marketing, South-Western/Thomson, Mason Ohio Bruno Tunderman, student ID Page 32

34 Lovelock et al. (2007) makes it clear why people complain: - To obtain restitution or compensation; - Vent their anger or frustration; - Help to improve the service; - For altruistic reasons. Recommendation for further study and research would definitely be an empirical study on complaint management within Churches. With respect to the study subject at hand and scope of this study I will stick to discussing the model within the services marketing framework. Find out whether implementation of such a service failure and complaint management process would be feasible and how communications should take place concerning the way the complaint process works and whom to address in case service failures occur. Service Recovery When a service failure does occur and complaint management processes are in place and it s clear for the complainer whom to talk to about his/hers complaint, we can look into service recovery. A most difficult process that needs to be very carefully conducted and communicated by very delicate and cautious people. Bateson et al. (1999) mentions a couple of good responses to service failures: - Acknowledgement, the complainer must be heard and seen; - Uniqueness and special, the complainer must feel that their opinions and experiences are valued and that they are important for the organization; - Apologies when appropriate; - Explanation of what happened, providing extra information about complexity or why things went differently than expected. After complaints have been notified and discussed they need to be filed and archived for administration and review in a later stage. Ideally the intermediaries should keep track of complaints and ask for affirmation on improvement at an appropriate moment later in time. Also this is a component that needs to be part of the services marketing framework. Bruno Tunderman, student ID Page 33

35 Management From an overall management point of view there are, not exhaustlessly, three issues for constant managerial monitoring and adjustment namely: - Quality Improvement; - Training Leadership; - Risk Management. QUALITY IMPROVEMENT When will good be good enough? Suppose we have a quality management system and monitoring process in place, measurement of quality, let alone improvement can still be very difficult. First of all, before we can think of quality improvement we will need to have an agreement on definitions, measurement criteria, managing and improvement possibilities, Lovelock et al. (2007). And even beyond quality improvement from a service delivery point of view the interaction and co-production of customers is equally important. Especially in traditional environments like Churches we can see reluctance or even resistance to changes because of familiarity and longestablished behaviour patterns. They can actually thwart attempts of service quality improvement. Lovelock argues for six possible steps that can help smooth the path of change: - Develop customer trust; - Understand customer habits and expectations; - Pre-test new procedures and equipment; - Publicize benefits; - Teach customers to use innovations and promote trials; - Monitor performance and continue seek improvements. Besides Schwarz s research (1996, 2007) regarding quality measurement he also found proof that quality improvement eventually will lead to quantitative growth of the Church community. His research gives insight in possibilities for Churches to improve on their minimum quality characteristic score. If the minimum-factor is improved, growth will follow in a natural way. This exactly underpins the statement made earlier by many marketing academics that true value of services will be measured by experiencing and evaluation of the overall quality of service versus the price that has been paid for. Bruno Tunderman, student ID Page 34

36 Schwarz discovered a helix-model based on a relation between quantity and quality. By improving the minimum-factor, barriers for further growth are withdrawn until the next minimum-factor arises and then a second barrier needs to be overcome. This process moves up until the next barrier rises. Schwarz (2007), Color your world with Natural Church Development, ChurchSmart Resources, St. Charles, Illinois The relationship between qualitative (yellow slices) and quantitative growth (spiral) in a Church: According to Natural Church Development, the quality of the Church in all eight areas determines the evolution of worship service attendance (quantity). The weakest quality characteristic (minimum-factor) plays the critical role. Eventually when all 8 quality characteristics achieve a 65% or higher score, growth will follow with a certainty of 99,4%. Bruno Tunderman, student ID Page 35

37 According to Schwarz s study; improvement of the 8 quality characteristics can only be achieved by a natural process of development through individual Church members. This exactly underpins the statements made by Wind and Rangaswamy (2000) that customer interaction is mandatory to achieve maximum value and quality in service delivery. By participating in the survey a Church profile will be created based on the score of all of the 8 quality characteristics. Next to strategic planning, actions and programs need to be developed in order to optimize the first minimum-factor. This optimizing itself needs to be a process in which individual Church members participate, and not a top-down tightly conditioned management program. Schwarz gives 6 natural based growth forces that can assist optimizing all quality characteristics: - Interdependence, there is a relation between all quality characteristics, by changing one, it effects the others; - Multiplication, a concept to multiplication of services is based on leaders training new leaders, Churches planting new Churches, etc.; - Energy transformation, don t put energy in opposing forces but instead put the energy in supporting forces, like how vaccinations work. Health destroying energies are transformed through the vaccination process into health-promoting ones; - Sustainability, is based on creating sustainable solutions, don t solve people s problems; help them to solve them on their won. This concept is the basis for fighting World poverty for instance; - Symbiosis, this describes two dissimilar organisms living together in a mutually beneficial relationship. In other words, there are no winners and no losers, decisions are made in such a way that everyone wins. General management literature describes this as a win-win relationship; - Fruitfulness, identification, planning and monitoring objectives. Since the Schwarz growth forces for optimizing quality characteristics seems to be a relevant and highly applicable concept and optimizing methodology, it would be interesting to investigate the application of Schwarz s quality improvement model within Christian Churches next to his quality measurement model. Bruno Tunderman, student ID Page 36

38 TRAINING LEADERSHIP Leadership is a very well understand concept within Churches. Bill Hybels (2009), leader of the Willow Creek Community Church, Chicago, USA wrote a very well received book within Church leaders on leadership titled The Language of Leadership. Within an interesting chapter on vision and strategy he argues for passion. Paint your Vision Picture Passionately: - Vision is a picture of the future that produces passion in people ; - Vision is the most potent offensive weapon in the leader s arsenal; - Paint your vision for anyone who will listen. He makes an interesting remark about hiring and development the skills of new leaders. In too many organizations people tend to protect their own position and hire less skilled personal in fear of their own position. Hybels strongly encourage leaders to embolden staff members to grow their own leadership and then to shoot high when someone needs to be added to the team. Encourage your leaders to go after the brightest, most accomplished, most effective leaders they can find. In doing so, you will continually upgrade your organization s leadership capabilities. John Kotter(1999), maybe the best-known authority on leadership says: Leadership works through people and culture. It s soft and hot. Management work through hierarchy and systems. It s harder and cooler The fundamental purpose of management is to keep the current system functioning. The fundamental purpose of leadership is to produce useful change. It s possible to have too much or too little of either. Strong leadership with no management risks chaos; the organization might walk right off a cliff. Strong management with no leadership tends to entrench an organization in deadly bureaucracy. Bruno Tunderman, student ID Page 37

39 Many management and leadership styles have been investigated varying from topdown approaches to bottom-up approaches. It proves these vertically organized leadership and management styles do not provide the necessary culture and atmosphere for effective change. True leadership evolves by 4 quality characteristics according to Beckman (2004). Inspire Coach Intervene Direct Adapted from Beckman (2004), Kernkwaliteiten van leidinggeven, het horizontale perspectief, van Gorcum, Assen, The Inspire Inspiring people is all about providing a vision. Leadership is about communicating the vision and leading the way to individual adoption of the vision. This personal connection of individuals with the vision will provide commitment and loyalty to support the vision. An anonymous vision will have significantly less-effective results. Coach Coaching is all about the learning process of employees and voluntary workers. Human capital is in many organizations a core value asset. How do they develop? Advancing knowledge and learning from others is very important and needs to be stimulated by leaders. Leaders need to support this learning process and give feedback. Learning is found most effective by using the zone of proximal development, a methodology originally developed by the Russian psychologist Lev Vygotsky ( ). Bruno Tunderman, student ID Page 38

40 His theory on the learning capabilities is based on a relationship between the level of competence and the level of challenge: Lev Vygotski ( ), Zone of proximal development Vygotsky coined the term Zone of Proximal Development to refer to the zone where teachers and students work as children moving towards independence. This zone changes as teachers and students move past their present level of development towards new areas of knowledge. Leadership and coaching based on this model will effectively lead to growth and better results. Bruno Tunderman, student ID Page 39

41 Direct Directing people to apply business services processes and how to make appropriate choices within these processes is mandatory. Choices need to be made aligned with vision and mission. Are we doing this? Are we going to pursue or are we going to stop this? This is an issue regarding improvement, attitude and behaviour of employees. Directions from management needs to be given to maintain individual identity and impulse reactions and stimulate creativity. Intervene When things go wrong intervention by leadership and management is demanded. This can be a painful action where a lot of courage is needed. Confrontations of what goes wrong or whom is not functioning well is the basis. Facts needs to be explained by clear communications in order to reach change in behaviour. Clear arguments are necessary without breaking the will of an individual person. This is the art of new horizontal leaders that can operate within the concept called servant leadership. Churches are not business corporations where management and leaders are hired and paid luxury salaries to keep the organization on a path of sustainable growth. Churches however do need leadership and management to inspire, coach, direct and intervene with their volunteers and staff workers when necessary. It would be interesting to learn how Churches deal with this issue and implement both leadership and management into their daily practice. Bruno Tunderman, student ID Page 40

42 RISK MANAGEMENT The last part of special attention for management has to do with risk management. Every change that is being planned will include a certain amount of risk. In commercial organizations these risks can include financial losses, loss of image and brand value or even at a personal level it can involve risk of career development and even dismissal. In Churches although money is not the first priority, risks are high with the introduction of every single change. Risk of failure, risk of disillusion and discouragement, risk of losing community members or even risk of national criticism, judgement and conviction of national community boards and organizations. Every change needs to be carefully thought through with a sound balance between the risks at hand and the benefits that are expected to be achieved by pursuing the change. Major concern therefore should be paid to pre-testing and questionnaires to minimize risks or at least to get a maximum basis and commitment from as many people as possible to embrace the actual change. As Jain (2006) said: conduct your development, preparation and implementation processes for the future with as little disruption to the business as possible. Bruno Tunderman, student ID Page 41

43 Operating Model After defining and creating the Service Delivery Organization, choices have to be made in terms of aligning the most optimum operating model in order to minimize the gap between expected services and delivered services. Treacy & Wiersema (1996) wrote a very well received management book covering this subject called The Discipline of Market Leaders. Basically what they say is that a customer will expect service delivery expectations in three major area s: - Operational efficiency, i.e. most efficient delivery (minimum of costs) - Product Leadership, i.e. constant innovation to meet customer needs - Customer Intimacy, i.e. knowing what these needs are and compliance to them. Treacy & Wiersema explain how these three focus area s needs to be balanced, they all need to be ok but it s best to excel in only one of them. A customer will not expect to get the best service possible, with the best product there is in the market at the lowest price possible. So choose one strategy, excel in that and keep the other area s in order. Once having this operating model in place a company should implement some kind of iteration process in order to keep an continuum between customer needs, service development and service delivery. These will become the major differentiator in the market where service delivery will be ultimately challenged against customer expectations. For Churches this choice of excellence will probably be Customer Intimacy, i.e. to offer a place where one feels welcome and accepted, a place where it s possible to be whom you are and where you will be able to participate in joined holiness. Service delivery should be efficient as possible and offer a constant renewal and innovation process to keep up with changing demands. This business model choice will not play a significant role in discussing the services marketing framework but does bring strategic awareness on management and staff level, especially with regard to implementing an iteration process of innovation and renewal. Bruno Tunderman, student ID Page 42

44 Based on the components listed before and the Lovelock et al. (2007) framework I created a Strategic Services Marketing Framework for Churches in which it is now possible to validate any research or study that has been done in the past and benchmark it against this framework. Tunderman (2010), Strategic Services Marketing Framework for Churches This framework will help me in positioning this strategic model and to discuss the theories and concepts with Church leaders and determine the extent in which the model and strategic services marketing theory is understood. Ultimately the Churches involved in this research will be able to use this framework and concept for repositioning, stop the decline and eventually possibly realize growth. Bruno Tunderman, student ID Page 43

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