Service Failure Management Research Articles

Service failure management system: evidence from the Indian hospitality industry

Service failure management system: evidence from the Indian hospitality industry

Trust recovery tactics in financial services: the moderating role of service failure severity

PurposeGiven the fierce competition in financial services, service failure management and trust restoration tactics are becoming strategic priorities. Studies investigating trust restoration have increased over the years due to the significance of trust in services and the frequency of trust violations. Drawing on the sense-making and defensive approaches of attribution theory, this study aims to explore the effectiveness of various trust recovery tactics (e.g. apology, explanation, and investigation) in financial services considering the prevalence of service failure severity.Design/methodology/approachBased on a scenario-based survey, this study gathered data from 402 consumers of different banks in Pakistan. The study analyzed the data using ordinary least square regressions and structural equation modeling.FindingsThe study indicated that explanation is more effective in repairing character-competence and commitment-based trust, while investigation remained highly effective for inducing congruence-based trust. Interestingly, an apology was more effective for communication-based trust repairing, while context-based trust recovery was unaffected against all recovery tactics. Despite the prevalence of severe service failure, recovery actions proved fully effective for character-competence and commitment-based trust while partially effective for congruence-based trust recovery. This study also found that severe service failure undermines the effectiveness of recovery actions in repairing communication and context-based trust.Originality/valueThe study extends the literature on trust recovery by integrating sense-making and defensive attribution theory. The sense-making approach contributes to the existing knowledge on trust recovery by elucidating how consumers and service providers develop a shared understanding to facilitate the recovery mechanism of multidimensional trust in financial services.

The Price of Good Friendships: Examining the Roles of Relationship Norms and Perceived Controllability in Service Failure Encounters

Despite companies’ efforts to cultivate positive relationships with their consumers, negative relational episodes such as customer service failures are inevitable. This study examines how perceived controllability of a service failure determines responses from consumers who have previously formed quality relationships with the company. Specifically, it distinguishes two types of quality relationships: communal and exchange relationships. It investigates how these two types of relationships interact with different levels of perceived service failure controllability, and collectively influence consumers’ emotional, cognitive, and behavioral responses (i.e., anger, perceived betrayal, and negative WOM intention) to the failure encounters. Results of an online experiment ( N = 140) show that consumers experience a greater level of anger and perceived betrayal when they consider the service failure as highly controllable (vs. uncontrollable) by the company. More important, this effect pattern only occurs when prior company-consumer relationships are communal rather than exchange. The results of this study enrich our body of knowledge on the role of company-consumer relationships in service failure encounters and provide useful guidelines for company-consumer relationship development and service failure management and recovery.

Determinants of banking consumers’ engagement in post service failure positive word-of-mouth

PurposeThe purpose of this paper is to develop and examine a theoretical framework that evaluates the effects of banking consumers’ justice perception on their post-complaint mindsets. It also aims to help business strategists to customize service failure management activities to achieve a competitive advantage.Design/methodology/approachTo examine the proposed framework using partial least square structural equation modeling, the authors collected data through a survey. The authors also evaluated the proposed framework through multi-group analysis and importance-performance map analysis (IPMA).FindingsResults show that recovery disconfirmation mediates the relationship between banking consumers’ perception of justice and recovery satisfaction. Moreover, after a service failure, brand equity and loyalty mediate the relationship between recovery satisfaction and positive word-of-mouth behavior. IPMA analysis at the construct level shows that fostering the perception of recovery satisfaction is crucial for creating a positive post-failure impression in the mind of the banking consumer.Practical implicationsFor banking practitioners, the findings of this research provide a strategic blueprint for managing service failure by developing relationships with consumers, thus creating an opportunity to gain competitive advantage.Originality/valueAnchored in the theoretical framework of justice theory (Adams, 1963), expectation disconfirmation theory (Oliver, 1977) and social exchange theory (Kelley and Thibaut, 1978), the research adds to the literature by providing a critical evaluation of how to influence banking consumers’ post-complaint behavior from a more systematic perspective.

Implications of Service Failure on Customer Perception and Patronage of Shuttle Services in South East Nigeria

This study examined customers’ perception and patronage level of ABC Transport Shuttle Services in relation to the service failure(s) recorded in the recent past. A survey research was conducted using 386 respondents drawn from the past, present and potential customers of the company in Owerri, Uyo, Calabar, Onitsha, Warri, Port Harcourt, Enugu, Aba and Umuahia. Structured questionnaire were administered on these passengers while an oral interview was conducted with the ABC General Shuttle Manager. The study revealed that major areas of service failure in ABC Shuttle services include poor adherence to scheduled departure time(s), unfriendly system resulting from glaring service failures, delay in service delivery, aging buses and poor service failure management efforts. The study recommended among others, total overhauling of the shuttle system, strict adherence to scheduled departure(s) as well as periodic training of staff on effective customer relationship management and timely, efficient/effective service delivery.

서비스 실패 관리를 위한 FMEA 이용 방안

Purpose: This study identifies preventive measures for VOC management by analyzing the causes and effects of factors that contribute to high risk service failure using FMEA on KORAIL VOC data. Methods: Two research methods were used. First, a Risk Priority Number (RPN) was assigned to each KORAIL VOC based on Failure Mode and Effect Analysis (FMEA). Second, multiple regression analysis was run with RPN factors that include severity, occurrence, and detection as the independent variables and customer dissatisfaction as the dependent variable. Results: Multiple regression analysis showed that RPN factors including severity, occurrence, and detection had significantly positive relationship with customer dissatisfaction. Based on these results, an FMEA was performed on VOC categories with high RPN for railroad stations including platform, ticketing, ticket verification, parking, and escalator, and VOC categories with high RPN for trains including entrance doors, cafes, air quality, announcement, and ticket verification. Conclusion: This study has practical implications to service failure management. A priority order using FMEA was established for the list of customer dissatisfactions that should be addressed to actively manage service failure, and strategies for tackling this priority list are offered.

Service Failure Management on Internet Shopping Environment by Combining Service Blueprint and FMEA

This paper introduces service failure management on internet shopping environment. The purpose of this study is to find and improve service failure modes at the time of customer's complaint thereby reducing that. To achieve this purpose, this study combines the Service Blueprint which describes the online shopping process and FMEA which finds each encounter of service failures and proposes how to recover them. First of all this study generates internet shopping process using Service Blueprint then matches customer's purchase decision making process and company's service provide process. After this process customer complaint types in real purchasing process are fell in according to their occurrence and more frequently occurred complaint is more risky. Finally 6 Risk Priority Numbers(unfair exchange/return policies, slow response/poor customer service support, purchase arrived later than promised/deliverly service dissatisfaction, dissatisfaction short period to take back/exchange/cancels order, A/S or handle defective item) are extracted and suggest their improvement.

Customer retention: A theoretical perspective of service failure and service recovery in the hotel industry

Purpose: The purpose of this paper is to provide a theoretical perspective on customer retention activities associated with service failure management and service recovery as a means to retain customers in the hotel industry - and to improve the competitiveness of a hotel. The research is pursued with the following objectives in mind: To determine the customer retention activities involved in the service failure management needed by hotels to retain customers. To determine the customer retention activities associated with the service recovery that hotels might perform in order to retain customers. Design/methodology/approach: Secondary sources such as textbooks, scientific journals, and previous studies on the subject were used to obtain relevant background information. A literature search of secondary sources was conducted to elucidate questions and areas of enquiry that relate to the research. Findings: The theoretical perspectives on service failure management and service recovery provided in this paper suggest several customer retention activities that might be used by hotels in order to manage service failure and service recovery - and thus become more competitive. Implications: This paper suggests a number of approaches that hotel managers might take to improve service failure management and service recovery. Such activities could assist a hotel in determining where it is lacking and where to improve its performance in these areas. These activities could provide guidance to managers who are dealing with the day-to-day operations of a hotel. They might help to avoid service failures in the first place, and, secondly, to give ideas about service recovery if failures do occur. On a more strategic level, these activities could also assist managers to develop a general customer retention strategy that incorporates service failure management and service recovery. Originality/value: Service failure management and service recovery are viewed as ways to retain customers and to improve the competitiveness of hotels. Service failure and service recovery activities are proposed; these might form part of a framework for customer retention management for the hotel industry in Gauteng, South Africa. Such a framework has not been attempted before. The paper discusses the environment in which hotels find themselves, provides a theoretical background to service failure and service recovery, and suggests strategies that could be put in place by hotels in order to retain customers. Managers of private or owner-managed - or of group or branded hotels - could perform these activities and thus improve their effectiveness.