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The purpose of this paper is to evaluate the implementation of the service profit chain as an entrepreneurial marketing initiative within a defined franchise system. An objective is also to evaluate these initiatives against service quality dimensions. Despite recognition of the merits and advantages of service profit chain initiatives of retention, related sales and referrals, little research has empirically addressed the perceptions of franchisees regarding these initiatives.

Methodology includes the empirical analysis of evaluating the effectiveness of service profit chain implementation, primarily based on initiatives of retention, related sales and referrals. Research methodology comprises the survey approach, using electronic media and Surveypro analysis. This is facilitated by descriptive and inferential statistical techniques using SPSS version 11.0 data analysis. Inferential significance tests include the ANOVA Kruskal‐Wallis hypothesis test; and the Cronbach's coefficient alpha.

Hypothesis tests highlight the significance of a positive association between service profit chain initiatives and service quality. All service profit chain initiatives were deemed appropriate. Item analysis highlights specific dominant service profit chain initiatives, linking key relationship marketing and service quality themes.

Findings are indicative of implementation opportunities, including measurement of loyalty within the system, developing customer feedback and complaint systems, and communicating the value of service profit chain enhancement within the franchise system.

Originality includes cognizance of entrepreneurial orientation, relationships and service quality when implementing service profit chain initiatives. Concurrent research opportunities include the implementation of other entrepreneurial marketing initiatives, including relationship marketing and benchmarking for best practice.

The purpose of this paper is to apply Heskett, Sasser and Schlesinger's service profit chain to a single retail service with a view to developing a better understanding of the performance linkages between employee perceptions and performance, customer perceptions and behaviour, and financial performance.

The research was based on the case study of a UK home improvement store chain. Measures of each of the variables in the service profit chain were analysed using Pearson's correlation coefficient, with a dataset based on 75 stores.

Although analysis of the performance relationships revealed many interesting correlations, the data lent little support for some of the expected linkages; in particular, the “satisfaction mirror” effect between employee and customer satisfaction and loyalty, and the link between customer loyalty and financial performance. The possible asymmetries and non‐linearity of certain performance relationships may also have added to the difficulty in applying the model to this organisation. Furthermore, the study revealed many performance linkages between variables which are not aligned in the service profit chain model.

The value of the paper lies in the conclusions directed at both practising managers and academics. It is contended that the service profit chain model cannot be applied generically to services but that managers should undertake the development of context‐specific models of their organisations. Unquestioning acceptance of Heskett et al.'s configuration of the service profit chain may indeed constrain managerial understanding of the complexities of business performance; whilst there is also a danger of applying a strait‐jacket to academic thinking on performance relationships and performance improvement.

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.

To provide public sector organizations with a development map to achieve employee and customer satisfaction and to align organizational processes for goal achievement.

The paper re‐works the highly influential and widely validated service‐profit chain and presents an analogous model, which reflects the essential differences of public sector organizations.

It was found that there is a direct link between the achievement of the organizational goal and the organization's ethics and values. This indicates that goal achievement reinforces the legitimacy of the values and ethics as the basis for organizational success.

Presents a practical model and explains, with examples, how an organization might implement this model. Identifies how public organizations can measure their customer value variables.

Despite the popularity of the service‐profit chain there has been no model for the public sector. This has been identified as a need in the literature. Therefore, this paper presents a long overdue and much needed public sector model. The model has great value for all levels of governmental bureaucracy irrespective of core business or global location.

Service profit chain is a well‐received model to explain the sustainable competitiveness of many service organizations. The model attributes a service organization’s financial and market performance to its relationships with its customers and employees. According to the service profit chain, internal service quality serves the foundation of the model and it ignites a chain effect leading to an organization’s growth and profitability in the end. The purpose of this study is to provide an ad hoc analysis of two key elements of the service profit chain. Specifically, this research explores the direct linkage between performance in growth and profitability and quality of work life, which is a proxy for internal service quality in the service profit chain model. The performance of companies with a reputation of high quality of work life were contrasted to a control group of S&P 500 companies using COMPUSTAT data.

This paper aims to explore how artificial intelligence (AI) technologies have redefined the hospitality industry. It develops a theoretical framework to evaluate its impact on employee engagement, retention and productivity levels, stemming from its potential implications for service quality and customer satisfaction.

Based on the exploration of relevant literature, role theory and service-profit chain were used to develop – role-service-profit chain.

Role-service-profit chain is an analytical tool which has strong implications for investment and deployment analysis of the new technologies in hospitality and tourism businesses. It proposes how managers can evaluate how the role expectation of technological innovations relate to service quality and customer satisfaction through its impact on employee-related outcomes (such as employee engagement, retention and productivity), and assess the corresponding impact on profitability and growth, in the context of their own unique internal environment and position in the market.

Although an empirical assessment of the hypothesised relationships in the model is required to evaluate and validate it in the hospitality industry, role-service-profit chain presents promising implications for tourism and hospitality practice and future research.

Role-service-profit chain is an analytical tool from which managers can make improvements on talent and talent management practices and adjust expectations and behaviours in ways that facilitate improvements in service quality and customer satisfaction.

This paper makes an important contribution to hospitality and tourism literature, as it explores how AI technologies implemented to improve on talent and talent management practices impact on service quality and customer satisfaction, and develops analytical tools by which this may be evaluated.

The purpose of this paper is to empirically test the validity of the service-profit chain (SPC) in a restaurant company context to comprehensively explicate the relationship between organizational practices, employee attitudes with customer and financial outcomes.

The method used both questionnaire and company proprietary data to measure the predicted SPC outcomes through structural equation modeling. The research data were obtained from employees, customers and management at five restaurants in one casual theme restaurant chain in Australia.

The findings indicate that revenue may be a more appropriate outcome than profit in the SPC, that context and individual unit circumstances matter and that there may be a time lag between organizational actions, employee behavior, customer satisfaction and financial outcomes.

Because of the nature of field research, there are limitations. As restaurants were added during the study, data per unit were impacted. Moreover, budgetary constraints limited the number of customer surveys. Nonetheless, the data set includes management, customer, employee and proprietary financial measures which are rarely available in the research literature. These data allow a thorough study of the SPC that provides both important findings and a model for future investigations into the SPC.

As the SPC is a widely cited model used to explain the linkages between managerial and organizational actions and financial outcomes as they work through employee interactions with customers, the findings suggest that the chain may have a more direct impact on revenue than profit. Moreover, the data strongly suggest that context matters as the unique context of the restaurants had important influences on financial outcomes. The findings also indicate that a time lag exists between managerial and organizational actions and financial outcomes, suggesting that it can take time for such actions to ripple through the SPC.

Structural equation modeling and standardized measures allowed the authors to overcome prior limitations in SPC research. Moreover, SPC researchers seldom have access to the proprietary data that enabled a test of the entire SPC. Consequently, this study contributes new insights into this classic model’s value in predicting and explaining financial outcomes resulting from the actions of an organization’s leadership influencing employee behavior toward customers in the restaurant industry.

To provide an alternative view of customer value and service quality as conceptualized in the service‐profit chain.

A survey of the vast and diverse literature on the concepts of value and quality is used to reconceptualize these constructs as they are used in the service‐profit chain. The concept of intrinsic value and quality is proposed as an addition to the extrinsic value and quality concepts already apparent in the chain.

The service‐profit chain is based on the premise that profitability to a firm derives from customer satisfaction and loyalty, which, in turn, are derived from a customer's sense of value received. This value, it is argued, is calculated with reference to the perceived quality of what is received, balanced against the aggregated costs to the customer of availing themselves of the service. This paper questions the sufficiency of the assumption that value offered to a customer resides solely in the customer's perception of what has been experienced in and through the service encounter. Correspondingly, it is argued that value to the customer may reside also in intrinsic qualities or attributes of a service.

The idea of value and quality being built into a service offering (intrinsic) has value for both practising service managers and academic researchers. Several avenues for future investigation are posited.

The service-profit chain model (Heskett, Jones, Loverman, Sasser, & Schlesinger, 1994) highlights the well-documented relationship between employee and customer attitudes suggesting that employees who are satisfied and engaged with their work provide better customer service resulting in higher levels of customer satisfaction and, ultimately, driving firm revenue. The authors propose an expansion of the service-profit margin identifying the leadership behaviors that create positive employee attitudes and engagement. Specifically, the authors suggest that leaders who focus on recognition, involvement, growth and development, health and safety, and teamwork (Kelloway, Nielsen, & Dimoff, 2017) create a psychologically healthy workplace for customer service providers and, ultimately, an enhanced customer experience.

This paper reports on the initial results of an ongoing research conducted in Mexican service industries aimed at understanding how value is delivered, measured and continuously improved in the studied firms. Using the service profit chain model data were collected from a sample of 28 supermarkets and 29 hotels in Mexican cities. Results show that both industries are similarly characterized by the service profit chain model (SPCM) tool, thus providing some opportunity for cross‐learning between industries; and some significant differences exist between domestic and foreign firms in both industries, thus providing some benchmark opportunities for industries based on origin of capital. For the sampled firms, categories of the SPCM were grouped into three statistically different ranges (high, medium and low), thus providing additional knowledge as to what strengths and areas of opportunity for improving performance of the studied industries there are.