A mathematical model of service failure and recovery strategies

Zhen Zhu, K. Sivakumar, Ananthanarayanan Parasuraman

Research output: Contribution to journalArticle

45 Citations (Scopus)

Abstract

Understanding the nature of service failures and their impact on customer responses and designing cost-effective recovery strategies have been recognized as important issues by both service researchers and practitioners. We first propose a conceptual framework of service failure and recovery strategies. We then transform it into a mathematical model to assist managers in deciding on appropriate resource allocations for outcome and process recovery strategies based on customer risk profiles and the firm's cost structures. Based on this mathematical model we derive optimal recovery strategies, conduct sensitivity analyses of the optimal solutions for different model parameters, and illustrate them through numerical examples. We conclude with a discussion of managerial implications and directions for future research.

Original languageEnglish (US)
Pages (from-to)493-520
Number of pages28
JournalDecision Sciences
Volume35
Issue number3
DOIs
StatePublished - Jun 2004

Fingerprint

Mathematical models
Recovery
Resource allocation
Costs
Managers
Mathematical model
Recovery strategies
Service recovery
Service failure
Cost structure
Optimal solution
Conceptual framework

Keywords

  • Mathematical Modeling
  • Optimization
  • Service Failure
  • Service Recovery
  • Services Marketing

ASJC Scopus subject areas

  • Management of Technology and Innovation
  • Strategy and Management
  • Business, Management and Accounting(all)

Cite this

A mathematical model of service failure and recovery strategies. / Zhu, Zhen; Sivakumar, K.; Parasuraman, Ananthanarayanan.

In: Decision Sciences, Vol. 35, No. 3, 06.2004, p. 493-520.

Research output: Contribution to journalArticle

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