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Given the fierce competition in financial services, service failure management and trust restoration tactics are becoming strategic priorities. Studies investigating trust restoration have increased over the years due to the significance of trust in services and the frequency of trust violations. Drawing on the sense-making and defensive approaches of attribution theory, this study aims to explore the effectiveness of various trust recovery tactics (e.g. apology, explanation, and investigation) in financial services considering the prevalence of service failure severity.

Based on a scenario-based survey, this study gathered data from 402 consumers of different banks in Pakistan. The study analyzed the data using ordinary least square regressions and structural equation modeling.

The study indicated that explanation is more effective in repairing character-competence and commitment-based trust, while investigation remained highly effective for inducing congruence-based trust. Interestingly, an apology was more effective for communication-based trust repairing, while context-based trust recovery was unaffected against all recovery tactics. Despite the prevalence of severe service failure, recovery actions proved fully effective for character-competence and commitment-based trust while partially effective for congruence-based trust recovery. This study also found that severe service failure undermines the effectiveness of recovery actions in repairing communication and context-based trust.

The study extends the literature on trust recovery by integrating sense-making and defensive attribution theory. The sense-making approach contributes to the existing knowledge on trust recovery by elucidating how consumers and service providers develop a shared understanding to facilitate the recovery mechanism of multidimensional trust in financial services.

The purpose of this paper is to provide a cross-cultural comparison of Chinese and American hospitality customers who report critical incidents and the resulting influences that these incidents and recovery efforts had on behavior. Recognizing that hospitality-based organizations are increasingly operating internationally, the study provides insights for managing customer relationships.

The study utilizes the critical incident technique in conjunction with a structured self-administered questionnaire. The sampling approach resulted in 1,146 usable responses.

The results demonstrate statistically significant cultural differences between American and Chinese consumers in terms of reported critical incident types, recovery approaches, and post-incident private voice, public voice, and repurchase intention.

This research uses cultural value scores for China and the USA as a way to explain and discuss the findings. Hofstede's model was not tested and the provided explanations should be viewed with caution.

The results of this research can provide practitioners with guidelines in regards to service recovery tactics, as well as insights into how customers respond to critical incidents across different cultures.

This study adds to the existing literature by investigating empirically critical incident types, recovery tactics, and the consumer post-encounter behaviors of public voice (i.e. complaining), private voice (i.e. negative word-of-mouth, positive word-of-mouth), and repurchase intention in China and the USA.

The purpose of this paper is to examine when (i.e. after a shorter or longer length of time) organizations should offer an apology or a promise of non-recurrence of a failure to recover trust following a failed service recovery (a double deviation).

This paper reports the results of a pilot study with a convenience sample and two experiments with samples from different populations, students and employees of a financial institution in one study and workers recruited through Mechanical Turk in the other.

An apology was most effective to recover trust when offered shortly after the double deviation (e.g. Study 1: after two days; Study 2: immediately and after two days), while making a promise was most effective when offered at a later time after the double deviation (e.g. Study 1: after 30 days; Study 2: after 15 days). Consumers consider an apology offered shortly after the double deviation as a sign of integrity and a promise communicated sometime after the double deviation as a sign of competence.

This paper complements prior research that demonstrates the effectiveness of apology and promise as trust recovery tactics. The findings show that managers should carefully consider the time at which they use these tactics to recover trust following a double deviation.

The service recovery literature provides little guidance to firms on how users of self-service technology (SST) perceive assistance provided by human and non-human service agents following a service obstacle. This research responds by addressing two important research questions about SST recovery: (1) how are perceptions of assistance provided following a service obstacle influenced by a customer's psychological needs? and (2) does supporting the psychological needs of customers positively impact continuance intentions following a service obstacle?

Data are collected to address the research questions via five experiments that explore how assistance provided by a non-human (vs human vs no assistance) service agent contributes to perceptions of psychological support and continuance intentions following a service obstacle while volitionally using SST.

The results show that while users of SST would prefer to do so without an obstacle requiring intervention of a service agent, if assistance is required then the psychological need support elicited from a non-human service agent was vital to an effective recovery. Further, the findings highlight some boundary conditions for this relationship, with the impact of customer perceived need support on continuance intentions found to be sensitive to fit between the task and assistance provided and the complexity of the task being completed.

Much of the prior service recovery literature has emphasized the different types of tactics that can be used (e.g. apologizing, monetary compensation and explaining what happened), failing to appreciate the role of different types of service agents or the underlying psychological process that explain the relative merit of such tactics. The present research shows that for these tactics to influence continuance intentions, they must be provided by a relevant service agent and support a customer's psychological need for autonomy, competence and relatedness. The hypothesized impact of psychological need support on continuance intentions was also observed to be contingent upon the fit between the task and the type of assistance provided, where the level of task complexity attenuated this fit.

The purpose of this paper is to understand if organizations can leverage recovery/continuous improvement (RCI) capabilities and two competencies to mitigate manifest supply chain (SC) disruptions. Specifically, the authors examine how learning from previous experience and SC disruption-orientation affects organizations’ capability to recover/continuously improve once a SC disruption has manifested. In addition, knowing that organizational inertia likely exists during disruptions, the authors examine the mediating effects of routine rigidity on proposed relationships.

To determine how these antecedents impact an organization’s RCI capabilities, the authors collected survey data from 219 procurement managers and analyzed these records using structural equation modeling.

The results indicate that by fostering SC disruption-orientation and developing competencies to learn from previous experience, firms can enhance their RCI capabilities, which in turn improves operational performance. Furthermore, the authors demonstrate how routine rigidity mediates the positive effects these antecedents have on the RCI capabilities construct.

By developing these risk management (RM) tactics and managing routine rigidity, organizations broaden their continuous improvement capability, which enables practitioners to respond to and recover from manifest disruptions. When used in conjunction with other RM tactics, such as inventory and/or redundant capacity, organizations can address an array of disruption scenarios.

Purpose: The COVID-19 pandemic has created shock and turbulence for the tourism industry in Baltic states such as Estonia, Latvia and Lithuania. To recover from the situation, tourism service providers had to act accordingly to maintain and sustain the tourism sector during and after the pandemic. The objective of the study is to analyse strategies adopted by Baltic states during and post pandemic times to recover the tourism industry.

Design/Methodology/Approach: The qualitative research method is based on survey and expert opinion of stakeholders of tourism in Baltic states. Further authors used content analysis of country and industry statements, articles, video stories, lectures and meetings.

Findings: Conclusion shows that there are several similarities in the recovery tactics of tourism by the government and other stakeholders amid the COVID-19 pandemic which include opening of borders among three countries for travellers, ability to jointly seek a solution for transformation, a common understanding between various tourism service providers. Non-governmental organisations demonstrated their power in influencing political decisions to adopt recovery strategies of tourism.

Originality/Value: This study provides a greater understanding of the state of tourism in Baltic states during the pandemic in general and the role of stakeholders in the process of recovery of tourism. The study provides the basement for continuing deeper research of COVID-19 influence on tourism in the Baltic states.

The purpose of this paper is to determine if internal integration, information sharing, and training constitute direct antecedents to organizations’ warning and recovery capabilities. Assuming that organizations periodically face various supply chain risks, the authors intend to show that managers can develop these antecedent competencies in ways that bolster their supply chain risk management (SCRM) capabilities.

To understand the relationships between the antecedents and SCRM capabilities, the authors used Q-sorts and confirmatory factor analysis to develop new warning and recovery measures. The authors then collected survey data from 231 hospital supply managers and analyzed these records using structural equation modeling.

The results indicate that internal integration and training positively affect organizations’ warning and recovery capabilities, in both a direct and indirect manner. The authors also illustrate how managers can leverage their SCRM capabilities to affect operational performance.

These results suggest that by developing antecedent competencies like internal integration and training, firms may bolster their warning and recovery capabilities, and ultimately operational performance of the organization.

The findings provide hospital supply organizations and other inventory management teams with a novel approach to managing an evolving array of supply chain risks. Rather than investing in costly risk management techniques, like inventory stocks, organizations can use internal integration and training to improve their SCRM capabilities.

Contributes to a growing body of service recovery knowledge by examining the impact of service recovery as a relationship tool, in addition to its well‐accepted role as a means to enhance customer satisfaction at the transaction‐specific level. Begins by providing an overview of the evolving concept of service recovery and continues by explaining the important and unique role that recovery plays in the service sector. A comparison of the concept of service consistency and reliability with the concept of service recovery leads to a statement of hypotheses tested in an experimental setting. Specifically, results indicate that while service recovery results in encounter satisfaction, service recovery does not significantly influence overall satisfaction, quality, image and future expectations. Rather, consistency of service influences these constructs.

This paper aims to present two updated typologies of service failures and recoveries in the omni-channel context. These typologies are based on customer complaints and recoveries collected from the corporate Facebook pages of four omni-channel department stores, two operating in Australia and two in the UK.

A document review is used of 400 customer complaints and recoveries. Content analysis is used to condense the Facebook data into categories of failures and recoveries.

Customer complaints on Facebook were triggered by a multitude of varying failures in the omni-channel context, given that it is the service brand that customers are experiencing, not just retail channels. The most prevalent failures were “bricks and mortar” shopping, delivery, marketing activities including communications and pricing, quality of goods and customer service. For service recoveries on Facebook, the four-dimensional justice framework appears valid.

Study limitations include potentially missing details about the nature of the service failures and recoveries, including customer satisfaction with service recovery.

The typologies offer guidance to omni-channel retailers by showing the range of online and offline situations, including those unrelated to actual transactions that trigger customer complaints on Facebook and the tactics of recovering.

The authors contribute to the service domain by updating failure and recovery typologies to reflect the emerging omni-channel context, jointly exploring failures and recoveries on Facebook and applying a four-dimensional justice framework for recoveries on Facebook.

The purpose of this paper is to investigate the effect of interdependent vs independent self-construal on service satisfaction, following the observation of failure and recovery experienced by a fellow customer.

Three experiments were conducted to test the research hypotheses.

After service failure, interdependent observers react less favorably compared to independent observers. After high recovery compensation, interdependent observers react more favorably compared to independent observers. The effects are driven by differences in perceived interactional and distributive justice.

This study uses three scenario-based experiments to test the hypotheses. While providing greater control of the experimental conditions, the external validity of the results is to some extent sacrificed. Moreover, this research does not investigate observers’ reactions to the interactional aspect of recovery.

When handling service failure, firms are required to anticipate and address not only the responses of the target customers involved but also those of potential observers. Providers can accordingly use available customer information to gauge customers’ likely self-construal and to adjust their service delivery and recovery tactics. Providers can influence observing customers’ reactions by creating a servicescape that activates a desired self-construal.

This research is one of a few to examine the effect of service failure and recovery on observing customers, and the first to do so via the lens of self-construal. It contributes to the literature on service failure and recovery and the literature on self-construal and has practical implications for service providers. The value of this research is further highlighted given the increasingly public nature of services and the multicultural context of service delivery.