Chapter six

Service recovery

6.1 concept of service recovery

Service recovery is the action taken by an organization in response to a service failure. Failures
occur for all kinds of reasons; the service may be unavailable when promise, it may be delivered
late or too slowly, the outcome may be incorrect or poorly executed, or employees may be rude
or uncaring. Consequence of service failure is indicated below.

Service failure

Dissatisfaction /negative emotion

______________________________________________

Complaint action No complaints action

 compliant to provide  exit /switch

 negative word of mouth  stay

 third party action

How customers respond for service failure

Customers who experience service failures can respond in a variety of ways, as illustrated in
Figure 4.2. It is assumed that, following a failure, dissatisfaction at some level will occur for the
customer. In fact, research suggests that a variety of negative emotions can occur following a
service failure, including such feelings as anger, discontent, disappointment, self-pity, anxiety,
and regret. These initial negative responses will affect how customers evaluate the service
recovery effort and presumably their ultimate decision to return to the provider or not.

Many customers are very passive about their dissatisfaction, simply saying or doing nothing.
Whether they take action or not, at some point the customers will decide whether to stay with
that provider or switch to a competitor. As we already have pointed out, customers who do not

complain are not very likely to return. For companies, customer passivity in the face of
dissatisfaction is a threat to future success.

Fig.4.2 Customer Complaint Actions Following Service Failure

Why do (and don’t) people complain.

Customers who are unlikely to take any action—the majority of customers in most situations—
have many reasons for not doing anything. They often see complaining as a waste of their time
and effort. They do not believe anything positive will occur for them or others based on their
actions. Many customers may have no confidence in the complaint process and thus refrain from
complaining because they do not think it will do any good. Sometimes customers do not know
how to complain—they do not understand the process or may not realize that avenues are open to
them to voice their complaints. Sometimes customers believe it is too difficult to report a
complaint to a firm and, in some cases, may feel like they are being punished by having to do too
much to make a complaint. In some cases non-complainers may engage in “emotion focused
coping” to deal with their negative experiences. This type of coping involves self- blame, denial,
and possibly seeking social support. They may feel that the failure was somehow their fault and
that they do not deserve redress.
Some customers are more likely to complain than others for a variety of reasons. These
customers believe that positive consequences may occur and that there are social benefits of
complaining, and their personal norms support their complaining behavior. They believe
theyshould and will be provided compensation for the service failure in some form. They believe
that fair treatment and good service are their due and that, in cases of service failure, someone
should make good. In some cases they feel a social obligation to complain—to help others avoid
similar situations or to punish the service provider. A very small number of customers have
“complaining” personalities—they just like to complain or cause trouble.

Personal relevance of the failure can also influence whether people complain. If the service
failure is really important, if the failure has critical consequences for the customer, or if the
customer has much ego involvement in the service experience, then he or she is more likely to
complain.

Customers are more likely to complain about expensive, high-risk, and ego involving services
(like vacation packages, airline travel, and medical services) than they are about less expensive,
frequently purchased services (fast-food drive-through service, a cab ride, a call to a customer
service help line). These latter services are often simply not important enough to warrant the time
to complain. Unfortunately, even though the experience may not be important to the customer at
the moment, a dissatisfying encounter can still drive him or her to a competitor the next time the
service is needed.

Types of complains.

A. passives : least likely to take any action

B. Voicers; Those customers actively complains to the service providers , but they are less
likely to spread negative word of mouth, to switch patronage or to go to third parties with
their complaints.

C. Irates: these consumers are more likely to engage in negative word of mouth to friend
and relatives and to switch providers than are others. They are average in their propensity
to complain to the provider. They are likely complained to third parties.

D. Activists; these consumers are characterized by above average propensity to complain on

6.1.1 Service recovery strategies

A. fail –safe your service. Do it right the first time

B. welcome and encourage complains

C. Act Quickly
 D. Treat customers fairly

E. learn from recovery Experience

F. lean from last customers.

6.2 service guarantees

It is a promise that if service delivery fails to meet predefined standards’, the customer is entitled
to one or more forms of complains. for example bank may offer a guarantee that an account will
be opened or a credit card will be issued within a specified number of working days otherwise it
will pay the customer a specified amount depending on the period of delay. or A restaurants may
offer home delivery within a guaranteed time , say 30 minutes, failing which the customer may
be given specified price-offs.

Benefits of service guarantees

Good guarantee can act as marketing tools for attracting customers and helps in retaining
customers. The benefits are:

A. force the company to focus on its customers

B. an effective guarantee sets clear standards for the organization

C. A good guarantee generates immediate and relevant feedback from customers.

D. When the guarantee is involved there is an instant opportunity to recover , thus satisfying the
customer and helping to retain loyalty.

E. information generated though the guarantee can be traced and integrated in to continuous
improvement effort

F. Increased service quality expectation , lower perceived risk and increased purchase intent.