Mike Hohnen

Mike has his own unique style. He draws on more than 27 years experience. He has worked most positions in the service industry and feels at home in more major cities than most people.

Mike Hohnen

The Service Profit Chain

The Service Profit Chain is a theory and business model evolved by a group of researchers from Harvard University in the nineties (among others James L. Heskett and Leonard Schlesinger). They have proved that there is a direct financial link between superior service experiences, customer loyalty, and financial performance (profit and growth).


The Service Profit model can be illustrated like this:









At a high level The Service Profit Chain shows a casual relation between the different important aspects and works like this unfolding all eight steps of the chain:


The 8 crucial steps to succes
Profit and growth are stimulated primarily by customer loyalty. Loyalty is a direct result of very high customer satisfaction. Satisfaction is largely influenced by the value of services provided to customers. Value is created by satisfied, loyal and productive employees. And employee satisfaction is a result from high-quality support services and policies that empower employees to serve customers well – also called internal quality. If you wish to influence the upper level (growth and profit) you need to look at the bottom level first which is internal quality.



  • PROFIT AND GROWTH: Most companies strive towards profit and growth. That is the main succes criteria.


  • CUSTOMER LOYALITY: Companies with profit and growth are characterised by a large number of loyal customers


  • CUSTOMER SATISFACTION: Loyal customers result from satisfied customers


  • VALUE: Satisfaction depends on the company’s ability to create value for the customer


  • EMPLOYEE PRODUCTIVITY: Satisfied an and loyal employees are far more productive


  • EMPLOYEE LOYALITY:Value is created by loyal employees


  • EMPLOYEE SATISFACTION: Employee loyalty is driven by employee satisfaction


  • INTERNAL QUALITY: To engage employees and ensure employee satisfaction the company has to build up the best possible internal quality




    • Explore the Service Profit Chain



    The Service Profit Chain has three main aspects to explore: Loyalty, Value & Internal Quality. Click on these items below to explore the service profit chain in more detail:


    LOYALTY (Customer and loyality satisfaction – involves step 2 & 3 from the top of the chain)

    VALUE (Creating Customer Value – Involves step 4 & 5)

    INTERNAL QUALITY (Great teams – involves step 6,7 & 8)