In pursuit of service productivity and customer satisfaction: the role of resources

Purpose In today’s global marketplace, the mantra of many service firms is enhanced efficiency and productivity. To increase their bottom line, firms must also expand revenue. They thus face the challenge of ways to increase revenue through customer satisfaction while also achieving productivity gains. The current study aims to offer insight into the role of various resources that encourage frontline employees (FLEs) to become engaged in the pursuit of achieving organisational goals, ultimately enhancing service productivity and customer satisfaction. Design/methodology/approach A total of 252 customer-FLE dyadic data were collected at a medium-sized retail bank in Ho Chi Minh City, Vietnam. Findings Results show that personal (self-efficacy) and organisational resources impact FLE productivity directly and indirectly through employee engagement. Importantly, service productivity is then positively associated with customer satisfaction. Research limitations/implications Extending previous investigations based on the job demands-resources model and theories of self-efficacy and conservation of resources, this study’s findings empirically support anecdotal accounts of the positive productivity–customer satisfaction relationship. Practical implications The results also highlight the importance of the management of human and organisational resources to attain this two-pronged goal. Originality value Using dyadic data (customers and FLEs) collected at a medium-sized retail bank, the authors refute the trade-off effect between attaining employee productivity and customer satisfaction in the service industry. This paper further fills research need to study how various resources available to FLEs can achieve desirable organisational outcomes in service firms – the improvement of both service productivity and customer satisfaction.