Today we identify service articles published in Marketing, Management, Operations, Productions, Information Systems & Practioner-oriented Journals in February 2017.
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Maklan, S., P. Antonetti and S. Whitty (2017): A Better Way To Manage Customer Experience: Lessons From The Royal Bank Of Scotland, California Management Review, 59(2), pp.92-115
Customer experience is heralded as the competitive battleground; however, it is defined so broadly that companies often struggle to define, implement, and measure it. Based on the experiences of the Royal Bank of Scotland, this article develops an effective approach to scoping and managing customer experience, identifying typical pitfalls, and providing guidance to organizations trying to understand where to start.
Link: http://dx.doi.org/10.1177/0008125617695285 [Google]
Ditkoff, S. W. and A. B. E. Grindle (2017): Audacious Philanthropy: Lessons From 15 World-Changing Initiatives, Harvard Business Review, 95(5), pp.110-118
Private philanthropists have helped propel some of the most important social-impact success stories of the past century: Virtually eradicating polio globally. Ending apartheid in South Africa. Creating a universal 911 service in the United States. These efforts have transformed or saved hundreds of millions of lives. That we take them for granted now makes them no less astonishing: They were the inconceivable moon shots of their day before they were inevitable success stories in retrospect. Today’s donors aspire to similarly audacious outcomes, but despite having written big checks for years, many aren’t seeing transformative results. A study of 15 breakthrough initiatives, ranging from broad access to end-of-life hospice care to the widespread use of a lifesaving oral rehydration solution in Bangladesh, revealed five shared elements that may help philanthropists improve the odds of swing-for-the-fences success. Effective initiatives: Build a shared understanding of the problem and its ecosystem; set concrete and compelling “winnable milestones”; design approaches that work at massive scale; drive demand; and embrace course corrections. INSET: AUDACIOUS SOCIAL-CHANGE INITIATIVES OF THE PAST CENTURY.
Link: http://dx.doi.org/ [Google]
Iansiti, M. and K. R. Lakhani (2017): Managing Our Hub Economy: Strategy, Ethics, And Network Competition In The Age Of Digital Superpowers, Harvard Business Review, 95(5), pp.84-92
A small number of digital superpowers—Alibaba, Amazon, Microsoft, and others—have become “hub firms” because they control access to billions of mobile customers coveted by all kinds of product and service providers. These hubs drive increasing returns to scale and claim a disproportionate share of the value being created in the global economy. The authors argue that the hub economy will continue to spread across more industries, concentrating more power in the hands of a few. As an example, they take an in-depth look at the auto industry and how Apple and Alphabet/Google are poised to become the main beneficiaries as cars turn into digitally connected spaces for work, entertainment, and shopping. As hubs proliferate and expand their reach, the danger is that they will exacerbate economic inequality and threaten social stability. It is thus incumbent on all stakeholders—traditional companies, start-ups, institutions, and communities— to make certain changes in the ways they do business. Moreover, hub firms themselves must lead responsibly for the good of all, not just creating and capturing value but doing more to sustain other players in the ecosystem.
Link: http://dx.doi.org/ [Google]
Pappas, I. O., P. E. Kourouthanassis, M. N. Giannakos and V. Chrissikopoulos (2017): Sense And Sensibility In Personalized E-Commerce: How Emotions Rebalance The Purchase Intentions Of Persuaded Customers, Psychology & Marketing, 34(10), pp.972-986
This research develops and tests a theoretical model of customer persuasion in personalized online shopping, building on information processing theory, and addressing cognitive and affective stages of the persuasion process. Data from 582 experienced online customers were used to validate the proposed model through structural equation modeling and multigroup analysis. Results show that quality of personalization, message quality, and benefits of the personalized recommendations are important in the persuasion process. Positive emotions increase the effect of persuasion on purchase intentions, contrary to negative emotions. The study extends online personalization theory, offers an in-depth analysis of the persuasion process in online shopping, and provides valuable recommendations for personalized online marketing.
Link: http://dx.doi.org/10.1002/mar.21036 [Google]
Visnjic, I., M. Jovanovic, A. Neely and M. Engwall (2017): What Brings The Value To Outcome-Based Contract Providers? Value Drivers In Outcome Business Models, International Journal of Production Economics, 192(0), pp.169-181
Outcome-based contracts (OBCs) are frequently seen as the most advanced level of service offering that product firms offer. To deliver OBCs, product firms have to shift from the traditional product business model (PBM) to adopting an outcome business model (OBM). This constitutes a major change that rearranges their activity system and therefore profoundly changes their value-creation process. The literature tells us little about what this change entails and the key value drivers that OBC providers focus on as they adopt outcome business models. To tackle this topic, we study four global capital equipment manufacturers that recently started to offer highly advanced forms of OBC: Bombardier, Caterpillar, Hitachi and Rolls Royce. We learn that, apart from recognized value drivers, such as efficiency, novelty, lock-in and complementarity, OBC providers draw value from what we have labelled accountability value. Second, the value drivers are more diverse in OBMs than in traditional PBMs. Third, while in PBMs there is a trade-off between value drivers, in OBMs value drivers are mutually reinforcing, as they create a synergistic interplay. At the same time, however, firms are exposed to some sources of value loss as they start providing OBCs and shift to OBMs. We contribute to the literature by connecting the OBM literature with the broader value-creation literature and identifying (specific) value drivers as they appear in the OBM context, as well as the relationships among them.
Link: http://dx.doi.org/https://doi.org/10.1016/j.ijpe.2016.12.008 [Google]
Witell, L., H. Gebauer, E. Jaakkola, W. Hammedi, L. Patricio and H. Perks (2017): A bricolage perspective on service innovation, Journal of Business Research, 79(0), pp.290-298
Service innovation is often viewed as a process of accessing the necessary resources, (re)combining them, and converting them into new services. The current knowledge on success factors for service innovation, such as formalized new service development (NSD) processes, predominantly comes from studying large firms with a relatively stable resource base. However, this neglect situations in which organizations face severe resource constraints. This paper argues that under such constraints, a formalized new service development process could be counter-productive and a bricolage perspective might better explain service innovation in resource-constrained environments. In this conceptual paper, we propose that four critical bricolage capabilities (addressing resource scarcity actively, making do with what is available, improvising when recombining resources, and networking with external partners) influence service innovation outcomes. Empirical illustrations from five organizations substantiate our conceptual development. Our discussion leads to a framework and four testable propositions that can guide further service research.
Link: http://dx.doi.org/https://doi.org/10.1016/j.jbusres.2017.03.021 [Google]
Lim, E., Y. Lee and M.-D. Foo (2017): Frontline employees’ nonverbal cues in service encounters: a double-edged sword, Journal of the Academy of Marketing Science, 45(5), pp.657-676
In this research, we look at the similarity between frontline service employees’ nonverbal or expressive behavior and customers’ receptivity of nonverbally expressed emotions (i.e., expressive similarity). Supported by evidence from four studies, we demonstrate that expressive similarity between customers and frontline service employees yields positive outcomes for both the employee and the organization under successful service delivery, but it can paradoxically backfire on the organization in service failures. In successful service encounters, higher expressive similarity between customers and employees enhances consumer satisfaction and promotes more direct compliments and positive word of mouth. In contrast, higher expressive similarity increases customer dissatisfaction and intent to engage in negative word of mouth, but it reduces customers’ inclination to lodge direct complaints following a service failure (Study 1). Studies 2 and 3, both field experiments, provide external validation of the key findings on customer satisfaction and voice intentions (Study 2) as well as actual voice behavior (Study 3). Building on these findings, Study 4 reveals that while customer-perceived rapport and trait impressions of the service employee mediate the observed effects of expressive similarity on satisfaction, only rapport significantly explains the effects of expressive similarity on voice intentions. Theoretical and managerial implications, along with suggestions for future research, conclude the paper.
Link: http://dx.doi.org/10.1007/s11747-016-0479-4 [Google]
Hong, Y. and P. A. Pavlou (2017): On Buyer Selection Of Service Providers In Online Outsourcing Platforms For It Services, Information Systems Research, 28(3), pp.547-562
The Internet has presumably created a level playing field that allows any service provider across the globe to compete for contracts on online outsourcing platforms for information technology (IT) services. In this paper, we empirically examine (a) how country (language, time zone, cultural) differences and the country’s IT development affect buyers’ selection of service providers in online outsourcing platforms; and (b) how the reputation of service providers moderates the proposed effects of country differences and the country’s IT development. We integrated a unique data set formed by a sample of 11,541 software development projects from an online outsourcing platform matched with archival sources on the language, time zone, culture, and IT development of countries. Since price is typically endogenous in any supply demand system, we used the exogenous variation of the normalized exchange rate of the currency among countries, as a ‘cost-shifter’ type instrumental variable (IV) for econometric identification. Our panel data analyses results (both with and without IV) show that buyers are negatively affected by country differences in terms of language, time zone, and culture, and prefer service providers from countries with higher IT development. Notably, the reputation of service providers attenuates the negative effects of language and cultural (but not time zone) differences, while it substitutes the positive effect of the country’s IT development. We discuss the study’s theoretical and managerial implications for understanding the global dynamics of online outsourcing platforms and better designing these platforms. The online appendix is available at .
Link: http://dx.doi.org/10.1287/isre.2017.0709 [Google]
Brandl, K., M. J. Mol and B. Petersen (2017): The Reconfiguration Of Service Production Systems In Response To Offshoring, International Journal of Operations & Production Management, 37(9), pp.1246-1264
Purpose A service production system has a structure composed of task execution, agents performing tasks and a resulting service output. The purpose of this paper is to understand how such a service production system changes as a consequence of offshoring.Design/methodology/approach Drawing on practice theory, the paper investigates how offshoring leads to reconfiguration of the service production system. Through a multiple case methodology, the authors demonstrate how agents and structures interact during reconfiguration.Findings The paper analyses the reconfiguration of components of a service production system in response to change ignited by offshoring. The authors find recurring effects between structures that enable and constrain agents and agents who shape the structure of the production system.Research limitations/implications The paper offers a novel contribution to the service operations management literature by applying practice theory. Moreover, the authors propose a detailed, activity-driven view of service production systems and service offshoring. The authors contribute to practice theory by extending its domain to operations management.Practical implications Service production systems have the ability to self-correct any changes inflicted through offshoring of the systems, which helps firms that offshore.Originality/value The paper is aimed at service professionals and offshoring managers and proposes a novel presentation of the service production system with a description of how it responds to offshoring. The authors contribute to theory by applying practice theory to the fields of service operations management and offshoring.
Link: http://dx.doi.org/10.1108/IJOPM-07-2015-0430 [Google]
Goode, S., H. Hoehle, V. Venkatesh and S. A. Brown (2017): User Compensation As A Data Breach Recovery Action: An Investigation Of The Sony Playstation Network Breach, MIS Quarterly, 41(3), pp.703-A716
Drawing on expectation confirmation research, we develop hypotheses regarding the effect of compensation on key customer outcomes following a major data breach and consequent service recovery effort. Data were collected in a longitudinal field study of Sony customers during their data breach in 2011. A total of 144 customers participated in the two-phase data collection that began when the breach was announced and concluded after reparations were made. Using polynomial modeling and response surface analysis, we demonstrate that a modified assimilation–contrast model explained perceptions of service quality and continuance intention and a generalized negativity model explained repurchase intention. The results of our work contribute to research on data breaches and service failure by demonstrating the impacts of compensation on customer outcomes. We discuss theoretical and practical implications.
Link: http://dx.doi.org/ [Google]
Young Bong, C., V. Gurbaxani and K. Ravindran (2017): Information Technology Outsourcing: Asset Transfer And The Role Of Contract, MIS Quarterly, 41(3), pp.959-A953
Information technology outsourcing (ITO) is the predominant mode of acquiring information systems services, providing clear evidence that the economics of service delivery favor external service providers over in-house information systems departments. An interesting feature of many large ITO arrangements is that the production assets necessary for service delivery are transferred to the vendor. The argument in favor of such asset transfers, based in property rights theory, is that they are necessary to incentivize vendors to continue to invest in transaction-specific assets to improve service. On the other hand, transaction cost economics predicts that transferring such assets increases bilateral dependence and will elevate the risk of post-contractual opportunistic behavior. The contracting challenge in this context is to specify the terms of exchange to achieve the client’s objectives for outsourcing while managing the risks of asset transfer. We develop a theoretical framework to derive propositions on contract design in the presence of asset transfer. We identify the importance of contractual clauses that mitigate the associated risks and the complementary role of compensation mechanisms, specifically the pricing scheme and IT-related performance incentives. We have compiled a unique dataset that allows us to test our propositions by comparing ITO contracts that include asset transfer to those that do not. We find that asset transfer does significantly affect contract design, manifested in the inclusion of clauses that protect both clients and vendors. Outsourcing objectives are more likely to be met when contracts include compensation mechanisms that complement asset transfer.
Link: http://dx.doi.org/ [Google]
Manou, A., P. G. Canbolat and F. Karaesmen (2017): Pricing In A Transportation Station With Strategic Customers, Production & Operations Management, 26(9), pp.1632-1645
We consider a transportation station, where customers arrive according to a Poisson process, observe the delay information and the fee imposed by the administrator and decide whether to use the facility or not. A transportation facility visits the station according to a renewal process and serves all present customers at each visit. We assume that every customer maximizes her individual expected utility and the administrator is a profit maximizer. We model this situation as a two-stage game among the customers and the administrator, where customer strategies depend on the level of delay information provided by the administrator. We consider three cases distinguished by the level of delay information: observable (the exact waiting time is announced), unobservable (no information is provided) and partially observable (the number of waiting customers is announced). In each case, we explore how the customer reward for service, the unit waiting cost, and the intervisit time distribution parameters affect the customer behavior and the fee imposed by the administrator. We then compare the three cases and show that the customers almost always prefer to know their exact waiting times whereas the administrator prefers to provide either no information or the exact waiting time depending on system parameters.
Link: http://dx.doi.org/10.1111/poms.12706 [Google]
