Leadership for the Global Marketplace - The College of Business ...

FACULTY INTERNATIONAL RESEARCH SPOTLIGHTSCultural Influences on Service Failure andRecovery: Implications for HRMKaren EhrhartSan Diego State UniversityDespite the rising share ofthe economy that servicesrepresent and the rapid globalizationof the marketplace,research on the culturalboundedness of theorieshaving to do with servicesmanagement is rather limited. As a result, relativelylittle is known about cultural differences in customerneeds and the corresponding variations inmanagement responses that those customer differencesnecessitate. Karen Ehrhart and Lisa Nishii(Cornell University) have been conducting researchaimed at addressing this knowledge gap by focusingon one aspect of services management–that ofservice failure and recovery. They presented theirmost recent study at the Academy of Managementconference and are currently writing a correspondingmanuscript to submit for publication.The focus of their study is on differences in thenaming, blaming, claiming, and outcomes thatoccur in customer experiences of service failures inthe two cultures of the US and Japan. Data collectedfrom customers in the US and Japan suggested thatindividuals’ experiences of and reactions to servicefailure situations do indeed differ across cultures,and that these differences can be explained primarilyin terms of cultural differences in individualismcollectivism.Given that frontline services areproducts of strategic issues, particularly of humanresource management (HRM) issues, the HRM implicationsof the results are of particular interest.With regard to naming issues, when employees displayednegative emotions and a lack of empathicbehavior, customers associated this with servicefailure, more so in Japan than in the US. As someargue, “we can train people to do anything technical,but we can’t make them nice” (Heskett, Sasser,& Schlesinger, 1998, p.116). Thus, one implicationis hiring people who are adept at self-monitoring.In addition, customers – particularly in the US –identified unfair treatment and unfair outcomesas contributing to service failures. Thus, organizationswould benefit from paying more attention totreating employees fairly, for it is then that employeeswill be more likely to treat customers fairly.Regarding blaming issues, US respondents weremore likely than Japanese respondents to blamethe service provider (employee) for the failure andto note that they would recommend the servicebecause the service is usually acceptable. Servicefailures may therefore be viewed as exceptionsrather than as the rule in the US. Japanese participantsblamed the organization as a whole moreoften than US participants, and Japanese customerswere less likely than US customers to recommendthe service to others. Investments in training, evenfor temporary employees, may be of paramountimportance in Japan, particularly given the repercussionsof insufficient training in terms of lowercustomer intentions to recommend the business.With regard to claiming issues, some customers,particularly in Japan, did not confront the serviceprovider even when they were dissatisfied. Thus,identifying ways to increase the probability thatcustomers will confront failure situations is critical.There are at least two means of eliciting this behaviorfrom customers: holding employees accountablefor collecting information about service failures andtraining customers to provide such information.Finally, regarding outcome issues, Japaneseindividuals were less likely to report recovery,be satisfied with the way the service failure washandled, and recommend the service to others.This suggests that the premise that recovery canbe good for business may be culture-bound, andit may be more important to focus on avoidingfailure in the first place in cultures such as Japan.As failure is seemingly inevitable, when it doesoccur, the organization might consider providingcustomers with coupons for free future servicewith the intention of re-establishing trust throughfuture interactions. Once trust is regained, customersmight be willing to spread positive wordof mouth about the organization.14 sdsu college of business administration: leadership for the global marketplace