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Planning and implementing effective service guarantee programs

Barry Berman and Anil Mathur

Business Horizons, 2014, vol. 57, issue 1, 107-116

Abstract: This article highlights different types of service guarantees, explains the benefits of service guarantees to consumers and service providers, examines why service guarantees are so rarely used, and describes the characteristics of effective service guarantee programs. We seek to motivate additional service providers into offering service guarantees (when appropriate), to improve the effectiveness of service guarantee programs, and to spur additional research that can reduce the gap between academic research and industry practices relating to service guarantees. Properly planned, implemented, and controlled service guarantees can benefit service providers by serving as a signal of quality to customers, focusing on consumer expectations, developing specific performance standards, providing reliable data on service failures, determining weak points in the service-delivery process, and regaining customers who would otherwise be lost. Despite these benefits, service guarantees are not commonly used by service providers for a variety of reasons. We study and evaluate these impediments as well as describe characteristics of effective service guarantee programs from both the consumer's and service provider's perspectives.

Keywords: Service guarantees; Service failures; Service recovery programs; Complaining behavior; Customer dissatisfaction (search for similar items in EconPapers)
Date: 2014
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Handle: RePEc:eee:bushor:v:57:y:2014:i:1:p:107-116