Customer satisfaction enhanced through vendor alliances
Tuesday, February 7, 2012
Purdue Marketing Professor Chad Allred’s paper, “The Service Hand-Off: Effects of Multivendor Service Performance on Customer Satisfaction - An Experimental Study,” explores the relationship between vendor collaboration and customer satisfaction. The Journal of Services Marketing published Professor Allred’s research and awarded him the 2011 Literati Network Awards for Excellence, Highly Commended Paper Award.
Professor Allred previously worked at Novell, where he led a groundbreaking initiative to form multi-vendor alliances between the industry’s leading computing firms. Alliance members were legally bound to assist each other “behind-the-scenes” to solve common customer problems.
Professor Allred notes that this “coopetition” served a twofold purpose: to solve the customer’s immediate problem and ensure the viability of multi-vendor computing systems. At the time, CIOs of large corporations were reluctant to run mission critical applications on unsupported multi-vendor systems. The press viewed the alliance to be a model of things to come.
This valuable experience led Professor Allred to pose the questions, “Why do we collaborate in these types of the environments? How do back-end business-to-business relationships affect front-end business-to-consumer satisfaction?”
Professor Allred developed a unique methodology to study the multi-vendor phenomena. He simulated a complex service experience involving two vendors by developing virtual web sites. University students were then assigned to different problem conditions and directed to the virtual vendor web support sites.
Special code controlled the resolution scenarios, where each student was given a unique experience pre-determined by experimental design. Key events were manipulated, such as response time, problem hand-off, and resolution time. Throughout, students were given surveys to assess their satisfaction with the problem solving experience.
Professor Allred’s research posed a particularly intriguing research question. What happens to customer satisfaction toward one firm when it hands the problem off to another firm? More specifically, how does the continuing performance of the second firm impact the customer’s perception of the first firm?
Professor Allred notes that while a firm may give up control of an issue, customers continue to adjust their satisfaction judgments with that firm’s performance through comparison. He describes this as “turning the fate of future customer satisfaction over to a potential competitor.”
Professor Allred’s research suggests that firms must carefully manage complex customer service experiences. Similar to a customer purchase cyclea customer choice process, service experiences are often comprised of unique events and critical decision points that may involve multiple individuals and span multiple firms.
Complex services experiences contain natural breaks that define uniquely evaluated events. Firms seeking to maximize customer satisfaction need to be keenly aware of these events and transition points. Professor Allred is continuing his research by examining event signatures and interrelationships between events within complex relational exchange experiences.
Professor Allred is teaching brand management and advising an Experiential Learning Initiative project in Purdue’s MBA program. He looks forward to working with students and sharing his business-to-business experience, as well as facilitating more experiential learning projects. --Heather Owens (MBA ’12)