When, and How, Should Firms Educate Their Customers?

[We’re pleased to welcome author Simon Bell of the University of Melbourne, Australia. Bell recently published an article in the Journal of Service Research entitled “Unraveling the Customer Education Paradox: When, and How, Should Firms Educate Their Customers?,” co-authored by Seigyoung Auh and Andreas B. Eisingerich. From Bell:]

  • What inspired you to be interested in this topic?

We have long been fascinated by service firms’ reluctance to let customers “into the kitchen”. Service firms have traditionally kept customers in the dark. The thinking is that giving cuJSR_16.2_72ppiRGB_powerpoint.jpgstomers too much insight or access to how a firm operates places that firm’s ‘black box’ or proprietary methodologies at risk. Educating customers apparently provides them with the skills to shop around and potentially switch to a competitor. Yet we noticed in our consulting work that some service firms (and even some service employees) were challenging this thinking. They were proactively educating their customers and seeme
d to be the better for it. We were keen to discover what was going on.

  • Were there findings that were surprising to you?

The results of our field study showed that firms were partly right. Increasing customer expertise through proactive efforts to educate their customers actually had an overall negative impact on loyalty. This was because customers build what we call “market-related” expertise – a general knowledge about how markets work – which provides customers with the confidence to shop around. But we also found that educating customers builds “firm-specific” expertise which ties a customer more closely to the firm. It’s just that this positive effect on loyalty did not outweigh the negative. Yet, when we conducted an experimental study we found that the customer loyalty effects of customer education were positive overall. We believe this has a lot to do with the context (i.e., firm and industry) in which customer education programs might be used. Our goal in this paper was to discover whether education did indeed have both positive and negative effects on loyalty, but clearly our next focus should be revealing the different contexts in which the positive effects outweigh the negative (and vice versa).

  • How do you see this study influencing future research and/or practice?

We think our results have some very important implications for managers. We think that, in this “Google age”, customers are already taking responsibility for their own understanding of how services, firms, and markets work. Easily digestible information and knowledge is at everyone’s fingertips so we think it’s risky for firms to keep customers in the dark. Our findings suggest that firms should be proactive in educating customers and pay particular attention to educating them about how their firm operates. Firms need to let customers into the kitchen and provide a greater level of transparency. We showed that it’s impossible to disentangle the market-related education from the firm-specific, but it is perfectly reasonable for firms to craft educational programs around more firm-specific elements. Ultimately, customers that are more competent at consuming your services are better for your business.

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Measuring Organizational Legitimacy in Social Media

[We’re pleased to welcome author Michael Etter of the City University of London, UK. Etter recently published an article in Business & Society entitled “Measuring Organizational Legitimacy in Social Media: Assessing Citizens’ Judgments With Sentiment Analysis,” co-authored by Elanor Colleoni, Laura Illia, Katia Meggiorin, and Antonino D’Eugenio. From Etter:]

8583949219_f55657573e_z.jpgSocial media have given ordinary citizens the opportunity to freely express their opinions and feelings in any tone or style. The heated discussions around various topics from politics, sports, and corporations often evolve in parallel to news media coverage. Accordingly, we have developed the idea that a measurement of citizens’ judgment in social media can give researchers a new way to assess the legitimacy of organizations. Compared to existing measurements that, for example, assess judgments in news media coverage, a measurement based on social media would directly access the voices of ordinary citizens and therefore account for their heterogeneous norms and expectations.

In this article we describe and test how a measurement based on social media data can give indication for organizational legitimacy. We use the method of sentiment analysis that is based on computational linguistics and apply it to a case from the banking industry over a one year period.

Our findings show that, indeed, an analysis of 14’000 tweets reveals a different judgment than the analysis of 730 news articles. Compared to the news media, citizens judge the bank in a much more negative way. Also we find that the bank is discussed by 6000 citizens and for a broad variety of topics (around 400 hashtags). Clearly, social media data gives researchers access to different judgments than found in news media, which are written by a few journalists that adhere to professional norms and standards and are subject to various selection processes. We therefore encourage researchers to take into account social media, such as Twitter, in order to achieve a richer understanding of legitimation processes in a digital world. For practitioners, sentiment analysis of twitter data is a tool to monitor and identify issues and sentiment in a timely manner.

Cell phone photo attributed to Jason Howie (CC).

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How Great Leadership Communication Yields Positive Job Satisfaction Scores

[We’re pleased to welcome authors Julian Erben of the University of Koblenz-Landau and Frank Schneider of the University of Mannheim. Erben and Schneider recently published an article in the International Journal of Business Communication entitled “In the Ear of the Beholder: Self-Other Agreement in Leadership Communication and Its Relationship With Subordinates’ Job Satisfaction,” co-authored by Michaela Maier. From Erben and Schneider:]

There is no doubt that effective leadership communication is one of the key factors for an organization’s success. But how good is leadership communication in the reality of everyday business? To answer this question, it’s not enough to rely solely on leaders’ self-ratings. Armed with a new instrument to assess the perceived quality of a leaders’ communication from the leaders own perspective and the perspective of their respective subordinates, we 17124643767_c7e281926f_z.jpgwere curious to explore how the perception of leadership communication within a leader-subordinate dyad may differ, and how different perceptions are related to concrete organizational outcomes.

The findings in this study underline the importance of taking into consideration both leader and subordinate perceptions of leadership communication. Results show, that they may in fact differ, and whether they differ or not is substantially related to relevant outcomes. It particularly points out the desirability of congruent positive perceptions of leadership communication as it appears to be a clear indicator of high job satisfaction of subordinates.

This has practical implications for the teaching and training of leadership communication, especially the importance of developing supervisory training programs that enhance the communicative behaviors of leaders and at the same time make them more perceptive for how their subordinates see things.

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Image attributed to David Sanabria (CC)

A Space for Place in Business Communication Research

As technology allows more employees to have a “mobile” workplace, what happens to effective business communication overall? Should more businesses adopt an open-concept floor-plan to foster better collaboration?

Author Deborah Andrews of the University of Delaware addresses the emerging millennial habits of group collaboration and workplace design in her recently published article in the International Journal of Business Communication entitled “A Space for Place in Business Communication Research.” From Andrews:

I’m inspired a lot by things, by objects and spaces and what they can make happen. For ye2392869301_65bb870ab9_m.jpgars, too, I have focused my research and teaching on business communication. So when my university started talking about the new “integrated science and engineering” laboratory it was building to fosterinnovation and creativity through collaboration, I wondered: can a building do this? Curious, I looked at some other campuses and, sure enough, many such buildings were being constructed and promoted with similar rhetoric. Because it’s essentially a matter of communication, I was particularly interested in the many occurrences of collaboration in these statements about how the building would deliver on its promise. I saw that term invoked as well in real estate columns, the marketing reports of design consultancies, and popular business articles about new offices being created, for example, by Google, Facebook, and Amazon. I knew then that I had an enticing research project: matching the rhetoric of these new laboratories and offices to results on the ground.

It’s becoming a commonplace of material culture studies that objects create subjects, the things we live with make us the people we are, maybe even more than the other way around. But I’ve been surprised about the extent to which academic administrators, corporate CEOs, and entrepreneurs believe that the right arrangement of plan and furnishings in an office can foster the achievement of organizational goals.

Examining that fit between the rhetoric of the office or lab as a transformative space and results on the ground is an inviting area for communications research. As one anthropologist notes, we often overlook the things in our environment because they are “blindingly obvious.” We take them for granted. My International Journal of Business Communication article aims to encourage researchers to take another look at the physical environment of a 21st Century workplace as it relates to the communication needed to get work done there. We know that the environment shapes us. But can it shape us in desired ways? And how can we tell?

 

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Office image attributed to Jesus Corrius (CC).

Communities as Nested Servicescapes

jsrrr.JPG[We’re pleased to welcome Xiaojing Sheng from the University of Texas at Rio Grande. Sheng co-authored a recently published article in the Journal of Service Research  entitled “Communities as Nested Servicescapes” with Penny Simpson and Judy Siguaw. From Sheng:]

  • What inspired you to be interested in this topic?

From groups of four to sixteen sipping margaritas in local restaurants to dancing at a beach or Mexican fiesta, retired winter migrants are a ubiquitous presence in the Rio Grande Valley of South Texas each winter. These migrating consumers repeatedly come to the area in large numbers each winter to enjoy the warm tropical weather, to participate in the many available activities, and to enjoy each other in their highly social living environment of mobile homes and recreational vehicle communities. These senior citizens also become an inseparable part of the region by routinely going to restaurants, events, shows and stores where they seem to exude a comradery and enjoyment of life not seen by typical residents of any community. For these migrants, winter life in the Valley seems to be a fun-filled, months-long vacation. Through casual observation of the lifestyle of these hundreds of thousands of active retirees, we were driven to understand their experiences as they become immersed in the broader servicescape of the Valley and in the nested servicescapes of their mobile home/recreational vehicle communities in which they reside for extended periods of time.

  • Were there findings that were surprising to you?

The finding that servicescape engagement weakened the positive effect of perceived servicescape satisfaction on loyalty intention is unexpected and surprising. This is probably because high levels of activity engagement become all-consuming, making perceived servicescape satisfaction itself less important in loyalty intention. For example, consumers may be willing to overlook a rundown beach villa if the beach activities are exceptional. On the other hand, lower levels of engagement strengthened the impact of perceived servicescape satisfaction on loyalty intentions, conceivably because consumer attention is less distracted by activity involvement, and therefore, more focused on servicescape factors.

  • How do you see this study influencing future research and/or practice?

An interesting finding from our study is that, when consumers interact with two servicescapes of which one is nested within another, their experiences are shaped by the effects of the individual servicescape, the compounding effects of both servicescapes, and by the transference effects between the two servicescapes. Consequently, marketers need to take a holistic approach to managing servicescapes at all levels to create an overall positive consumer experience. We hope that our research serves as a catalyst for future studies that examine effects of nested servicescapes. Moreover, we hope our work encourages other researchers to investigate less conventional servicescapes, such as regions, towns, and neighborhoods, because there is so much more to be learned about how the places in which we live, work, and play affect and transform our lives.

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Notes on the Origin of “The Normalization of Corruption”

[Wjmie’re pleased to welcome back J.S. Nelson, Senior Fellow at the Zicklin Center for Business Ethics Research at Wharton, and an Advisor in the Center for Entrepreneurial Studies at the Stanford Graduate School of Business. Nelson recently published an article in the Journal of Management Inquiry entitled “The Normalization of Corruption.” Notes from Nelson:]

My forthcoming article on “The Normalization of Corruption” in the November 2016 issue of the Journal of Management Inquiry started in a fairly unusual way. I am an attorney—a former prosecutor and commercial litigator—who has taught in business schools for nearly ten years. My work focuses on both entrepreneurship and business ethics.

But the differences between law and business still surprise me. At the 2016 Western Academy of Management meeting in Portland, a group of us were lingering over the end of breakfast at a conference table. As we described what we were working on, and I mentioned my articles about the incentives for wrongdoing within organizations leading to the 2007-08 financial crisis and scandals since, someone at the table stopped me mid-stream. “What are you doing sitting here? You need to be in the session happening now on corruption,” she told me. I protested that I didn’t work on corruption. For lawyers, corruption is the paying of bribes to government officials. But the management, finance, and organizational behavior people at the table envisioned corruption much more broadly—they saw corruption as the misuse of organizational resources by anyone who hijacks the proper purpose of the corporation. Yes, under this definition, the financial crisisthe VW emissions scandal, and today’s headlines about fraud at Wells Fargo are all corruption.

So I ran over to the room where the corruption symposium was mid-stride. And, lo and behold, a defense lawyer spoke to the crowd about white collar crime. Other people described the loss of positive “voice” that they had seen in corporate scandals. I was writing the Oxford University Press’s book on Business Ethics. These people were speaking my language. As the session drew to a close, I raised my hand to make a comment about the sorry state of the law and how middle management is often where the details of large scandals originate in order to protect top executives who don’t want to ask the questions that they should while on the job.

My comment and question drew Paul Hirsch’s attention. Paul is, as you know, the James L. Allen Professor of Strategy & Organizations in the Kellogg School of Management at Northwestern University. He is also passionate about new ideas and what we can do about corruption in this country. We sat down for an impromptu talk perched at a small table outside the meeting room to compare notes about how decisions in the courts are helping to fuel the patterns of corruption that we both study. We talked about the work that I was doing on the prevalence of corruption industry-by-industry, and how behavioral ethics helped explain the tipping points beyond which corruption became a norm.

Paul looked at me hard. I could tell he was coming to a decision. “Okay, do it,” he said. “Write this up for me as a guest editor of the issue—let’s put this in the Journal of Management Inquiry’s special issue on Corruption.” I protested—I came from a different discipline, the deadline was two weeks away, I had other publishing commitments, it just wasn’t possible. But Paul had seen the links between my work and his field. We cared about the same things. He knew that the management community needed to hear from additional perspectives, and he knew that the synergies would be worth pursuing.

And he was exactly right. The “Normalization of Corruption” article wrote itself.  The management material told part of the story, and the additional keys were in law and behavioral ethics. There is a pronounced cycle: the fact that misconduct is perceived by individuals to be so widespread has led to a normalization of corruption within companies and industries. The contribution of the law—and this part is particularly vicious—is that the normalization of corruption, in turn, helps to defeat attempts to prosecute the misconduct and to prevent its spread. Normalizing corruption tells individuals not only that it is acceptable to cheat, but that cheating is the behavior now expected of them and for which they will be rewarded.

So read the paper. Let me know what you think. Lawyers don’t usually talk about cultures and norms, and business professors don’t usually talk about doctrine and cases. But it’s time to put the pieces together. These synergies are shaping the world we live in, and—unless we have the conversations that we need to change that world—they are reciprocally creating the normalization of corruption.

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How Has HR Become More Strategic and Integral to Businesses?

12669067945_e017b825c8_zIn today’s competitive and complex business environment, the role of human resources (HR) is constantly changing. With its increasing alignment to core business and integration to the bottom line, HR is a reflection of the constant changing nature of its functions. Being responsive to globalization, demographic and technological changes, as well as the turbulent, competitive and complex environment of business, HR itself has been changing dramatically. From the conventional role of “administrative expert,” HR has evolved to become more tactical and integral to business strategies.

A recent major change in the function of HR the strengthening partnership with line managers. By providing line managers better understanding of their responsibility in specific HR issues, such as absence control, team development, discipline, induction, health and safety, recruitment policy and performance management, HR aims to enhance Current Issue Coveremployee engagement and open communication between line managers and employees. These in turn lead to low turnover and high morale—keys to organizational performance and competitive success. In this regard, by replacing the traditional supervisory role of line managers and empowering them to act as leader, enabler and facilitator, HR is playing the strategic role of an “objective adviser”.

This change has made HR more strategic and more business integrated. This reorientation helps HR to not only play a critical role in the overall strategic planning of the business, but also to act as a messenger to clarify and direct employees about the desired goal of the organization. A recent article from the journal Vision entitled “Strategic Value Contribution Role of HR,” from authors Humaira Naznin and Md. Ashfaq Hussain,  delves into the evolution of HR.

 The abstract for the article:

This article aims to challenge the perceived lack of a strategic value of human resource (HR) function and seeks to focus on the devolution of HR from its transactional role to strategic effectiveness. Utilizing a range of secondary resources, this article aims to critically analyze the shift of HR from transactional to a strategic role and its value contribution role in business. HR needs to overcome conventional resistance and act as the driver of an organizational strategy through aligning the HR strategy to the business strategy, adopting workforce planning and measuring an organization’s competencies. The paper contributes to the evaluation of HR management from viewpoint perspective and offers help to HR practitioners in understanding the changing role of HR.

Click here to read Strategic Value Contribution Role of HR from the journal Vision free for the next two weeks by clicking here. Make sure to sign up for e-alerts and be notified of all  of the latest research published the journal Vision!

*Image attributed to woodleywonderworks (CC)