Discrepancies in Services

DISCREPANCIES BETWEEN TOURISTS AND MANAGERS PERCEPTIONS OF SERVICE FAILURES AND SERVICE RECOVERIES IN HOTELS

Sven Kuenzel, University of Greenwich, London, UK / Yancheng Institute of Technology, China

Nektarios Katsaris, University of Greenwich, London, UK ABSTRACT From the moment consumers purchase hotel services, they desire and expect excellence. Throughout the past twenty years, hotels have sought to improve and maintain their service quality, adopting quality control techniques whose basic goal is to ensure that services meet specific requirements, and are dependable and satisfactory. Otherwise service failures and service recoveries are likely to occur which can be very costly to hotels as found in the literature. However it remains unknown if managers and tourists view service failures and service recoveries differently. Consequently this paper investigates possible differences between tourists and managers with regard to service failure and service recovery in Greece. Keywords: Tourist, Hotel, Greece, Service failure, Service recovery, Tourism Research 1. INTRODUCTION Services, rather than products, due to their unique and distinctive nature, seem to contain a higher level of risk for the provider in handling a quality item for consumption. Zeithaml (1981) illustrated the four unique characteristics of services as follows: intangibility, inseparability, perishability and heterogeneity. To further explain these characteristics, intangibility is considered the fundamental factor which differentiates services and goods (Zeithaml et al., 1990). This lack of physical evidence, therefore, increases the level of uncertainty that a consumer faces when choosing between competing services. Inseparability refers to a services simultaneous production and consumption, hence the requirement of the customers participation in its consumption. As a consequence, the quality of a service depends partly on this participation, as well as on the providers performance. Perishability refers to the fact that, unlike products that can be stored or reinvented for future orders, services cannot be returned, recaptured or recreated (Zeithaml et al., 1985). Thus, adjustments in services must be made at the same time as they are delivered since there is no room for correction later. Lastly, heterogeneity refers to the fact that products performance may vary from producer to producer, from customer to customer and from day to day; the quality of the interactions can rarely be standardised the way that manufactured goods can be (Zeithaml et al., 1990). Thus, each service encounter is different in terms of the presence of participants and the time of performance. As a result, each consumer is likely to receive a different service experience (Gabbott & Hogg, 1994). Considering the aforementioned complex nature of services, service providers realise that during the consumption of services, failures seem to an extent, to be inevitable. Service failures, consequently, are defined as any service-related mishaps or problems (real and/or perceived) that occur during a consumers experience with the firm (Maxham, 2001) According to a number of authors it is their very nature that generates service failures (e.g. Hess et al., 2003; Palmer et al., 2000). Additional reasons, however, that such failures occur particularly in the hotel industry is due to the high level of interaction between employees and customers (Lewis & McCann, 2004) as well as the increasingly high demands of todays hotel guests (Kim et al., 2009). However no previous study has examined possible differences between tourists and managers in a hotel setting and this paper will try to fill that void. The paper continues as follows: the subsequent chapter contains a review of the relevant literature; and afterwards we will present the research methodology of a qualitative study in Greece, followed by the results and conclusions. 2. CRITICAL REVIEW OF THE LITERATURE Service failure is the starting point that defines the field where a service recovery is needed. In addition, the development of services marketing suggests that a customer orientation puts the customer at the core

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of a companys goals and activities; thus, treating the customer right and maximising customer satisfaction with the product or service which allows the firm to remain competitive and profitable. Especially in services which are intangible (hence their final quality is not totally controllable by the firm) it was found that nurturing a long-term, mutually satisfying relationship between service providers and customers constitutes a strong advantage for the firm (Webster, 1992). Furthermore, service failures create a negative impact on the customers intention to repurchase from the service provider and they constitute a significant factor in customers switching from one service provider to another (McCollough et al., 2000). The way that customers perceive the performance of a service, and whether or not it is a failure, seems partly to depend on customers prior expectations. Expectations are described as what the consumers predict would happen (Bitner, 1990). These expectations are influenced by:

the product/service itself, which includes prior experience and brand connotations; the overall context, including the content of communications from salespeople and social

referents; and individual characteristics, such as persuadability and perceptual distortion.

Miller (1977) outlined the existence of a consumers minimum tolerable expectations, or the lowest levels of performance acceptable. Zeithaml et al. (1993) adopted Millers (1977) framework to introduce the zone of tolerance, which extends between the desired service and the service which is perceived as merely adequate. The authors proposed that the perception of this zone differs among customers but also between interactions with the same customer, and that the adequate level is more subject to change than the desired level. Thus, cases of service failure occur as a result of customers perceptions of service delivery falling short of the zone of tolerance. A further issue under study is the service providers ability to provide services that fall within the limits of the zone of tolerance. Indeed, Nyquist et al. (1985) in their study of hotel, restaurant and airline industries illustrated that: Seventy-five per cent of the reported communication difficulties stem from cases where customers have expectations or demands that exceed the firms and its employees willingness or ability to comply, (p. 207) rather than due to a breakdown in technical operation as might be expected. A source of service failures might be a difference in the perception of quality held by customers and management. Parasuraman et al. (1985) conducted interviews with firm executives and consumer groups as part of their research on service quality and identified significant gaps or discrepancies between executive perceptions about what consumers expect and the actual customers expectations. The authors report that: Service firm executives may not always understand what features connote high quality to consumers in advance, what features a service must have in order to meet consumer needs, and what levels of performance on those features are needed to deliver high quality service (Parasuraman et al., 1985, p.44). Furthermore Nyquist et al. (1985) suggest that a difference in the perception of the importance of service failures between employees and customers in the hotel industry might play an important role in tackling such failures. The authors consider that all customer-contact personnel play a marketing role in their firm, as representatives of the firm to the public. Their selection and training, therefore, is critical to a service provider and additional attention should be paid to their communication skills, apart from the technical skills required for each job (Nyquist et al., 1985). The authors asked hotel, restaurant and airline employees to describe any critical incidents that involved difficult interactions with customers. The majority of the incidents in the hotel industry (62 percent) fell into the category of customers unreasonable demands and demands against policies. In total, 80 percent of the incidents that employees reported were caused by false customer expectations, rather than by firm or employee performance that did not match the capacity of the service delivery system. The result is in contrast with the usual findings of such studies that confirm the dominance of lost and dishonoured hotel reservations as the major customer-related problem in the hotel industry. The authors ascribe the rare report of such problems to the fact that hotels acknowledge the situation, recoveries are well-planned, and thus such cases do not cause employees major problems throughout their interaction with hotel guests. On the contrary, since a number of studies have found that such problems are most commonly reported by hotel customers, a discrepancy can be observed between customers and employees perceptions about the severity of these situations. Indeed, this discrepancy becomes apparent if Bitner et al.s (1990) classification of service failures is considered. In order to further the understanding of the causes of service failures, the authors created three groups, a categorization which the majority of researchers seem to adopt. Specifically, the authors used the critical incident technique to examine very satisfactory and very dissatisfactory service


encounters from consumers perspectives, in order to clarify the roots of favourable and unfavourable incidents. With regard to this classification, the first group consists of the most serious failures, those which can affect the overall service experience, because they are related directly to the core service. Core service is defined as the basic service that the service provider agreed to supply. The second group comprises of cases where the service failed to satisfy customers special needs or requests for customised service. The authors explain that what customers perceive to be a special requirement may be regarded by the service provider as routine; however it is customers perception that determines the nature of the incident. Lastly, the third group is composed of failures that were caused by unprompted and unsolicited employee actions and, mostly, negative or unacceptable behaviours. Within these groups, several more specialised sub-categories exist. Several authors later developed comparable classification systems in different environments, using the critical incident technique. Kelley et al. (1993), for instance, created a similar typology of service failures in the field of retailing, whereas Hoffman et al. (1995) identified and classified failures specifically within the restaurant industry and formed more specialised sub-categories such as slow service, stock unavailability, seating problems and wrong orders. Bitner et al. (1994) also presented an alternative approach to explaining service failure by examining employees perspectives. The authors used a similar classification of failures in order to group them effectively. They concluded that in the majority of cases, employees understand customers needs and offer their assistance. However, a number of cases were identified where the customers were the source of their own dissatisfaction, meaning that their personality type was the main reason for their perception of the failure. Thus, the authors outlined the existence of the wrong type of customers that may harm a firm. Lovelock (1994) identified six types of customers that may be considered wrong customers and should be avoided because they easily confront a service provider with service failures. The notion of wrong customers can manifest itself in situations where:

product and customers fit poorly; customers personality and style are different to that of the company; the mutual value produced by the bond between provider and customer is not sufficient; the customer lacks resources; the customers demand is not in accordance with a products; or the customer lacks the appropriate skills and technological efficiency needed for evaluating the

consumption of the product. Identifying these types of consumers early, according to the author, can prevent potential service failure events which would harm both sides. 3. METHODOLOGY This study follows an interpretivist research approach. The interpretivist research tradition has its roots in the late eighteenth and early nineteenth centuries. Although it grants the existence of physical reality, it maintains that the mind was the source and creator of all knowledge. Rather than assuming that the social world pre-existed or was a given, the founders of this approach believed that this social world is created by the individuals who live within it. The world is believed to be socially constructed through the interaction of individuals (Grix, 2004). Hence the task of the social scientist appears not to be to gather facts and to measure how often certain patterns occur, but to appreciate the different constructions and meanings that people place upon their experiences. The interpretive research philosophy allows the main focus of research to be on understanding what is happening in a given context. It includes consideration of multiple realities, different actors perspectives, research involvement, taking account of the contexts of the phenomena under study, and the contextual understanding and interpretation of data. Interpretivist researchers are considered part of the reality being researched, and therefore not detached from the subject of study (Grix, 2004). Its ontological focus favours the existence of multiple realities in any given situation, whereas with regard to epistemology, the study favours a close interaction of the researcher with the subject under study. Thus, these perspectives determined the employment of a qualitative type of methodology for the study involving an inductive approach. Induction refers to the process by which conclusions are drawn from direct observation of empirical evidence (Landman, 2000, p.226). By following an inductive approach, the researcher generates and builds theory through analysis and interaction with the qualitative data (Creswell & Clark, 2007; Grix, 2004).


When conducting a study, the appropriate tools and techniques need to be employed. Such instruments should support the exploratory and explanatory nature of the research. The most common qualitative tools are observation, focus groups, narrative and in-depth interviews. After considering the different tools which could be used to achieve the objectives of this study, in-depth semi-structured interviews were employed. This type of interview gives the respondent the opportunity to talk freely about incidents, behaviour and beliefs, which are related to the subject. Before undertaking the main study, a pilot study was conducted. As Lofland & Lofland (1984) stress, a pre-test study is essential, especially when using semi-structured interviews, in order to modify the interview guides, to focus attention on areas of particular importance or to exclude questions that prove to be irrelevant to the research. The pilot interviews also helped to identify persistent problems and address them at an early stage (Bryman & Bell, 2007). For this purpose, four pilot interviews were conducted. The sample was convenient but as similar as possible to the population of the main studys sample. Pilot studies, according to Bryman and Bell (2007), give an opportunity to ensure not only that the questions work well, but also that the entire research instrument functions well. Indeed, this pilot gave the chance to actually test the interview guide in practice. It showed that the main research question and most of the sub-questions were meaningful and in most cases, were supported by the findings. In addition, the interview guide seemed to work well, encouraging respondents to explore their knowledge, feelings and beliefs regarding their experience. However further refinement of the wording and nature of some questions was needed. Lastly, the experience of approaching respondents, including the handling of cases where their answers were irrelevant, monosyllabic, not focused on the topic or highly emotional, proved to be extremely useful for the main stage of the qualitative research. For interviews with tourists, a purposive data sample was employed (Bryman & Bell, 2007), whereas for managers, a convenience sample was used. In order to locate the tourist participants who have experienced the phenomenon being studied (a service failure experience in a hotel that the hotel personnel should have been aware of), a criterion sampling was used. As Creswell (1998) explains, according to this type of sampling all participants should meet this criterion. Unlike the positivist research approach, the sample was not formed to be generalisable. However, participants with different demographic characteristics in terms of age, gender and nationality were sought in order to represent various socio-demographic groups, thus offering distinctive perspectives on the subject under study. The interviews for the main study were conducted on the Greek islands of Crete (in the area of Rethymnon) and Santorini, between April and May 2010, which was an off-peak tourist period. The selection of this time period was due to the fact that April and May constitute the starting months of the tourist season for these popular Greek destinations, where hotels and tourism businesses operate (in winter the majority of them are closed). At the same time, the quantity of tourists on the island is sufficient whereas in summer months these destinations are extremely crowded and in winter tourist numbers are very low. The specific locations were selected due to their popularity as destinations (hence their tourism development); the large number of British tourists that they attract (hence convenience in approaching them); the variety of the types of accommodation offered (hence variety of socio-demographic characteristics of tourists); and the warm climate that constitutes a reason for attracting tourists even during the months between the peak and off-peak tourist season. It was intended that the tourist-interviewees should be of British or Greek nationality for language reasons and as an opportunity for a later possible comparison of the results of the two groups. The interviews with Greeks were conducted in Greek. All interviews lasted between 35 and 70 minutes. Interviews with tourists took place in tourism spots (mainly in hotel lobbies), while interviews with managers took place in their offices by appointment. Interviews were digitally recorded recordings have the advantage of capturing data more faithfully than hurriedly written notes, and can make it easier for the researcher to focus on the interview (Hoepfl, 1997) transcribed, and those in Greek were translated into English by one of the researchers. Prior to participation in this study, all participants gave written consent, and were informed about the purpose of the study. The respondents that were eligible to participate in this study were those who answered positively to the question whether they had experienced a service failure in a hotel in the past. The reason for this screening was essential, since this precise experience would be the incident that they would be called to describe. A second positive answer to the question of whether staff members of the hotel were aware of the failure (by any chance) was required as a second level of screening. The hotels awareness of the failure was required, so that customers could be in a position to evaluate the hotels


response. If the hotel had not been aware of the failure (despite its apparent responsibility), then the notion of service recovery could not occur and the respondent could not evaluate the service recovery performance which was one of this studys purposes. Thus, when respondents answers passed the aforementioned filter questions, the respondent was considered eligible to participate in the study. In addition, participants were informed that they could withdraw their consent at any stage, without providing a reason. They were also encouraged to ask questions and discuss any issues related to the interview. Finally they were asked to confirm the sufficiency of information they had received and only if all of these presuppositions were fulfilled, the interviews would be included. The sample comprised seventeen participants, ten of whom belonged to the category entitled tourists whereas seven were managers (five hotel and two destination managers). It was crucial to maintain the anonymity of the respondents. As a result, in the study the participants are referred to as GT-1 to GT-5 (Greek Tourists), BT-1 to BT-5 (British Tourists), HM-1 to HM-5 (Hotel Managers) and DM-1 and DM-2 (Destination Managers). Therefore, it is unlikely that an answer could be attributed to a particular interviewee. The interview comments were coded into themes using thematic content analysis (Braun & Clarke, 2006). Since content analysis is any technique for making inferences by objectively and systematically identifying specified characteristics of messages (Holsti, 1969, p.14), thematic content analysis process is a method, where qualitative data was thematically analysed in order to code the common themes that derived from participants responses. The codes may constitute a list of themes, a complex model with relating themes, indicators and qualifications, or something in between these two forms (Boyatzis, 1998, p.4). Themes, on the other hand, are found in the information; their role is to describe and organise the data or interpret aspects of the phenomenon. Themes were created from the content of the data by retrieving all the text coded with the same label to combine passages that are related to the same idea, theme or phenomenon. As Gibbs (2007) suggests, it is a useful way of managing data, enabling the researcher to examine it in a structured way. 4. FINDINGS The first discrepancy observed was about the types of failure that hotel managers and tourists consider severe. In particular, when the hotel managers were asked to mention what types of failures they regarded as the most serious problems that hotel guests may encounter, they emphasised failures related with technical aspects (HM-2, HM-3), like plumbing and the room air-conditioning system, or external factors, like the outer noise (HM-1, HM-3), whereas no instances of such categories were reported by tourists in their responses. Nevertheless, a possible explanation for managers references to technical aspects could be their difficulty in tackling such situations immediately and successfully during the summer period, when the availability of local technicians in a small destination is limited, whereas the instances in the peak tourist period are numerous. However, the absence of such service failure incidents from respondents reports may indicate that either these are not critical for them, or that they are justifiable to a certain extent, since they cannot be totally controlled by the hotel. When the hotel offers an apology, an acknowledgement of the situation, an explanation and a sympathetic approach, apart from any demonstrated efforts to bring about a prompt recovery, these may actually neutralise a negative outcome. The strength of interactional justice in companies recovery efforts has been stressed by a number of studies, including Johnston and Mehra (2002), who suggested that consumers need to witness the human face of the providers. This study, too, underlined that tourists may appreciate a response to failures that would involve an acknowledgement of the situation and a commitment to future improvement. Respondent BT-3 would expect the hotel to say that they would look into it and try and improve the standards and GT-3 would have been satisfied with the following type of response from the manager: Thank you very much for letting me know, I wish that more people would do that, I promise that within a certain time period everything will be resolved and, I would honestly like to invite you to come and visit us next year to see how different we can be. On the contrary, a lack of the human touch of the hotel personnel was reported repeatedly by all tourist-respondents as a cause for service failures. At the same time, hotel managers did not mention any behavioural aspects as possible generators of service failure. All seven tourist-respondents, however, who experienced service failures with unsuccessful recoveries involved aspects of poor, hostile, indifferent or insufficient behaviour by members of staff, which caused or worsened the service failures. Descriptions about hotel staffs behaviour as very surly, very offhand, no thank-yous (BT-1), very cold,


unfriendly manner, unapproachable, made us feel uncomfortable (BT-4), submissive, quite curt (BT-5), sarcastic, hostile, not talkative at all (GT-2), horrible behaviour, not polite at all, apathetic (GT-3), insincere, impolite, professional courtesy zero (GT-4) seemed to play a crucial role in determining the seriousness of the failure and its importance to respondents. However, a type of a serious service failure that was described by a hotel manager (HM-3) seems to hold equal importance for visitors too, since similar failures were described by two respondents (BT-4, GT-3): I think that a serious case is when you provide them [i.e. the tourists] with an image [i.e. of the hotel], which they do not actually get. I mean, you should not hire a professional photographer to make your hotel seem like a palace, whereas in reality it is not. [In that case] you know very well what you are doing. Also, when you exaggerate about your hotel and you write about facilities that the customer cannot use, then you will have a problem. This will reflect on the destination. This type of failure, which is also related to tourists prior expectations, seems to be significant to visitors for an additional reason that it affects their evaluation of the hotels performance, and as the hotel manager outlined, it is serious enough to influence the image of the destination. With regard to the destination managers, their perceptions seem to be similar to those of tourists. Either due to their awareness of tourists complaints - there are cases, where visitors drop in because of a problem that they encounter with a hotel (DM-1) - or due to their impartial position, destination mangers disregard any technical problems and emphasise the service failures caused by a kind of certain behaviour (DM-2) of the hotel. This observation advances the role of destination managers in assisting hotels to prevent or recover service failures effectively. Nonetheless, hotel managers lack of acknowledging the importance of inappropriate behaviour as a source of generating service failure may have an association with the second major discrepancy that was observed between managers and tourists perceptions and will be discussed in the forthcoming section. The absence of the previously discussed acknowledgement on the part of the hotel managers, of the fact that hotel personnels impropriate manner can engender or worsen a service failure, is in line with the impact that such failures may have on the image of the entire tourist destination. Although tourists have indicated the means through which this association occurs, hotel managers seem not to consider that a service failure in their hotel can negatively influence visitors image of the destination: I do not think that there is any type of problem in hotels capable of making a customer not return to the place (HM-4). The managers also stress that a combination of further incidents is needed for the formation of a negative destination image, rejecting the notion that a hotel alone may create a negative opinion of the destination: if their only problem is the one with the hotel, it will not reflect on the region (HM-2); it does not depend only on me. It is also when they [i.e. the guests] will go out to drink or to eat. Everyone plays their part. This is a chain. It cannot only be me. (HM-1). An indicative response constitutes manager HM-5s reply. When the respondent was asked about whether he believes that service failures can negatively affect visitors image of the destination, he replied in general terms, no, while later he explained in other hotels, yes. []Such hotels exist Hotel managers behaviour can be explained by using attribution theory according to which, individuals attribute any negative outcomes of a situation to external factors rather than to themselves. Accordingly, hotel managers attribute any visitors negative impressions about the destination to other factors than the hotel. By using the same framework it is also possible to explain the discrepancy that was discussed earlier and is related to managers failure to consider hotel personnels behaviour as a source of a service failure, owing to managers responsibility for personnels behaviour to customers. However, at the same time, they attribute visitors possible negative impressions about the destination to other hotels or businesses in the region, as stressed earlier. The lack of managers consideration of the benefit of the destination on the implementation of the service recovery may be a significant negative consequence. Since managers disregard the service failures effect on the destination, by the time they consider a customer as lost in terms of their business, they refrain from making an additional effort to minimise the possible loss for the destination. By not acknowledging the fact that a customer who is satisfied with the destination may spread positive word of mouth that could benefit the other local enterprises, the customer will leave dissatisfied both with the hotel and the destination, thus harming the image of the destination. Destination managers perspectives seem to differ with that of hotel managers in this case. In particular, respondent DM-1 stressed the fact that a single accommodation brings down and knocks down the entire island. When asked about whether hoteliers of the region are aware of that aspect, he replied no, this hasnt become embedded in their minds. As a consequence, respondent DM-1 acknowledged that


hoteliers and hotel managers with this kind of mentality can create huge damage [] to this destination and consequently to the whole countrys image. However, destination managers underlined the existence of several exceptions to this mindset, and several phrases from hotel managers in this study seemed to acknowledge the situation: After all, we have to be good as a tourism destination and hotel industry, apart from our own business (HM-5). A number of authors argue that excellent recovery tactics can leave customers who experienced a service failure more satisfied than those who did not experience a service failure incident at all; this generates the service recovery paradox (e.g. McCollough & Bharadwaj, 1992), a concept that has caused disagreement among researchers. In Michels (2001) study, cases emerged in which customers experiencing a better than expected recovery rated the firm higher than customers who did not report any failure. Ok et al. (2007), after having conducted a scenario experimentation study with restaurant customers, found that customers post-recovery overall satisfaction could be higher than their initial overall satisfaction when they were highly satisfied with service recovery (p.680), in cases where the recovery efforts are exceptional, rather than just good. Accordingly, Smith & Bolton (1998) reported that a highly satisfactory recovery will maintain or increase cumulative satisfaction and loyalty (p.77). The authors, however, seem to diminish the importance of these effects, perhaps so as not to be seen to encourage firms to abandon service quality in favour of an emphasis on efficient recovery strategies, as a panacea to all failures. Similarly to Ok et al, (2007) they stress the fact that only a high level of effectiveness in recovery can lead to customers happiness. On the other hand, a repeated failure where the recovery does not completely achieve its goals would eliminate the benefits of a previous satisfactory experience, because customers repatronage intentions have little memory (p.77). The diminishing effects of the service recovery paradox in the case of repetitive failures were also observed by Maxham & Netemeyer (2002). Throughout the authors longitudinal study of customer complaints and business recovery efforts, they found that paradoxical increases diminished after repetitive failures, regardless of a service recoverys effectiveness, because customers increase their recovery expectations. But in the event of a single failure and a satisfactory recovery, customers rated the firm paradoxically higher in terms of satisfaction, generating more positive word of mouth and repurchase intentions. The authors openly discourage managers from using satisfactory recoveries as an antidote for poor service, i.e., from becoming recovery experts (p.67). Other studies, however, make less of the implications of the service recovery paradox, considering it a rare event, whose applicability is restricted (Boshoff, 1997). More specifically, Magnini et al. (2007) specified the theorys effectiveness in the following cases:

when the failure is not considered by the customer to be severe, when the customer has not experienced a prior failure with the firm, when the cause of the failure was perceived as unstable by the customer, and when the customer perceived that the company had little control over the cause of the failure.

Michel & Meuter (2008) tend to understate the importance of the service recovery paradox due to their presumption that the cases where a service recovery is both very positive and surprising characteristics which are essential for a paradox phenomenon to occur, according to the authors are by design rare (p.454). The authors seem to accept the significance of the phenomenon, but at the same time they do not consider it large enough to create serious managerial implications. Boshoff (1997), on the other hand, agrees that the phenomenon is rare and very costly. Out of twenty-seven scenarios that the author used for the purposes of his study, he only observed significantly high post-recovery satisfaction in one. This was in an airline setting, in which the supervisor immediately offered a refund of expenses and an additional free airline ticket. As emerged from the interviews, a satisfactory service recovery is able to positively affect the image that a visitor will form of the destination. In some cases the paradox is that it can leave visitors more satisfied with the destination than if they had not confronted a service failure in the hotel. Respondent GT-1s positive image about the destination may to a great extent be attributed to the upgrade of their hotel room to a bungalow on the beach, as part of the service recovery for a dishonoured booking. The respondent described the bungalow as paradise, commenting that this thing changes your mood at once. Assuming the service failure had never happened and the respondent had stayed in the medium sized and priced room, perhaps his overall satisfaction with the destination would have been reduced. This assumption may actually expand the field of effect of the service recovery paradox phenomenon, from customers satisfaction with the service provider as identified by McCollough and Bharadwaj (1992) and


Ok et al. (2007) to their satisfaction with wider settings, such as the tourist destination in a tourism context. Moreover, this is confirmed by examining two other respondents cases of satisfaction with the recovery and their image of the destination. Respondent BT-2, in particular, clearly stressed that actually at the end, my bad experience turned into a good experience, so my perception of the town is positive and the hotel itself, illustrating her perceived close association of the hotel with the destination. An explanation of the crucial role of the service recovery was given by respondent GT-5, who admitted that because they sorted it out immediately I did not regard it as a major problem, which it actually was; but this way I just did not realise how major it was. Thus, the role of the service recovery seems not to be limited to merely minimising the loss of a failure, or even creating a positive attitude towards the service provider (Gustafsson, 2009), but also to improve and positively change the image of the destination. Hotel managers seem to hold a similar perception about the issue; those who consider the service recovery paradox phenomenon seem to also acknowledge that this also influences the destination. Destination managers in particular, driven by their experience, overwhelmingly agree with this consideration. Respondent DM-1, for instance, narrated an incident where tourists reported a service failure in a hotel within a destination that annoyed them to such a degree that they wanted to leave the island. The destination manager assisted in resolving the problem and finally the tourists told the destination manager that they left the island extremely satisfied with the destination. The respondent concluded: All I want to say is how with just a simple gesture from the hoteliers part, a problem could be resolved. And not only this: these girls stated that they had become fans of the island because they were having a great time and that they would return to our island. So everything went fine (DM-1). This incident illustrates how the satisfactory treatment of service failure can generate satisfaction with the destination as well. 5. CONCLUSION In conclusion, the service recovery paradox has gained attention from researchers from a theoretical perspective, but practitioners do not consider it to hold much importance. Perhaps this is due to the fact that in practice, the phenomenon rarely occurs, and is difficult to implement to good effect. However, findings from the in-depth interviews which were conducted for the purposes of this study showed its importance in certain circumstances. After having conducted the in-depth interviews with tourists and hotel managers, a general impression was formed about a discrepancy in the answers of these groups in the areas of service failure and service recovery. Indeed, after a thorough examination of both groups responses on particular matters such as what failures they consider as serious and the impact that such failures may have on tourists image of the destination, discrepancies have been observed between managers and tourists perceptions. This study adopted a qualitative approach in order to examine the perceptions of different stakeholders, to draw out any hidden parameters around the topic as well as to record the protagonists behaviour and explore its drivers. The hotel and destination managers that were interviewed for this study were Greeks who were not randomly selected. Therefore, their perceptions and practices cannot be generalised. REFERENCES: Bitner, M.J. (1990) Evaluating service encounters: The effect of physical surroundings and employee responses, Journal of Marketing, 54(2), pp.69-82. Bitner, M.J., Booms, B.H. & Tetreault, M.S. (1990) The service encounter: Diagnosing favourable and unfavourable incidents, Journal of Marketing, 54(1), pp.71-84. Boshoff, C. (1997) An experimental study of service recovery options, International Journal of Industry Management, 8(2), pp.110130. Boyatzis, R.E. (1998) Transforming qualitative information: Thematic analysis and code development, Thousand Oaks: Sage.


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