al.). Organizations that are attaining the highest levels of performance in services industries have created processes for internalizing lessons learned in service recovery and transforming them into processes and strategies (Boshoff, 43, 44). Based on the accumulated research a proposed Services Recovery Model is also defined in this analysis. This proposed model defines the need for coherence and consistency between organizational and individual service recovery strategies, based on the foundation of accumulated expectations of customers. The focus of the Services Recovery Model is the validation and reinforcement of trust through coherency and consistency of organizational and individually-oriented recovery strategies.
From these theoretical foundations, the developments of strategic responses to service recovery are possible to design, implement and monitor over time. Service recovery has progressed as an academic discipline and business practice due to the increasingly commoditized product strategies that rely increasingly on price and service, less on product or services features. In conjunction with the commoditization of products is the increasingly sophisticated use of analytics and lifetime customer metrics.
From the insights gained from analytics, multi-dimensional approaches to defining service recovery strategies continue to be made more effective and targeted (Bhandari, Tsarenko, Polonsky, 174). Despite these external market dynamics the objective of making ongoing relationships as productive and valuable as possible for customers is crucial for greater levels of trust and loyalty to be earned. Despite the ongoing and often thorough efforts of organizations to deliver exceptional levels of performance in services, it is often seen as an unrealistic goal or objective if attainment is set at 100% (McCullough, et.al.). The shift from seeing customer problems as a source of cost and pain to viewing them as a potential...
The role of Service Lifecycle Management (SLM) is increasingly becoming more important to manufacturers who must rely on their installed bases of customers to gain recurring revenue streams to finance new growth (Giuntini, 58). Service recovery strategies are critical for manufacturers to attain their SLM revenue-based objectives and programs. In the context of the proposed Services Recovery Model, the iterative development of trust and the creation of value within any customer base have much longer-term revenue potential than simply seeing repurchase rates. SLM strategies of auto manufacturers for example translate into 60% or more of a vehicle's profits being made from aftermarket parts. SLM strategies are the foundation of these aftermarket strategies, and in the end, provide a monetization framework for service recovery strategies.
The following terms are used throughout this analysis and they are defined here. A service failure is defined as a flawed outcome that reflects a breakdown in reliability and one that leads to a reduction in trust and value of a relationship with a business. For purposes of this analysis a consumer complaint is defined as an action that involves negative communication about a product or service consumption or experience (Forbes, 90). Service recovery is defined as the series of strategies that enterprises initiate, launch and monitor in response to customers' defections over service failures (Johnston, Michel, 80). Another critical concept to this analysis is the recovery paradox (Michel,
