Literature Review of Service Failure, Service Recovery and their Effects on Consumers and Service Employees

This review aims to analyze literature related to service failure; firm's attempted service recovery; and effects of failure & recovery on consumer and employees. The study identifies important themes emerging in the topic. Chronologically arranged literature is studied for themes, using relevance to the topic. The study identifies three important themes related to; service failure, service recovery and its effects on consumer and employees. First theme is about effect of service failure on consumer value & experience through; negative emotions, emotional labor, and emotion contagion. Second theme is emerged as customer reactions to service failure in terms of; justice & fairness, consumer forgiveness, consumer revenge, opportunistic claiming, recovery satisfaction, and switching behavior. Third theme is about managing service recovery using; compensation & apology, speed of response & positive ending, and customer relationship management. Services being simultaneous processes involving consumer and employees, control of service failures and subsequent service recovery are important functions of managers. Lastly, this study lists failure & recovery management methods for effective use by service manager