Service Recovery Research Paper Example | Topics and Well Written Essays - 2000 words

Service Recovery - Research Paper Example In order to conduct effective service recovery, it is paramount that management institutes a cross-functional approach, which acquires a marketing perspective, management perspective and an operations perspective. This essentially entails customer recovery, employee recovery and process recovery respectively. This paper will examine the three elements of service recovery, discussing the best practice of service recovery through the extensive examination of the literature. Through the examination of the three main service recovery approaches in a number of industries, this paper will offer eight key hurdles that institutions have to overcome to bridge the gap between best service recovery practices and the actual recovery practices and suggest how to do so. Importance of Service Recovery Service recovery entails actions that a service provider institutes in response to a failure in terms of service delivery. Such a failure occurs when the perceptions of customers of the service provid ed do not match their expectations. As per this definition, it is evident that service recovery is not limited to service industries. Empirical research demonstrates that managing problems effectively entails the most vital component of a company’s reputation for excellent service delivery in institutions and industries. This means that a company that serves either internal or external customers should accept that failures are bound to happen; thus the essential thing is to institute systems and procedures that counter such failures. In recent years, a number of empirical studies have dealt with service recovery in numerous industries globally (Maxham and Netemeyer 61). Concern in service recovery has developed because companies and industries appreciate that poor service experiences are the main reason for customer switching, which also results in loss, in customer lifetime value. However, a viable service recovery system is noteworthy as it has immense, positive impacts on customer satisfaction, customer loyalty, word-of-mouth behaviour and subsequently, customer profitability. While certain studies show that great initial service is better than excellent service recovery, other empirical studies suggest that an excellent service recovery can result in even greater customer loyalty and satisfaction than if a company did nothing wrong in the initial place. This paradox is referred to as the service recovery paradox and holds true in most instances (McCollough 56). Literature on interdisciplinary services provides a rich source of insight and research on effective service recovery (Bell. and Zemke 33). The literature on service recovery shows that perceived justice is a vital element in the evaluations of service recovery. Reports on service failure show that perceived unfairness in customer treatment results, in lower customer satisfaction and loyalty. Service recovery must re-establish justice from the customer’s perspective. Justice entails th ree distinct dimensions, i.e. procedural, distributive and interactional. Distributive justice centers on the allotment of costs and benefits. This element asserts that customers weigh the benefits they gain from services with regard to the costs associated with the service.