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Applying the service profit chain in a retail environment Challenging the “satisfaction mirror”

Applying the service profit chain in a retail environment Challenging the “satisfaction mirror” This paper reports the result of an exploratory study of the application of Heskett, Sasser and Schlesinger's service profit chain to a single organisation, one of the UKs leading grocery retailers. The results showed correlations between profit, customer loyalty, customer satisfaction, service value, internal service quality, output quality and productivity; however there was no support for the claim that these are driven by employee satisfaction and loyalty. In fact, to the contrary, there was a strong correlation between employee dissatisfaction and store profitability. This research raises questions about the robustness of a central premise of the service profit chain, which is that strong business performance is the result of a mirror-effect between employee and customer satisfaction. The paper considers the implications for management and calls for the development of a contingency based understanding of the drivers of business success. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Service Industry Management Emerald Publishing

Applying the service profit chain in a retail environment Challenging the “satisfaction mirror”

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Publisher
Emerald Publishing
Copyright
Copyright © 2000 MCB UP Ltd. All rights reserved.
ISSN
0956-4233
DOI
10.1108/09564230010340760
Publisher site
See Article on Publisher Site

Abstract

This paper reports the result of an exploratory study of the application of Heskett, Sasser and Schlesinger's service profit chain to a single organisation, one of the UKs leading grocery retailers. The results showed correlations between profit, customer loyalty, customer satisfaction, service value, internal service quality, output quality and productivity; however there was no support for the claim that these are driven by employee satisfaction and loyalty. In fact, to the contrary, there was a strong correlation between employee dissatisfaction and store profitability. This research raises questions about the robustness of a central premise of the service profit chain, which is that strong business performance is the result of a mirror-effect between employee and customer satisfaction. The paper considers the implications for management and calls for the development of a contingency based understanding of the drivers of business success.

Journal

International Journal of Service Industry ManagementEmerald Publishing

Published: Aug 1, 2000

Keywords: Business performance; Retailing; Customer satisfaction; Profitability

References