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Institutionalising customer-driven learning through fully integrated customer feedback systems
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Most companies understand the importance of complaint handling, customer satisfaction measurement and service recovery, and many firms have systems and procedures to do at least part of these activities. However, few companies have implemented integrated customer feedback systems to systematically collect, analyse and disseminate the various types of feedback coming into the firm and guide customer-focused learning, continuous improvement and process redesign. A key reason is the difficulties faced in integrating various systems and procedures. This paper focuses on how to design, and cost-effectively run, a completely integrated customer feedback system (CFS) that ensures continuous learning and improvement in service quality, as well as productivity.
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... However, dissatisfied customers do not necessarily complain, which is why managers must actively work to identify levels of customer satisfaction (Andreassen 1999). Service organizations invest extensive resources in follow-up customer satisfaction surveys; however, such surveys take considerable time and resources to administer and analyze (Wirtz and Tomlin 2000). Thus, insights about customer satisfaction may have to wait until a significant period of time has passed from when a service encounter occurred. ...
... Through automated assessments of customer and employee affective displays, service managers can obtain swift insights about the quality of their organizational service interactions. Current practices for assessing customer satisfaction take considerable time (Wirtz and Tomlin 2000). Our models and methods offer a way to obtain insights immediately after an interaction ends, for every single service encounter. ...
This study introduces affect-as-information theory to the service encounter context and advances that customer and employee affective displays during a service encounter together estimate post-encounter customer satisfaction (CSAT). A large-scale dataset of 23,645 real-life text-based (i.e., chat) service encounters with a total of 301,280 genuine messages written by customers and employees was used to test our hypotheses. Automatic sentiment analysis was deployed to assess the affective displays of customers and employees in every individual text message as a service encounter unfolded. Our findings confirm that in addition to customers' overall (mean) affective display, peak (i.e., highest positive or least negative) and end (final) affective displays explain additional variance in satisfaction. Further, as customer displays may not fully capture their satisfaction process and employees understand the service quality they deliver, we propose and confirm that service employee displayed affect explains further variance in CSAT. Our analyses also find that the predictive power of affective displays is more pronounced in service failure than non-failure encounters. Together, these findings show that automatic monitoring beyond operational variables and customer overall affect (i.e., adding customer peak and end, and employee affective displays) can expedite the evaluation of CSAT immediately upon completion of a service encounter. 2
... In the hospitality industry, the service mix is characterized by a combination of production and the service elements, which if properly managed can generate positive outcomes like repeat purchase and overall customer satisfaction but if poorly managed can result in failure which may or may not be recovered. (Wirtz & Tomlin, 2000;Mucha, 2002;Cherbakov, 2005;Stephen, Colgate, & Bowen, 2006). Scholars like Kotler, Boven and Makens (2006);Brady, Cronin and Brand (2002); Bitner, Booms and Tetreault, (1990) had since documented the importance of recovery strategies and their associated limitations in terms of effectiveness in driving consumers behaviour. ...
... The data suggest that to the extent that managers engaged in recovery effort and expected their customers to willingly return to the firm, customers want to recover the failure as it happens before deciding about future consumption. The findings of the study are in consonance with a vast number of studies demonstrating that recovery strategy should be matched against the nature of failure (Gronroos, 1999;Bhamdari & Sharma, 2011;Lovelock & Wirtz, 2007;Pieters & Zeelenberg, 2003;Mucha, 2002;Tomlin, 2000;Stephen, Colgate, & Boven, 2006). A number of studies (Warden, Huang, & Wu, 2008;Hart, Heskett, & Sassen, 1990;Keaveney, 1995;Bitner et al., 1990;Matilla, 2001;McDougall & Levesque, 1999) also demonstrated that recovery strategy that has monetary reward produce strong willingness to return behaviour among the customers. ...
... The company should also establish a customer feedback system that should have at least seven components [29], such as service indicators, performance targets and standards, feedback collection tools and process management, and reporting and IT systems. Additionally, the company should campaign the importance of customer complaint information to improve the organization's image, disseminate procedures for reporting customer complaints, implement an incentive system for reporting customer problems, and non-usage of customer complaints to evaluate the personal performance of certain employees [30]. ...
... The leaders should be provided with adequate training related to the knowledge of company quality management, as well as motivational and inspirational skills [36]. The training should not only be related to the technical areas of work but also related to the methods of dealing with customers in obtaining feedback and maintaining expectations [29,30]. According to the involved experts, an effective training program should be developed based on employee management plans. ...
... This importance is recognized within the seminal work of Sampson (1999), who developed a framework for designing customer feedback systems (CFS) to improve service quality. Furthermore, an overview of advantages and disadvantages of different feedback collection systems and their designs for improving service quality in organizations have been illustrated by Wirtz and Tomlin (2000). ...
Organizations have to adjust to changes in the ecosystem, and customer feedback systems (CFS) provide important information to adapt products and services to changing customer preferences. However, current systems are limited to single-dimensional rating scales and are subject to self-selection biases. The work contributes design principles for CFS and implements a CFS that advances current systems by means of contextualized feedback according to specific organizational objectives. The authors apply Design Science Research (DSR) methodology and report on a longitudinal DSR journey considering multiple stakeholder values by utilizing value-sensitive design methods. They conducted expert interviews, design workshops, demonstrations, and a four-day experiment in an organizational setup, involving 132 customers of a major Swiss library. In the process, the identified design principles and the implemented software artifact were validated qualitatively and quantitatively, leading to conclusions for their efficient instantiation. The authors found that i) blockchain technology can afford four design principles of effective CFS. Also, ii) combining DSR with value-sensitive design methods explicitly provides rationale for design principles in the form of identified important values. Moreover, iii) combining DSR with value-sensitive design methods makes the construction of software artifacts more efficient it terms of design time by restricting the design space of a software artifact to those options that align with stakeholder values. The findings of this work thus extend the knowledge about the design of CFS and offer both researchers a theoretical contribution to reasoning about design principles and managers and decision makers a guide for the efficient design of software artifacts.
... This importance is recognized within the seminal work of Sampson (1999), who developed a framework for designing customer feedback systems (CFS) to improve service quality. Furthermore, an overview of advantages and disadvantages of different feedback collection systems and their designs for improving service quality in organizations have been illustrated by Wirtz and Tomlin (2000). ...
Organizations have to adjust to changes in the ecosystem, and customer feedback systems (CFS) provide important information to adapt products and services to changing customer preferences. However, current systems are limited to single-dimensional rating scales and are subject to self-selection biases. This work contributes design principles for CFS and implements a CFS that advances current systems by means of contextualized feedback according to specific organizational objectives. It also uses blockchain-based incentives to support CFS use. We apply Design Science Research (DSR) methodology and report on a longitudinal DSR journey considering multiple stakeholder values. We conducted expert interviews, design workshops, demonstrations, and a four-day experiment in an organizational setup, involving 132 customers of a major Swiss library. This validates the identified design principles and the implemented software artifact both qualitatively and quantitatively. Based on this evaluation, the design principles are revisited and conclusions for the construction of successful CFS are drawn. The findings of this work advance the knowledge on the design of CFS and provide a guideline to managers and decision makers for designing effective CFS.
... Therefore, an interested manager should make sure that, as with leads, no customer request or complaint passes without analysis and response. The annual aggregated complaint statistics may expose some trends, for example in the general quality of customer encounters, but only short loop analysis by the responsible team gives the company a chance not only to restore the individual customer's trust, but to mitigate the risk of committing the same mistakes again soon (Wirtz and Tomlin 2000). A strong indicator for making the management of customer feedback a priority among other business goals is its incorporation in the employee assessment system . ...
This chapter introduces the notion of RM maturity. The first section clarifies the role of the maturity concepts in management science and presents the design of a systemic theoretical inquiry into RM maturity. In total, 13 RM-related themes were qualified to become the content of the RM maturity concept. The second section discusses the themes grouped in the strategic dimension of RM, including Service-Dominant Logic (SDL) as the most distinctive and consistent theme in this group. A brief theory-integrative discourse is given about the interplay between RM and SDL as permeable paradigms embedded in the RBV and dynamic capabilities theories. The third section discusses the roles of interdepartmental and departmental processes and ICT in defining RM maturity. The chapter concludes with the preliminary proposal of the RM maturity model fitted into the broad definitional basis of RM.
... Therefore, an interested manager should make sure that, as with leads, no customer request or complaint passes without analysis and response. The annual aggregated complaint statistics may expose some trends, for example in the general quality of customer encounters, but only short loop analysis by the responsible team gives the company a chance not only to restore the individual customer's trust, but to mitigate the risk of committing the same mistakes again soon (Wirtz and Tomlin 2000). A strong indicator for making the management of customer feedback a priority among other business goals is its incorporation in the employee assessment system . ...
In this chapter the domain of relationship management (RM) is discussed and the notion of the RM mid-range theory is introduced. The first section highlights the socio-economic duality of RM and presents the core characteristics of the RM business model. The diversity of partly overlapping relational constructs is commented on, and a uniform semantic programme for RM is proposed that links the notion of relationship capital and three RM dimensions: structural, psychological and behavioral. In the second section, the role of mid-range theories in linking macro and micro theoretical levels is presented. The theoretical boundaries (the content) of the envisioned RM mid-range theory are outlined, which link the RM business model, the key relational activities and approaches, and business performance. A hypothetical system of theories for competitive advantage is drafted, where the general theory level is occupied by the Resource-Advantage Theory of Competition followed by the upper mid-range theory level; where the RM mid-range theory is placed, completed by the specific market type mid-range theory level; and where network-based and market-based relational theories are positioned.
... Therefore, an interested manager should make sure that, as with leads, no customer request or complaint passes without analysis and response. The annual aggregated complaint statistics may expose some trends, for example in the general quality of customer encounters, but only short loop analysis by the responsible team gives the company a chance not only to restore the individual customer's trust, but to mitigate the risk of committing the same mistakes again soon (Wirtz and Tomlin 2000). A strong indicator for making the management of customer feedback a priority among other business goals is its incorporation in the employee assessment system . ...
Relationship management (RM) is an essential part of business, but its success as a business model can be hard to measure, with some firms embracing a model that is truly relationship-orientated, while others claim to be relationship-orientated but in fact prefer transactional short-term gain.
This open access book aims to develop a mid-range theory of relationship management, examining truly relationship-orientated firms to discover not only what qualities these firms have that make them successful at the RM model, but also what benefits this model has for the firm. It addresses questions like how RM-mature companies achieve and sustain competitive advantage, and what determines the scale and scope of these firms, illustrating with case studies.
This book will be of interest to scholars studying leadership and strategy, especially those interested in relationship management, business ethics and corporate social responsibility. It will also be of interest to professionals looking to develop their understanding of relationship management.
... Therefore, an interested manager should make sure that, as with leads, no customer request or complaint passes without analysis and response. The annual aggregated complaint statistics may expose some trends, for example in the general quality of customer encounters, but only short loop analysis by the responsible team gives the company a chance not only to restore the individual customer's trust, but to mitigate the risk of committing the same mistakes again soon (Wirtz and Tomlin 2000). A strong indicator for making the management of customer feedback a priority among other business goals is its incorporation in the employee assessment system . ...
This chapter presents the final proposal of the RM maturity model and proposes a robust framework for the upper RM mid-range theory. The first section synthesizes and explains the mutual connections of distinct RM activities and approaches of an RM-mature firm. A quick test for RM maturity is proposed. The second section introduces the notion of an RM niche, which is needed to explain why moderate proficiency in RM yields no significant advantages and why the relationship between what a company does in terms of RM and achieving a sustainable competitive advantage is highly curvilinear. The universal factors that determine the size of an RM niche and thus the size and scope of RM-mature firms are proposed and discussed. The third section provides eight examples of companies illustrating different facets of RM ‘in motion’ and serves as supplementary qualitative material to study the diverse challenges in managing relationships.
Although a large body of research theoretically asserts a positive relationship between market orientation and organizational
performance, fewer empirical studies demonstrate it using multiple and varied organizational performance measures. Additionally,
a series of recent studies have theoretically proposed, but not empirically demonstrated, that a firm’s learning orientation
is likely to indirectly affect organizational performance by improving the quality of its market-oriented behaviors and directly
influence organizational performance by facilitating the type of generative learning that leads to innovations in products,
procedures, and systems. This empirical study supports all of these specific contentions and the more global notion that higher
order learning processes may be critical in creating a sustainable competitive advantage in the firm.
Sumario: In this paper, the authors discuss the concept of a service-quality information system. They argue that companies need to establish ongoing listening systems using multiple methods among different customer groups. A single service-quality study is a snapshot taken at a point in time and from a particular angle. Deeper insight and more informed decision making come from a continuing series of snapshots taken from various angles and through different lenses, which from the essence of systematic listening