Remedy or cure for service failure?

Abstract

STRUCTURED ABSTRACTPurpose: This paper aims to contribute to a growing body of service recovery knowledge by examining the relationship between service recovery, consumer satisfaction and loyalty in a commercial banking environment. Design/methodology/approach: A conceptual framework encompassing the concepts of service recovery, communication, customer satisfaction and customer loyalty in the commercial bank setting is developed. A questionnaire is designed to focus on issues related to efforts made to investigate causes of service failure and to develop recovery strategies that meet customer expectations of how their banks should handle such problems. Findings: Results show that communication had a significant relationship with service recovery and that higher levels of redress independently increase positive consumer responses. The findings also show that the interaction of employee responsiveness and courtesy can also have a positive impact on consumer evaluations. Satisfaction was highest and negative word-of-mouth intentions lowest only under conditions of high responsiveness and courtesy. Research limitations/implications: Service recovery is process-oriented, and does not assess whether the reported problem that led to the actual complaint has actually been resolved. This aspect of the study opens a number of directions for future research with the goal of increasing the still limited understanding of Service Recovery issues in commercial banks. To achieve an indepth view, a more comprehensive qualitative study that pursues the same research questions may be appropriate. Practical implications & Originality: An implication is that, when managing complaints related to customer dissatisfaction, the approaches undertaken by service quality leaders should aim to provide just resolutions/fairness in service recovery. This study also provides insight into a company's customer relationship management practices. However, in order to encourage customers to complain directly, a company needs to enhance the perception of a possible outcome if complained to. A conceptual framework is developed and used to investigate the relationship between service recovery, consumer satisfaction and loyalty

The Relationship between Service Recovery and Patronage Intentions: The Mediating Role of Relationship Quality

“…SR strategies are an effective way to increase customer satisfaction, which in turns increase trust in the provider and create customer commitment toward it. These results are on the same page with other results we have found in the existing literature (Tax et al, 1998;Wirtz and Mattila, 2004;Duffy et al, 2006;Kim, 2007;DeWitt et al, 2008;Komunda and Osarenkhoe, 2012;Yaya et al, 2013;Kandulapati and Bellamkonda, 2014;Stratemeyer et al, 2014) that SR strategies will enhance relationship quality.…”

“…In addition, problem solving acts as a direct antecedent to retail patronage intentions (Lee et al, 2009). More recent research shows that SR strategies directly affect service recovery satisfaction (Wirtz and Mattila, 2004;Kim, 2007;Duffy et al, 2006;Komunda and Osarenkhoe, 2012;Yaya et al, 2013;Kandulapati and Bellamkonda, 2014;Stratemeyer et al, 2014;Mostafa et al (2014) and customer trust (DeWitt et al, 2008 ) as a sub-components of relationship quality. In addition, some aspects of relationship quality influence patronage intentions (Sadachar, 2014;Park et al, 2015;Sharma, 2015).…”

“…Previous studies found that some service recovery dimensions had a direct effect on service recovery satisfaction as a dimension of relationship quality (Tax et al, 1998;Wirtz and Mattila, 2004;Duffy, Miller and Bexley, 2006;Kim, 2007;Komunda and Osarenkhoe, 2012;Yaya, Marimon and Casadesus, 2013;Kandulapati and Bellamkonda, 2014;Stratemeyer, Geringer and Canton, 2014;Mostafa, Lages, and Sä ä ksjä rvi, 2014). In addition, SR justice further leads to customers trust (DeWitt, Nhuyen and Marshall, 2008).…”

“…Several authors have considered that this tight relationship increases the chance of a service failure (Hart, Heskett and Sasser, 1989;De-Ruyter and Wetzels, 2000;Chueh, Wang, and Liao, 2014;Komunda and Osarenkhoe, 2012). If service providers' deal with failures in the wrong way they can incur in some harmful consequences as it can drive customers away produce negative WOM, and reduced profits (Tax, Brown and Chandrashekaran, 1998;Bitner, Brown and Meuter, 2000;Tronvoll, 2010).…”

The Influence of Psychographic Variables on the Theory of Exit, Voice, and Loyalty of Customer Complaints Behaviour in Banks

“…In Africa as well as Ghana, Customer Complaints Behaviour is understudied, as few researchers like (Donoghu & De Klerk, 2006;Petzer & Moslert, 2012;Iyiola & Ibidunni, 2013;Nimako & Mensah, 2014;Ofori-Okyere & Kumadey, 2015) have studied CCB on the continent. The few studies conducted on the continent not moved beyond, improving of the customer complaints and loyalty in the telecommination sector, Uganda (Komunda, Kibeera, Munyoki & Byarugaba, 2015), exploring customer dissatisfaction/satifaction and complaining responsess among bank customers, Ghana (Nimako & Mensah, 2014), dissatisfaction and complaining responses towards mobile telephony service, Ghana (Mensah & Nimako, 2012), complaints behaviourand product failure, South Africa (Donoghu & De Klerk, 2006) complaints emotion, anger, and subsequent behaviourof customers, Nigeria (Iyiola & Ibidunni, 2013) service failure and customer compalints management in the health sector, Ghana (Ofori-Okyere & Kumadey, 2015), attitude towards and likelihood of complaining in the banking, domestic airline and restaurant industry (Petzer & Moslert, 2012). It is obvious that, little has been studied on how psychographic variables: justice of success, self-confidence and willingness, conservatism, assertiveness, attitude towards complaints, and attitude towards businesses in general influence complaints CCB of (complainers and non-complainers) based on the three characteristics of Hirschman's theory (1970): Voice, Exit and Loyalty.…”