Final DBA Dissertation Defense - Daniel P. Nowak
ABSTRACT
Public trust in institutions is essential for a well-functioning society; however, according to opinion polling, the legitimacy of institutions has been in steady decline over the past few decades. For example, government, banking, healthcare, and higher education are all institutions that have experienced a decline in public trust. As institutional trust declines, marketers in these sectors face decreases in brand image and consumer confidence. Multiple reasons explain why trust in institutions is eroding, including a rise of political polarization, social media disinformation, corporate political advocacy, and corruption. This dissertation proposes that service failure-recovery strategy (SFR) is also a cause of institutional mistrust. The SFR field has long been interested in how SFR interacts with perceptions of trust but has yet to examine trust from an institutional level. This two-essay dissertation provides a high-level conceptual framework of the SFR literature and an empirical study that investigates various SFR strategies and their impact on institutional trust.
Essay 1 employs a scoping literature review methodology to map the essential topics of interest in the SFR field. The field of SFR is broad, complex, and heterogenous and has received increased research interest. The full range of content is difficult to traverse given the long history and broad interests in the SFR domain. As such, a key gap in the literature is a conceptual framework that provides an extensive descriptive account of SFR terminology and concepts. Essay 1 addresses this gap by reviewing the early history and relevant scales of SFR, categorizing the relevant SFR antecedents, theories, outcomes, and strategies, and organizing the different types of SFR strategies into three categories: reactive, adaptive, and proactive.
In Essay 2, an empirical model of SFR and institutional trust is conceptualized and empirically evaluated within healthcare, artificial intelligence, and transportation institutional contexts. In these service contexts, consumers often derive value in complex intangible benefits. However, intangible benefits may not be immediately visible and are challenging for consumers to quantify. Further, in expert services like healthcare, it is a challenge for consumers to accurately assess risk, particularly in physical harm contexts. As a result, consumers may heavily rely on institutional trust as a guiding factor in their decision-making process. Consequently, as institutional trust erodes, market inefficiencies may occur when there is a misalignment of customers’ perception of risk and actual risk involved. Marketers in these institutional contexts must seek effective strategies to rebuild institutional trust by increasing their willingness to accept risk and avoiding transferring risk onto customers. In the field of SFR, and more broadly in the marketing field as a whole, there has been little research examining institutional trust from a customer perspective. The methodological approach for this study is a quasi-experimental research design with self-administered surveys as the data collection tool and structural equation modeling and analysis of variance (ANOVA) as the tools to evaluate the data. Four service-oriented studies were conducted within healthcare and artificial intelligence contexts. These studies were manipulated into different conditions for a 2 (risk transfer vs. risk acceptance) x 2 (service employee - present vs. not present) x 2 (involuntary vs voluntary risk) between-subjects study design. Essay 2 makes a considerable number of contributions to SFR and institutional trust literature.
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