The Effect of Leadership Styles on Service Quality Delivery

The Effect of Leadership Styles on Service Quality Delivery Andrew M. Farrell Corresponding Author Marketing Group, Aston Business School Aston University Birmingham, B4 7ET United Kingdom Phone: 0044 121 359 3011 ext. 5019 Fax: 0044 121 333 4313 Email: farrelam@aston.ac.uk Anne L. Souchon Marketing Group Aston Business School Aston University Birmingham, B4 7ET United Kingdom Phone: 0044 121 359 3011 ext. 5060 Fax: 0044 121 333 4313 Email: a.l.souchon@aston.ac.uk Geoff R. Durden Marketing Group Victoria University of Wellington PO Box 600 Wellington New Zealand Phone: 0064 4 463 5152 Fax: 0064 4 463 5231 Email: geoff.durden@vuw.ac.nz

The Effect of Leadership Styles on Service Quality Delivery Introduction The study of service provision has gained prominence in recent marketing literature as it enables organisations to gain competitive advantages (Ozment and Morash, 1994). At the heart of service provision research is the concept of service quality (REF). The management of service quality has become one of the most important topics in marketing literature to date (Cronin and Taylor, 1992). However, much of the current literature on service quality deals with its measurement or outcomes rather than focussing on improving the process of service quality delivery (Farrell and Souchon, 1998). This is surprising since the process of service delivery is considered by some to be more important than the outcome itself (Chenet, Tynan, and Money, 1999). Nevertheless, a limited number of studies have attempted to identify means of improving the delivery of service quality through such activities as employee management (e.g., Hartline and Ferrell, 1996), internal marketing (e.g., Lings, 1999), and total quality management (Lukas and Maignan, 1996). The role of leadership in improving service quality delivery has been advocated and service leadership in particular has been deemed crucial to the provision of higher levels of service quality (Zeithaml and Bitner, 1996), but the lack of any psychometric scales or empirically tested relationships means that the question of how service managers should lead still remains. When attempting to formulate an understanding of leadership Bass (1997) notes that by dissecting leadership into various styles, the effectiveness of different types of leaders can be better understood. Additionally, Yammarino (1997, p. 43) reasons the particular leadership style or behavior endorsed by the manager can enhance, neutralize, or inhibit such job-related outcomes and responses of sales subordinates as job satisfaction, motivation, effectiveness, and performance. The objectives of this study are therefore to conceptualize service

leadership, and to model its effects on perceived service quality delivery, drawing on generic leadership styles conceptualized within psychology and sales management literature (e.g., Bass, 1997; Jolson, Dubinsky, Yammarino, and Comer, 1993). Background Amongst the sales and psychology literature, leadership is widely recognized as a medium for influencing subordinates actions (Bass, 1997; Jolson, Dubinsky, Yammarino, and Comer, 1993) although past services marketing research concerned with leadership has largely ignored this parallel literature, resulting in a construct of service leadership that is often mentioned but rarely understood. Utilizing this parallel literature, service leadership can be viewed as the instillation by service managers of an organizational customer focus amongst customer-contact employees aimed at inspiring and sustaining a continual commitment towards achieving a level of service that customers want and for which they are willing to pay (c.f., Stutts, 1999; Yammarino, 1997; Zeithaml and Bitner, 1996). Drawing on the sales management and psychology literature, two leadership styles feature prominently: transactional and transformational leadership. Transactional leadership involves an exchange process whereby leaders secure the work effort of followers through use of contingent reward and/or management-by-exception (Jolson, Dubinsky, Yammarino, and Comer, 1993). Transformational leaders are concerned with raising the consciousness of followers about the importance of outcomes and how to reach those outcomes by going beyond their own selfinterests (Bass, 1997, p. 21). They achieve this through charisma, inspirational motivation, intellectual stimulation, and individual consideration of followers (Bass, 1997; Dubinsky, Yammarino, Jolson, and Spangler, 1995).

The Service Delivery Process The process of service delivery is comprised of a number of managerial- and employeespecific factors whose inter-relationships and effects upon service quality have been well documented. Employees attitudes (e.g., role stressors such as role ambiguity and role enhancers such as job satisfaction and organizational commitment) and behaviors (e.g., recovery of service failures, teamwork, and adapting service behaviors to suit customers needs) during service delivery play a crucial role in the development of customers perceptions of service quality (Bitner, 1990; Hartline and Ferrell, 1996). Managers in turn provide inputs to the service delivery process (e.g., feedback to employees) to attempt to influence employees attitudes and behaviors in a positive way (c.f., Hartline and Ferrell, 1996). Hence, the inputs of managers as well as employees service attitudes and behaviors make up the service delivery process. Based upon the service they receive, customers then formulate perceptions of service quality (Parasuraman, Zeithaml, and Berry, 1988). The process of service delivery is illustrated by the shaded area of Figure 1. When discussing the effects of leadership upon service delivery transactional and transformational leadership styles, in the absence of a detailed understanding of service leadership, will be used to for the initial conceptualization. Conceptualization Research has shown that transactional and transformational leadership are common to high performing sales managers (Dubinsky, Yammarino, Jolson, and Spangler, 1995; Russ, McNeilly, and Comer, 1996). It seems logical to infer from this that the adoption of transactional and transformational leadership characteristics by service managers should result in higher performance, although no empirical evidence exists to confirm this. Transactional and transformational leadership are likely to increase the influence that managerial inputs

have upon employees attitudes since leadership represents a process (Jolson, Dubinsky, Yammarino, and Comer, 1993) whereby any managerial inputs are performed continuously rather than uniquely. For example, continuous feedback to employees is likely to have a greater impact than feedback given sporadically. Transactional and transformational leadership are also likely to influence the relationship between managerial inputs and employees service behaviors. If followers observe their leader achieving desired results, they are more likely to try and emulate the leader (Avolio, Waldman, and Yammarino, 1991) in order to satisfy their expectations (Bass, 1985). Amongst the sales management literature there has been considerable discussion of the positive effect that transactional and transformational leadership have upon employees role enhancers (Avolio, Waldman, and Yammarino, 1991; Bass, 1985, 1997; Yammarino, 1997) and the negative effect relationship that they have with employees role stressors (Avolio, Waldman, and Yammarino, 1991; Dubsisky, Yammarino, Jolson, and Spangler, 1995). The relationship between employees attitudes and their service behaviors should be positively moderated by transactional and transformational leadership from service managers. Transactional leaders can increase employees confidence when performing service behaviors by clarifying employees roles (Bass, 1985). Customer-contact employees under transformational leadership develop an acceptance of the mission of the group (Den Hartog, van Muijen, and Koopman, 1997) and (presumably in a service setting) the importance of customer service. This, along with the greater employee effort associated with transformational leadership (Bass, 1985; Jolson, Dubinsky, Yammarino, and Comer, 1993), should give employees more psychological drive to employee appropriate service behaviors. Leadership styles are also likely to impact directly upon employees service behaviors. Transformational leadership promotes innovation and causes employees to think in terms of the work group rather than just themselves (Avolio, Waldman, and Yammarino, 1991;

Yammarino, 1997) increasing the likelihood of teamwork and adaptability behaviors being adopted by employees. Transactional leaders, through task identification for employees (Dubinsky, Yammarino, Jolson, and Spangler, 1995), are likely to cause only those behaviors that are deemed necessary by the leader (such as teamwork) to be performed. Transactional leadership will not necessarily result in higher levels of, say, employee adaptability. The previous discussion of service leadership s effects is modelled in Figure 1 by the arrows labelled one through five. Employee Role Stressors Managerial Service Delivery Inputs Role Ambiguity Role Conflict Employee Role Enhancers Empowerment Job Satisfaction Motivation Organisational Commitment Employees Service Encounter Behaviors The Service Encounter Customers Service Encounter Quality Perceptions Satisfaction Behavioural Intentions Self-Efficacy 1 2 3 4 5 SERVICE LEADERSHIP STYLES Figure 1. The Effect of Leadership Styles on Service Quality Delivery Conclusions, and Future Research Directions The conceptual model makes the following theoretical contribution. It aids the service quality enhancement literature by being one of the first models to detail the effects of leadership upon the process of service delivery drawing from the comparatively sagacious psychology and sales management literature. The model also has implications for management training and

recruitment, as well as giving guidelines to existing managers on how to lead in ways more likely to strengthen service delivery. Research is necessary to determine whether the conceptual model displays empirical validity. To this end, a triadic survey of service managers, front-line staff, and customers appears the most promising way forward. A qualitative approach appears prudent for more indepth explication of service leadership due to the relative infancy of the construct. The conceptual model of the effects of service leadership presented here represents a step forward in the understanding of how to optimise organizational service provision. References Avolio, Bruce J., Waldman, David A., and Yammarino, Francis J. (1991), Leading in the 1990s: The Four I s of Transformational Leadership, Journal of European Industrial Training, 15, 4, pp. 9-16 Bass, Bernard M. (1997), Personal Selling and Transactional/Transformational Leadership, Journal of Personal Selling and Sales Management, 17, 3, Summer, pp. 19-28 Bass, Bernard M. (1985), Leadership and Performance Beyond Expectations, New York, The Free Press Bitner, Mary J. (1990), Evaluating Service Encounters: The Effects of Physical Surroundings and Employee Responses, Journal of Marketing, 54, April, pp. 69-82 Chenet, Pierre, Tynan, Caroline, and Money, Arthur (2000), The Service Performance Gap: Testing the Redeveloped Causal Model, European Journal of Marketing, 34, 3/4, pp. 472-495 Cronin, Joseph J. and Taylor, Stephen A. (1992), Measuring Service Quality: A Reexamination and Extension, Journal of Marketing, 56, July, pp. 55-68 Den Hartog, Deanne N., Van Muijen, Jaap J., and Koopman, Paul L. (1997), Transactional versus Transformational Leadership: An Analysis of the MLQ, Journal of Occupational and Organizational Psychology, 70, March, pp. 19-34 Dubinsky, Alan J., Yammarino, Francis J., Jolson, Marvin A., and Spangler, William D. (1995), Transformational Leadership: An Initial Investigation in Sales Management, Journal of Personal Selling and Sales Management, 15, 2, Spring, pp. 17-31

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