How and when does customer feedback influence organizational health? An organizational-level study

Abstract

This study explores how and when customer feedback influences organizational health, conceptualized as a combination of employee health and organizational performance. Based on affective events theory, we classify both positive and negative customer feedback as affective work events. We expect that these events influence organizational health through their impact on positive affective climate, and that the relationships are moderated by empowerment climate. We tested the model in a dataset consisting of 80 independent organizations with 178 board members, 80 HR representatives, and 10’953 employees. The findings support the expected indirect effects. Furthermore, empowerment climate strengthened the impact of positive customer feedback on organizational health but does not affect the relationship between negative customer feedback and organizational health. By providing first insights into the consequences of both positive and negative customer feedback on organizational health, this study opens a new avenue for scientific inquiry of customer influences on employees at the organizational level.