Critique of the service-profit chain - Essay Example

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Critique of the service-profit chain

The paper tells that the service-profit chain is a good theory that assisted and continues to assist many organizations to make profit through the satisfaction of its employees and in turn its customers. In many sectors like in banking, hospitality and retail, the overall profitability is in most cases pegged on the satisfaction of customers. This is because in these sectors, competition is usually very stiff and many customers who are not satisfied by one operator usually find satisfaction in the competition. However, the service-profit chain is not applicable to the sale of essential products like prescription drugs or in the case of monopolies where there are single products in the market. While arguments and counterarguments have been presented that have been aimed at establishing the viability and validity of the service-profit chain, it is important to recall some simple facts. First, in cases of single business units, there has been evidence of a relationship between the job satisfactions of employees with the satisfaction of customers. Second, in the researches that have been cited on the validity of the service-profit chain, there has been evidence that the companies that are most focused on the satisfaction of customers are the ones that attract loyalty from customers. Third, there has been no numerical fact that have been cited by all researchers (for or against of the service-profit chain) that suggests whether it hold true or not and all assertions have been hypothetical and lastly, there has been evidence that the service-profit chain does not hold true for all business models. ...Show more


According to the research findings the service-profit chain is still very much relevant into the business environment today although studies have to be further done on the topic to establish and attempt to measure the variable that determine to what extent it is relevant. …
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