Influence of country of origin and type of information exchanged on consequences of offshore service sentiment

Abstract

PurposeThis research extends existing services offshoring literature by investigating how the type of information exchanged, technical support or personal billing, in conjunction with country-of-service-origin (COSO) influences consumer likelihood to react negatively (boycott issue importance, NWOM, perceived service quality) to an offshore service exchange.Design/methodology/approachStructural equations modelling is employed to assess relationships among constructs when country of service origin (New Zealand and the Philippines) and type of service provided (technical support and personal billing services) are varied. Using a scenario-based experimental design we collected 337 responses from a consumer panel across Australia.FindingsResults indicate that both COSO and type of information exchanged affect service sentiment. Overall, consumers feel more negative and more likely to punish a company for offshoring to culturally dissimilar countries such as the Philippines than to culturally similar ones such as New Zealand. However, consumers were more concerned with personal billing services provided from offshore providers than technical support, regardless of COSO.Practical implicationsPractitioners need to understand customer sentiment about services offshoring in general as well as the relationship between service type and country of service origin when designing the global service supply chain.Originality/valueThis study extends theory by applying a multi-dimensional portfolio perspective in examining customer sentiment of offshore services. Understanding the underlying bases of customer concerns and how companies can mitigate negative perceptions allows firms to better manage service offshore strategy.