Abstract

The service profit chain (SPC) is a concept used to explain excellence in service management. Essentially, the SPC suggests a positive effect of operational inputs and employee satisfaction on company performance mediated by constructs of employee loyalty, customer satisfaction, and customer loyalty. Since employee satisfaction plays a key role in the service delivery system, considerable attention has been placed on investigating its impact in securing customer satisfaction, loyalty, and firm profitability. The reason for growing (management) attention to employee satisfaction is twofold: if the service profit chain concept holds, employee satisfaction positively influences perceived service quality as well as customer orientation which consequently enhances customer behavior towards the company and finally, financial performance. A key driver in this argument is employee satisfaction which can be directly affected by the manager/superior as well as incentives given by the company. Hence, employee satisfaction is a well-manageable factor to improve customer satisfaction through company policies.

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