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Critical Service Incidents: Analyzing Service Failure And Recovery In Hotels, Restaurants And Transportations In Malaysia


  • Nek Kamal bin Yeop Yunus

    () (Faculty of Management and Economics, University Pendidikan Sultan Idris, Tg Malim, Malaysia)

  • Salomawati Ishak

    (Commerce Department, Politeknik Sultan Azlan Shah, Behrang, Malaysia)

  • Suraini Rhouse

    (Faculty of Management and Economics, University Pendidikan Sultan Idris, Tg Malim, Malaysia)


Service quality has become an important and strategic variable as companies attempt to satisfy and retain present customers. It was also useful in attracting new customers as they compete effectively in the market place. However, due to the characteristics of services, it makes consistent service delivery very difficult across customers. Some aspects of services which relates to employee actions and customer attitude are outside the control of managers. Consequently, service failure is inevitable, sometimes mistakes will happen or things will go wrong, and so service recovery action is needed to deal with the mistakes or problems in order to restore customer satisfaction. This study attempted to analyse the service failures and recovery in service organizations. Data were collected by using Flanagan’s Critical Incident Techniques i.e. interviewing customers who had experienced service failures in restaurants (102), hotels (213) and transportation (51) industries in Malaysia. The result of the analysis shown that on the overall, 239 (65%) of the respondents were dissatisfied and 127(35%) of them were satisfied. In the first category of service failure, 47(28%) of the customers were satisfied and 118 (70%) of them were dissatisfied to the employee response to service delivery failure. In the second category, 32(49%) and 31(47%) of the customers were satisfied and dissatisfied respectively to the employee response to customer needs and request. In the third category, 48(23%) of the customers were satisfied and 90(64%) of them were dissatisfied to unprompted and unsolicited employee actions. Recovery strategies were discussed in the final part of the paper

Suggested Citation

  • Nek Kamal bin Yeop Yunus & Salomawati Ishak & Suraini Rhouse, 2012. "Critical Service Incidents: Analyzing Service Failure And Recovery In Hotels, Restaurants And Transportations In Malaysia," Journal of Global Business and Economics, Global Research Agency, vol. 5(1), pages 18-37, July.
  • Handle: RePEc:grg:01biss:v:5:y:2012:i:1:p:18-37

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    References listed on IDEAS

    1. Siregar, Sylvia Veronica & Utama, Sidharta, 2008. "Type of earnings management and the effect of ownership structure, firm size, and corporate-governance practices: Evidence from Indonesia," The International Journal of Accounting, Elsevier, vol. 43(1), pages 1-27, March.
    2. Klock, Mark S. & Mansi, Sattar A. & Maxwell, William F., 2005. "Does Corporate Governance Matter to Bondholders?," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 40(04), pages 693-719, December.
    3. Dimitropoulos, Panagiotis E. & Asteriou, Dimitrios, 2010. "The effect of board composition on the informativeness and quality of annual earnings: Empirical evidence from Greece," Research in International Business and Finance, Elsevier, vol. 24(2), pages 190-205, June.
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    More about this item


    critical incident techniques; service encounter; service recovery; service failures;

    JEL classification:

    • M0 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - General


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