Title : Efforts to Enhance Service Quality: The Roles of Innovation Capability and Service Recovery

Vol 7 No 3 (2024): Volume 07 Issue 03 March 2024

Article Date Published : 18 March 2024 | Page No.: 1738-1751 | Google Scholar | Crossref doi for this article

Abstract :

This research aims to discuss the service quality issue at 4-star hotels in Medan. Next, build a model on how to enhance service quality.  A sample of 560 guests was taken by random proportional from each hotel. Structural equation models with the lisrel software supported. Market orientation influences innovation capability and service quality. Value co-creation influences innovation capability, service recovery, and service quality. Innovation capability influences service recovery. Innovation capability mediation can increase the influence of market orientation on service recovery. Service recovery affects service quality. Integration between functions in hotels, especially information dissemination in formulating policies to increase innovation capabilities, is important to pay attention to. It is important to develop a risk-taking attitude to improve service recovery. Recovery strategies are important to pay attention to in efforts to improve service quality. The role of market orientation needs to be followed by innovation capability to improve service recovery.

Keywords :

Innovation Capability, Market Orientation, Service Quality, Service Recovery, Value Co-creation

References :

  1. Agrawal, A. K., & Rahman, Z. (2015). Roles and Resource Contributions of Customers in Value Co-creation. In International Strategic Management Review (Vol. 3, Issues 1–2). Holy Spirit University of Kaslik. https://doi.org/ 10.1016/j.ism.2015.03.001
  2. Ahmad, B., Liu, D., Asif, M. H., Ashfaq, M., & Irfan, M. (2022). Ambidextrous Leadership and Service Recovery Performance Under B2B Selling Context: An Examination Through Service Innovation Capability. SAGE Open, 12(2). https://doi.org/10.1177/21582440221096454
  3. Al-kalouti, J., Kumar, V., Kumar, N., Garza-Reyes, J. A., Upadhyay, A., & Zwiegelaar, J. B. (2020). Investigating innovation capability and organizational performance in service firms. Strategic Change, 29(1), 103–113. https://doi.org/10.1002/jsc.2314
  4. Aldas‐Manzano, O., Küster, I., & Vila, N. (2005). Market orientation and innovation: an inter-relationship analysis. European Journal of Innovation Management, 8(4), 437–452. https://doi.org/https://doi.org/10.1108/ 14601060510627812
  5. Alhakimi, W., & Mahmoud, M. (2020). The impact of market orientation on innovativeness: evidence from Yemeni SMEs. Asia Pacific Journal of Innovation and Entrepreneurship, 14(1), 47–59. https://doi.org/https://doi.org/10.1108/APJIE-08-2019-0060
  6. Amangala, E. A., & Wali, A. F. (2020). Market Orientation, Service Quality Perception, and Customer Satisfaction: The Role of Market-sensing Capabilities. Business Perspectives and Research, 8(2), 216–231. https://doi.org/https://doi.org/10.1177/2278533719887453
  1. Anning-Dorson, T. (2016). Interactivity innovations, competitive intensity, customer demand and performance. International Journal of Quality and Service Sciences, 8(4), 536–554. https://doi.org/10.1108/IJQSS-11-2015-0075
  2. Arshad, A. M., & Su, Q. (2015). Interlinking service delivery innovation and service quality: A conceptual framework. Journal of Applied Business Research, 31(5), 1807–1822. https://doi.org/10.19030/jabr.v31i5.9393
  3. Atınç, Y. Ö. (2016). Analysis of Service Recovery Failure: From Minority Perspective. Business and Economics Research Journal, 7(4), 97–97. https://doi.org/10.20409/berj.2016422341
  4. Budiaji, W. (2013). Skala Pengukuran dan Jumlah Respon Skala Likert (The Measurement Scale and The Number of Responses in Likert Scale). Ilmu Pertanian Dan Perikanan, 2(2), 127–133. http://umbidharma.org/jipp
  5. Buttle, F., & Burton, J. (2002). Does service failure influence customer loyalty? Journal of Consumer Behaviour, 1(3), 217–227. https://doi.org/10.1002/cb.67
  6. Calantone, R. J., Cavusgil, S. T., & Zhao, Y. (2002). Learning orientation, firm innovation capability, and firm performance. Industrial Marketing Management. Industrial Marketing Management, 31, 515–524.
  7. Chang, H., Fu, H., Chen, C. S., Shu-Hui, Chiu, W. Z., & Lu, Y.-Y. (2016). CUSTOMER READINESS, MARKET ORIENTATION AND TRANSACTION FREQUENCY IN MOBILE BANKING SERVICE RECOVERY. PACIS 2016 Proceedings.281. https://doi.org/https://aisel.aisnet.org/pacis2016/281
  8. Chang, T.-Z., & Chen, S.-J. (2008). The Effect of Market Orientation on Service Quality. Journal of Customer Service in Marketing & Management, 4(3), 33–45. https://doi.org/https://doi.org/10.1300/J127v04n03_03
  9. Collis, J., & Hussey, R. (2021). Business Research, a practical guide for students (fifth edit). Macmillan Education Limited.
  10. Deshpandé, R., Farley, J. U., & Frederick E. Webster, J. (1993). Corporate Culture, Customer Orientation, and Innovativeness in Japanese Firms: A Quadrad Analysis. Journal of Marketing, 57(1). https://doi.org/https://doi.org/10.1177/00222429930570010
  1. Farida, N., & Listyorini, S. (2021). Innovation Capability Model and Co-Creation as an Improvement of SMEs Performance. ICISPE 2020. https://doi.org/10.4108/eai.9-10-2020.2304781
  2. Farida, N., Naryoso, A., & Yuniawan, A. (2017). Model of Relationship Marketing and E-Commerce in Improving Marketing Performance of Batik SMEs Model Pemasaran Hubungan dan E-Commerce dalam Meningkatkan Kinerja Pemasaran UKM Batik. Jurnal Dinamika Manajemen, 8(36), 20–29.
  3. Ford, R. C., Sturman, M. C., & Heaton, C. P. (2012). Managing Quality Service in Hospitality. Delmar, Cengage Learning.
  4. Foroudi, P., Jin, Z., Gupta, S., Melewar, T. C., & Foroudi, M. M. (2016). Influence of innovation capability and customer experience on reputation and loyalty. Journal of Business Research, 69(11), 4882–4889. https://doi.org/https://doi.org/10.1016/j.jbusres.2016.04.047
  1. Geiser, C. (2021). Longitudinal Structural Equation Modeling with Mplus A Latent State–Trait Perspective (T. D. Little (ed.)). The Guilford Press. file:///C:/Users/MAESTRO/Downloads/Longitudinal Structural Equation Modeling with Mplus A Latent State-Trait Perspective (Geiser, Christian) (z-lib.org).pdf
  2. Gerber, M. (2020). What are the benefits of implementing Service Recovery? EHL Insight. https://hospitalityinsights.ehl.edu/benefits-of-service-recovery
  1. Gilles, R. S., & Armirotto, V. (2017). 6. Co-creating service recovery after service failure : The role of brand equity This paper is an author pre-print version of a paper accepted for publication in the Journal of Business Research . Journal of Business Research, 74, 101–109.
  2. Goni, K. (2021). Service Quality and Financial Performance of Hotels: Evidence from Kano, Nigeria. ‎ LAP LAMBERT Academic Publishing.
  3. Gummesson, E. (2008). Quality, service-dominant logic and many-to-many marketing. TQM Journal, 20(2), 143–153. https://doi.org/10.1108/17542730810857372
  4. Hair, Black, W., Babin, B., & Anderson, R. (2019). Multivariate Data Analysis (Eighth Edi). Cengage Learning EMEA.
  5. Hair, J. F., Page, M., & Brunsveld, N. (2020). Essentials of Business Research Methods (Fourth Edi). Routledge.
  6. Hamidi, F., & Gharneh, N. S. (2017). IMPACT OF CO-CREATION ON INNOVATION CAPABILITY AND FIRM PERFORMANCE: A STRUCTURAL EQUATION MODELING. AD-Minister, 30. https://doi.org/10.17230/ad-minister.30.4
  7. Han, Y., & Xie, L. (2017). Relationship between innovation capability, innovation type, and firm performance. Journal of Innovation & Knowledge, 8(4), 100416. https://doi.org/10.1016/j.jik.2023.100416
  8. (2020). Pengaruh gaya kepemimpinan, kompetensi, dan displin kerja terhadap komitmen organisasi serta implikasinya pada kinerja dosen tetap prodi S1 Manajemen terakreditasi A di universitas swasta LLDIKTI wilayah III. Uniiverrsitas Persada Indonesia Y.A.I.
  9. Hasanah, U., Usman, I., Agustina, T. S., & Syarif, M. (2023). Authenticity, market orientation, and innovation capability: A multilevel analysis. Uncertain Supply Chain Management, 11(3), 1333–1342. https://doi.org/10.5267/j.uscm.2023.3.015
  10. Hazée, S., Vaerenbergh, Y. Van, & Armirotto, V. (2017). Co-creating service recovery after service failure: The role of brand equity. Journal of Business Research, 74, 101–109. https://doi.org/https://doi.org/10.1016/j.jbusres.2017.01.014
  11. Heng, L., FERDINAND, A. T., AFIFAH, N., & RAMADANIA, R. (2020). SERVICE INNOVATION CAPABILITY FOR ENHANCING MARKETING PERFORMANCE : AN SDL PERSPECTIVES. Verslas: Teorija Ir Praktika / Business: Theory and Practice, 21(2), 623–632. https://doi.org/https://doi.org/10.3846/btp.2020.12163
  12. Hintama, A., Maulida, M., & Bustaman, Y. (2021). The Impact of Innovation Capability on Product Innovation Performance (Case Study of Manufacturing Industry in Indonesia). Conference Series, 3(1), 616.
  13. Hoffman, K. D., & Kelley, S. W. (2000). Perceived justice needs and recovery evaluation: a contingency approach. European Journal of Marketing, 34(3/4), 418–433. https://doi.org/https://doi.org/10.1108/03090560010311939
  14. Hogan, S. J., Soutar, G. N., McColl-Kennedy, J. R., & Sweeney, J. C. (2011). Reconceptualizing professional service firm innovation capability: Scale development. Industrial Marketing Management, 40(8), 1264–1273. https://doi.org/10.1016/j.indmarman.2011.10.002
  1. (2021). The Impact of Value Co-Creation on Service Quality. IvyPanda Free Essays. https://ivypanda.com/essays/the-impact-of-value-co-creation-on-service-quality/
  2. Janjua, R., & Ramay, M. I. (2020). The effect of cocreation of value on seervice quality – customer loyalty chain on the role of relationship quality in higher education institution. Journal of Business and Economic, 12(1), 125–147.
  3. Janteng, J., & Tan, C. L. (2017). Effects of Value Co-Creation on Innovation Capability: Knowledge Sharing as a Moderator. Polish Journal of Management Studies, September 2018, 116.
  4. Jiménez-Jiménez, D., & Sanz-Valle, R. (2011). Innovation, organizational learning, and performance. Journal of Business Research, 64(4), 408–417. https://doi.org/10.1016/j.jbusres.2010.09.010
  5. Joe F. Hair, J., Page, M., & Brunsveld, N. (2020). Business Research Methods (Fourth Edi). Routledge.
  6. Joensuu-Salo, S., Kangas, E., Kettunen, S., & Mäntysaari, P.-P. (2019). THE EFFECT OF TECHNOLOGY AND MARKET ORIENTATION ON SERVICE INNOVATION CAPABILITY IN THE CONTEXT OF SOCIAL AND HEALTH CARE SME The Thirteenth International Conference: “Challenges of Europe: Growth, Competitiveness, Innovation and Well-Being, 187. https://www.proquest.com/openview/eefaea4642217c7c8bf8d977b3691f9a/1?pq-origsite=gscholar&cbl=1566342
  7. Johnston, R. (2001). Linking complaint management to profit. International Journal of Service Industry Management, 12(1), 60–69. https://doi.org/10.1108/09564230110382772
  8. Jöreskog, K. G., Olsson, U. H., & Wallentin, F. Y. (2016). Multivariate Analysis with LISREL. Springer.
  9. Keskin, H. (2006). Market orientation, learning orientation, and innovation capabilities in SMEs: An extended model. European Journal of Innovation Management, 9(4), 396–417. https://doi.org/10.1108/14601060610707849
  10. Kline, R. B. (2023). Principles and Practice of Structural Equation Modeling (FIFTH EDIT). THE GUILFORD PRESS.
  11. Kolbe, D. (2022). Market Orientation and Innovation Capability, the Key to Export Success for Latin American SMEs. EGADE IDEAS. https://egade.tec.mx/en/egade-ideas/research/market-orientation-and-innovation-capability-key-export-success-latin-american
  12. Komunda, M. B., & Osarenkhoe, A. (2023). Can Efficacious Service Recovery Enable Retention of Complaint-Averse Savvy Customers ? Journal of Service Science and Management, 16(6), 670–693. https://doi.org/10.4236/jssm.2023.166036
  1. Liat, C. B., Mansori, S., Chuan, G. C., & Imrie, B. C. (2017). Hotel Service Recovery and Service Quality: Influences of Corporate Image and Generational Differences in the Relationship between Customer Satisfaction and Loyalty. Journal of Global Marketing, 30(1), 42–51. https://doi.org/https://doi.org/10.1080/08911762.2016.1262932
  2. Liu, Y., Lv, D., Ying, Y., Arndt, F., & Wei, J. (2018). Improvisation for innovation: The contingent role of resource and structural factors in explaining innovation capability. Technovation, 74–75, 32–41. https://doi.org/https://doi.org/10.1016/j.technovation.2018.02.010
  1. Lohr, S. L. (2022). Sampling Design and Analysis (Third Edit). CRC Press.
  2. Lusch, R. F., & Vargo, S. L. (2014). Service-Dominant Logic Premises, Perpectives, Possibilities. Cambridge University Press.
  3. Mose, J. A., & Kibera, F. N. (2015). The Influence of Service Quality – Management Practices on the Performance of Hotel Firms in Kenya. European Scientific Journal, 11(22), 315–336. www.ijsrp.org
  4. Mwangangi, J. (2014). FFECT OF SERVICE RECOVERY STRATEGIES ON SERVICE QUALITY IN COMMERCIAL BANKS IN KENYA [University of Nairobi]. http://erepository.uonbi.ac.ke/handle/11295/76162
  5. Nair, G. K., & Choudhary, N. (2016). The impact of service quality on business performance in Qatar-based hotels: An empirical study. Journal of Hospitality Financial Management, 24(1), 47–67. https://doi.org/10.1080/10913211.2016.1170559
  6. Nasution, E. N. (2023). Medan Municipality in Figures. https://medankota.bps.go.id/publication/2023/02/28/fd2c9f972ff3f33b1289067a/kota-medan-dalam-angka-2023.html
  1. Ngo, L. V., & O’Cass, A. (2013). Innovation and business success: The mediating role of customer participation. Journal of Business Research, 66(8), 1134–1142. https://doi.org/https://doi.org/10.1016/j.jbusres.2012.03.009
  2. Pantouvakis, A., & Karakasnaki, M. (2021). Examining the impact of market orientation on service quality in shipping companies: the role of risk propensity. International Journal of Quality and Service Sciences, 13(1), 106–122. https://doi.org/https://doi.org/10.1108/IJQSS-01-2020-0012
  3. Parasuraman, A., Zeithaml, V. a, & Berry, L. L. (1988). SERQUAL: A Multiple-Item scale for Measuring Consumer Perceptions of Service Quality. Journal of Retailing, 64(January), 28. https://doi.org/10.1016/S0148-2963(99)00084-3
  4. Perks, H., & Riihela, N. (2004). An exploration of inter-functional integration in the new service development process. The Service Industries Journal, 24(6), 37–63. https://doi.org/https://doi.org/10.1080/0264206042000299176
  5. Petri, J., & Jacob, F. (2016). The customer as enabler of value (co)-creation in the solution business. Industrial Marketing Management, 56, 63–72. https://doi.org/10.1016/j.indmarman.2016.03.009
  6. Pradana, B. I., & Safitri, R. (2023). Business Orientation and Innovation Capability in Improving Operational Performance. International Journal of Professional Business Review, 8(5), 1–17. https://doi.org/10.26668/businessreview/2023.v8i5.1136
  7. Pranoto, Z. A., & Syahlani, D. H. (2021). Relationship Between Service Innovation and Innovation Capability That Affects Customer Satisfaction Mediated by Service Quality in the Public Sector. Seventh Padang International …, 192(Piceeba), 382–393. https://www.atlantis-press.com/article/125963960.pdf
  8. Rajapathirana, R. P. J., & Hui, Y. (2018). Relationship between innovation capability, innovation type, and firm performance. Journal of Innovation and Knowledge, 3(1), 44–55. https://doi.org/10.1016/j.jik.2017.06.002
  9. Rantyanti, V. N. P., & Halim, R. E. (2020). The influence of service innovation on service quality, customer satisfaction, and customer loyalty at Indonesia banking [Universitas Indonesia]. https://lib.ui.ac.id/m/detail.jsp?id=20507618&lokasi=lokal
  10. Roggeveen, A. L., Tsiros, M., & Grewal, D. (2012). Understanding the co-creation effect: When does collaborating with customers provide a lift to service recovery? Journal of the Academy of Marketing Science, 40(6), 771–790. https://doi.org/10.1007/s11747-011-0274-1
  11. Sallis, J. E., Gripsrud, G., Olsson, U. H., & Silkoset, R. (2021). Research Methods And Data Analysis For Business Decisions: A Primer Using SPSS. Springer.
  12. Sasono, I., & Novitasari, D. (2020). Enhancing Service Quality through Innovation Capabilities and Work Productivity. International Journal of Science and Management Studies (IJSMS), 3(6), 123–133. https://doi.org/10.51386/25815946/ijsms-v3i6p111
  1. Setiawan, R., Eliyana, A., Suryani, T., & Prayitto, H. (2020). The effect of market orientation on innovation capacity through entrepreneurial orientation at business start-up Coffee shop in Indonesia. Systematic Reviews in Pharmacy, 11(11), 298–305. https://doi.org/10.31838/srp.2020.11.44
  2. Shah, S. N., Irshad, M., & Maher, S. (2019). Impactof Service Quality on Business Performance Evidence from Pakistan Hotel Industry. Discourse (2521-5337), 5(2), 121–132. https://discourse.org.pk/index.php/discourse/article/download/107/98
  1. Siahaan, D. T., & Tan, C. S. L. (2020). Antecedents of innovation capability and firm performance of indonesian ict smes. Asian Journal of Business Research, 10(2), 45–71. https://doi.org/10.14707/ajbr.200083
  2. Song, X., Khosa, M., Ahmed, Z., Faqera, A. F. O., Nguyen, N. T., Rehman, S. U., & He, Y. (2022). Linking Transformational and Despotic Leadership to Employee Engagement: Unfolding the Role of Psychological Distress as a Mediator. In Sustainability (Switzerland) (Vol. 14, Issue 14, pp. 1–21). https://doi.org/10.3390/su14148851
  3. Suarka, F. M., & Sulistyawati, A. S. (2023). Service Recovery Strategy for Non-Star Accommodation in the Seminyak Area, Kuta, Bali. European Modern Studies Journal, 7(4), 390–400. https://doi.org/10.59573/emsj.7(4).2023.35
  4. Subroto, F. A. (2013). Pengaruh Market Orientation Terhadap Service Quality, Satisfaction Dan Loyalty Pelanggan Toko Buku Gramedia Di Jawa Timur. Jurnal Manajemen Dan Kewirausahaan, 15(1), 41–52. https://doi.org/10.9744/jmk.15.1.41-52
  1. Suk, J. B., Chung, S. H., & Choi, K. (2013). TQM Factors and Their Impact on Service Recovery and Service Performance – In restaurant settings -. Manag, Korean Soc Qual, 41(1), 95–108. https://doi.org/http://dx.doi.org/10.7469/JKSQM.2013.41.1.095
  1. Sukanthasirikul, K., & Trongpanich, W. (2013). the Effects of Market Orientation on Service Quality and New Service Success. Journal of International Business and Economics, 13(3), 215–224. https://doi.org/10.18374/jibe-13-3.19
  2. Syah, T. Y. R., & Olivia, D. (2022). Enhancing Patronage Intention on Online Fashion Industry in Indonesia_ The Role of Value Co-Creation _ Enhanced Reader.pdf. Cogent Business & Management, 1–32. https://doi.org/10.1080/23311975.2022.2065790
  1. Tabachnick, B. G., & Fidell, L. S. (2019). Using Multivariate Statistics (Seventh Ed). Pea rson Education, Inc.
  2. Taghzadeh, S. K., Jayaraman, K., Ismail, I., & Rahman, S. A. (2016). Scale development and validation for DART model of value co-creation process on innovation strategy. Journal of Business & Industrial Marketing, 31(1), 24-35. https://doi.org/https://doi.org/10.1108/JBIM-02-2014-0033
  3. Thakkar, J. J. (2020). Structural Equation Modelling (V. 285 (ed.)). Springer Nature.
  4. Vázquez, R., Iglesias, V., & Varela-Neira, C. (2016). Co-creation and service recovery process communication: effects on satisfaction, repurchase intentions, and word of mouth. Service Business, 11, 321–343.
  5. Wang, J., & Wang, X. (2020). Structural Equation Modeling (Second Edi). John Wiley & Sons Ltd.
  6. Xia, Y., & Ha, H. Y. (2021). Does customer orientation matter? Direct and indirect effects in a service quality-sustainable restaurant satisfaction framework in China. Sustainability (Switzerland), 13(3), 1–16. https://doi.org/10.3390/su13031051
  7. Yi, Y., & Gong, T. (2013). Customer value co-creation behavior: Scale development and validation. Journal of Business Research, 66(9), 1279–1284. https://doi.org/10.1016/j.jbusres.2012.02.026
  8. Zeithaml, V., Bitner, M. J., & Gremler, D. D. (2013). Services marketing: integrating customer focus across the firm (6th ed.). McGraw-Hill. https://lib.atmajaya.ac.id/default.aspx?tabID=61&src=k&id=189062
  9. Zhang, L., Yang, W., Yang, L., & Gao, L. (2022). How does the value co-creation of e-commerce platform and manufacturers affect channel performance? The moderating role of innovation capability and market turbulence. Electronic Commerce Research and Applications, 52. https://doi.org/https://doi.org/10.1016/j.elerap.2022.101120
  10. Zhang, M., & Jin, S. (2020). Value Co-Creation in Service Recovery: A Combination of Systematic Literature Review and Meta-Analytic Research. Journal of Service Science and Management, 13(02), 388–407. https://doi.org/10.4236/jssm.2020.132026

How to Cite :

Efforts to Enhance Service Quality: The Roles of Innovation Capability and Service Recovery. Ronnie Togar Mulia Sirait, Maretta Ginting, Fridawati Maduwu, Martinus Ndruru, Desi R.S. Kalit, Adilman Laia, Runggu Besmandala Napitupulu , 7(3), 1738-1751. Retrieved from https://ijcsrr.org/single-view/?id=15486&pid=15277

Most read articles by the same author(s)

Ronnie Togar Mulia Sirait, Maretta Ginting, Fridawati Maduwu, Martinus Ndruru, Desi R.S. Kalit, Adilman Laia, Runggu Besmandala Napitupulu,

View

123

Citation

Downloads

Article Details