A Service Climate Synthesis and Future Research Agenda

Abstract

Theory and research on service climate are synthesized, and an extensive agenda for future research is proposed. The service climate construct is first differentiated from conceptually related but distinct constructs, such as job satisfaction, service culture, and service orientation. Then a framework is presented based on prior research that displays service climate’s antecedents and consequences and the linkages among them. The synthesis draws heavily upon organizational behavior/human resource management (OB/HRM), but service climate has also received significant interdisciplinary attention. In particular, past work has integrated OB/HRM’s focus on the internal organization and marketing’s focus on the external world of the customer. The future research agenda includes further specification of the framework’s variables and linkages (e.g., the relative roles of individual and contextual attributes in creating service climate) as well as recommended research methods (e.g., profile analysis to assess interactions among multiple climates in a setting). Finally, the utility of the service climate framework for analyzing four key issues in service management is demonstrated: service infusion in manufacturing; the cocreation of value; sustainable competitive advantage; and the fostering of additional interdisciplinary research.

Keywords

service climate service quality linkage research customer experiences interdisciplinary research

Service climate is employees’ shared sense of the service quality—focused policies, practices and procedures they experience and the service quality emphasis they observe in behaviors that are rewarded, supported, and expected (Schneider, White, and Paul 1998). The topic is interesting to both academics and managers. Service climate theory and research emphasize that these employee experiences are reflected in customer reports of service quality (Bowen and Pugh 2009), customer satisfaction (Dean 2004), customer loyalty (Liao and Chuang 2004), and indirectly—through customer satisfaction—in a firm’s market value (Schneider et al. 2009b).

This article aims to summarize guiding theory and existing research on service climate’s antecedents and consequences and the various linkages among them (see the framework in Figure 1). This work synthesizes thinking and research from individual articles across multiple disciplines as well as reviews the relationship between internal and external linkages in service settings (Brown and Lam 2008; Dean 2004; Hong et al. 2013). Brown and Lam (2008) conducted a meta-analysis of linkages between employee satisfaction, customer satisfaction, and perceived service quality. In that article, service climate is mentioned as one of the three conceptual models that can help frame the overall relationship between employee and customer variables. Dean (2004) includes service climate only as 1 of the 11 “organizational features” that can play a role in linking organizational and customer variables. Hong et al. (2013) offer an excellent meta-analysis focusing explicitly on service climate; yet, their service climate model includes only leadership and HR practices as antecedents and fails to include other practices, such as marketing and operations, that are also antecedents to a service climate. In addition, the future implications for service climate theory and research are limited largely to their model’s test results.

Figure 1.

A service climate framework.

The service climate framework in Figure 1 reveals there are known antecedents of service climate (leadership issues, human resource management [HRM] practices, and systems support, e.g., operations, marketing, and information technology [IT], for those who serve customers) and important organizational consequences of service climate found in the variety of customer experiences shown (quality, satisfaction, and loyalty). The framework in Figure 1 also indicates there are important foundations (subsumed under employee engagement) that must exist in organizations for a service climate to develop. The framework presents evidence-based moderators of the service climate–customer experience link that both researchers and practicing managers will find useful. These moderators identify boundary conditions for the link of interest, suggesting conditions under which an investment in service climate may be more or less useful.

This article also presents a broad set of suggestions for future research to further specify, validate, and expand the framework. For example, we discuss the need for improved specification of the role leaders play in creating service climate; the conceptualization of “bundles” of HRM practices—together with other organizational practices—in creating service climates; measures and methods for studying variables in the framework; and exploration of causal priorities in understanding internal organizational and external customer relationships.

A third goal is to demonstrate a service climate framework’s utility in analyzing key contemporary issues in service management: an overall service orientation in manufacturing (Gebauer et al. 2012), the cocreation of value (Hibbert, Winklhofer, and Temerak 2012), and the potential relationship between service climate and sustainable competitive advantage (Ployhart, Van Iddekinge, and MacKenzie 2011). We also suggest that service climate research offers an exemplar of how to stimulate interdisciplinary research in the service management field.

The Service Climate Construct

Before elaborating the framework, we will first review the meaning of service climate as developed in prior theory and research. The generic climate construct flows from the Gestalt psychology of Lewin (1936), which emphasizes how our perceptions of the whole are influenced by the elements we perceive. The overall sense or meaning people construe from the patterns of their individual experiences and behaviors they observe in social settings constitutes the climate of the setting (Lewin, Lippitt, and White 1939; Schneider, Ehrhart, and Macey 2011). As climate research evolved, Schneider (1975) advocated that the construct should refer to a climate for something; that climate should have a strategic focus—a climate for safety (Zohar 2000) or a climate for service (Schneider, Parkington, and Buxton 1980). Service climate, again, is the shared sense people who work for an organization have, where policies and procedures, and the expected and rewarded employee behaviors, emphasize service excellence (Schneider, White, and Paul 1998).

Key Differences Between Service Climate and Related Constructs

Service climate is conceptually related but distinct from several other constructs (see Table 1). The distinctions are in terms of the constructs being generic or contextually service specific in focus; evaluative or descriptive in assessment; and individual or collective/aggregate in the level of analysis. Service climate is contextually service specific, descriptive, and collective. In contrast, job satisfaction is generic, evaluative, and individual. Organizational culture and organizational climate have a generic focus, though they are aggregated and descriptive as is the organizational service orientation measure (SERV^*OR) of Lytle, Hom and Mokwa (1999). Individual service orientation is, of course, individually focused without an assessment of context, and aggregated customer orientation that does focus on the context is another term for service climate (e.g., Ployhart, Weekley, and Ramsey 2009). In short, if the construct and measure are descriptive and focus on the aggregate on the collective service emphasis of the context, it is service climate.

Table 1.

Service Climate and Related Constructs.

Construct/Variable	Definition
Service Climate	Description of what happens in people’s work units with regard to the service-focused policies, practices, and procedures they experience as well as the behaviors they observe being rewarded, supported, and expected (Schneider, White, and Paul 1998); see Table 2 for a representative measure of service climate
Job Satisfaction	Job satisfaction is determined by people’s evaluation of what they feel they receive from their job. Measures of job satisfaction are evaluative in nature, focusing on affect toward what was received or experienced regarding such issues as pay, promotion opportunities, supervision, and so forth (Spector 1997); such measures are neither focused on service nor on customer experiences
Organizational Climate	In contrast to measures of service climate, measures of generic organizational climate have typically focused on the general nature of job attributes, supervisory style, interpersonal relationships, and the nature and fairness of reward systems. In combination, these measures yield what would appropriately be called a climate for employee well-being (Schneider, Ehrhart, and Macey 2011)
Organizational Culture/Service Culture	Organizational culture concerns the basic assumptions and values that guide organizational action as transmitted implicitly and explicitly to newcomers through myths, stories, and socialization tactics. Organizational culture emerges over time and becomes more or less fixed as a function of success; the more success the organization has, the more fixed it becomes (Martin 2002; Schein 2010). Climate attributes (polices and routines) may emerge from culture, making it a more distal correlate of customer experiences. To our knowledge, there is no empirical research on service culture
Service Orientation: Individual	Service orientation is an individual’s willingness to treat coworkers and customers with courtesy, consideration, and tact; it includes perceptiveness regarding customer needs and the ability to communicate accurately and pleasantly (Frei and McDaniel 1998). Such individual predispositions can be aggregated to unit and organizational levels, producing customer orientation competencies at these higher levels of analysis (Ployhart, Weekely, and Ramsey 2009)
Service Orientation:Organizational	Organizational service orientation is an organization-wide embracement of a basic set of relatively enduring organizational policies, practices, and procedures intended to support and reward service-giving behaviors that create and deliver “service excellence.” Lytle, Hom, and Mokwa’s (1998) definition of organizational “service orientation” is almost identical to the definition of service climate presented earlier
Service Orientation:Organizational	See also Homburg, Hoyer, and Fastnacht (2002) on service-oriented business strategy measures

Two Key Facets of Service Climate in Prior Research

The “Positiveness” of Service Climate

The positiveness of climate in a setting, also termed service climate level, is the mean of the service climate survey items on employee perceptions of service-focused practices and rewards. For example, a frequently used measure of service climate is shown in Table 2 from Schneider, White, and Paul (1998); see also the use of this measure by Chuang and Liao (2010), de Jong, Ruyter, and Lemmink (2004), Dietz, Pugh, and Wiley (2004), and Schneider et al. (2009b). The items all focus on service quality and are empirically and appropriately intercorrelated, and the aggregate scores across employees within settings reveal (a) a main effect for the units studied (such as branch banks, supermarkets, companies) on service climate and (b) significant within setting agreement across respondents (Schneider and White 2004). Research exists with other measures of service climate as well (Borucki and Burke 1999; Gebauer, Edvardsson, and Bjurklo 2010a; Johnson 1996), yielding robust and, depending on the outcome studied, stronger (Hong et al. 2013) links to customers’ perceptions of service experiences (i.e., service quality, satisfaction, and loyalty), hereafter called customer experiences (Dean 2004; Schneider and White 2004; Yagil 2008).

Table 2.

Service Climate Survey Items.

How would you rate the job knowledge and skills of employees in your business to deliver superior quality service?

How would you rate efforts to measure and track the quality of service in your business?

How would you rate the recognition and rewards employees receive for the delivery of superior service?

How would you rate the overall quality of service provided by your business?

How would you rate the leadership shown by management in your business in supporting the service quality effort?

How would you rate the effectiveness of our communications efforts to both employees and customers?

How would you rate the tools, technology, and other resources provided to employees to support the delivery of superior quality service?

Source. From Schneider, White, and Paul (1998) slightly modified ^©American Psychological Association Used by permission.

The “Strength” of the Service Climate

A strong climate is one in which employees have consensus on what the climate is. Low variance in employee perception of climate attributes reveals a setting’s high climate strength. Research indicates that climate strength moderates the relationship between climate level and customer experiences (Schneider, Salvaggio, and Subirats 2002).

The research shows that service climate positiveness, a high mean level, is significantly related to customer experiences. In addition, when the climate perceptions reveal strength, or low variance, the relationship between service climate and customer experiences is significantly higher. The research on service climate relationships, overall, is detailed next in the presentation of a synthesized service climate framework.

A Service Climate Framework

Figure 1 reveals our assessment of what the research literature has established vis-à-vis service climate and its antecedents, foundation, and most immediate (mediated and moderated) customer experience consequences. This framework has not been subjected to a single comprehensive modeling effort, but the elements in it have been studied; the bivariate, and in some cases multivariate, linkages shown have been validated. In essence, Figure 1 proposes that with the support of HRM practices, leadership, and other systems (e.g., operations, marketing, IT), as well as the engagement of employees in their work, a strong and positive service climate can be built in organizations. Such a climate, in turn, yields customer service behavior that produces positive customer experiences (service quality, customer satisfaction, and customer loyalty) and the financial consequences (increased revenues, market value) that follow (Lovelock and Wirtz 2004). The framework also reveals existence of mediators and moderators of the link between service climate and customer experiences. The following points present in some detail the elements and linkages shown in Figure 1, reading from left to right.

Antecedents of Service Climate

Leadership

Service climate research establishes effects for three contrasting leadership emphases: management of the “basics” versus transformational leadership; general versus service-oriented leadership; and formal versus informal leadership. On the first, service climate research has clearly shown the persistent management of the basics and endless details create a positive and strong climate for service. For example, studies (Salvaggio et al. 2007; Schneider et al. 2005) indicate leaders who demonstrate commitment to improving service quality—by setting high standards for it, recognizing it, removing obstacles to it, modeling it in their own behavior, and ensuring the availability of the resources needed to do it—create a service climate.

These leadership behaviors may sound mundane compared to the transformational and visionary. Yet, Heskett et al. (1994) observed that the service leaders they studied held a unique view of leadership, one that emphasized both visionary attributes and the “importance of the mundane” (p. 164). Netemeyer, Maxham, and Lichtenstein (2010), for example, showed that small retail operations managers who worked best at mundane administrative tasks (store merchandising, managing their time well, opening/closing procedures) had more satisfied customers.

Relevant research also exists on the more visionary aspects of leadership with regard to service climate. For example, Liao and Chuang (2007) found that store-level transformational leadership (charisma, inspirational motivation, intellectual stimulation, and individualized consideration) was positively associated with store-level service climate and that service climate moderated leadership’s effects on employee service performance. In a similar vein, Wieseke et al. (2011) show how the leader’s own motivation influences employee motivation to serve customers, and Berry (1995) highlighted the role of inspirational motivation in service leadership to create a service culture, if not climate. More recently, Walumbwa, Hartnell, and Oke (2010), in a study of seven multinationals operating in Kenya, found that servant leadership, which consists of both inspirational and moral components, linked directly to a service climate.

Finally, it is not only the formal leader who affects service climate. For example, Lam and Schaubroeck (2000), in a true experimental design, showed that training bank branch opinion leaders (vs. randomly selected tellers) how to promote a service quality “attitude” yielded significant improvements in teller effectiveness of all tellers in a branch when rated by customers and tellers themselves.

In a recent meta-analysis, Hong et al. (2103) found that service-oriented leadership appeared to have stronger relationships with service climate than did more generic forms of leadership, but they did not distinguish between the various forms of generic leadership as we have here: transformational/visionary leadership, attention to mundane details, and more informal sources of leadership. These different forms of leadership may all contribute differently to service climate formation when combined with the service-focused leadership that is proximally important for a service climate.

In sum, leadership behaviors are central to the creation and maintenance of a service climate. An important finding from this review suggests leaders’ committed attention to everyday mundane tasks may be as impactful as their stated service vision and generic motivational inspiration. The impact of this dual focus is evidenced in Walker, Smither, and Waldman’s (2008) study of bank branch leadership. Their measure of leadership included survey items having to do with transformational leadership (e.g., establishment of a vision) as well as items such as encouraging the unique skills of employees and resolving differences within the team. They tracked changes over time in this comprehensive measure of bank branch leadership for 68 branch managers and showed that changes in those linked significantly through growth modeling to concomitant changes in customer satisfaction ratings. They interpret this finding as resulting from the positive service climate such leaders create.

HRM Practices

The intermediate linkages between HRM practices and organizational outcomes have not been well understood (Ferris et al. 1999). Two intervening and interrelated theoretical perspectives help explain this process (Bowen and Ostroff 2004). The first perspective is the social context model (Ferris et al. 1998), which asserts that packages or bundles of HRM practices determine organizational climate. In service climate research, this is exemplified by Rogg et al. (2001), who, in a sample of 385 franchise dealerships, found HRM practices were mediated by service climate in relationship with customer experiences. Chuang and Liao (2010) replicated these findings, showing that high-performance-oriented HRM work practices are significant correlates of a service climate, which, in turn, relate to employee service performance. In addition, Hong et al. (2013) found that packages of service-oriented HRM practices had stronger relationships with service climate than the generic, high-performance practices did.

Second, the competencies perspective (Ployhart, Van Iddekinge, and MacKenzie 2011) indicates that appropriate personality and ability attributes achieved through staff selection and training produce people who collectively may constitute the elements of a service climate. Ployhart, Van Iddekinge, and MacKenzie (2011), for example, show through growth modeling in 238 chain restaurants that aggregate improvement in employees’ service-focused personality and ability also improves training and experience—which, in turn, produces changes in restaurant performance and effectiveness. We infer this happens because service competencies are an important element of a service climate. That is, it has long been known that hiring people with a service orientation produces higher levels of service behavior (Frei and McDaniel 1998). Indeed, Ployhart, Weekley, and Ramsey (2009) showed that positive changes in the aggregate service orientation of employees in an organization drove unit effectiveness over time. In sum, the relationship between service-relevant HRM practices and customer experiences appears to be mediated by the climate those HRM practices produce.

Systems Support From Operations, Marketing, IT, etc

In their comprehensive assessment of service climate, Cooil et al. (2009) note that service climate consists of a variety of interrelated parts, including features of the context other than HRM, leadership, or other employee-focused issues. Schneider’s (1980, pp. 58–59) early study of service climate revealed the impact of various functions besides HRM on service climate. The study, in which branch climate was significantly linked to customer service quality experiences, included the following items: “The employees sent by Personnel are not able to do their jobs well”; “Having all customer records in a central location makes it easier on the branch”; “We are well prepared by Marketing for the introduction of new products and services”; and “Equipment and machinery in the branch are well serviced and rarely break down” (pp. 58—59).

In a later study, Schneider, White, and Paul (1998) showed the reported internal service quality that service delivery people received from various functions (IT, HRM, operations) was directly correlated with the service climate they experienced. Recently, Ehrhart et al. (2011), in a study of branch banks in Jamaica, showed that internal service quality from these other functions not only had a main effect on service climate but also moderated the relationship between service climate and customer experiences; we will have more to say on moderators later. For now, it is sufficient to note that an established link exists between the systems support that front line employees of service facilities’ experience and the service climate they perceive.

A Foundation of Employee Engagement

Figure 1 displays that in addition to leadership’s emphases on service quality, HRM, and other systems, a service climate most likely can exist when the employees in an organization are engaged in their work. Schneider et al. (2009a) suggested that a positive service climate exists when the foundation for it first exists in the engagement employees experience in their work and work world. Engaged employees are more willing to do the kinds of things a service climate asks of them, and, similarly, a service climate is more easily built on a foundation of engaged employees (Schneider et al. 2009a). Indeed, Salanova, Agut, and Peiró (2005) proposed that employee engagement is necessary as a foundation for a service climate and revealed empirically that employee engagement affects customer experiences through service climate.

Employee engagement concerns the feelings of vigor, dedication, and absorption (Schaufeli, Bakker, and Salanova 2006) that employees have about their work and work world and the energetic behaviors they display for the good of the company (Albrecht 2010). This issue of energy contrasts to job satisfaction, which connotes more satiation and comfort than energy and which research shows is both conceptually and empirically different (Christian, Garza, and Slaughter 2011).

As shown in Figure 1, creation of employee engagement relies on the following inputs: the resources that support and facilitate people’s work (Schaufeli and Bakker 2004), the challenging and involving work they do (Coelho and Augusto 2010; Kahn 2010), and the fairness and resulting trust (Li and Cropanzano 2009) they experience (Macey et al. 2009). In service settings, Bowen, Gilliland, and Folger (1999) reasoned that when employees feel fairly treated, they would feel more emotionally committed to their organization and would exert extra effort to behave conscientiously and altruistically toward customers; this behavior, in turn, results in customers feeling fairly treated. Studies have confirmed this hypothesis (Masterson 2001; Maxham and Netemeyer 2003; Maxham, Netemeyer, and Lichtenstein 2008; Yagil 2008), and very recently some direct links between employee engagement and customer engagement have also been implied (Brodie et al. 2011).

Service Behaviors as Mediators

In-Role and Customer-Focused Organizational Citizenship Behaviors (OCBs)

The literature suggests service climate does not produce by itself the customer experiences of interest but that employee service-oriented behavior, as a mediator variable, tangibly yields customer experiences. For example, Liao and Chuang (2004) found that store service climate is positively associated with individual employees’ in-role service performance (e.g., finds out what customers need; explains the features and benefits of the service). Similarly, Borucki and Burke (1999) found a relationship between service climate and customer-focused service performance, which reinforces the research on customer-focused OCB by Bettencourt and his colleagues (Bettencourt and Brown 1997; Bettencourt, Gwinner, and Meuter 2001). Also, in a study of 56 supermarket departments noted earlier, Schneider et al. (2005) found that service climate was significantly linked to customer experiences via customer-focused OCB. Indeed, a meta-analysis of the consequences of OCBs linked them to customer experiences (Podsakoff et al. 2009).

In summary, service climate, as shown in Figure 1, does not directly yield customer experiences; it is employee behavior, particularly in the form of customer-focused OCBs, not just generic OCBs (Chuang and Liao 2010; Macey and Schneider 2005) but OCBs regarding service behaviors that customers experience. Research by Salanova, Agut, and Peiró (2005) neatly tied together service climate as a mediator, employee engagement, employee service behaviors, and customer experiences (loyalty). They found that service climate predicted employee service performance, and then customer loyalty, in a study of 114 hotel service units (58 hotel front desk units and 56 restaurants) and that service climate mediated the link between employee engagement and customer experiences. Furthermore, the potential for moderators of the service climate–customer experiences link must also be considered—the topic to which we turn next.

Moderators of the Service Climate–Customer Experiences Link

In addition to mediators of the service climate–customer experiences link, a number of moderators of that relationship have been identified. Interestingly, this research has been primarily based on the early conceptualization of the attributes that distinguish services from goods (e.g., Lovelock and Wirtz 2004).

Customer Contact

Mayer, Ehrhart, and Schneider (2009) and Dietz, Pugh, and Wiley (2004) proposed and found, for example, that under high customer contact conditions, service climate is more strongly related to customer experiences. In the Dietz, Pugh, and Wiley project, the self-reported frequency of customer visits to branch banks was a significant moderator while for the Mayer, Ehrhart, and Schneider project, the level of customer contact was rated for different departments in supermarkets (e.g., bakery vs. pharmacy vs. groceries). Hong et al. (2013) explored the form of customer contact in their meta-analysis, contrasting findings regarding the linkage between the effects for personal services (directed at the person, as in a bank) with those for nonpersonal services (directed at possessions of the person, as in auto repair) and found a significantly stronger effect for personal services.

Intangibility

Mayer, Ehrhart, and Schneider (2009) also found that the more intangible the service offering is, the stronger the link is between service climate and customer experiences.

Interdependence

Gittell (2002) proposed that service climate can be a mechanism to provide the conditions needed for coordination (e.g., in health care teams), and she found that high interdependence leads to stronger links between service climate and customer experiences. Mayer, Ehrhart, and Schneider (2009) replicated these findings. In addition, in self-managed teams, where interdependence may figure prominently, de Jong, Ruyter, and Lemmink (2004) found that service climate’s effect on service quality was significantly higher for nonroutine services.

Internal Service Quality

Lastly, as noted earlier, Ehrhart et al. (2011) found that high internal service quality from corporate functions to local units moderated the relationship between local service climate and customer experiences. Thus, internal service quality from corporate seems to provide the capability to deliver the behaviors that local service climate motivates.

In sum, these moderator variable studies of the service climate–customer experience link indicate caution when concluding the link will always exist. This means that boundary conditions, such as customer contact, intangibility, and so forth, may influence the benefits to be achieved with a focus on service climate.

Customer Experiences

Significant relationships with direct customer experiences, as well as via mediation and moderation, have proven through research to be a consequence of service climate (See Figure 1). We use the term customer experiences because some research has focused on customer reports of service quality (Schneider and Bowen 1985), some has focused directly on customer satisfaction (Schneider et al. 1996), and other research has focused on customer loyalty (Salanova, Agut, and Peiró 2005) and all three simultaneously (Liao and Chuang 2004). Of course, there is vast marketing and consumer behavior literature on the links among these customer experiences (Verhoef et al. 2009), generally revealing consistently significant correlations among them and the service quality–customer satisfaction–customer loyalty causal stream (Lovelock and Wirtz 2004). We use the term customer experiences to represent this interrelated set of robustly correlated constructs.

Much of the evidence for the relationship between service climate and customer experiences comes from what has been termed linkage research (Pugh, Dietz, Wiley, and Brooks 2002; Wiley 1996). This research has firmly established that service climate relates significantly to customer experiences. As noted earlier, several summaries of this linkage reveal robust and consistent relationships (Bowen and Pugh 2009; Brown and Lam 2008; Dean 2004; Hong et al. 2013; Keiningham and Aksoy 2009; Schneider and White 2004; Yagil 2008).

The effect sizes for these relationships range widely as a function of the sample and sample size, the inclusion of mediators between service climate and customer experiences, and the inclusion of potential moderators of that relationship. For example, in Schneider et al. (2009b), the direct correlation was .48 between service climate and customer satisfaction across 36 companies, with customer satisfaction serving as a mediator of the service climate–market value relationship. However, in Schneider et al. (2005), the correlation was .04 on a sample of 56 supermarket departments; but (a) the service climate–customer satisfaction relationship was significantly mediated by service-related OCBs and (b) Mayer, Ehrhart, and Schneider (2009) showed that under high contact, high intangibility, and high interdependence, the correlations were all in the .25 range and statistically significant. Thus, in the complex world of real organizations, as we noted earlier, expecting the service climate relationship with customer experiences to always be direct and simple underestimates the many variables simultaneously at work. On the other hand, a recent meta-analysis of this linkage (Hong et al. 2013) reveals a typical and significant effect of .25 as the usual relationship (across 23 studies).

Table 3 presents a summary of what the existing research reveals about service climate, its antecedents, foundations, and its direct, mediated, and moderated consequences in customer experiences. Although a rich body of evidence, further development of the existing research can be guided by the proposed future research agenda that follows.

Table 3.

Summary of Established Relationships in the Service Climate Framework.

Service Climate Facets

Strong service climates (climates where the variance in perceptions of service climate is small) magnify the positive level of service climate (climates where there is a high overall mean on the service climate measure, such as in Table 2) such that service climate is then more strongly reflected in customer experiences (Schneider, Salvaggio, and Subirats 2002)

Antecedents of service climate

Leadership on mundane issues of generic support and support for service (Salvaggio et al. 2007); transformational leadership (Liao and Chuang 2007); service-oriented leadership even more so than general leadership (Hong et al. 2013); and role modeling by opinion leaders (Lam and Schaubroeck 2000) favorably influence service climate

HRM practices that yield service competencies (including customer orientation) favorably influence service climate (Ployhart, Van Iddekinge, and MacKenzie 2011; Rogg et al. 2001)

General HRM high-performance work practices (Chuang and Liao 2010) favorably influence service climate; service-oriented HRM practices have a stronger influence than general HRM practices (Hong et al. 2013)

Other systems’ support to service providers from, for example, marketing, HR, operations, IT (Cooil et al. 2009; Schneider 1980; Schneider, White, and Paul 1998) can favorably influence service climate

A foundation of employee engagement

Engagement is a necessary but not sufficient condition for a service climate, and service climate mediates the relationship between engagement and customer experiences (Salanova, Agut, and Peiró 2005)

Research indicates the following characteristics help build employee engagement:

Resources needed to do the work (Schaufeli and Bakker 2004)

Job characteristics that present challenge and involvement (Coelho and Augusto 2010)

Fair treatment yielding the trust that promotes engagement behavior (Li and Cropanzano 2009)

Service behaviors as mediators

In-role service behaviors (e.g., identifying customer needs) mediate the service climate–customer experience relationship (Hong et al. 2013; Liao and Chuang 2007)

Customer-focused OCBs, more so than generic OCBs, intervene as a mediator variable between service climate and customer experiences (Podsakoff et al. 2009; Schneider et al. 2005)

Moderators of the service climate–customer experiences link

Higher levels of each of the following are associated with a stronger service climate–customer experience link (see Hong et al. 2013 and Mayer, Ehrhart, and Schneider 2009):

Customer contact frequency and/or personal services

Intangibility of the service

Interdependence level required among service providers

Internal service quality from corporate support services (IT, operations, marketing)

Customer experiences

Various direct and indirect significant effects of service climate on customer experiences (service quality, customer satisfaction, and customer loyalty; see also Verhoef et al. 2009) have been found (Dean 2004; Hong et al. 2013; Yagil 2008). For example, the typical direct effect for customer satisfaction, the most researched service climate experience, is 0.25 (Hong et al. 2013). These experiences are reflected in positive financial consequences for organizations (Hong et al. 2013; Schneider et al. 2009b)

Note. HRM = human resource management; OCBs = Organizational Citizenship Behaviors; IT = information technology.

An Agenda for Future Service Climate Theory and Research

Here we build on the findings in Figure 1 and Table 3 to suggest future theory building and research on service climate. Table 4 summarizes the proposed agenda for further specification of variables and linkages, followed by recommended measures and methods.

Table 4.

An Agenda for Future Theory Building and Research on Service Climate.

Antecedents of service climate

Bundle more than HRM practices for theory and research (HRM and marketing, operations, IT, etc. and the servicescape); assess the “strength” of service climate they create

Conceptualize and measure individual-level attributes (e.g., employees’ customer orientation) in addition to context-level attributes (e.g., leadership), including their interaction

Measure the effects of leadership from all levels, not just senior leadership

A foundation of employee engagement

Conceptualize and measure employee engagement as a strategically focused construct

Service behaviors as mediators

Identify and measure in-role behavior and OCBs that map to the SERVQUAL model—reliability, responsiveness, assurance, and empathy (Parasuraman, Zeithaml, and Berry 1985)

Contrast employee job satisfaction and service climate as the correlates of the mediating behaviors that yield positive customer experiences

Moderators of the service climate–customer experience link

Consider cross-cultural influences in addition to the oft-studied “service type” moderators

Assess the strength of B2B linkages relative to those in B2C

Study and model service climate itself as a moderator as well as a main effect

Possible correlates of customer experiences other than those associated with service climate

Assess the following factors’ influence relative to service climate’s on customer experiences:

The other “Ps” of marketing (price, place, promotion, package)

Differences in customer expectations, needs, and cocreation capabilities

Service climate measurement

Combine generic and customized approaches to climate measurement

Include managers as raters of service climate—in addition to customers and employees—and interpret the differences in ratings

Methods that treat the service climate–customer experience link as part of a natural system

Assess multiple content and process climates simultaneously for their potential complementarity or competitive interaction

Use multivariate techniques (e.g., profile analysis and multivariate partial least squares (MPLS), not just linear prediction models, to assess the complexity and consequences of multiple climates

Address causality by estimating models with longitudinal data

Expansion of the service climate framework

Specify and measure the service climate–financial performance link (see Hong et al. 2013; Schneider et al. 2009b)

Note. HRM = human resource management; IT = information technology; OCBs = Organizational Citizenship Behaviors.

Antecedents of Service Climate

Bundle More Than HR Practices for Theory and Research

HRM theory and research have increasingly emphasized how HRM systems of practices (e.g., Bowen and Ostroff 2004) or HRM “bundles” of practices (Subramony 2009), as opposed to individual practices, influence organizational outcomes and through which mediating variables. For example, Subramony's (2009) meta-analysis found that HRM bundles have significantly greater effects on outcomes than do their constituent individual practices. In research specifically in a service setting, the study by Chuang and Liao (2010) cited earlier and the Hong et al. (2013) meta-analysis showed that high-performance work systems (a bundle of HRM practices) facilitate a climate of concern for both customers and employees. Indeed, Bowen and Ostroff (2004) theorized that when the overall mix of HRM practices was high in attributes including visibility, relevance, consistency, and validity, then the climate will be not only positive but also strong.

But a focus only on HRM practices is limiting because so many other practices and issues influence employee experiences and their likely perceptions of service climate level and the strength of that service climate as well. Thus, research also indicates that operational and IT (Chase and Haynes 2000; Davis and Heineke 2005) and marketing (Lovelock and Wirtz 2004; Zeithaml, Bitner, and Gremler 2005) tactics also influence service climate, as do the very physical attributes of the workplace in the form of servicescapes (Bitner 2000; Parish, Berry, and Lam 2008). Following the logic of Bowen and Ostroff (2004), we propose that the more the overall bundle of service-focused tactics in HRM, marketing, operations, IT, and the servicescape are high in visibility, consistency, validity, and so forth, the stronger the service climate will be.

Conceptualize and Measure Individual-Level Attributes in Addition to Context-Level Attributes, Including Their Interaction

Both academics and practitioners have a contextual-attribute bias on creating service climates (see Table 2). Research on the employee attributes and behaviors that matter most for a service climate has received less attention; but when such research is accomplished, it reveals significant validity for such individual constructs. For example, Salvaggio et al. (2007) found that managers’ positive core self-evaluations predicted their units’ service climate; de Jong, de Ruyter, and Lemmink (2004) found that individual team members’ tolerance for self-management, flexibility, and inter- and intra-team support related to team service climate; and Auh et al. (2011) found that employees who are conscientious, open to experience, and agreeable perceive their service climate more positively. These results, combined with the earlier reported results on customer orientation at the individual level of analysis (Frei and McDaniel 1998) and the aggregated levels of analysis (Ployhart, Weekley, and Ramsey 2009), suggest these people are the ones most likely to display the highest levels of customer-focused OCB that a service climate facilitates. In other words, it is likely the combination of the right individuals and the right context that is important. A few such studies exist (Chuang and Liao 2010), but more research could prove both academically interesting and practically useful.

Measure the Effects of Leadership From All Levels, Not Just Senior Leadership

There remains a tendency to focus on the role of senior leadership in shaping the organization’s social context, that is, climate and culture (Schein 2010). We encourage additional research on leadership in all manifestations (mundane, visionary)—exercised at all levels of the organization. Multilevel work on service leadership could borrow from research on the related construct of market orientation by Lam, Kraus, and Ahearne (2010) and the work on safety climate by Zohar and Luria (2005). Both cases revealed via hierarchical linear modeling that senior leadership actions and middle manager actions each contributed significantly and in combination to the experiences of frontline employees (Lam, Kraus, and Ahearne 2010) and safety/accidents rates (Zohar and Luria 2005).

A Foundation of Employee Engagement

Conceptualize and Measure Employee Engagement as a Strategically Focused Construct

In some ways, employee engagement has become a popularized term for the even more generic concept of employee attitudes (Macey and Schneider 2008). It would be useful to make engagement more strategic in focus, just like the organizational climate construct evolved from generic “climate” to a focus on strategically relevant behaviors and outcomes—like service. We can see the development of “service engagement” measures that build on the existing notions of the demands-resources generic model of engagement presented earlier (Schaufeli and Bakker 2004). Again, focusing energy on service might enhance the probability of service-focused OCB and thus strengthen the OCB mediator between service climate and customer experiences.

Service Behaviors as Mediators

Identify and Measure In-Role Performance and OCBs That Map to the SERVQUAL Model

Service behaviors are established as a link between service climate and customer experiences but underspecified in theory and research. One conceptual model useful for suggesting potential additional mediators for study is the service quality framework suggested by Parasuraman, Zeithaml, and Berry (1985): reliability of performance, assurances offered, responsiveness to customer requests and/or requirements, and empathic behaviors (showing concern and interest). There are examples of prior research on employee–customer relationships, in general, that indicate this could be a fruitful approach. Grandey, Goldberg, and Pugh (2011) found that service employee responsiveness partially mediated the relationship between employee and customer satisfaction. Homburg, Wieseke, and Bornemann (2009) found that “customer need knowledge”—accurately identifying customers’ hierarchy of needs—mediated between individual employee and organizational context in understanding customer experiences. Wieseke, Gelgenmuller, and Kraus (2012) showed that people who report themselves to be empathic have customers who are more satisfied and, interestingly, that when empathic employees interact with empathic customers, the customers are even more satisfied. We thus propose that behaviors suggested in the marketing and consumer behavior literatures that influence customer experiences (Verhoef et al. 2009) be studied as additional possible links between service climate and customer experiences.

Contrast Service Climate and Employee Satisfaction as Correlates of the Mediating Behaviors

The belief that “satisfied employees make for satisfied customers” acquired widespread popular acceptance from the “satisfaction mirror,” as presented in the “service profit chain” (Heskett, Sasser, and Schlesinger 1997). Reviews of this relationship have reported conflicting conclusions, with Dean (2004) stating the relationship is not unequivocally supported, but Brown and Lam (2008) concluding from their meta-analysis that it is generally true. Specific recent studies of the link also reveal a significant relationship (Evanschitzky et al. 2011; Grandey, Goldberg, and Pugh 2011), one originally found by Pickle and Friedlander (1967). Our view is that the satisfaction mirror is generally true; but as Keiningham and Aksoy (2009, p. 69) state, it is not the whole truth: “ … if it were that simple, then the primary objective of every company would be to make their employees ecstatic.”

Of course, these findings also do not answer the question of whether employee satisfaction or service climate best predicts service performance and customer experiences. For example, Way, Sturman, and Raab (2010) found for Food and Beverages hotel managers a significantly stronger correlation between service climate and job performance than for job satisfaction; and Schneider, Parkington, and Buxton (1980) showed that employee job satisfaction did not significantly relate to any 1 of the 11 different facets of bank branch customer experiences (with branch administration, overall service quality, teller courtesy, etc.), but that branches in which employees reported an enthusiastic orientation to serving customers correlated significantly with 8 of the 11 customer reports (see table 3, p. 261). We propose employee satisfaction is the less direct correlate of the link to customer experiences and perhaps serves as another foundation for service climate. Our logic is that satisfaction infers satiation and contentment (Warr 2007) rather than motivation and behavior, which service climate does infer, making the latter more proximal to customer experiences.

Moderators of the Service Climate–Customer Experience Link

Consider Cross-Cultural Influences in Addition to Oft-Studied Service-Type Moderators

Cooil et al. (2009) recommended that variables such as industry and cultural effects should be included to assess more fully the robustness of service climate effects. The relevance of culture is demonstrated by Chan, Yim, and Lam (2010) who found the effects of customer participation on value creation in financial service firms depended on the cultural values (power-distance and individualism-collectivism) of both employees and customers in Hong Kong versus the United States. In an analysis of cross-cultural expansion, Hallowell, Bowen, and Knoop (2002) reported that France’s higher power-distance required adjustments to the employee empowerment culture of the George V Hotel when it opened in Paris. Similarly, Schumann et al. (2010) found cross-cultural differences in the ways customers learn to trust their service providers. Indeed, regional dialect differences have also been found to have effects on customer satisfaction (Mai and Hoffmann 2011). In short, more conceptual and empirical work in this domain is needed in our era of increasing multinational service delivery.

Assess the Strength of Business-to-Business (B2B) Linkages Relative to Those in Business to Consumer (B2C)

It is important to note that all of the studies reported in this review and synthesis have been done in retail consumer service businesses but that research is also needed in B2B settings to ensure the same relationships hold—and if not, why not. We propose the relationships will continue to hold at a minimum and, in fact, might be enhanced: B2B contexts establish stronger relationships (Gutek 1995) between those who serve and those who receive, and such B2B settings enhance the nature of interpersonal and business dependencies. More broadly, the range of possible moderators of the service climate–customer experience link is limited only by researcher creativity, because at present there is no conceptual scheme for mapping such possibilities. More research is obviously needed on this issue.

Study and Model Service Climate as a Moderator as Well as a Main Effect

Most research has treated service climate as a dependent, mediator, or direct/mediated antecedent of customer experiences but seldom as a moderator for other correlates of customer experiences. However, limited research reveals that service climate is a significant moderator of relationships between (1) subordinates’ and supervisors’ emotional exhaustion and subordinates’ positive emotional display to customers (Lam, Huang, and Janssen 2010), (2) leadership’s effects on employee service performance (Chuang and Liao 2010), (3) employee psychological capital (efficacy, hope, resilience, and optimism) and employee performance (Walumbwa, et al. 2010), (4) procedural justice and commitment to the supervisor with OCB (Walumbwa, Hartnell, and Oke 2010), and (5) the level of internal support employees receive from different functions and customer experiences (Ehrhart et al. 2011). Not often appreciated but worth noting is the fact that whenever a variable moderates the service climate–customer experience link, it is also true that service climate moderates the other variable to customer experience link (e.g., the work of Mayer, Ehrhart, and Schneider 2009).

These studies reveal the potential for service climate to enhance the effects of other features of the service organization. In short, this potential could warrant additional research on the effects of service climate as not only a mediator of important links to customer experience but also a moderator.

Possible Correlates of Customer Experiences Other Than Service Climate

Assess the Ps of Marketing and the Characteristics of Customers for Their Influence on Service Climate

Obviously, there are variables other than those in Figure 1 that link to customer experiences. For instance, one must consider the relative importance of price, advertising, physical features of a service setting, and even diversity of customer expectations, needs, and capabilities to help coproduce the service they receive as potential contributors to customer experiences. Indeed, comparisons of such effects and their potential interactions would prove useful.

Service Climate Measurement

Combine Generic and Customized Approaches for Service Climate Measures

A generic service climate measure is exemplified by the measure shown in Table 2 from Schneider, White, and Paul (1998), which was built on a content analysis of focus groups (Schneider, Wheeler, and Cox 1992) run in various service companies. Also, SERV*OR (Lytle, Hom, and Mokwa 1998) was developed using a similar process.

An alternative approach is to develop a customized measure specifically validated in a particular company. In Schneider et al. (1996), regional insurance company agents completed a survey of global organizational climate and service climate items, and these item responses were then correlated with regional customer satisfaction and intent to renew data. The 7 items that correlated most strongly and consistently across four quarters with customer satisfaction and intent to renew became the company measure of service climate.

Hong et al. (2103) found that the Schneider, White, and Paul (1998) generic measure was the most widely used measure for service climate and that other measures had significantly stronger relationships with some outcomes than did that one (self- and supervisor-rated performance)—but not for customer ratings of service performance or customer satisfaction. They recommended more research to determine how scale characteristics and outcome prediction affect the relationship between service climate measures and the various possible consequences of interest.

Overall, we recommend a combination of generic and customized approaches because it has both the benefits of prior academic research and practical relevance to a specific company. The addition of company-specific items could enhance respondents’ acceptance of the survey and yield superior rates of return, both of which could be useful in practice (Higgs and Ashworth 1996).

Include Managers as Raters of Service Climate in Addition to Customers and Employees, and Interpret Differences in Ratings

Dean’s (2004) review recommended incorporating the views of bothmanagers and employees with those of customers in linkage research. For example, Netemeyer, Maxham, and Lichtenstein (2010) found that in the small retail organizations they studied, manager performance and satisfaction correlations with customer satisfaction were as high (mid-0.50s to mid-0.60s) as those for employee performance and satisfaction. Managers serve as models for employees, and this dynamic warrants more research on manager ratings of service climate (Walker, Smither, and Waldman 2008; Walumbwa, Hartnell, and Oke 2010; Wieseke et al. 2011); knowing this effect clearly has practical implications for the use of the service climate construct.

Research Methods That Treat the Service Climate–Customer Experience Link as Part of a Natural System

Assess Multiple Content and Process Climates Simultaneously for Their Potential Complementarity or Competitive Interaction

Content climates focus on strategic outcomes (e.g., innovation, service), and process climates, for example, focus on fairness and ethics. Rarely has more than one focus been studied simultaneously. Yet, as Kuenzi and Schminke (2009, p. 706) put it in their extensive review, “[E]xploring single climates in isolation is unlikely to be the most productive path to creating a full and accurate understanding of how work climates affect individual and collective outcomes within organizations.” They note that while different climates may be simultaneously studied because they have similar antecedents (leadership, HRM practices), such climates (e.g., for sales and for service) can also compete with each other, and this certainly needs to be studied.

Process climates, such as fairness and ethics, might constitute the kind of foundation required for a service climate to be built, contributing to the employee engagement shown in Figure 1. Walumbwa, Hartnell, and Oke (2010) found that both service climate and procedural justice (fairness) climate mediated the relationship between servant leadership and OCB. McKay et al. (2011) found that the diversity climate–customer satisfaction relationship was strongest when stores in a large U.S. national retail organization were perceived to have positive service climates. The Auh et al. (2011) study found that employee involvement climate (a process climate) strength moderated the employee personality–service climate relationship. Simultaneously conceptualizing and studying multiple, complementary, and perhaps competing climates is a potentially fruitful area for climate research in general—and for service climate in particular.

Use Multivariate Techniques (e.g., Profile Analysis) and Multivariate Partial Least Squares (MPLS), not Just Linear Prediction Models, to Assess the Complexity and Consequences of Multiple Climates

One possibility for studying multiple climates simultaneously is to use profile analysis. Thus, Schulte et al. (2009) suggested that it is the overall profile of focused climates in organizations that yield increased understanding and predictability. Profile analysis allows for nonlinear estimates of the influence of variables on outcomes, thereby avoiding the implicit linear prediction assumption.

Another possibility, exemplified in the work of Cooil et al. (2009), is to study simultaneously a number of possible consequences (service employee performance, customer experiences, financial outcomes) and their potential antecedents (service climate, leader self-efficacy, HR practices, internal support) using MPLS for data analysis. The procedure can be viewed as one in which all variable data are entered into an exploratory factor analysis with the set of factor loadings indicating the relative weights among the variables of interest. Cooil et al. showed that hypothesized “causes” of the outcomes were differentially related to them in complex ways, suggesting again that service organization effectiveness, generally conceived, will benefit from a complex system’s approach. In short, alternatives to simple linear prediction models exist and should be explored, perhaps aiding the understanding of service climate causality issues.

Address Causality by Estimating Models With Longitudinal Data

The framework shown in Figure 1 is the usual unidirectional model moving from left to right.But real organizations are part of larger systems in which the parts influence each other, making causal priority difficult to establish. For example, Schneider, White, and Paul (1998) collected service climate and customer experience data for three time periods and showed that service climate during the first period was as strongly related to customer experiences as the latter were to the former. Schneider et al. (2003) reported a similar finding in a study across 8 years in which they showed that financial and market performance predicted employee satisfaction as well as, if not better than, employee satisfaction predicted financial and market performance.

Based on such research, one might erroneously reach the one-way conclusion that happy customers create positive service climates and that financially successful firms have happy employees. But in real organizational systems, the parts are in reciprocal causality, and both variables in the relationships of interest require attention, especially as the organization develops over time. The dearth of longitudinal panel–type studies on these important relationships hampers clear conclusions about systems as they grow, develop, and work, and more such multivariate longitudinal panel studies are definitely required.

Expansion of the Service Climate Framework

Specify and Measure the Service Climate–Financial Performance Link

The service profit chain (Heskett, Sasser, and Schlesinger 1997) attracted much attention because it proposed a link between the internal world of human service organizations and organizational financial performance. There have been very few, if any, studies substantiating the service profit chain model, but pieces of it have been tested with some success (Loveman 1998). Also, Hong et al. (2013) made a good case for service climate being a missing link in the service profit chain.

Regarding the service climate–financial performance relationship, two studies exemplify the possibilities to test that linkage. A study by Schneider et al. (2009b) showed, in a broad cross section of 44 service companies (finance, transportation, IT, airlines, hotels, retail), that service climate is significantly linked to the American Customer Satisfaction Index (ACSI, Fornell et al. 1996) and that, in turn, the ACSI scores mediate the relationship between service climate and Tobin’s q (1969), an index of market value. In this study, the ACSI and Tobin’s q data were collected over 3 years, with results revealing that service climate in Year 1 of the data collection predicted customer satisfaction in Years 2 and 3—and then market value, too. The second exemplar study, by Chuang and Liao (2010) of 133 stores in Taiwan (hair and beauty salons, retail stores, and restaurants and cafes), found that service climate was significantly linked to unit employee service performance, and a climate for employee concern linked to employees helping coworkers. Both types of behavior contributed to the stores’ market performance in terms of market share, sales growth, and profitability. As a final observation, there are mediators and moderators of the service climate–financial performance link, pricing parameters, and so on, to be further specified, as was noted for the service climate–customer experience link.

The Utility of the Service Climate Framework for Analyzing Service Management Topics

We conclude by demonstrating how a service climate framework can enrich the understanding of service infusion in manufacturing (Gustafsson, Brax, and Witell 2010), the cocreation of value within a Service Dominant Logic (SDL) paradigm (Vargo and Lusch 2004), service climate as a source of sustainable, competitive advantage (Ployhart, Van Iddekinge, and MacKenzie 2011), and, finally, the fostering of interdisciplinary research in service management.

Service Infusion in Manufacturing

Service-oriented manufacturing has received considerable attention over the last decade under various labels such as transitioning from products to services (Davies 2004; Oliva and Kallengberg 2003), servitization (Neely 2008), and service infusion in manufacturing (Gustafsson, Brax, and Witell 2010). Service-driven manufacturing will continue to be among the most significant developments in modern business for years to come (Gebauer et al. 2012).

The key focus is how manufacturing firms can adopt a service logic for the entire business overall (Gronroos and Helle 2010), not just for services. Early conceptual work on this perspective was offered by Bowen, Siehl, and Schneider (1989) who described a “service-oriented manufacturing configuration” in which an overall service gestalt emerged via service-focused strategy, structure, and environment—all three elements being internally consistent, complementary, and mutually reinforcing (for “configurations,” see Miller 1986). They noted that this configuration would include a service-related climate and culture promoting flexibility, relational markets, and customer coproduction that, in the aggregate, would change the manufacturing firm atmosphere.

The need to better understand the role of service climate and culture (see Table 1) for service infusion in manufacturing, to use that term, was raised in Ostrom et al.’s (2010) research priorities for service management, highlighting the need to understand (a) the cultural changes that would infuse service logic into goods-logic organizations and (b) the development of a service mind-set in a product-focused organization. Indeed, Figure 1 (and Table 3) plus our agenda for future research (Table 4) on service climate indicate the antecedents and foundations requiring attention for infusion of a service logic into manufacturing organizations.

Recent examples of empirical work on such culture and climate issues include works by Gebauer and his colleagues (Gebauer, Edvardsson, and Bjurklo 2010a; Gebauer et al. 2010b; for a summary, see also Gebauer et al. 2012) and Antioco et al. (2008). Gebauer et al. (2010b) used the Bowen, Siehl, and Schneider (1989) framework in a study of European B2B manufacturing companies and concluded that a specific, comprehensive service-focused strategy structure configuration is necessary for success when a manufacturing firm attempts a new and different service strategy.

Antioco et al. (2008) drew upon the service climate literature to study the configuration of organizational parameters in 137 manufacturing companies in the Netherlands, Belgium, and Denmark. The organizational parameters were essentially dimensions of service climate and service orientation measured with customizations of the SERV*OR (Lytle, Hom, and Mokwa 1998) and the measure used by Homburg, Hoyer, and Fastnacht (2002). They found these service-focused parameters moderated the main effects of production parameters on sales such that services supporting the product significantly magnified sales volume.

Future research should examine (1) change processes in moving from a goods-oriented to a service-oriented climate and culture, and, perhaps most interestingly, (2) how goods-oriented and service-oriented climates can coexist in an organization, rather than one climate replacing the other. Theoretical direction on the latter issue might be found in the Kuenzi and Schminke (2009) exploration of competing climates and competing cultures in Martin (2002). These writings present a real view of organizations as typically having potentially competing climates and cultures and suggest ways in which such competition can be harnessed for the benefit of an organization’s people and performance.

The Customer’s Role in Cocreating Service Climates as the Social Context for the Cocreation of Value

SDL dramatically recast the role the customer plays in service, extending it from merely helping coproduce the service to truly cocreating value (Vargo and Lusch 2004). The role of customers has evolved theoretically from early descriptions—“clients as partial employees of service organizations” (Mills and Morris 1986) and “customers as human resources in service organization” (Bowen 1986)—to “customers as resource integrators” (Hibbert, Winklhofer, and Temerak 2012) who obtain value by integrating their resources with those of the organization and other actors in cocreation of value.

We propose to begin to understand the interplay of the cocreation of value with service climate creation and the role the customer plays in each part. For example, how do customers simultaneously react to and help “create” climate as the social context in which cocreation occurs? Edvardsson, Tronvoll, and Gruber (2011) offer an overarching theoretical starting point wherein they propose a social construction approach to understanding value cocreation. They emphasize the need to recognize that value cocreation is embedded in a social context of structure, roles, norms, and values—and actors’ own constructions of the social reality those represent. Customers do not just experience the social context; they socially construct their own and that is the context in which cocreation unfolds. This is very much the ground of psychological and social forces at both organizational and societal levels of influence and may be exemplified by the earlier described reciprocal causation research of Schneider, White, and Paul (1998). Edvardsson, Tronvoll, and Gruber maintain that SDL has understated the influence of social forces, and they suggest that social construction theories could help move SDL logic toward a social dominant logic of marketing that places cocreation in its naturally occurring social context.

Service Climate as a Basis of Sustainable Competitive Advantage

In the language of strategic management, service climate has potential competitive advantage because of its relative inimitability (Ployhart, Van Iddekinge, and MacKenzie 2011). Inimitability has four major attributes (Barney 1991):

Resource interconnectedness—The interrelated service climate antecedent and foundation issues explicated in Figure 1 are difficult to put in place and to sustain.

Social complexity—Part of the value of a service climate is that it acts as glue for people’s common understanding of what is important, especially when the climate is strong.

Causal ambiguity—How to create a service climate is ambiguous and difficult because it is a bundle of mutually reinforcing multiple policies, practices, and procedures. Service climate also needs to be “fitted” to a broader overall configuration of external environment and business strategy (Miller 1986).

Path dependency—The creation of a service climate, as must be clear from this synthesis and review, is achieved through continual emphasis over time of the centrality of service excellence in all facets of a firm. The creation and maintenance of a service climate is the classic example of how there is no single, quick fix to the design of complex systems.

We maintain that a service climate framework can be one response to the dearth of thought and research on service from the strategy discipline and perspective. Service climate has the potential to aid a firm’s competitive advantage precisely because it is difficult to accomplish and relates significantly to customer experiences and, through those, to indices of organizations’ financial and market performance.

Service Climate Research as a Model for Interdisciplinary Research in Service Management

It is useful to reflect on the fact that research on the link between service climate and customer experiences has been of an interdisciplinary nature for 40 years (Schneider 1973). We performed a quick count of the disciplinary sources of the journal article citations for the paper as an index of the relative interdisciplinary nature of the reviewed research and thinking. The ratio of sources for citations is 60:40, with 60% from organizational behavior (OB)/HRM and 40% from services marketing/marketing (for some articles it is difficult to tell!). Clearly, understanding of service climate and the variables and linkages in Figure 1 has emerged from an unusually strong interdisciplinary effort. The linking of internal human/organizational variables (a typical focus in OB) to external customer outcomes (a typical focus in marketing) is surely noteworthy in and of itself. Service climate research has been true to the spirit of the founding of this interdisciplinary field (Fisk, Grove, and John 2000).

Might it be possible to infer from this service climate interdisciplinary effort the theory-building and research characteristics likely to encourage interdisciplinary research more broadly? Possible clues from service climate research include:

applying theoretical perspectives that incorporate multiple stakeholders (employees, customers, and management) and collecting data from more than one stakeholder, certainly including both internal and external sources;

linking the work to significant business outcomes, such as customer experiences and organizational performance, on multiple dimensions and time intervals;

considering both scholarly and practical implications; and

taking seriously what was previously taken seriously when the field of service management first emerged—that all business functions, in interdependence, are necessary to create positive customer experiences.

Conclusion

We have attempted to synthesize what is known about the antecedents of service climate, the foundations for it, service climate itself, and service climate’s links with customer experiences, including mediators and moderators. Table 3 summarized the literature support for Figure 1, but we also concluded it was not time to be complacent about what we know. In addition, then, we painted a rather complex portrait of future theory and research needs surrounding service climate (summarized in Table 4) and even suggested the practical consequences of strong and positive service climates may extend beyond sole customer experiences to overall competitive advantage. The portrait of future research on service climate is complex, largely in part because service climate exists in real organizational systems and therefore is subject to many forces.

In sum, service climate theory—and research—is alive and well, but along with the interdisciplinary effort that has distinguished its past, it is in need of additional attention to sustain its position in the world of services management and marketing.

Footnotes

Acknowledgments

The authors are very grateful to Kay Lemon and two anonymous reviewers for their helpful and constructive comments through the review process for this article; all errors, of course, remain ours. We contributed equally to this article and authorship is alphabetical.

This manuscript was accepted under the editorship of Dr. Katherine Lemon.

Declaration of Conflicting Interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

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