The service recovery paradox in B2B relationships

Abstract

Purpose This study aims to explore the service recovery paradox (SRP) in business to business (B2B) relationships. Previously, this phenomenon has been identified in consumer-facing industries. The research advances the marketing literature by highlighting the ways in which the antecedents of the service recovery paradox differ between B2B and consumer markets. Design/methodology/approach This research draws upon findings on the SRP in the consumer setting and service failure literature in business to consumer and B2B contexts. For the analysis, interview data were collected from 43 informants among clients and service providers in the aftermath of a service failure. Findings The authors propose an exploratory model of the SRP for B2B relationships. In the B2B setting the propensity of eliciting the SRP depends on (1) the characteristics of the service failure, (2) the attributes of the service recovery and (3) the shared subjective perceptions among boundary spanners. Practical implications Empowered operating-level employees, straightforward communication, immediate responses and action plans that ensure future conformance are the key factors to turn service failures into increased customer satisfaction. Originality/value This study is the first to transfer the SRP from consumer marketing into the B2B domain. Moreover, it derives an exploratory model of the SRP, which can be refined by future research.

Toward Relationship Resilience: Managing Buyer‐Induced Breaches of Psychological Contracts During Joint Buyer–Supplier Projects

“…Similar findings in the services marketing literature also confirm the existence of a so‐called recovery paradox, in which a customer's postfailure satisfaction exceeds the prefailure satisfaction (McCullough, ). Unfavorable events can thus even strengthen relationships when they are successfully managed (Hübner, Wagner & Kurpjuweit, ; Tax & Brown, ).…”

An Analysis of Service Failures and Recovery Strategies in the Turkish Third Party Logistics Service Industry

“…However, from the perspective of B2B services, critical incidents like service failures have greater impact since they usually have major economic consequences due to the multiplying effect (van Doorn and Verhoef, 2008). Moreover, B2B service failures have an amplified effect when compared to consumer markets (Hübner et al, 2018) 2.1. Failure Types When the service provided fails to meet customer expectations, a service failure occurs (Halbheer et al, 2018).…”

“…Recovery from service failure is an indelible part of the service provided, of utmost importance for maintaining excellence, a fundamental asset of the company and an opportunity to restore or even improve the relationship between the service provider and the customer (Flores and Primo, 2008;Hart et al, 1990;Swanson and Hsu, 2009;Ok et al, 2005). Whenever a recovery is well-managed, it provides additional capabilities, strengthens personal relations and increases confidence in the service provider, which is highly significant on B2B markets that 3PLs operate in (Hübner et al, 2018).…”

Service Failure and Recovery in B2B Markets – A Morphological Analysis

“…The increased criticality of B2B SFaR is attributed to its changing nature, which is caused by the following factors: (1) B2B customers’ rising expectations of more personalized and frictionless experiences ( Gandhi et al, 2019 ); (2) expectations towards real-time performance monitoring of the supplied products or services, so that a failure can be anticipated and timely actions can be taken ( Hübner et al, 2018 , Shin et al, 2017 ); (3) hyper competition in B2B markets enabled by easy availability of competitive offerings ( Sarin, 2014 ), thus putting extra pressure on the SPs to prevent failure or take timely corrective actions to recover the failure; (4) the rapid advancement of technology, leading to B2B customers demanding digital self-service systems backed by AI and automation, so that they can resolve smaller issues whenever and wherever they want, thus requiring the SP to empower customers ( B2B Marketing, 2019 ); (5) stricter legal regulations for the conduct of business and the protection of the rights of customers ( Myers et al, 2019 ); and, finally, (6) the increased connectedness of the world (due to advancement in communication technologies), making it necessary to maintain firm/ brand image in B2B markets, and thus leading to SPs feeling extra pressure to perform effective recovery ( Myler, 2017 ). Further, the current COVID-19 crisis had put several B2B SPs in a difficult, or even impossible, position to deliver on their business contracts.…”

“…In more recent years, Zhu and Zolkiewski (2015) explored SFs and how they manifest in a manufacturing context, whereas Shin et al (2017) examined proactive and reactive approaches to containing SF. Finally, Hübner et al (2018) conducted an exploratory study to propose a framework for the service recovery paradox in B2B markets. Though these researches explored important variables for different events and/or processes of SFaR in B2B markets, such events and/or processes need to be viewed in intersection with each other in order to derive more meaningful results in further research.…”