Foreign or domestic: who provides better customer service?

Abstract

Purpose – The purpose of this paper is to investigate the role of customer service employees’ (CSEs) competence and service recovery outcomes on service evaluations of foreign and domestic CSEs. Design/methodology/approach – Three experiments were conducted to test and validate the proposed hypotheses. The participants were told a cover story that they were either listening to (Study 2) or reading (Studies 1 and 3) a real conversation between a customer service representative of a bank and a customer and the authors wanted their views about the service encounter. While country of origin (COO) and competency were common independent variables across three studies, Study 2 included service recovery with a full refund and Study 3 had both full and partial refund and apology offered or not. Findings – Results from three experiments show that while competent CSEs are evaluated the same, regardless of their COO, the domestic CSE is evaluated more negatively than the foreign CSE when both are incompetent. The authors also find that when competent CSEs deliver no service recovery, the foreign CSE evaluations are significantly lower than the domestic one. Study 3 results show that this effect is mediated by participants’ ethnocentric beliefs. Research limitations/implications – For implications, this study provides a deeper understanding of the role of COO in services contexts. Future researchers can utilize the findings to investigate the important role that expectations play in determining service excellence and how it affects the COO effect. Practical implications – The paper provides managers in both offshoring client and provider firms with an understanding of the effects of offshoring on employee evaluations. It discusses the relevance/irrelevance of COO on the customer evaluations of service employees. Originality/value – The study investigates an under researched phenomenon – offshoring of services. This paper is one of the few looking at the role of different interaction factors, such as competence, recovery on service evaluations.

Brand value proposition for bank customers in India

“…Are the same benefits expected from both types of banks? Poddar et al (2015) show that FB employees, in general, are more favorably viewed by customers. This gives FBs more elbow room to deal with customer dissatisfaction.…”

Stereotypes in Services - A Systematic Literature Review to Move from Scattered Insights to Generalizable Knowledge

“…The fourth category, a different approach to address stereotypes, recommends focussing on delivering high-quality services and ignoring potential stereotypical perceptions because excellent service delivery can render stereotypes irrelevant. For example, in a cultural context, the country-of-origin of a service employee was not as important as the competence of the employee (Poddar et al 2015). In a gender context, the most important determinant of customer evaluations was the service outcome, not stereotypical perceptions (Mohr and Henson 1996;Pinar et al 2017).…”

“…Studies have shown that in a positive service experience, stereotypical characteristics do not seem to be influential. In contrast, after a negative service outcome, customers evaluate minority service providers more poorly than traditional ones (Poddar et al 2015;Wang et al 2013). Interestingly, in a gender context, Matta and Folks (2005) found that due to lower expectations in the beginning, initially negatively stereotyped service providers who deliver an excellent service outcome are evaluated even higher than standard service employees delivering the same service outcome.…”

“…At the customer level, the most important behavioural intentions are purchase and repurchase intentions toward a service provided. Other behaviours that were analysed were willingness to pay (Gill et al 2017), likelihood to recommend (Baker et al 2008;Thakor et al 2008), word-of-mouth (Wu et al 2016;Zolfagharian et al 2018), intention to complain (Poddar et al 2015) and switching to another employee or provider (Zolfagharian et al 2017). Interestingly, from an organisational perspective, behavioural intentions have been investigated very sparsely.…”

“…Two types of training are recommended based on the direction of stereotypes. For employee facing stereotypes, companies should provide training in the appropriate use of individual defensive tactics when being stereotyped (Pinar et al 2017;Poddar et al 2015). This can include trainings on how to create a positive self-perception (Ashfort and Kreiner 1999) or handle special requests and complaints of customers who are predisposed to be negative toward minority employees (Mohr and Henson 1996).…”