Service failure recovery: The moderating impact of individual-level cultural value orientation on perceptions of justice

Abstract

It is now well recognized that an effective service recovery program is essential to generating customer satisfaction and loyalty. A number of studies have investigated the impact of service recovery efforts (compensation, speed of response, etc) on post-recovery satisfaction. However, despite the importance of global markets, none have examined the impact of customers' cultural value orientation (i.e., cultural values measured at the individual level) in implementing effective service recovery programs. In this research we use the individual rather than the nation as the unit of analysis. Using an experimental design with data from both Eastern and Western cultures, we investigate how customer evaluations of recovery efforts are influenced by interplay of consumers' value orientation and service recovery attributes (apology, cognitive control, and recovery initiation). The results reveal that cultural values of individual Power Distance, Uncertainty Avoidance and Collectivism do indeed interact with a firm's recovery tactics to influence perceptions of fairness (justice). Finally, all three forms of justice (distributive, procedural, interactional) positively impact on overall service recovery satisfaction.