The fact that superior service can generate a competitive advantage fo : Reading Comprehension (RC)

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

09 Dec 2020, 11:34

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adkor95 wrote:

d3thknell wrote:

I'll give a shot at attempting to explain the answers.

1) C is incorrect because the passage illustrates only ONE WAY in which the investment has failed to generate increased revenues. That leaves B is the correct answer

2) C is the correct answer. Second line of passage. Straightforward.

3) "The bank managers did not recognize the level of customer inertia in the consumer banking industry that arises from the inconvenience of switching banks."
From this statement we can infer that although existing service was inferior to the new service, but the disadvantage in the existing system was not a strong enough motivation for customers to make them consider switching to competitors. So A can be somewhat concluded and is the correct answer as every other option is 100% incorrect.

4) "Nor did they analyze their service improvement to determine whether it would attract new customers by producing a new standard of service that would excite customers or"
B can be concluded to be the correct answer from this statement.

"by proving difficult for competitors to copy"
D can be inferred to be the correct on the basis of this statement.

So In my opinion both B and D can be the correct answers.

5)E is the correct answer. Para 1 talks about reasons why sometimes investment in better services does not yield increased revenues and para 2 gives an example of such a situation.

6) in Para 2 author goes at length to describe various flaws in the decision to make a new investment and closes the passage with a merit of the new investment. Here "only" is used to highlight the difference between the "value of merit" to the "value of demerits"( ability to easily explain to customer is a relatively miniscule advantage when compared to disadvantage of inability of new service to attract new customers). So option B is correct

Option B uses a phrase " relatively low value of the investment", here the word "value" does not refer to the actual MONETARY VALUE of the investment but to the VALUE ADDITION that is brought out due to investment.

Thanks this is really helpful! But sorry, I disagree with #3 - I'm not entirely sure how mentioning there are high switching costs suggests that customer did want to switch banks? It's also difficult to arrive at this answer through POE.

Hi, adkor95,

Please refer the answer by expert here:

https://gmatclub.com/forum/the-fact-that-superior-service-can-generate-a-competitive-advantage-fo-67847-20.html#p1909515

Let me know if this clears your doubt.

Thanks.

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The fact that superior service can generate a competitive advantage fo [#permalink]

Updated on: 11 Dec 2020, 12:07

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dortinator1234923 wrote:

GMATNinja or d3thknell

Hi there,

Could you please explain why Q6 cannot be '(C) distinguish the primary attribute of the service improvement from secondary attributes'?
I understand that the only is used to explain that the one merit is miniscule. But isn't it therefore a secondary attribute, as it is not as relevant as the other advantages (which would be primary attributes)? Thanks a lot in advance!

Hi

You have confused the word "advantage" with "attribute". An advantage is something that is good or better than others. In this case, the fact that it could be described easily definitely counts as an advantage.

However, the answer option is not talking about advantages but about "attributes", or, characteristics. From the passage, we do not know whether the fact that it can be described easily counts as a primary or secondary attribute. Additionally, we do not know enough from the passage to clearly state what should, in fact, count as the primary attribute. Therefore, the word "only" cannot be used for the purpose stated in this option.

Hope this helps.

Originally posted by svasan05 on 11 Dec 2020, 03:27.
Last edited by svasan05 on 11 Dec 2020, 12:07, edited 1 time in total.

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

11 Dec 2020, 03:30

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custodio wrote:

Dear beloved GMATNinja,

Quote:

This truth was not apparent to managers of one regional bank, which failed to improve its competitive position despite its investment in reducing the time a customer had to wait for a teller. The bank managers did not recognize the level of customer inertia in the consumer bank ng industry that arises from the inconvenience of switching banks. Nor did they analyze their service improvement to determine whether it would attract new customers by producing a new standard of service that would excite customers or by proving difficult for competitors to copy.

What role does this boldface underlined sentence play here? And what does it mean exactly?

My understanding:
The company did not gain competitive position (despite an improved service, i.e. less waiting time) because
(1) The bank managers did not recognize the level of customer inertia in the consumer banking industry that arises from the inconvenience of switching banks
(2) Nor did they analyze their service improvement to determine whether it would attract new customers by producing a new standard of service that would excite customers or by proving difficult for competitors to copy

Does (1) mean: the existing customers stayed BECAUSE it was inconvenient for them to change to another bank, NOT BECAUSE the improved service made them stay?

Hi

The highlighted sentence brings out a negative aspect of the service improvement. Since the service improvement was brought in with the aim (one of) of attracting new customers, this sentence tells us that it failed to do so because customers have great inertia in switching banks. They would have opted to remain with their current banks rather than switch to this regional bank just have a lower teller waiting time.

Hope this clarifies.

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

12 Dec 2020, 02:12

Quote:

Hi

The highlighted sentence brings out a negative aspect of the service improvement. Since the service improvement was brought in with the aim (one of) of attracting new customers, this sentence tells us that it failed to do so because customers have great inertia in switching banks. They would have opted to remain with their current banks rather than switch to this regional bank just have a lower teller waiting time.

Hope this clarifies.

Thanks for your answer. Can you elaborate a little bit more? I am not sure I totally understood it.

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

12 Dec 2020, 04:52

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custodio wrote:

Quote:

Hi

The highlighted sentence brings out a negative aspect of the service improvement. Since the service improvement was brought in with the aim (one of) of attracting new customers, this sentence tells us that it failed to do so because customers have great inertia in switching banks. They would have opted to remain with their current banks rather than switch to this regional bank just have a lower teller waiting time.

Hope this clarifies.

Thanks for your answer. Can you elaborate a little bit more? I am not sure I totally understood it.

You have asked:

"Does (1) mean: the existing customers stayed BECAUSE it was inconvenient for them to change to another bank, NOT BECAUSE the improved service made them stay?"

(1) is not talking about the existing customers of the bank which implemented the service improvement (let's call it bank X), but about customers of other banks that bank X had hoped to attract to itself due to this service improvement. The highlighted text states that such customers would not have shifted from other banks to bank X despite the service improvement at bank X due to the high inertia in changing banks.

Hope this helps.

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

13 Dec 2020, 08:57

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custodio wrote:

Dear beloved GMATNinja,

Quote:

This truth was not apparent to managers of one regional bank, which failed to improve its competitive position despite its investment in reducing the time a customer had to wait for a teller. The bank managers did not recognize the level of customer inertia in the consumer bank ng industry that arises from the inconvenience of switching banks. Nor did they analyze their service improvement to determine whether it would attract new customers by producing a new standard of service that would excite customers or by proving difficult for competitors to copy.

What role does this boldface underlined sentence play here? And what does it mean exactly?

My understanding:
The company did not gain competitive position (despite an improved service, i.e. less waiting time) because
(1) The bank managers did not recognize the level of customer inertia in the consumer banking industry that arises from the inconvenience of switching banks
(2) Nor did they analyze their service improvement to determine whether it would attract new customers by producing a new standard of service that would excite customers or by proving difficult for competitors to copy

Does (1) mean: the existing customers stayed BECAUSE it was inconvenient for them to change to another bank, NOT BECAUSE the improved service made them stay?

The sentence you've underlined explains why the bank did NOT manage to attract as many new customers as it hoped, even though it invested in improved customer service.

We're told that it is inconvenient to switch banks -- customers don't want to deal with that inconvenience, so they stay at their current bank. This inertia was more powerful than the attraction of lower waiting times to see a teller, so the bank could not attract as many new customers as it hoped and it failed to improve its competitive position.

Question 6

dortinator1234923 wrote:

GMATNinja or d3thknell

Hi there,

Could you please explain why Q6 cannot be '(C) distinguish the primary attribute of the service improvement from secondary attributes'?
I understand that the only is used to explain that the one merit is miniscule. But isn't it therefore a secondary attribute, as it is not as relevant as the other advantages (which would be primary attributes)? Thanks a lot in advance!

This question asks us which answer choice most likely describes why the author uses the word "only" in line 23 of the passage:

"The only merit of the improvement was that it could easily be described to customers."

The "improvement" mentioned in this sentence is the reduction in waiting time to see a teller. From the sentence quoted above, we know that there is only one upside of this improvement -- and it's a pretty weak upside, at that.

So, does the author use the word "only" to "distinguish the primary attribute of the service improvement from secondary attributes?"

To distinguish between different attributes of the service improvement, there would need to be more than one attribute mentioned in the passage. That's simply not the case here. Instead, the author makes it clear that there is ONLY one advantage of the improvement. So it's not possible that the author includes the word "only" to distinguish between advantages.

Compare this to (B):

Quote:

(B) emphasize the relatively low value of the investment in service improvement

The bank has spent money on improving its customer service, and the best the author can say about the improvement is that it "could easily be described to customers." This gives the impression the author thinks the investment has been a poor one and has not been very valuable to the bank.

Indeed, the author goes further -- they say that the only merit that can be said about the service improvement is that it can be described easily. This emphasizes the poor value this investment has provided to the bank.

From this, we can tell that the word "only" was used by the author to emphasize their point that the bank's investment in their service improvement was a poor one. This means (B) is the answer to this question.

I hope that helps!

B

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

14 Dec 2020, 00:34

sajjad1994
im quiet confused between A and C
End up marking A as it is similar to the point given in passage
kindly help me in this

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

15 Dec 2020, 10:02

Anshuman0902 wrote:

sajjad1994
im quiet confused between A and C
End up marking A as it is similar to the point given in passage
kindly help me in this

Hi Anshuman0902,

Would be glad to help you out, if you could let me know the question number.

Thanks.

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

09 Mar 2021, 07:28

GMATNinja wrote:

darshak1 wrote:

Hi GMATNinja

In question 4,

the bank did NOT determine whether it would attract new customers either 1) by producing a new standard of service that would excite customers or 2) by proving difficult for competitors to copy.

I seriously dont understand what this statement is trying to convey. By proving is parallel to by producing and hence, what I am inferring here is that, bank failed to determine whether it would attract new customers --> by producing new standard of service. And bank also failed to determine whether it would attract new customers by proving difficult for competitors to copy. Bank isnt proving difficult. The new standards should be difficult. I couldnt even grasp what the sentence is trying to convey and ended up eliminating all 5 options. Scary. Is that bad parallelism here? Or am I supposed to infer such meanings in RC?

Further, If bank failed to considered whether new standards will bring more customers by having standards difficult to copy, what i infer here is that bank failed to consider whether it will have new customers or not. Not the failure of considering how difficult it is for others to copy. WE really dont care how difficult it is for other banks to copy those standards. And we have no reason to believe that even in the case of no difficult, whether banks will invest some amount to keep up. Its a leap of faith.

I am an avid reader and yet, I got stuck in here without any direction. PLease help.

Take another look at the full sentence:

Quote:

Nor did [the bank managers] analyze their service improvement to determine whether it would attract new customers by producing a new standard of service that would excite customers or by proving difficult for competitors to copy.

Here, "it" refers to "service improvement," NOT to banks or bank managers (you can tell because "it" needs to refer back to something singular, and "service improvement" is the only singular noun available).

With that understanding, here is how the parallelism shakes out:

Bank managers failed to analyze whether their service improvement would attract new customers by:

producing a new standard of service that would excite customers; OR by
proving difficult for competitors to copy.

The second parallel piece does require a small inference to understand: the service improvement could attract new customers IF it proved difficult for competitors to copy, because it would give the bank an advantage over its competitors.

However, the question makes our life easy. We do not need to figure out WHY a certain piece of information is important. We simply need to determine which answer choice is something that bank managers failed to consider when implementing the service improvement.

(D) is the only answer choice that does this. Can you think of a different answer choice (such as "whether [the bank] will have new customers," as you suggested)? Sure. But that is not one of the options in front of us, so it cannot be the correct answer. The managers failed to consider whether the service improvement "was an innovation that competing banks could have imitated," so (D) is the correct answer to question #4.

I hope that helps!

Hello [url=https://gmatclub.com:443/forum/memberlist.php?mode=viewprofile&un=GMATNinja]GMATNinja AjiteshArun

Quote:

(D) was an innovation that competing banks could have imitated

Should not the option be: (D) was an innovation that competing banks could NOT have imitated

They failed to realize that service improvement should have competitive edge that can not be copied by competitors.
So What they fail to realize that Service Improvement was an Innovative that competitors could not be Imitated.

Please clarify GMATNinja GMATNinjaTWO AjiteshArun

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The fact that superior service can generate a competitive advantage fo [#permalink]

09 Mar 2021, 20:50

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mSKR wrote:

Should not the option be: (D) was an innovation that competing banks could NOT have imitated

Hi mSKR,

Interesting question, but both statements lead to very similar outcomes.

1. They failed to consider whether or not the service improvement was an innovation that competing banks could have imitated.

2. They failed to consider whether or not the service improvement was an innovation that competing banks could not have imitated.

Whether or not, as it is used here, points to both possibilities. In (1), it means that they failed to check whether (a) the improvement was something that competing banks could have imitated or (b) it was not something that competing banks could have imitated. In (2), it means that they failed to check whether (a) the improvement was something that competing banks could not have imitated or (b) it was not something that competing banks could not have imitated.

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

23 May 2021, 08:50

Great work by GMATNinja!

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

05 Jul 2021, 09:37

MartyTargetTestPrep GMATNinja on q3, where does it say in the passage that It enabled the bank to retain customers at an acceptable rate? Struggling to understand why A is the correct answer.

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

07 Jul 2021, 10:24

shenwenlim wrote:

MartyTargetTestPrep GMATNinja on q3, where does it say in the passage that It enabled the bank to retain customers at an acceptable rate? Struggling to understand why A is the correct answer.

Hi shenwenlim,

Please refer the below reply by expert here:
https://gmatclub.com/forum/the-fact-that-superior-service-can-generate-a-competitive-advantage-fo-67847-20.html#p1909515

Let us know if you still have doubts.

Thanks.

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The fact that superior service can generate a competitive advantage fo [#permalink]

09 Aug 2021, 12:22

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More than Half of the questions, less than 50% people got it right? Shouldn't it be a 700-level question?

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

14 Jan 2023, 03:21

Can someone clearly explain Question 1 and 4?

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

14 Jan 2023, 11:40

Expert Reply

aksh123456123456 wrote:

Can someone clearly explain Question 1 and 4?

Follow the posts in the links below

Combine Questions 1 and 4
https://gmatclub.com/forum/the-fact-tha ... l#p2010554

Question #1
https://gmatclub.com/forum/the-fact-tha ... l#p2010554

Question#4
https://gmatclub.com/forum/the-fact-tha ... l#p2069596
https://gmatclub.com/forum/the-fact-tha ... l#p2334542

Good Luck!

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

12 Jan 2024, 05:55

Quote:

Q5. The discussion of the regional bank (line 13-24) serves which of the following functions within the passage as a whole?

(A) It describes an exceptional case in which investment in service actually failed to produce a competitive advantage.
(B) It illustrates the pitfalls of choosing to invest in service at a time when investment is needed more urgently in another area.
(C) It demonstrates the kind of analysis that managers apply when they choose one kind of service investment over another
(D) It supports the argument that investments in certain aspects of service are more advantageous than investments in other aspects of service.
(E) It provides an example of the point about investment in service made in the first paragraph.

hi experts, any one can help this question?
I was confused coz I can't figure out what's wrong with A
yes it is an exceptional case.
yes , the case shows the investment in service failed to produce a competitive advantage .

A seems to match with passage.

thanks in advance

have a nice day

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Re: The fact that superior service can generate a competitive advantage fo [#permalink]

12 Jan 2024, 05:55

GMAT Reading Comprehension (RC) Questions

The fact that superior service can generate a competitive advantage fo