The Roles of Personnel Autonomy and Service Leadership in Innovative Service Recovery - Research Proposal Example

Thesis Proposal on the Effects of Social Powers of Managers to Subordinates and Its Influence to Service Outcomes (Success or Damage Control) and Service Recovery in Restaurant Management by [Insert Names of Author(s)] [Insert Course Identification information here] [Insert Professors name here] [Insert Submission date here] [Insert Names of Author(s)] [Insert Course Identification information here] [Insert Professors name here] [Insert Submission date here] Thesis Proposal on the Effects of Social Powers of Managers to Subordinates and Its Influence to Service Outcomes (Success or Damage Control) and Service Recovery in Restaurant Management Introduction Background Statement of the problem Objectives Hypothesis Significance of the problem Review of literature Methodology Research schedules and budget Introduction One of the most interesting topics of management is when an established service organization has failed to deliver the expected service to the customer and consequently how to recover from it becomes a fundamental managerial concern. Understanding then the impact of managerial powers on service recovery remains an important area of study. The science of service delivery, and/or, its failure and how failure is corrected, becomes more interesting because it gives an edge to the people inside that organization that studies and applies it. Inevitably, competition is the most powerful reason behind the study of service delivery failure and recovery. Eventually, competition by various organizations in service delivery could boil down to customer loyalty when the business organization fails to deliver what the customer expected or what maybe generally called poor and failed service outcomes. Profit oriented organizations can be generally categorized into goods-oriented, service-oriented, or a combination of both. In any of these industries, seldom do outcomes get a hundred per cent score in terms of services delivered all of the time. A survey may show that the rating of the quality of service maybe 100% but service delivery failure may occur to some customers. This is a fact because service delivery is related to human nature, which varies from person to person. The customer is the centre of focus when it comes to service delivery because it is from the customer that the income of the organization is obtained. When service delivery fails, the consequences will also vary from the top to the bottom, left to right, or cross-sectional interaction in the organization performing the service. Evidently, there exists a relation between the organization (providing the goods or the service or both) and the customer. The front liners of service groups are the first line of intervention when it comes to service delivery, without the proper skills how to close the deal or to recover from a soured deal, business for the organization inevitably loses. The manager or the immediate boss of the front liner must see to it that the proper skills must be acquired by the people in the first line of intervention. The science of management of organizations may have probably started when prestigious business schools like Harvard and Oxford were founded. Several aspects of management have been studied, reviewed and have evolved to be a particular branch of business science studies. Among these are accounting, finance, objectives management, human behaviour in organizations, market trends or marketing, product improvement and delivery, customer relations, and others. Most business schools during the higher stages of the courses present actual cases of business to exemplify to their students how a business organization has coped up with its ups-and-downs. Service outcomes are a cost to any customer and theoretically, the better the service, the higher the price that a customer may or should pay for the services rendered. When the customer comes back regularly in a determinable pattern, then the business organization has won customer loyalty. When the customer inside a restaurant is satisfied with the food and the service, he will comeback to frequent the place and may recommend it to others, thereby, increasing the customer base. During the process service delivery, it is evident that the authority of the attendant delivering the service is utilized and practiced, meaning, the delineation of responsibility and job scope is well defined. When there is use of authority, there has been the assignment of power prior to the performance of the specific functions the attendant is performing. These powers bestowed to the attendant are usually defined to him/her by the management or prescribed to him by the manager at hand. Where the sanctions of power or authority come, the source of the power has also its limits. In this research, it shall be attempted to analyze the powers bestowed on the manager, its effect on the responsibilities and duties of subordinates, and its effect on the outcomes of a service. For this paper, the research will be conducted from the point of view of an observer, specifically that in a restaurant scenario. When the service fails because of one reason or another, damage control has to be implemented in order to recover the lost “face” the restaurant encountered. What we may call damage control is recovery in service delivery failure or in simple terms, how would waiters, supervisors and managers recover back or handle complaints from an unsatisfied customer. The importance of understanding the dynamics involved in service failure and recovery as it relates to managerial styles as reflected in the use of social powers associated with management could not be underplayed. Statement of the problem As patterns of ups-and-downs can be distinguished in restaurant operation, it remains an important management concern. Service recovery is one part of the cycle in the delivery systems which essentially outside the loop and associated closely with the nature of service failure and in which part of the cycle the failure occurs. There is then a need for a study the relationship between customer retention, potential failure identification, and service failure resolution using the manager’s bases of power on subordinates as basis of evaluation as well evaluating how systems failure occurs and what steps could be carried out to recover customers which may be lost forever to the business establishment due to poor service outcome. The results of the study maybe used as a baseline in developing seminars, workshops and manuals for restaurant managers. Objectives of the study The general objective of this research is to find out how subordinate employees of restaurants are influenced by social powers of managers in restaurant management, especially in the field of service recovery (when service fails). Specifically, the study wants to a) explore the relationship between effects of social powers of managers (legitimate, reward, coercive, referent and expert powers) and subordinates who have at one time or another have encountered success recovery and succeeded. b) identify potential area wherein service failure could occurs; and; c) determine the skills of the manager in charting service process flows and contingencies in case of service failure. Review of literature There are several important theories on social power and one of its core contentions is that there are inequalities as far as distribution of power and wealth in societies, an observation which holds true even for the industrialized countries of North America and Europe. Text book definitions of social power varies but it generally give common attribution including the ability to influence policies and allotment of social wealth. But nevertheless, the manner how such powers are acquired and used and how this affects stratification varied across societies. In the United States, pluralism has been one of the theories propounded to explain the complex power structure. G. William Domhoff maintains that pluralism is the theory that most closely corresponds to “claims made in high school textbooks and the mass media, and to what many Americans believe. Its most general point is that there is not a dominant class or a set of institutionally based elites that has predominant power. Different groups have power on different issues. (Alternative Theoretical Views, by G. William Domhoff, April 2005, http://sociology.ucsc.edu/whorulesamerica/theory/alternative_theories.html). Thus we could view society as composed of different groups with different issues and functions in society such as management group, labor group, advocacy groups, government institutions, etc. On social powers associated with the corporate functions, Sharifzadeh focused on different powers bestowed by the management unto a manager. Power can flow in any direction in an organization and power applies both to individuals and groups. Sharifzadeh went to categorize power into legitimate power, reward power, coercive power, referent power and expert power. As the name suggests, legitimate power is derived from the institution or organization to which the manager belongs. Reward power works in the similar fashion as positive reinforcement. Coercive power meanwhile works on the premise of control and sanctions and might be contrary to legitimate or reward power. Expert power is posited on the power of knowledge. Referent power meanwhile is based on interpersonal relationships which according to Sharifzadeh “permits influence to extend across the organization, outside of the usual channels of legitimate authority, reward, and coercion.” (Dr. Mansour Sharifzadeh entitled: ``The Definition of Power'', California Poly Pomona Magazine, http://www.csupomona.edu/~msharifzadeh/mhr318/power.htm) Service recovery The social powers associated with management by definition manifest in the different areas in the business cycle from service production, service delivery and in case of service delivery failure in service recovery. Backer (2006) studied in detail how service recovery works in an enterprise. He said that service recovery is ultimately decided by the “client’s expected standards and impressions of the enterprise.” Backer in his research, identified three important trends: a) customers who expect the relationship to continue actually have lower service recovery expectations, that these customers are more satisfied with customer service performance after failure recovery with the expectation that strong future interactions may correct the customer service failure over time; b) a client who does not have much loyalty to the enterprise is incline to be more interaction-focused and anticipates quick service recovery when a specific interaction did not satisfy expected standards; c)“service suppliers not only have measures in place to determine the degree of intensity of customer relationships but also the capacity to responds to customer service failures” d) that the extent of the failure in customer service “moderates the relationship between customer satisfaction and commitment” e) “managers may need to do more to mend the strength of customer relationships and restore commitment, and; f) service companies need to track and identify occurrences of customer service failure as well as the extent of each; and g) the information given by the client at the time of the grievance, should be analyzed as crucial marketing research information important not only for immediate service recovery but for the improvement of prospective performance (Backer, 2006). (Backer, 2006, How to Restore Customer Satisfaction after Customer Service Failure, http://www.customerservicemanager.com/how-to-restore-customer-satisfaction-after-customer-service-failure.htm). Evaluating failure Before any service recovery could take place the nature of service must be fully understood. In what area in the cycle from production to delivery did a failure occurred? What could be the nature of such failures? These are the questions tackled by Rotondaro and Oliveira and their study focused on the use of Failure Mode Effect Analysis (FMEA) to improve service quality. The study found out that service failure could be corrected if employees are involved in identifying and coming up with remedies to such failures. There are six areas of service wherein failure could occur: Failure 1 – badly set tables; Failure 2 – impolite employee; Failure 3 – tableware missing; Failure 4 – cold meal; Failure 5 – cleaning and food hygiene, and; Failure 6 – delay in serving the customer. The research also found out that the workforce could be cooperative in improving service delivery. (Roberto Gilioli Rotondaro and Claudio Lopez de Oliveira University of São Paulo, Av.Professor Almeida Prado No. 128.Trav.2, São Paulo,Brazil Rotondar@cwaynet.com.br ) Psychology in service failure In a paper by Chang, C. (2006) entitled “When Service Fails: The Role of the Salesperson and the Customer”, Psychology and Marketing, 23(3), 203-224”, Chang examined how freedom of choice could potentially promote a client's sense of control and satisfaction regarding recovery options when service failure occurs. Chang insinuates to interaction theory, even mentioning the boundary spanner role that salespeople assume with clients. To Chang, there is a glaring gap in the knowledge on how actions and approach used by salespeople can support customer retention and even strengthen a firm's overall relationship with customers when service failure happens. A hypothetical experimental survey study was done with 314 university students using case scenarios to test three hypotheses related to service recovery options and perceived control and satisfaction. The author achieved favourable statistical results that supported his hypotheses. However, his study does not investigate how interaction plays a role in service recovery and several questions remain. Does freedom of choice in a real world context, help enhance customer retention and improve the customer's perception and experience of the firm's response to service failure? Does it also improve customers' affective and cognitive levels of satisfaction with the salesperson's/firm's service? Another unanswered important question related to human resource development is, how companies can help their salespeople cultivate a variety of strategies for service recovery to use as needed when service failure occurs. Service failure as viewed by the client In another paper, Dunning, J., Pecotich, A., and O'Cass, A. (2004), focused on service failure from a customer's perception. They zeroed in on the actual interpersonal process and dynamics that occur as both customer and salesperson negotiate a satisfactory resolution and achieve service recovery. The projected style (credibility, aesthetics, empathy, sincerity), the adequacy, and timeliness of the explanatory content provided by a salesperson seemed critical in promoting client satisfaction during service failure resolution. The authors focused on actual experiences by asking a diverse sample of consumers to describe and assess an incident in the past. They used a survey based, recall and evaluation of a past critical incident design, where they asked participants to share their perceptions of an unsatisfactory sales incident. The results showed that the majority of the described sales incidents reflected dissatisfaction with either quality (product defects) or service (slow service, service faults and rude/problem salespeople). A salesperson's interaction skills were keys to satisfactory resolution. These authors concluded that human resource development such as teaching supportive and effective communication skills and other strategies that promote satisfactory interaction with clients is needed to navigate through service failure incidents. (Dunning, J., Pecotich, A., and O'Cass, A. (2004), “What Happens When Things Go Wrong?”, Retail Sales Explanations and Their Effects, Psychology and Marketing, 21(7), 553-572,) Resolving conflicts due to service failure A research paper by McColl-Kennedy and Sparks (2003), examined customer emotions in relation to accountability during service recovery initiatives used the fairness or equity theoretical model as a framework. The authors noted that customer emotions tend to be heightened during service encounters, and encompass a spectrum ranging from anger to delight, depending on the success of the transaction/interaction. The objective of the research was to look how the emotions of the customer are altered favourably as a direct result of the attending employee's actions during service recovery. Accountability is an essential element of fairness theory, thus the authors focused on how customers do or do not hold service providers liable when service fails. In relation to accountability, counterfactual thinking was also considered. Customers often contrast “what is perceived to be with might have been” (p. 254), mentally framing what could have been (conduct), what should have been (moral principles), and how it would have felt had alternative action been taken (negative event). These were all viewed through the lens of interactive, procedural and distributive justice. Like attribution, counterfactual thinking relates to causal inference or deduction. When a customer is experiencing intense emotions like anger or frustration, “they will likely engage in detailed, systematic and complex judgmental processes”, which leads to critical counterfactual thinking about the service (p. 257). The authors found that intention was an important consideration in the assignment of accountability. The authors provided recommendations for managerial strategies to address the findings. It was suggested that management conduct developmental workshops in interpersonal skills, perspective taking, lateral thinking, applying intentional/visible effort and strategy, and integrating moral principles into the workplace. McColl-Kennedy, J. & Sparks, B. (2003), “Application of Fairness Theory to Service Failures and Service Recovery”, Journal of Service Research, 5(3), 251-266, Service recovery and long term relationships with customers Meanwhile de Ruyter, K. & Wetzels, M. (2000), looked at the role service recovery impacts on the establishment of long-term relationships with customers. The authors pointed out that customer-equity considerations have a two-way effect. Long-term satisfied customers tolerate a service failure, maybe more than once before “they will drop their loyalty due to a lack of service quality” (p. 96). New customers may well choose not to use the service again after just one service failure. Satisfaction in service recovery is achieved by meeting or exceeding a customer's expectations. How designated personnel handle the process of service recovery appears to be very important to customers than the outcome or compensation of the recovery itself. Their major research question focused on “does failure of a tangible good lead to different recovery expectations than failure of an intangible service?” (p. 94). Since services are intangible, it is harder to correct service failure in comparison to product failure. The authors pointed out that it is best to always ask a customer what they expect after a service failure in order to avoid common post-purchase consequences. Consequences include complaining to external agencies or parties, damaging word-of-mouth communication, brand switching, and negative purchase intention, as well as a loss of loyalty and trust. Customer recovery expectations included consideration of various aspects of the service encounter, namely: (1) the magnitude of the failure, (2) the tangibility of the product (goods or services), (3) organizational commitment (new or established customer), (4) equity sensitivity of customer (benevolent, equity sensitive, entitled), (5) the potential for negative word-of-mouth consequences, and (6) the necessary recovery expenditures. In the cross-industry study, which was case-focused, the authors found that distributional fairness and procedural fairness during the service recovery significantly improved results for service quality, customer satisfaction, trust, and loyalty. Interactional fairness was also basic for rebuilding trust. The results focused on the effects of apology (interactional), voice (procedural), outcome (distributional) and industry (overall fairness) equity strategies in restoring customer satisfaction and negating post-purchase consequences. They found that the strongest results were achieved when all four dimensions were applied in the service recovery scenario. There seemed to be more weight in voice and outcome. de Ruyter, K. & Wetzels, M. (2000), “Customer Equity Considerations in Service Recovery: A Cross-Industry Perspective”. International Journal of Service Industry Management, 11(1), 91-108, Employee Attitudes In the paper by Koys, information was gathered from the different departments of a dining chain through the conduct of employee interviews, manager surveys, customer questionnaires, and organizational data. Additional cross-lagged regression analyses in the said research facilitated by Koys demonstrated that there was significant relationship between organizational effectiveness and the employee attitudes and behaviours. This suggested a relationship between human resource outcomes and business results. (Koys, 2001). (Koys (2001), The Effects of Employee Satisfaction, Organizational Citizenship Behavior, and Turnover on Organizational Effectiveness: A Unit-level, Longitudinal Study”, http://ocls.cmich.edu/a5.html). The study also a weak relationship between between individual level employee satisfaction and individual-level performance. Ryan opines that “organizational performance is not simply a totality of individuals' performances, thus, it may be affected by factors other than those affecting individual-level performance. Share values could be one of these factors which affect individual-level performance (Ryan et al, 1996). Schneider's work has supported this statement in from his own conduct of study using the attraction-selection-attrition model (Schneider, Goldstein, & Smith, 1995). Heskett, et al. (1997) meanwhile emphasize that value perception could lead to customer loyalty and satisfaction and in the long run could contribute to company growth and profits. (Heskett et al., 1997). Organizational citizenship behavior Looking at the overall setting of organization behaviour, Organ (1988) as cited by Koys, pointed out to five categories of organizational citizenship behavior (OCB) which includes organizational consciousness, altruism, civic virtue, sportsmanship and courtesy. Organizational consciousness refers to in-role behaviors such as individual task performance. This role are sometimes carried out well beyond the minimum required levels. Altruism refers to “otherness” or willingness to help co-workers or friends or even strangers without expectation of gain. Civic virtue refers to participation in the socio-political affairs of the organization. Sportmanship was taken more on the positive attitude on competition or conflict resolution contexts. Courtesy refers to mutual respect between employees (Koys, 2001). Blau as cited by Ndonga was of the early theorist on organizational behaviour stipulating that social exchange involves the voluntary actions of individuals. These exchanges are motivated by the expectation of a rewarding experience from the exchange. Consequently such exchanges could grow in complexity encompassing organizations, institutions and permeating the socio-cultural-economic web of complex relationships. The central core of the social theory is reciprocity and once this reciprocity is broken could lead to the dissolution of a particular relationship. The social exchange theory remains the foundational theory behind the corporate citizenship behaviour. Peter Blau's Conception of Social Exchange Theory: A Critique, Bernard N.Ndonga*http://localhost/sap/publications/cuea/templpdf.php?name=eajourn1Blau.html (3 of 6) [6/10/2002 9:10:37 PM] The Eastern Africa Journal of Humanities & Sciences, Vol1. No 1. – 2002. Methodology To evaluate how a particular power affects service and service recovery in case of service delivery failure (SDF) in any of the components in a restaurant service/product and delivery process, the researcher will use a three stage research process. Stage I will involve profiling 12-15 restaurants with comparable service capability along a set of criteria that will be developed by the researcher to evaluate the management style. This is on the assumption that each restaurant though having unique characteristics also shared common practices and will be possible to categorize each restaurant by marking the dominance of any of the five powers defined by Sharifzadeh: Legitimate Power Legitimate power derives from a person's position or job in the organization. It is a prescribed authority, prescribed by management to create order in the chain of command and not to overlap the functions of those who are holding it. It is well defined in the job description of the power holder. It constitutes to the organization's judgment about who is formally permitted to influence whom, and it is often called authority. The power holder is hired or employed by the organization. As we move up the organization's hierarchy, we find that members possess increasingly legitimate power. The head of the organization can assert legitimate power to all of its members. Reward Power In general, the article states that reward power “corresponds   to the concept of positive reinforcement”. It promises rewards and promotions, can be Limited when the manager is not authorized to assert it or can be exercised by subordinates who are successful in flattery. Coercive Power Sharifzadeh (1999) considered that coercive power is obtainable while the controller of that authority can wield impact by making use of penalty and warning. Referent Power Referent power exists when the power holder is well liked by others. Expert Power A person has expert power when that person has special knowledge or specialization that the organization values”. Stage II will be involved in comparing each category with respect to customer perception on six service scenarios as adapted from Failure Mode Effect Analysis (FMEA). Using the Likert scaling method of comparing perceptions or psychometric parameters, appropriate statistical test will be employed to identify differences between managerial powers with respect to a specific service scenario. These scenarios are outlined thus: Failure 1 – BADLY-SET TABLES Failure 2 – IMPOLITE EMPLOYEE Failure 3 – TABLEWARE MISSING Failure 4 – COLD MEAL Failure 5 – CLEANING AND FOOD HYGIENE Failure 6 – DELAY IN SERVING THE CUSTOMER In order to value the objectives and goals of this research and to derive the conceptual framework, the first step is to elaborate all the probable causes of service delivery failure in a restaurant scenario. For each cause, the identified powers of the managers must be used to intervene to activate service delivery recovery. The second step is to identify the types of socials power that managers often exhibit within the restaurant service industry and expounded each. Third, the probable outcomes when these social powers are used in service delivery recovery must also be projected, enumerated and expounded. In this case, there are only two (2) possible outcomes, success or failure. Data gathering To gather data, a set of questionnaires must be designed specifically for the customer, the attending personnel (waiter or waitress) and the manager who has had actual experiences in these types of scenarios. It should be noted that the sample data must come from an event where service delivery failure has occurred. Since this kind of scenario is almost, always avoided by management in a restaurant, and thus might pose some difficulty in data gathering, especially in the time frame the research will be conducted. Lastly, there will only be two (2) outcomes, success or total failure. In success, customer loyalty will be retained while total failure means losing the customer to competition. What must be clear here is that the when service recovery is taking place, there are three (3) parties involved during the process; i.e., the customer, the attendant and the manager. To analyze the outcomes which power or combination of powers used is more effective, analysis of variance can be computed to rank the levels of significance. Thereof, conclusions can be drawn to which social power or its combinations are the most effective to use in service recovery. Legitimate powers of managers pertain to the actual job description that the management has bestowed on them. The legitimate powers are written in the job description and are standard practice in order for the organization to delineate the various tasks that he will perform. There will be several managers inside an organization especially if it is large and overlapping of functions will happen if duties and responsibilities are not specified from the time of hiring. Reward powers of the manager pertain to the potential to influence others due to the manager’s control over desired resources, for instance, raises or promotions or incentives or awards. The possible aim of the manager for such control over the desired resources is to provide positive outcomes and prevent negative outcomes. Coercive power of the manager, on the other hand, refers to the potential of the manager to influence subordinates through the use of punishment or the removal of positive events, for example, firing lazy employees. Lastly, referent power is the influence based on the relationship between him or her and the subordinates, for example, the manager’s role model image will influence the followers. Data Presentation and Analysis Data collated will be represented in a 5 X 6 matrix representing general ranking of powers with respect to the six scenarios. Significant differences between the average rankings of powers with respect to service scenarios will be conducted. Graphical analysis will complement to statistical tests. Facilities to be used This study can be effective and efficient by having the information on the quantities of available resources and equipment and other needed facilities, knowing the ratios in which production units can combine inputs to yield the desired outputs and have sufficient computing facilities to carry out quantitative manipulations. Very crucial facilities that will be used in this study are computer set with printer complete with materials like paper, compact discs and other supplies. The necessary hardware and software are in place. Other urgent software that will be needed in the analysis of the data will be acquired from computer software store. It will take a week to put everything in place. It has some resource implication. This study will require budget from the identification of restaurants to be included in the study to preparation of survey questionnaires to analysis of the data gathered to finalization of the paper. Budget The total budget for the project is five hundred dollars. The funds have been already acquired. The said fund will comprise expenses for travel for the presentation of research results, travel in the performance of research and other expenses such as equipment, library fees, reproduction costs of research materials, survey questionnaires and other miscellaneous documents, supplies, computer programs, software for data analysis and contingency fund. Deliverables and Program Schedule Table 1. Deliverables and Program Schedule. Task Deliverable Month 1 2 3 4 5 6 7 8 9 10 Task 1: Conduct an inventory and complete hardware, software, data analysis tools, materials, supplies and other miscellaneous materials that will be required for the conduct of the study. List of inventory of available resources and facilities X Lacking resources and facilities completed X Task 2: Conduct library research, collate and consolidate needed background information and review of literature. Library resources related to the study collated X Library resources related to the study consolidated X Task 3: Identify the restaurants that can be participants in the collection of data. List of Restaurants Gathered, Prepared and Finalized X Task 4: Design the questionnaires that will derive the expected data to be used in the analyses. Sets of Survey Questionnaires X Task 5: Conduct interviews using the devised questionnaires to gather longitudinal, unit-level data. Interviews Conducted X Longitudinal, Unit-level Data Gathered X Task 6: Analyze the data to find out how subordinate employees of restaurants are influence by social powers of managers in restaurant management, especially in the field of service recovery (when service fails). Data Analyzed X Assessment conducted on how subordinate employees of restaurants are influenced by the social powers of managers in restaurant management, especially in the field of service recovery (when service fails). X Task 7: Conduct statistical analysis to find out to if a co-relation exists between the effects of social powers of managers (legitimate, reward, coercive, referent and expert powers) and subordinates who have at one time or another have encountered success recovery and succeeded by measuring variables via different methods such as cross-lagged correlation and regression analyses using a 1-year time lag to test the hypotheses. Statistical analyses conducted X Analysis conducted to determine if a co-relation exists between the effects of social powers of managers and subordinates through measurement of variables via cross-lagged correlation X Analysis conducted to find out to if a co-relation exists between the effects of social powers of managers and subordinates through measurement of variables via regression analysis X Task 8: Write-up of analyses and conclusions. Write-up of analyses and conclusions completed and finalized X Works cited Read More