Customers Expectations Versus Management Perceptions

Customers Expectations Versus Management Perceptions Eating is observably a daily action and necessity for all human beings. Depending on individuals reason for eating at restaurants, individual intentionally or instinctively assess a multifarious set of attributes ahead of choosing a restaurant. The significance involved to these restaurant attributes is ultimately evaluated in the customers mind, leading to a decision of purchasing (Johnson and Champaner, 2004). Thus, this study is to investigate how much service quality can have an impact on customer satisfaction and retention especially in our Mauritian context at KFC. As there is a casual inter-relationship between customer satisfaction and service quality, this study aims to find out the effectiveness of the service dimensions of service quality which leads to customer satisfaction and finally to retention at KFC. All the main aspects will be analyzed and recommendations will be drawn out for better improvement. Company Background History Kentucky Fried Chicken (KFC) was founded by Colonel Harland Sanders in 1952 and its primary focus is fried chicken. KFC also offers grilled and roasted chicken products, wraps, salads, sandwiches and desserts as well beef based products outside the USA. Although the death of Sanders in 1980, he remains a vital part of the firms branding and advertisements, and Colonel Sanders or The Colonel is a metonym for the company itself. In 1991, the abbreviated form of its name KFC was adopted by the company. The Present KFC operates more than 5,200 restaurants in the United States and more than 15,000 units around the world. In 109 countries and territories around the world, KFC everyday serves more than 12 million customers. KFC is world famous for its Original Recipe fried chicken, made with the same secret blend of 11 herbs and spices Colonel Harland Sanders perfected more than a half century ago. Based on the Fortune 500 List, KFC is ranked on 239 positions with revenues in excess of $11 billion in 2008. Introduction of KFC in Mauritius With time, consumers were more demanding for large variety of food and then, the first KFC outlet was launched in Mauritius-1983. Pick N Eat is the company which operates the KFC franchise in Mauritius. KFC has carved a solid reputation as a quick service restaurant which provides quality products and service. Across our island, 18 outlets are spread out and 10,000 customers daily are enjoying their finger-linking favorites in the consumer-friendly environment. Background of the program In the fierce competition, the market trend has changed noticeably from agricultural to service market. The service sector especially fast food industry is in a rapid growth and gain a position in the market due to lack of time to prepare food and dual income families. All of the fast food businesses are trying their best to improve their service quality in order to make customer satisfied and return back to them again. They are concentrating more on service quality in order to meet the needs and expectations of the customer. The more satisfied the customers are, the more likely they are to return to the restaurant. The restaurant industry has undoubtedly not been free from either augmented competition or from increasing customer expectations regarding quality. According to the Kaplan and Norton (2001) the importance of the perceived quality in order to get the retention effect in restaurant industry is always considered as a main element to retain in the customers and the business. The main reason behind that in this industry entry barrier are usually low and any one can easily enter due to investment required that is not on the higher side. So the point is that when ever consumer is satisfy from the arrangement by the management, the quality of the food provided by the staff members with the positive attitude than this result in increasing the loyalty towards the particular restaurant and increases the retention intensions of the customers. Problem Statement Service quality is a vital strategy for any restaurants, success and repeat business and it has long been defined by adopting a rather more customer-oriented view and not by the restaurateur-oriented (Saleh and Ryan, 1991). Customer is the key role in any business, without any customer it is difficult to do business. It is necessary to work closely with your customer. As customers can also create your business, thus, customer is the major part of business and also in the market. Business runs through customer, without the customer there is no business. Due to the increasing competition with other restaurants and quality-conscious customers, it is vital to carry out this research. There is a need for further improvement in order to face the competitors and meet the increasing customers expectation concerning quality. Based on the actual service quality performance of KFC, it is important to identify if customers are satisfied with the current situation and are likely to retain at KFC or switch to other competitors. Also, to find out the factors of service quality that leads to customer satisfaction and retention. From the above reasons, it is important that the service performance meets or exceeds customers and their expectation, the customer will be satisfied. Service quality is an antecedent of customer satisfaction. Research Objectives -To assess customers expectation and perception level towards service quality. -To analyze the discrepancy gap between customers expectation and perception level towards service quality. -To identify the discrepancy gap between customer expectations and employees perceptions at KFC. -To explore the service aspects of the dimensions which have an influence on customer satisfaction and retention? Research Questions -What is the level of customers expectation and perception towards service quality? -What is the discrepancy gap between customers expectation and perception towards service quality? -What is the discrepancy gap between customer expectations and employees perceptions at KFC? -What are the service aspects of the dimensions which have an influence on customer satisfaction and retention? Aims of the study This study is to find out whether the service dimensions have an impact on customer satisfaction and retention at KFC by using the SERVQUAL Model by Parasuraman, Zenithaml, and Berry (1988). It will also explore the service aspects that affect and influence customer satisfaction and retention. Significance of the study This study will act as a practical guideline for KFC, especially the management and the front line employees which may increased a higher level of customer satisfaction in the near future. The results of this quantitative assessment of service quality may provide some insights into how customers rate the service and assessed customer satisfaction at KFC. The outcomes will utilize as a basis to improve their existing service quality or to develop a new one in order to meet with the customers needs and satisfy them. Furthermore it will help KFC managers to know if they are providing services according to the norms established by customers. The management will be able to come up with a strategy for upgrading their service quality which will definitely lead to customer satisfaction and retention. All these views of customers will help KFC to remedy problems if there are and maintain their service quality. Phases of the discussion Introduction In the first chapter, the problem area is discussed with a deeper understanding regarding the research. The problem discussion ends with a research objectives and questions. In the end of this chapter, the contributions of this research are also presented. Literature Review In the second chapter, the literature review of service qualitys impact on customer satisfaction and retention is discussed with the following purposes of assessing customers expectation, customers and employees perception, identifying their gaps and the influencing service quality aspects. Research Methodology ************************************* Analysis ************************************************* Conclusion and Recommendation ******************************************************** Conclusion The first chapter provided us a background to the outline of the dissertation. It contained the research context, which is, identify the problems, and establish its aims and its objectives, set out the research questions and finally present the outline of the study. Chapter 2- LITERATURE REVIEW 2.1 Introduction This chapter will give an overview of literature and models that presented by writers and journalists. It will support the research objective presented in the previous chapter. The chapter will elaborate the concepts of service, service quality, customer satisfaction, customer retention, service quality dimensions, the gaps and others. 2.2 Service There are many definitions concerning the concept of service by researchers. (Parasuraman et al. 1985). Gronroos (1983) defined service as: An activity or series of activities of more or less intangibles nature that normally, but not necessarily, take place in interactions between the customer and service employees and/or physical resources or goods and / or systems of service provider, which are provided as solutions to customer problems. Service is: Any primary or complementary activity that does not directly. Produce a physical product that is, the non-goods part of the transaction between customer and provider (Payne, 1993). Whereas Kotler et. al. (1999) defined service as any activity or benefit that one party offers to another which is essentially intangible and does not result in the ownership of anything, and it may or may not be tied to a physical product. In today market, products heavily rely on its service to acquire competitive advantage and to satisfy customers needs. 2.3 Service Quality In the service industry, service quality has become a crucial tool. Practitioners are interested in the concept of service quality, which has an advantageous effect on outcome performance for the company. Service quality is a critical element of customer perceptions as well as in determining customer satisfaction. Various experts have defined service quality differently. Parasuraman et al. (1985) proposed a formal definition of service quality as the degree and direction of discrepancy between customers service perception and expectation. If expectations are greater than performance, then perceived quality is less than satisfactory and hence customer dissatisfaction occurs. Asubonteng et al. (1996) defines service quality as the extent to which a service meets customers, need and expectation. Hooley, Saunders and Piercy (2004) A prime factor in differentiating the product or service from that of competitors is quality. Quality concerns the fitness for purpose of a product or service. For manufactured products that can include the durability, appearance or grade of the product while in services it often comes down to the tangible elements of the services, the reliability and responsiveness of the service provider, the assurance provided of the value of service and empathy, or caring attention, received. 2.4 SERVQUAL Approach The SERVQUAL framework has come up for the purpose to improve service quality in services and retailing organizations as it has suggest that customer satisfaction is based on multiple factors rather than one. The SERVQUAL method developed by Parasuraman et al. in 1988 is a technique used to perform a gap analysis of an organizations service quality performance against customer service quality needs. Parasuraman et al. (1988) came up with five dimensions (grouped with 22 attributes) to measure service quality are tangibles, reliability, responsiveness, assurance and empathy. The SERVQUAL instrument is regarded as a reliable method of measuring service quality (explore customers expectation and perceptions), which in turn leads to a measurement of customer satisfaction. 2.4.1 SERVQUAL Dimensions In 1985, Parasuraman et al. has identified ten determinants for measuring service quality: reliability, responsiveness, competence, access, courtesy, communication, credibility, security, understanding or knowing the customer and tangibles. Later, in 1998, Parasuraman et al. refined the model to the useful acronym RATER:- Reliability It is defined as the ability to perform the promised service dependably and accurately or delivering on its promises (Zeithaml et al., 2006, p. 117). It is one of the most important service components for customers as it implies doing it right the first time. The service organizations need to keep its promise and maintain an error free record. The reliability factor: the staff performs tasks that have been promised to guests and resolve problems encountered by guests. For the food beverage industry, reliability can be interpreted to mean fresh food delivered at the correct temperature and accurately the first time (Andaleeb Conway, 2006). Assurance It is defined as the ability of staff to inspire confidence and trust. Assurance is defined as the employees knowledge and courtesy and the service providers ability to inspire trust and confidence (Zeithaml et al., 2006, p. 119). The staff can handle effectively complaints and problems from the guests. Customers are more likely to use tangible evidence to assess the assurance dimension such as awards or special certificates which give a new customer confidence. Tangibles Tangible is defined as the physical facilities, equipment, staff appearance and others. It translates to the restaurants interiors, the appearance and condition of the cutlery, tableware, and uniform of the staff, the appearance and design of the menu, restaurant signage and advertisements (Zeithamal et al., 2006). Tangibles are used by firms to convey image and signal quality (Zeithaml et al., 2006). Customers use this dimension to evaluate the quality. Empathy Empathy is the extent to which caring individualized service is given to a customer. The customer is treated as a king. Many small companies use this ability to provide customized services as a competitive advantage over the larger firms (Zeithaml et al., 2006). Empathy may be important to ensure customer loyalty as the server knows how the customer likes his or her food prepared. In return, the customer is easily approach and spell out their needs to the service provider. If a company looks its customer as an individual, as result, the company will come as a winner. Responsiveness Responsiveness is defined as the willingness to help customers and provide prompt service (Zeithaml et al., 2006, p. 117). The service provider has the ability to deal customer requests, questions, problems and complaints with attentiveness and promptness in a timely manner and it is crucial for the customers. In order to be responsive, a service provider has to determine how long it would take to get answer or to solve a problem. To be successful, companies need to look at responsiveness from the view point of the customer rather than the companys perspective (Zeithaml et al., 2006). This dimension captures the notion of flexibility and ability to customize the service according to the customer needs. 2.4.2 Service Quality Gaps Model In 1990, Zeithaml, Parasuraman and Berry have developed a survey instrument to measure the gap between customers expectation for excellence and their perception of actual service delivered. The SERVQUAL model uses the terms that describe one or more determinants of a quality service encounter. SERVQUAL as the most often used approach for measuring service quality has been to compare customers expectation before service encounter and their perception of the actual service delivered (Gronroos, 1982, Lewis and Booms, 1983; Parasuraman et al., 1985). There are seven major gaps in the service quality concept, out of which Gap 1, Gap 5 and Gap 6 are more associated with the external customers as they have a direct relationship with customers. Figure 1: SERVQUAL or Gaps Model (Zeithaml Parasuaman Berry 1988) Gap 1: Customers expectations versus management perceptions It is the knowledge gap which portrays the difference between the management beliefs about customers, expectations and what customers actually need and expect. This gap happens when there is insufficient flow of communication upwards, lack of marketing research orientation and too many level of management. Gap 2: Management perceptions versus service specifications It is a policy gap where a difference occurs between management perceptions regarding customers expectations and service specifications are set for service delivery. The reasons for this gap are unfeasibility, inadequate commitment to service quality and task standardization as well as an absence of goal setting. Gap 3: Service specifications versus service delivery It is the difference between the service specifications and the service delivery teams actual performance on these specifications. The gap is a result of poor employee-job fit, lack of perceived control and lack of teamwork. Gap 4: Service delivery versus external communication The communication gap is the difference between what the company communicates and what is actually delivers to the customer. It is due to inadequate horizontal communications and propensity to over- promise. Gap 5: The discrepancy between customer expectations and their perceptions of the service delivered It is the difference between what has actually delivered and what customers feel they have received. Customer expectations are influenced by the extent of personal needs, past service experiences and word of mouth recommendation. The difference occurs when customers are influenced and service provider has shortfalls. Gap 6: The discrepancy between customer expectations and employees perceptions The service quality gap is what the customers expect to receive and their perception of the service that is actually delivered. There is a difference in the understanding of customer expectations by front-line service provider. Gap 7: The discrepancy between employees perceptions and management perceptions This gap is mainly an internal difference in the organization such as differences in understanding of customer expectations between management and employees. 2.3 Customer Satisfaction Customer satisfaction is the heart of marketing. Customer satisfaction is the customers evaluation of the service or product against if their needs and expectations are meant. Richard L. Oliver (1997, P.13) define customer satisfaction as Satisfaction is the consumers fulfillment response. It is a judgment that a product or service feature, or the product or service itself, provides a pleasurable level of consumption-related fulfillment. Satisfaction is influenced by customers emotional responses, their attributions and their perceptions of equity. As Kotler (2000, p.36) defined that satisfaction is a persons feelings of pleasure or disappointment resulting from comparing a products perceived performance (or outcome) in relation to his or her expectation. Johnston and Clark (2005) defined Service as the combination of outcomes and experience delivered to and receives by a customer. Customers therefore judge the quality of the service on the experience as well as the outcome. 2.5 Customer Retention Lovelock (2004) illustrates importance of customer retention The hardest part of a business is customer retention. If a company does not retain its customers, inevitably it will fail. Marketing essentially means keeping customer loyalty. When an organization is able to retain a customer in a good way, the customers will be loyal with the firm for lifetime. Laura Lake (2010) defined Customer retention is not only a cost effective and profitable strategy, but in todays business world its necessary. This is especially true when you remember that 80% of your sales come from 20% of your customer and clients.. Hill and Alexander (2006) defined It is becoming accepted that there is a strong link between customer satisfaction, customer retention and profitability. After providing all service to customer, means that the organization understands customer expectation well, according to the customer expectation, organization provide all service and customer is loyal to the organization. It makes profit for the organization and organization has to retain by providing continues good services, more better customer satisfaction and that will be profitability for the organization. So, organization has to make strong relation with customers. 2.6 Customers expectations and perceptions 2.6.1 Customers expectations Consumers expect to be delivered quality products and services; therefore expectations play an important role in the customer satisfaction formation. The term expectations really matters to companies because they want to know what customers expectations are. According to Oliver (1981) à ¢Ã¢â€š ¬Ã‚ ¦ expectations are consumer-defined probabilities of the occurrence of positive and negative events if the consumer engages in some behavior. Customers form their expectations from their past experience, friends advice, and marketers and competitors information and promises. Organizations in order to keep expectations from rising, they have to perform services properly from the first time (Parasuraman et al. 1988). Thus, customer expectations for the service are likely to rise when the service is not performed as promised. Expectations serve as reference points in customers assessment of performance (Cronin Taylor, 1992). The purpose of trying to understand customers expectations is to try to ensure that service can be designed and delivered in order to meet those expectations. If the operation meets the expectations, or indeed exceeds them, then customers are satisfied with the service. If they are satisfied they are more likely to become valuable customers who not only use the service again, but are positively disposed towards it and may even recommend it to other Johnston and Clark (2005). Therefore, the perceived service quality is viewed as the difference between consumers perceptions and expectations for the service provided. 2.6.2 Customers perceptions Mc Kenna (2000) is of opinion that perception is a vital process in a persons life where he or she has to manage and interpret a situation or an event to define a particular respond. Service firms must understand the concept of service quality from the point of view of the customer, not from the view point of the service firm or service provider. Besides, customer perceives services in the response to quality pertaining to the service and the extent to which they are satisfied with the overall service with their experiences (Zeithaml and Bitner 2003). The customer satisfaction is determined by the customers perceptions and expectations of the service quality. Customer perceives services in terms of the quality of the service and how satisfied they are overall with their experience. The customers perception varies from customer to customer and each one has different beliefs towards the services that play a crucial role in determining customer satisfaction. Therefore, customer percepti on and customer satisfaction are very closely linked together, because if the perceived service is close to customers expectations it leads to satisfaction. Satisfied customers provide recommendations; maintain loyalty towards the company and customers in turn are more likely to pay price premiums (Reichheld, 1996). As such, perceived service quality is a key component of customer satisfaction. 2.7 Relationship between service quality and customer satisfaction A great emphasis need to be heightened on service quality and customer satisfaction. Sureshchandar et al, (2003) identified that strong relationships exist between service quality and customer satisfaction while emphasizing that these two are conceptually distinct constructs from the customers point of view. Spreng and Mackoy (1996) also showed that service quality leads to customer satisfaction while working on the model developed by Oliver (1997). Customer satisfaction and the quality of food have long been acknowledged as a essential function for success and endurance in competitive marketplace that have been connected to consumer behavioral intentions as purchase and loyalty intention, their willingness to widen positive word of mouth, recommendation, and complaint intention (Olsen, 2002). Customers perceived service quality has a positive effect on customer satisfaction. 2.8 Relationship between service quality and customer retention Service Quality is viewed as a vital means for customer retention. Service quality is regarded as one of key factors for service differentiation and competitive advantage for a business. It has been argued that service excellence enhances customers inclination to buy again, to buy more, to buy other services, to become less price sensitive, and to tell others about their positive experiences (Anderson and Fornell, 1994; Anderson et al., 1994; Rust et al., 1995; Zeithaml et al., 1996; Bolton et al., 2000). A study by Zeithaml et al. (1996), determines that service quality influences different intentions, such as giving recommendations, doing more business, and willingness to pay more. When customers perceive that they are receiving better quality service for their money, they believe they are receiving good value, which increases their loyalty to the service provider (Bolton et al., 2000). 3.0 Comparison between authors Many researchers and writers have their own opinion regarding service quality, customer satisfaction and customer retention. These opinions will definitely shed light and need to determine which is more applicable in this research work. Service quality has many definitions but the most common is the match of customers expectation and their experience. Asubonteng et als definition is more relevant to this study as it describe as the extent to which a service meets customers, need and expectation. The SERVQUAL model is valued as an all purpose measurement and Parasuraman et als definition has used in this study. Some authors define the service quality gaps model similarly as a mean to measure customers expectation and customers perception. The SERVQUAL dimensions in this study have mostly used the definition of Zeithaml et al which are Reliability- to perform dependably and accurately, Assurance- knowledge, courtesy, trust and confidence, Tangibility- the physical evidence of the servi ce, Empathy- caring individualized service to customer, Responsiveness- the willingness to help. Oliver, Kotler, Johnston and Clark illustrate customer satisfaction as a positive response of the consumers expectation. Customer retention becomes a necessity for the success of a business. Oliver, Johnston and Clark agreed with the fact that customers expectation should be understand in order to design better service and meet their expectation. Then, the customer will be satisfied and Parasuraman et al. explained that in order to increase the level of expectation, the task must be done properly at the first time itself. Regarding customers perception, Mc Kenna, Zeithaml and Bitner share the same opinion that it the way of customer to interpret their experience and if they are satisfied. 4.0 Application of the theory at KFC Internationally, a service quality assurance team conducts regular surveys in every KFC restaurant in every country. The evaluation is mainly attributed by the aspects of CHAMPS including cleanliness, hospitality, accuracy, maintenance, product quality standard and speed of service. This is to evaluate the customers experience whether they are satisfied or not with the products and services. In Mauritius, KFC has already executed the theory of service quality and conduct survey regarding the services locally. A Hazard Analysis Critical Control Point (HACCP) program is implemented in order to identify, evaluate and control any physical and environmental hazards in the work place. KFC restaurants in Mauritius are constantly checked through internal audits and checks by the parent company with the aspects of CHAMPS. KFC has its own training center recognized by the franchisor for their staffs and also have achieved National Quality Award. The most significant policy of KFC is evaluating the customers experience with KFC restaurants, whether they are satisfied or not with the products and services, and they can also put their comments and suggestions for further improvements of the products and services of KFC. Today for Mauritians, KFC restaurants has become the preferred eating spots, living and amusement spots for the families and young people especially. 5.0 Conclusion The literature review shows some general agreement by writers that the concept of service quality is an antecedent of customer satisfaction and retention. High service quality will obviously lead to high levels of customer satisfaction and result in customer retention. Finally, the SERVQUAL Model was established as a widely used and reliable method of measuring service quality.

My Philosophy of Teaching Essay -- Philosophy of Education

Philosophy of Education To be an effective educator, I believe one must have a foundation of moral and ethical principles. An educator should support the learning environment, while being flexible and teachable. He or she must also lay a foundation of beliefs on how individuals learn, seeking to enable individuals to reach their optimal potential. My personal educational philosophy begins with believing all children are unique individuals, with different emotions and different styles of learning. An educator has the incredible challenge of attempting to meet those needs. As an educator, I believe all children deserve the opportunity and resources that would better enable them to reach their maximum potential. Classroom management is essential to effective teaching. While the reasons for misbehavior can be attention seeking, health problems, boredom, or simple frustration, how the problem behavior is dealt with will eliminate, decrease, or increase the behavior. Therefore, teachers should evaluate and determine appropriate strategies to increase or decreas...

Good Essay Writing

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Similarly, Margaret Wood s The Weather Where We Are, tackles climate change and how it is effectingRead MoreAnalysis Of The Poem Easter Wings By George Herbert947 Words   |  4 PagesReligious is a strong topic because many people accept it and others do not. Beliefs are very important in the life of several human beings and people enjoy expressing them. The poem, â€Å"Easter Wings,† illustrates the life of the first man on Earth, Adam, and the present life of G eorge Herbert, the author, in 1633. This poetry battles between the loss of hope and hope and is a reflection on the author’s life. In the first stanza the author mentions how Adam had it all and then because of his sin heRead More Analysis of the Inferno of Dante Alighieris Divine Comedy Essay1221 Words   |  5 PagesAnalysis of the Inferno of Dante Alighieris Divine Comedy The Divine Comedy by Dante Alighieri is considered by many as the first great poem in the Italian language and perhaps the greatest poem written in Medieval Europe. The poem is so famous that one of the minor characters, Capaneus the great blasphemer, has his name on a mesa on one of Jupiters moon Io (Blue, 1). Also, the poem is divided into three canticles, or sections, Inferno, Purgatorio, andRead MoreComparative Stylistic Analysis of a Poem3580 Words   |  15 Pagesï » ¿ Comparative Stylistic Analysis of a Poem Submitted to: Mrs. Daisy O. Casipit Submitted by: Lovely Anne B. 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Leadership In American Community Colleges -Myassignmenthelp.Com

Question: Discuss About The Leadership In American Community Colleges? Answer: Introduction Based on the topic, Bill Gates can be considered as one of the known personalities with the traits and behaviors like that of a transactional leader. Bill Gates can be portrayed in multiple ways, as a billionaire, humanitarian, IT business tycoon, perceptive interpreter of future technologies. He is not only the worlds richest man but he can be considered as a prominent leader who has transformed the whole world in form of technological renovation. Based on the leadership style of Bill Gates, he can be tagged as a transactional leader (Colbert, Barrick Bradley, 2014). On the other hand, Jeff Bezos, the CEO of Amazon, the largest shopping portals in the world can be considered as a transformational leader, who has changed his leadership style from being transactional. It can be considered that Jeff Bezos and Amazon have traveled together from the first and the main credit that contributes to the success of both the company and the owner is his transformation in the leadership (Rock, 2014). Based on the innovations and the leadership strategies that Jeff has taken the initiatives to change in the company to help it become one of the high grossing e-commerce companies of all time helps conclude Jeff as a transformational leader (Chou et al., 2013). Organizational introductions Microsoft is the major player in the Information Technology platform with the operating system as one of the very base of this whole industry. The company has been created in the year of 1975 until the year of 2006. Microsoft has not only been responsible for the production of computer-based operating systems but the company has taken the initiative to introduce multiple portable devices to its large consumer base. Bill Gates had been primarily held for the responsibilities regarding the changes in the companys product strategy (Burke Barron, 2014). He had uncompromisingly broadened the companys product range that has in turn helped Microsoft achieve a dominant position in the global market. In the early phases of Microsoft, the focus was kept more on the achievement, rather than reassurance, well-being, and retention of the staffs (Dale, 2015). Based on which some of the critics have argued that the company only broadened the spectrum to satisfy the customer base but nothing has be en done to invent newer product lines (Goetsch Davis, 2014). However, it can be considered that it is the transactional style of leadership that has helped the company to touch soaring heights. On the contrary, Amazon is the typical example of a company, which has led the way of e-commerce. It is an American e-commerceandcloud-computingcompany, which is based inSeattle, Washingtonand was established byJeff Bezosin the year of 1994. It can be considered that the successful repositioning of the core business along with active investment in the new growth of the business has helped Amazon expand its founding retailing platform into innovative categories, such as groceries and entertainment content streaming. With parallel to the same, it has built the worlds largest cloud computing enterprise known as the Amazon Web Solutions. With the company generating revenue of $ 135.99 billion in the year of 2016, Jeff Bezos has surpassed Bill Gates to top in the Forbes list of the richest man in the world. This success, in turn, can be contributed to the transactional turned transformational style of leadership of Jeff Bezos. Transactional Leadership vs. Transformational Leadership Northouse (2015) considers that the transactional leadership styles are more apprehensive with the maintenance of the standardized flow of the operations. In simple words, transactional leadership can be described as helping keep an organization sustained in the competition. It can be stated that the transactional leaders utilize disciplinary powers along with an assortment of incentives to help motivate employees to perform at their best (DInnocenzo, Mathieu Kukenberger, 2016). The phrase "transactional" signifies the fact that this type of leader fundamentally encourages subordinates and staffs by the exchange of rewards for performance. A transactional leader usually does not look forward to the strategic guidance of an organization to a position of market leadership; instead, the leaders are solely concerned with smoothly flowing of the operations. Based on the analysis, Bill Gates is a perfect example of a Transactional Leader (Daft, 2014). On the contrary, transformational leadership goes much more beyond the management of the daily procedures and devises strategies for taking the company, its departments or the working team to a subsequent level of performance and accomplishment (Braun et al., 2013). Transformational leadership styles primly focus on the building teams, motivation and collaboration with the employees at the different levels of an organization to adopt changes for the betterment. The transformational leaders set the goals, objectives and the incentives to push and motivate the associates and subsidiaries to a higher level of performance while imparting with opportunities for both personal and professional growth for each individual staff (Odumeru Ogbonna, 2013). On a further note, it can be added that this kind of leadership and strategies are long surviving and flexible, which is a total opposite to the transactional style of leadership (McCleskey, 2014). With relevance to this kind of leadership, Je ff Bezos can be considered as one of the famous persona adopting the transformational style of leadership. Strategies that help consider Bill Gates as a Transactional Leader Bill Gates has been represented as a commanding and stern leader to his adversaries as well as to his employees. He has productively altered Microsoft into a stable domination. In order to maintain the companys existing status, Gates had kept the center of attention on creating barriers to the new candidates or employees. Besides being a staunch leader, he had strictly kept control over the organizations production process to enable them to be received by the patrons. Bill Gates is not really known for his engaging or adaptive communication strategies. Rather, he is known for his rude, abrasive nature that is often dismissive of others ideas. For example, it is well evident from the idea that he once addressed his hiring process as non-selection of bozos, who will tell him how to run the business. This, in turn, demonstrates his prescience in the hiring process by actively selecting the dedicated and hard-working individuals at the initial development stages of Microsoft. His task-or iented behavior is evident by the display of strong personality attributes such as focus, passion and as a confronting taskmaster (Hackman Johnson, 2013). Jeff Bezos, on the other hand, can be reverted to the fact that Jeff is the best leaders in the existing time. This is evident from the fact about the growth and performance of Amazon in the international market. Amazon is the result of the vision, the long-term application of the strategies, the inspiration, and the innovation, which is not accepted by most other leaders. The successful repositioning of the operation and the expansion of the other ends of the business helped Amazon to grow on a large scale. Large-scale introduction of product lines, services and business opportunities and innovating business models by the CEO is the primary key that has contributed to the economic growth and performance of the company. These attributions have helped conclude the fact that Jeff Bezos is one of the prospective leaders in the current space. With respect to the qualities of a normal individual, transformational leaders are just regular people. However, these kinds of leadership are not about the position, the designation or the amount of money generated but a good transitional leader is about humbleness, passion, and vision. It is not only making one great but also helping other to expand to a higher level of greatness. Jeff Bezos inspire others with his vision and complies with the fact that vision does not count without actions and innovations. He certainly considers that vision and innovation needs a long-term implementation. Evident from an example regarding the qualities of Jeff as a leader, it is apparent from the point that he considers the customers to be the greatest asset of Amazon and takes an extreme level of measures to embrace and bind his customers to the business. Organizational management in Microsoft under Transactional Leadership Microsoft can be considered as a highly stressful environment because of Bill Gates, who drove others as hard as he directed himself. Bill evidently grew into a taskmaster who would literally stalk the parking lot on the weekends to see who had made to the office premises. The employees keep into boiling and it eventually gets on their nerves by the fact that Gates constantly keeps a push to drive them to their limits. It can be assumed that Gates as a transactional leader likes to sort out things in a rigorous, one-on-one discussions. He prospers on conflicts and does not hesitate in instigating the same. Being a task-oriented leader, he has helped the official groups to understand their goals by providing a sequence of steps that structures their initial meetings. In terms of managing the people, Bill considers that if the individuals can be directed towards the problem with its solution at the same time, then they can be motivated to jump into action, without any delay. In other w ords, it can be assumed that Bill Gates motivate the employees and helps them grow in his own manner and under tough situations that can help them prosper and sustain in the tough competition. However, the major change that takes place in the company when Satya Nadella takes the place of a CEO in the company, who brought a wealthy experience, an exceptional international perspective, and aleadership style, which would be tested as he commands an employee base of over 100,000 professionals. Amid new possibilities that spawned from a diverse assortment of tech platforms, ever-expanding wireless and mobile markets that have been continuing to explode across the marketplace along with a recent history of playing catch-up to other Silicon Valley upstarts, Nadella has been appointed to carve out a bigger slice of market share for Microsoft. Organizational management in Amazon under Transformational Leadership Two of the effective management strategies that have been adopted by Jeff Bezos is customer-centric service and more expectations from the employees. It can be said that Jeff Bezos places a great deal of focus on the customer needs and demands. The management through the information of customers hating delays, defects and out-of-stock products are the major issues that are being taken into consideration (Bolman Deal, 2017). One example of more expectation from the employees is followed by the fact that Amazon has 500 employees just for the sole task of email answering. Each of them is expected to answer 12 emails per minute and can be possibly fired if that number dropped below 7. By having high expectations of his employees, Bezos has created an incredibly efficient machine, which is now famous for being able to make same-day deliveries in more than a dozen US cities. This change can be considered as one of the strategies that would keep the competencies amongst the employees activ e and in turn help the company to be become more flourishing (Raes et al., 2013). It can also be added that through this leadership style individualized consideration to followers by paying attention to and meeting the needs of followers can be exhibited. In the process, Jeff Bezos as a transformational leader serves as role model for his followers, thus allowing them to identify the organizational vision, and help provide a sense of meaning and achievement (Noruzy et al., 2013). Contrast of Incremental and Radical Changes In contrast to the incremental changes, it can be defined as the innovation which is mostly concerned with the existing product, service, process, organization or perhaps a method, whose performance has been significantly enhanced or upgraded. In simple words, incremental changes are small changes that are comparatively slow and unplanned, with predefined results. On the contrary, the radical changes can be considered as certain disruptive changes that have a significant impact on the market as well as the economic activity of the organization. This change is also known as the transformational changes that work side by side with the employees along with the leader. Organizational changes that take place in Microsoft Based on the analysis it can be considered that the company did not take up or undergo any major change, thus a few changes that have been undertaken can be considered to be incremental in nature. For example, Incremental changes can be exhibited when Microsoft decides to come up with newer versions of Microsoft and upgrade the existing user interface of the operating platform to give a good user-friendly work experience to all of the customers. Newer introduction and expansion of product lines also falls under incremental changes as it is certain that people are influenced by not highly patronized by the same. The certain changes in the leadership style by the new CEO are yet to be tested and it can be considered that these changes would not affect the existing management of the company. On the contrary, the changes in Amazon can be considered to be radical, due to the sudden changes in the business expansions. The highly expanding platform of the previously e-commerce platforms is now going to service a wider customer base with service that has never been expected to be provided by an online retail seller, such a grocery, entertainment, networking services (Kerzner, 2013). The changes in the logo of Amazon is a change that signifies a big meaning of making the customer smile with the a-z services that are being provided. Even though the company did not undergo major changes, yet this sudden expansion can be considered to be a radical change. Perception of an incremental change for a radical change along with the role of leader Sudden and drastic changes in an organization can certainly affect an individual working in the organization, which in turn can take a toll on their performance, the mindset, and strategies of working in a predictable environment. For example, an employee who is working for Amazon, in the basic customer retailing and product supply can work under proper guidance under the manager, who can help guide them to cope with the radical changes. However, if the same employee is transferred to a different expanded wing of the company, he/ she might face stress, which can, in turn, the performance of the employee (Antonakis Day, 2017). It can also be added that the sales and promotion of the parent company products are not same as the newer products or expanded service that the company has introduced in line. Based on the two changes, it can be elaborated that often-incremental changes taken by a leader can be perceived as radical changes by employees due to differentiation in the perspective s. However, this perception of the individuals is subjected to certain factors that can be taken into consideration such as expertise, qualification, confidence, and guidance from the leader (Reiche, Mendenhall Stahl, 2016). For example, the transference of an employee into a different operational wing might not affect the employees with adequate knowledge and experience but this incremental change can affect a new individual who would be relocated all of a sudden. Gradual implementation of a radical change It can be considered that indeed the radical changes can introduce slowly and steadily in the process. It can further be added that the radical changes can appear to be a sudden and tough move, that just comes out of nowhere and can hit the employees, from where it is least expected. However, it can be assured that these changes are entirely subjected to the needs and demands of the company and as per the requirements of the leader (Cameron Green, 2015). For example, the organizational policies in Amazon can be incorporated and modified slowly, keeping the employees in mind. Sudden changes can not only drive the employees into shock but also affect their performance. The only means to control the same is to steadily, inform the employees to avert clash in the workplace, thus saving the company from criticism and defamation. Potential barriers faced by the leaders in implementing the changes Based on secondary research it has been found that Amazon has recently expanded its divisions and Jeff Bezos have alleged bought the Washington Post under his control. Even though this strategy has been considered as one of the motives to lean and expand the profits, yet according to President Donald Trump, this can be considered as a motive to evade tax. The main reason that is responsible for this kind of perception is the question of why a retail owner would look forward to buying a newspaper. Challenges due to change in the business model No matter how effective is the business model how effective the strategies might be, it has been always under the impression that the business model of Amazon is highly pressurizing and complicated, even though there is no doubt regarding the leadership of Jeff Bezos. It can be added that the workload in the organization is tremendous and extreme. Lack of the customer service With the following change, it can be considered that the customer-centric company can face probable barriers due to the extension in the business model and wings, where it would be difficult to manage the demands of each customer, imparting a load on the employees, thus rising to chaos. Mismanagement of the employees With the extension of the business model and the expansion, there can be a potential mismanagement of the employees due to the rising needs and demands to meet the customer services of the ever-expanding customer base. This, in turn, can affect the existing diversity of the company. Clear financial report to keep a track of the financial transactions In response to the allegation, the company can keep a transparency in the financial transactions, including the tax records, to keep a clarity in the financial operations and activities of the company. This, in turn, can not only keep the company clean and free from allegation but would help in restructuring the business model. Simplification of the Business model The business model can be restricted to a simplification that can be easy enough for everyone to accept and follow the same. This would not only help the employees to understand and comply with the operations but also help the company to work on further improvements. Imparting of proper training The customers are the prime key to the success of the company and inadequacy in the customer-centric activities can severely affect the operations of the company. Imparting of proper training to the staffs and employees can help understand the value of time management, customer demands, and service. Improvising the HRM of the company The managing of the employees due to the radical changes can be a crucial task, the employees can be imparted with proper knowledge and coordination, that can help facilitate better performance and activity from their end. Relocation in the departments can obviously strain the employees but managing the diversity can solve the issue. Using Lewin's three-step change model The three stages of the model developed by Kurt Lewin has been used to manage the change in the organization, Microsoft. They are as follows. Unfreezing This step is the first stage of the change process, which mainly involves the revelation and the acceptance of an idea that has been unfrozen to create an awareness about the idea that has generated. For example, Microsoft wishes to implement a new service "Cortana" with all the Microsoft operating systems, which would help the users to filter their searching options. Changing This is the second stage of the process and involves the initiating of the alteration process, which enforces the movement to a level of stability. This stage is mainly the balance where the changes transfer from the initial to the final stages of the change. For example, the new CEO of Microsoft Satya Nadella explains the significance and the benefits of the new changes that would be implemented. This would also help the employees understand the need for change. Refreezing This is the final stage of the change that is finally incorporated into the system and has been consolidated based on the activities that have been done to successfully implement the same. For example, after the successful implementation of Cortana in the Windows system, the benefits of the application has helped the employees understand the usefulness of the same. This, in turn, has motivated the employees to rethink and introduce more useful application based functions that can benefit everyone. Using Kotters 8 step change model The eight stages of the model developed by John Kotter has been used to manage the change in the organization, Amazon. They are as follows. Stage 1: Urgency This stage refers to the need for urgency. The need for urgency refers to a need for a change in the organization, which in turn justifies the change in the organization to be an urgent matter for the implementation. For example, there is an urgent need to implement and restructure the time management process in terms of a certain perishable product that the company offers to the valued customers. However, for the urgent implementation of change, the employees need to see the need for the change. Stage 2: Coalition Formation The second stage of the model involves the selection of the right employees for the job with the appropriate skills to deliver a perfect service. For example, Jeff Bezos has divided the operational teams who expertise in the customer service and time management to amplify the better service (Hawkins, 2017). Stage 3: Vision for change This stage involves the developing of a vision for the company as well as helps the employees look forward in the same prospect regarding that change that needs to be implemented in the organization. For example, Jeff Bezos visions to make Amazon the best e-commerce retailer in the world. The extensive leadership skills of Jeff would lead him to achieve the same due to his focused, visionary, appealing and extensive leadership skills. Stage 4: Communication of the Vision This is the fourth stage where the vision corresponds to every employee so that develop awareness about the vision and could help improvise the same. For example, organizing of regular communication sessions and meetings can be helpful to disseminate the ideas and the concepts to the employees regarding the managing of the change in the company (Roueche, Baker III Rose, 2014). Stage 5: Obstacles Removal Based on this model, there are several challenges that can come upon the path of implementation of the change, which in turn needs to be taken care of. For example, Jeff faced several challenges in the process of implementation of his vision to make Amazon a diversified company. He faced several challenges for political background along with the management of the company, but these challenges have been worked out with his better communication and leadership skills. Stage 6: Short-term goals - The sixth stage of the change model can be explained as imparting of small appreciation tokens and incentives to the employees in the beginning of change, which would motivate the employees to contribute more on their efforts. For example, Jeff managed to appreciate the employees with a small token of appreciation and incentives after each season to keep them motivated and active in their interaction and participation. Stage 7: Building of change This stage of change building can be addressed as the implementation of the change for some point of time. However, the implementation of the change is subjected to the time. For example, Jeff allows the target of each team to maintain the competition and efficiency of the team for better implementation of the organizational change. The setting of the target also helps the employees to be indirectly directed towards adapting to the change (Barna, 2013). Stage 8: Consolidating the change in the workplace diversity The final stage of the model refers to the permanent consolidation of the change in the work culture and the diversity, where the main objectives, principles are cultivated within the employee's perception on a regular base. The regular implementation, in turn, takes a permanent shape in the work culture. For example, the better management and shortening of the time management for the deliveries, on a wide array of products have resulted in immense customer satisfaction as a result, newer clients have generated, who have switched from other services and existing clients have remained on the same side. References Antonakis, J., Day, D. V. (Eds.). (2017).The nature of leadership. Sage publications. Barna, G. (2013).The power of team leadership: Achieving success through shared responsibility. WaterBrook. Bolman, L. G., Deal, T. E. (2017).Reframing organizations: Artistry, choice, and leadership. John Wiley Sons. Braun, S., Peus, C., Weisweiler, S., Frey, D. (2013). Transformational leadership, job satisfaction, and team performance: A multilevel mediation model of trust.The Leadership Quarterly,24(1), 270-283. Burke, R., Barron, S. (2014).Project management leadership: building creative teams. 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Transformational vs. transactional leadership theories: Evidence in literature.International Review of Management and Business Research,2(2), 355. Raes, E., Decuyper, S., Lismont, B., Van den Bossche, P., Kyndt, E., Demeyere, S., Dochy, F. (2013). Facilitating team learning through transformational leadership.Instructional Science,41(2), 287-305. Reiche, B. S., Mendenhall, M. E., Stahl, G. K. (Eds.). (2016).Readings and cases in international human resource management. Taylor Francis. Rock, D. (2014).Quiet leadership. HarperCollins e-books. Roueche, P. E., Baker III, G. A., Rose, R. R. (2014).Shared vision: Transformational leadership in American community colleges. Rowman Littlefield. Roueche, P. E., Baker III, G. A., Rose, R. R. (2014).Shared vision: Transformational leadership in American community colleges. Rowman Litt