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Assessing the impact of a quality improvement intervention on an organization is particularly difficult in a high contact service operation where the intangible service encounter is the unit of output. Frequently, accounting or financial data must be used to evaluate the effectiveness of the intervention; however, these data may be problematic with respect to sample size and masking effects due to aggregation. Presents a systems model which describes metaphorically how an unstable process can continue to show no performance gains despite continued input of resources into improvement initiatives. A special type of Shewart control chart, known as the X‐chart, is developed as a methodology for assessing process performance after an improvement programme has been implemented. An X‐chart is used to analyse performance data collected in a real service setting where service quality standards were deployed in the front line phase of the operation. Although traditional analysis of variance concluded that there was no significant improvement in performance, the X‐chart indicates that real performance gains were occurring. The X‐chart provides management with an easy‐to‐use decision tool which can help assess the effectiveness of many different types of organizational change initiatives.

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