The effects of deviant customer-oriented behaviors on service friendship: The moderating role of co-production

Journal of Retailing and Consumer Services 48 (2019) 60–69

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The effects of deviant customer-oriented behaviors on service friendship: The moderating role of co-production Jin Ho Junga, Jaewon Yoob, a b

T

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James F. Dicke College of Business Administration, Ohio Northern University, OH 45810, USA Small Business and Entrepreneurship Department, Soongsil University, Seoul, Republic of Korea

A R T I C LE I N FO

A B S T R A C T

Keywords: Deviant service adaptation Deviant service communication Deviant use of resources Customer indebtedness Service friendship Co-production

The aim of this paper is to test the effects of deviant customer-oriented behaviors (deviant service adaptation, deviant service communication, and deviant use of resources) on the building of service friendship through customer-based indebtedness perception. Furthermore, this study empirically examines the moderating role of customer co-production in positively enhancing the effect of customer indebtedness on service friendship. Three hundred forty-five completed questionnaires were collected from retail bank customers in the Republic of Korea. Results showed the positive role of deviant customer-oriented behaviors as a type of relationship-building strategy for building commercial relationships with customer-contact employees from the customer’s perspective. Additionally, our findings showed that when co-production is high, the indirect effects of deviant customeroriented behaviors on service friendship are stronger, suggesting the importance of co-production in strengthening the service friendship. Considering the positive-rebound effect of deviant customer-oriented behaviors, service managers should recruit empathetic employees and allow them to take risks, within an acceptable range, during service-encounter behaviors.

1. Introduction Particularly in high-customer-contact service situations (e.g., financial services and hospitality services), the interaction between customers and employees is frequent, intimate, influential, and dynamic (Ahn et al., 2014). As market competition intensifies, the interaction between customers and employees in service industries becomes more important to the success of service organizations (Yoo, 2017). Therefore, building a strong relationship with customers is a vital strategy that service organizations employ to maintain a competitive advantage. In this regard, customer-contact employees’ role in building a strong relationship with customers remains an important area of investigation in the services marketing literature (e.g., Macintosh, 2007; Wang et al., 2017). Research shows that customer-contact employees always break organizational rules and deviate from the job's prescribed role (Van Eerde and Peper, 2008; Daunt and Harris, 2014). In this regard, prior research addresses some detrimental impacts of negative employee deviance, such as reduced patronage (e.g., Harris and Ogbonna, 2012). Beyond the harmful consequences of negative employee deviance, recent research suggests that employees often enact deviant behaviors by bending organizational norms in a prosocial way (Leo and Russell-

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Bennett, 2014; Dahling and Gutworth, 2017). Customer-oriented deviance is a positive form of employee deviance that defies organizational provisions and higher-authority rules aimed at benefiting customers. Based on this definition, Leo and Russell-Bennett (2012) introduced deviant customer-oriented behaviors as a form of customeroriented deviance and categorized them in three ways: (1) deviant service adoption, (2) deviant service communication, and (3) deviant use of resources. Though Leo and Russell-Bennett (2014) suggest customer-contact employees can engage in three forms of deviant customer-oriented behaviors on behalf of customers, the impact of deviant customer-oriented behaviors is a largely unexplored area. Moreover, none of the existing research investigates how deviant behaviors affect customer psychological responses (states) to consequently build customer relationships. Based on social exchange theory (Blau, 1964), we propose that deviant customer-oriented behaviors influence customer indebtedness, and customers therefore reciprocate the favor by building service friendship. Thus, the study fulfills a gap by testing a psychological state (i.e., customer indebtedness) as a mediator in the relationship between customer-oriented deviance and service friendship in the role of reciprocity. Service friendship includes intimacy, voluntary social interactions, intrinsic motivations, and communal orientation (Grayson,

Corresponding author. E-mail addresses: [email protected] (J.H. Jung), [email protected] (J. Yoo).

https://doi.org/10.1016/j.jretconser.2019.02.012 Received 19 September 2018; Received in revised form 22 January 2019; Accepted 18 February 2019 0969-6989/ © 2019 Elsevier Ltd. All rights reserved.

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J.H. Jung and J. Yoo

employee-customer exchanges. Social exchange theory highlights that an exchange between two parties is characterized by “voluntary actions of individuals that are motivated by the returns they are expected to bring and typically do in fact bring from others” (Blau, 1964, pp. 91–92). The process of social exchange theory is governed by a set of propositions (Schoenherr et al., 2015). The assumptions are that: (1) individuals act rationally to maximize return; (2) gratifications are dependent on other parties; (3) individuals are goal-oriented and able to find the best alternatives; and (4) social credit (or indebtedness) is reciprocated, and parties’ interactions occur in the exchange (Schoenherr et al., 2015). Based on the propositions, both parties expect to be balanced in their exchanges. If a party provides a value or benefit to another party, the receiver attempts to repay the good deed to the donor. However, unbalanced exchanges between two parties may occur when a party provides an unexpected benefit to another party. To ensure a balance in their exchange, the receiver feels obligated to reciprocate by providing additional value in return (Peng et al., 2017). Thus, indebtedness is key to maintaining the equality that is critical to sustainable social cooperation (e.g., Trivers, 1971). Applying social exchange theory to deviant service exchanges, we suggest that three types of deviant customer-oriented behaviors (i.e., deviant service adoption, deviant service communication, deviant use of resources) affect service friendship through customer indebtedness (see Fig. 1). When customers perceive that employees deviate from organizational rules for the sake of the customer, the customer feels a sense of duty to repay the favor. This feeling of indebtedness ultimately leads to service friendship. These ideas are further addressed in the following sections.

2007; Liu et al., 2016). Prior research suggests the importance of service friendship such as enhanced brand satisfaction and brand loyalty (Paulssen et al., 2014) and increased customer commitment toward service firms (Ahn et al., 2014). Understanding the antecedents of service friendship is critical for service organizations. Moreover, we propose that co-production serves as an important moderator in the relationship between customer indebtedness and service friendship. This aspect of the present study is notable because it offers meaningful insights concerning potential situations where customer indebtedness is highly applicable to forming service friendships through reciprocal relationships. Social exchange theory (Blau, 1964) supports the notion that in order to build a reciprocal and beneficiary relationship between customers and employees, customers should contribute and generate social and economic value by becoming a coproducer of that value (Prahalad and Ramaswamy, 2004). Considering co-production as a moderator, this study acknowledges the potential for the mutual dependence between employees and customers in relationship building. Using structural equation modeling and bootstrapping method with 345 retail bank customers in the Republic of Korea, research findings indicate that customers feel indebted when they perceive employee deviant behaviors, and the feeling of indebtedness subsequently enhances service friendships with employees. The results further reveal that the positive relationship between customer indebtedness and service friendship is strengthened when customers co-produce services. This study contributes to the existing literature in two ways. First, we attempt to bridge prosocial employee-deviance research and customer relationship-building research by investigating how different forms of customer-oriented deviance generate service friendship through the feeling of indebtedness based on social exchange theory. Thus, we identify the positive role of deviant customer-oriented behaviors as a type of relationship-building strategy from the customer's perspective. Second, by suggesting customer co-production as a moderator, this study shows that service friendship is formed not only by the feeling of indebtedness, but also by its interplay with the customer role of co-producer. Including the constructive role of customer coproduction in commercial friendship building can enrich our understanding of the customer-provided contribution to creating relational value. For managers who want or need to build long-term relationships with customers, this study offers useful insights into the management that deviant customer-oriented behaviors are not an organizational rule-breaking factor, but a relation development factor. Considering the positive-rebound effect of deviant customer-oriented behaviors, service managers may recruit empathetic employees and allow them to bend rules, within an acceptance range, in service encounters. Furthermore, given the reciprocal efforts to build commercial relationships, managers may not only have to support employees’ relational building behaviors (e.g., deviant customer-oriented behaviors), but also need to create an environment that can motivate customers to engage in co-production activities. The reminder of the paper is outlined in the following ways. First, a discussion of social exchange theory and customer-oriented deviance is presented. Next, research hypotheses are developed. Then, methods and findings from our study are presented. Finally, theoretical and practical implications are discussed, along with research limitations.

2.2. Deviant customer-oriented behaviors increase customer indebtedness Many customers have experienced an exceptional service encounter from employees who engage in behaviors that go beyond the standard organizational operating procedures to primarily benefit customers (e.g., Boukis, 2016). For example, QANTAS-airline service employees in Australia helped passengers who missed their flight rebook another flight service at no extra charge (Ironside, 2011). Service-employee overserving behaviors may surpass customers’ normal expectations and greatly please customers (Rust and Oliver, 2000). As in the previous example, customer-contact employees often enact deviant behaviors by bending the standard rules to provide exceptional customer service. In this regard, exceptional customer service provided by employees who act beyond the organizational rules is unexpected by customers (Leo and Russell-Bennett, 2012); these are the deviant customer-oriented behaviors. From the customer perspective, deviant customer-oriented behaviors are defined as a customer's perception of employee extra-role behaviors that defy expectations or break higherauthority rules for which service adoption, service communication, and the use of organizational resources are utilized to primarily benefit customers in interpersonal relationships (Leo and Russell-Bennett, 2012). Based on this definition, deviant customer-oriented behaviors have been categorized in three previously described ways: deviant service adoption, deviant service communication, and deviant use of resources. An example consistent with the definition of each type is subsequently presented for illustrative purposes. First, deviant service adoption is defined as perceived employee behaviors that “alter the service delivery in ways that employees perceive defy expectations or prescribed rules of higher authority” (Leo and Russell-Bennett, 2014, p. 1219). Unofficial price discounts (Lam, 2007) or unauthorized hotel-room upgrades (Hui et al., 2004) are examples of deviant service adoption. Second, deviant service communication is defined as perceived employee behaviors that “give and/or share information with customers on products or services in ways that employees perceive defy expectations or prescribed rules of higher authority” (Leo and Russell-Bennett, 2014, p. 1219). Deviant service communication includes honest and credible service-employee verbal

2. Literature review and hypotheses development 2.1. Social exchange theory and customer-oriented deviance The theoretical foundation of the relationship between deviant customer-oriented behaviors and service friendship is underpinned by social exchange theory (Blau, 1964). Social exchange theory is widely used to explain reciprocity in employee-customer interactions (e.g., Boukis, 2016). Its role can be also extended to prosocial deviant 61

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Fig. 1. Hypothesized model.

2.3. Customer indebtedness increases service friendship

communications to customers with respect to products, services, or the organization against the company's expectation. Third, deviant use of resources is defined as perceived employee behaviors that “include use of resource inputs to support or help customers in ways that employees perceive defy expectations or prescribed rules of higher authority” (Leo and Russell-Bennett, 2014, p. 1219). Deviant use of resources may be related to the employee's resource-input usage enacted to help or support customers beyond their role requirements. If customers perceive that these three types of deviant employee behaviors benefit them, they could feel that they owe something to employees as a result of the unbalanced exchange, leading to a feeling of indebtedness from the deviant employee behaviors. In this study, customer indebtedness is defined as a customer's sense of obligation to repay employees (Greenberg, 1980). This is consistent with a prior study wherein the recipients (customers) felt a sense of indebtedness that closely matched the employee-benefactor concern about the recipient's (customer) welfare relative to his or her own concern (e.g., Gouldner, 1960; Schopler, 1970). In this regard, Harmeling et al. (2015) found that service encounters that significantly disconfirm relational expectations produce indebtedness, imposing an obligation to reciprocate even if such behaviors are not formally expected. Moreover, Arnold et al. (2005) argued that salespeople possibly bend the rules to accommodate customers by introducing a story where “a customer warranty has expired, but the salesperson arranges for the product to be repaired free of charge” (p. 1132). The rule-bending behaviors make customers feel obligated to repay their debt, resulting in a higher indebtedness toward the salespeople. Therefore, the following effects can be derived:

The social exchange theory that is driven by the reciprocity norm suggests that customers feel a sense of indebtedness to those who provide favors to them (Gouldner, 1960). Accordingly, the feeling of indebtedness leads to customer actions for the repayment of the favors. Greenberg (1980) argued that the state of indebtedness is supposed to consist of motivational characteristics, whereby a customer feels a greater discomfort if the magnitude of the indebtedness is greater, thereby intensifying the motivation to reduce it. Thus, customers may seek to reduce the level of perceived indebtedness in ways governed by the role of reciprocity (Kelley and Dorsch, 1991). One approach to reduce this state of indebtedness involves an attempt by the customer to build emotional bonds with the service provider (Wathne et al., 2001). De Peyrelongue et al. (2017) suggest that in order to obtain customer attachment and to create a good relationship, sellers may place customers in a position of indebtedness by giving additional time and attention while listening to customers. In addition, Pereira and Strehlau (2016) argue that “indebtedness provides a way to offer a good or experience to someone, following which the giver and receiver become involved in a gifted relationship. This involvement leads to social exchanges between them and, consequently, their social ties are reinforced” (p. 248). Further, Ho (2012) suggests that friendship between employees and customers entails indebted social obligations. In our study, customers may perceive that the unexpected service provided by employees acting outside the organizational rules exceeds the organization's rules and expectations for the customer's benefit, leading to a feeling of indebtedness and a desire to repay the debt or the favor; therefore, customers try to show positive emotions to employees, such as displays of friendliness (e.g., Price and Arnould, 1999) and respect, for the purpose of forming the service friendship. Even at the workplace, friendship involves a two-way flow of resources to fulfill the obligation and expectation of openness among employees (Mao et al., 2012). In a similar vein, Huang and Chiu (2018) suggested that a sense of obligation and indebtedness encourages open dialogue between employees and customers. This dialogue fosters trust, shared values, and personal familiarity, resulting in a service friendship

H1a. Deviant service adoption exerts a positive effect on customer indebtedness. H1b. Deviant service communication exerts a positive effect on customer indebtedness. H1c. Deviant use of resources exerts a positive effect on customer indebtedness.

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considered suitable for the current study because all the participants reported a high level of contact with service providers in the bank (Doney and Cannon, 1997). A number of reasons exist for selecting research subjects from the bank. First, customers can perceive deviant customer-oriented behaviors due to the fact that most retail banking services (personal loans, merchant services, and payment services) are well established in a clear set of standard processes and procedures. According to Laroche and Sadokierski (1994) and Levy (2014), financial service is considered a high-involvement service due to the fact that it poses the risk of significant economic loses (negative consequences) for customers if a mistake is made. In this regard, customers are highly concerned about bank policies and procedures and understand them very well. Therefore, customers are able to recognize even small deviant behaviors from bankers, like ignoring unnecessary paper work. Second, customers participate as co-producers at different degrees to obtain financial services. In addition, the chance of developing a friendship with a banker is present because they work together to obtain mutual benefits. Overall, it is believed that deviant customer-oriented behaviors, service friendship, and co-production can be readily observed in this research setting. The senior manager at the bank allowed the authors to collect data from customers for approximately three months. The surveys were conducted by one of the authors in the customer waiting room. The participants received a general introduction and were asked to answer questions regarding bank-worker attitudes and behaviors and their relationships with bank workers. To ensure the customers’ confidentiality, participants completed surveys anonymously and returned surveys directly to the author when finished. Five hundred questionnaires were distributed to customers, and 155 of them were not returned or were incomplete; meanwhile, the remaining 345 samples were deemed useable for this study. Among respondents, 30.1% were female; 81.8% had attained a bachelor's degree or higher; the mean age of the sample was 34.62 (SD = 10.22), ranging from 20 years to 60 years; and the average working relationship with the bank was 10.24 years.

(Tangpong et al., 2010). H2. Customer indebtedness positively affects service friendship. 2.4. Moderating role of customer co-production Additionally, it is proposed that the positive effect of customer indebtedness on service friendship varies as a function of customer coproduction, such that the influence of customer indebtedness on service friendship is stronger when the co-production level is high rather than low. Co-production is defined as “constructive customer participation in the service creation and delivery process” with the requisite meaningful, cooperative contributions to the service process (Auh et al., 2007, p. 361). Discovering a moderator that may amplify the positive effect of customer indebtedness on service friendship is critical for understanding the potential conditions where customer indebtedness is highly relevant in building a service relationship. According to social exchange theory, participants in an exchange tend to assess costs and benefits so that they commit to an exchange that generates social and economic benefits for them (Preikschas et al., 2017). In addition, social exchange theory suggests that customers can contribute and generate social and economic value by becoming coproducers or partial employees as a means to gain a competitive advantage (Prahalad and Ramaswamy, 2004). In essence, the two-way interaction between exchange partners makes it easy to obtain social rewards one could not gain independently (e.g., Saarijärvi et al., 2013). Customer co-production can generate mutually beneficial outcomes for both parties (Ramirez, 1999). Therefore, in this study, we argue that coproduction may serve a moderating role in enhancing service friendship driven by indebtedness. In the case of a high customer co-production level, customers consider themselves a partial organizational member and are motivated to participate in the service production and delivery process (Cheung and To, 2011). Through their co-production, customers build trust with employees and generate affective commitment toward them (Auh et al., 2007). That is, co-production facilitates a sense of emotional attachment to employees. In this regard, when co-production is high, customers have a strong tendency to repay the feeling of indebtedness due to the trust and affective commitment to service-contact employees. As a result, the degree of perceived indebtedness becomes more influential on the formation of service friendships. Therefore, customers who experience co-production may feel more gratitude for employees and develop more commercial friendships in response. However, when co-production is low, customers are less involved and thus have less collaboration with service providers to improve service production and delivery. In this situation, customers are less likely to shape confidence and favorable attitudes toward employees because they have less frequent interactions with them relative to high co-production (Cheung and To, 2011). Moreover, though customers feel indebted under this condition, they have few opportunities to take actions to repay. This dampens the tendency driven by the customer's feeling of indebtedness to repay employees, resulting in lower service friendships. Therefore, the following is suggested.

3.2. Measurements The measurement scales were originally developed in English and translated into Korean. During the translation process, the translated survey was assessed by two English-Korean bilingual judges. Moreover, the survey was evaluated by the back-translation procedure in order to minimize any possible systematic bias. Thus, we ensured that the translated survey reflects the same content as the original survey. The measure of deviant customer-oriented behaviors was adopted from Leo and Russell-Bennett (2014). They developed multidimensional scales of deviant customer-oriented behaviors including deviant service adoption (e.g., “bankers use service processes that depart from their bank's expected practices”), deviant service communication (e.g., “bankers are open about their bank's problematic practices when they think it is necessary”), and deviant use of resources (e.g., “bankers use extra time to assist me even if it is something they should not be doing”). To ensure that customers captured the perception of service-provider deviant behaviors, the original items were slightly modified. The response anchors range from 1 = Strongly Disagree to 7 = Strongly Agree. To measure customer indebtedness, items from Tokman et al. (2007) were adopted. Customers reported the degree to which they felt indebted to the working relationship (e.g., “I feel indebted to bankers due to the favors/special treatment I receive”). All of the items were assessed using 7-point Likert scales ranging from 1 = Strongly Disagree to 7 = Strongly Agree. Service friendship was measured using four items from Lin and Hsieh's (2011) study. Customers were asked to rate the extent to which they developed a rapport and a friendship with the service provider (e.g., “there is a friendship between bankers and me”).

H3. The positive effect of customer indebtedness on service friendship is stronger when co-production is high rather than when co-production is low. 3. Research methods 3.1. Samples and procedure To test the impact of deviant customer-oriented behaviors (i.e., deviant service adoption, deviant service communication, deviant use of resources) on service friendship, we sampled customers from a major retail bank located in the Republic of Korea. The subject selection is 63

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Table 1 Descriptive statistics and intercorrelations. Construct

M

SD

AVE

CR

1

2

3

4

5

6

7

8

9

1. 2. 3. 4. 5. 6. 7. 8. 9.

3.33 3.01 3.14 3.35 3.56 4.14 ___ 34.62 10.24

1.15 1.33 1.29 1.30 1.42 1.15 ___ 10.22 7.70

0.60 0.63 0.73 0.65 0.77 0.65 ___ ___ ___

0.91 0.92 0.95 0.88 0.93 0.88 ___ ___ ___

(0.91) 0.66** 0.67** 0.56** 0.35** 0.24** − .14** − .22** − .16**

(.91) 0.74** 0.64** 0.39** 0.27** − .16** − .24** − .16**

(.95) 0.63** 0.38** 0.31** − .22** − .20** − .11**

(.88) 0.56** 0.47** − .19** − .12* − .16**

(.93) 0.62** − .16** 0.01 − .01

(.88) − .06 − .01 − .02

(___) − .01 − .00

(___) 0.65**

(___)

DSA DSC DUR Customer indebtedness Service friendship Co-production Gender Age Length of relationship

Notes: DSA= deviant service adaptation; DSC = deviant service communication; DUR = deviant use of resources. Results are based on two-tailed t-tests. AVE = average variance extracted; CR = composite reliability. Cronbach's alphas are reported within parentheses along the diagonal. * p < .05. ** p < .01.

factor model has a significantly better fit than the one-factor model for pairs of constructs, addressing additional evidence for the discriminant validity. Also, all of the standardized factor loadings into the intended factors are significant and greater than 0.50, suggesting a strong internal consistency. Overall, the results suggest that the proposed constructs are valid and reliable.

The items were assessed by 7-point Likert scales ranging from 1 = Strongly Disagree to 7 = Strongly Agree. In addition, co-production was measured using a 4-item scale adopted from Auh et al. (2007). All of the items (e.g., “I try to work cooperatively with bankers”) used the response anchors of 1 = Strongly Disagree to 7 = Strongly Agree. Appendix A describes all the measures. The descriptive statistics and the correlation matrix are shown in Table 1.

4.3. Structural model analysis 4. Model analyses First, a structural equation model analysis was performed to test four linear relationships for significance in Mplus 7. To identify whether the effects of perceived deviant customer-oriented behaviors on service friendship are fully mediated by customer indebtedness, the main effect model added the direct paths between three deviant behaviors and service friendship. In addition, three control variables (age, gender, and length of working relationship) were added to the model to control for participants’ demographic differences. The resulting structural model provided a good fit for the data ( χ 2 /d.f. = 2.89, p < .01; CFI = 0.91; TLI = 0.90; SRMR = 0.07; and RMSEA = 0.07), and its results are presented in Fig. 2. H1a hypothesized that deviant service adoption is positively related to customer indebtedness. The results demonstrated that deviant service adoption significantly increases customer indebtedness (γ = .16, p < .05). H1b predicted that deviant service communication is positively related to customer indebtedness. In support of the path relationship, deviant service communication has a strong positive effect on customer indebtedness (γ = .37, p < .01). H1c investigated the relationship between deviant use of resources and customer indebtedness. The results support the hypothesis by providing a significant link between deviant use of resources and customer indebtedness (γ = .26, p < .01). Additionally, age and length of working relationship are significantly related to customer indebtedness (age: γ = .02, p < .01, length of working relationship: γ = −.02, p < .01), although gender does not affect customer indebtedness (γ = −.19, ns). H2 predicted that customer indebtedness positively leads to service friendship. As expected, customer indebtedness significantly enhanced service friendship between customers and employees (γ = .77, p < .01) after controlling for the effects of age, gender, and length of working relationship; however, none of the control variables affected service friendship (age: γ = .01, ns; gender: γ = −.09, ns; length of working relationship: γ = .00, ns). We conducted a bootstrap analysis (n = 5000 bootstrap resamples) using the SPSS 22 program to determine the magnitude of indirect effects in the relationships between three deviant behaviors and service friendship through the mediating role of customer indebtedness. Bootstrapping is widely used to estimate the specific indirect effect in a bootstrap resample data (Preacher and Hayes, 2008). The

4.1. Common method variance test All variables were self-reported by customers, so common method variance (CMV) might inflate correlations among focal constructs. The partial correlation technique of including a marker variable was conducted to reduce the CMV concern (Podsakoff et al., 2003). We used age as the marker variable in the model (c.f., Hughes et al., 2013; Jung et al., 2017). We generated partial correlation between predictor and criterion variables, which parceled out the effects of age. The partial correlation matrix was compared to the zero-order correlation matrix, and the result showed no significant difference in correlations with and without the effects of age. The result minimizes the CMV concern in the data. 4.2. Measurement model analysis A confirmatory factor analysis (CFA) was performed to assess the constructs’ measurement properties and the psychometric adequacy in Mplus 7. The results indicate that the measurement model provides a sound fit to the data ( χ 2 /d.f. = 2.91, p < .01; CFI = 0.91; TLI = 0.90; SRMR = 0.06; and RMSEA = 0.07), and all the item loadings are statistically significant (p < .01). Also, relatively high Cronbach's alpha values (≥ 0.88) suggest that all the measures are reliable (Bagozzi and Yi, 1988). Overall, the sound fit of the measurement model demonstrates a robust support of the focal construct's unidimensionality. Table 1 provides strong evidence of the convergent and discriminant validity for each latent construct. All of the composite reliability scores exceeded the minimum criteria suggested by Nunnally (1978). To evaluate the discriminant validity, average variance extracted (AVE) scores were calculated. The AVE values are all well over 0.50 and are higher than the shared variances among all the construct pairs in the measurement model, thereby supporting the discriminant validity. In addition, CFA-based discriminant validity tests were used (Voorhees et al., 2016). Pairwise CFAs were applied for all possible pairs of constructs to compare the fit of a two-factor model to that of a single-factor model. The chi-square difference test showed that the two64

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Fig. 2. Hypothesized model.

bootstrapping technique computes confidence intervals and standard errors that allow us to test the statistical significance of indirect effects (Hayes, 2009). The results demonstrate that all three deviant behaviors have significant, indirect effects on service friendship (deviant service adoption: indirect effect = 0.10, LLCI: .02, ULCI: 0.20; deviant service communication: indirect effect = 0.18, LLCI: .10, ULCI: 0.29; deviant use of resources: indirect effect = 0.16, LLCI: .08, ULCI: 0.26). We verified the significant mediating role of customer indebtedness in the relationship between customer-oriented deviance and service friendship. Moreover, the results support the conclusion that the relationships between three deviant behaviors and service friendship are fully mediated by customer indebtedness because direct paths from three predictor constructs (i.e., deviant service adoption, deviant service communication, deviant use of resources) to service friendship are insignificant (γ = .06, ns; γ = .02, ns; γ = −.08, ns, respectively).

Fig. 3. Moderating effect of co-production. Notes: CI = Customer indebtedness, COPRO = Co-production.

4.5. Moderated mediation analysis

4.4. Moderation analysis

We conducted additional tests to investigate the conditional indirect effects of three deviant behaviors on service friendship at the three levels of co-production (one standard deviation above the mean, the mean, and one standard deviation below the mean). A bootstrapping technique that generated 5000 bootstrap resamples was applied in the SPSS 22 program (Preacher and Hayes, 2008). Table 2 shows that the indirect effects of three types of deviant customer-oriented behaviors on service friendship significantly varied as a function of the co-production level. The conditional indirect effects are not significant at one standard deviation below the mean; however, the effects become significant at the mean and stronger at one standard deviation above the mean. Further, a spotlight analysis was conducted to supplement the conditional indirect effects (Spiller et al., 2013). The results indicate that (1) the indirect effect of customer indebtedness on the relationship between deviant service adoption and service friendship is significant at the Johnson-Neyman point of 2.82 and above because 95% confidence intervals for the effect exclude zero; (2) the indirect effect of customer indebtedness on the relationship between deviant service

This study proposed that co-production moderates the relationship between customer indebtedness and service friendship. We employed a bootstrapping technique to assess the moderation effect with 5000 bootstrap samples in the SPSS 22 program. The effect of the interaction between co-production and customer indebtedness on service friendship is positively significant (β = 0.12, p < .01), thereby supporting H3. We graphically interpret the moderation effect of co-production on service friendship. Fig. 3 demonstrates the effects of customer indebtedness on service friendship at the high and low co-production conditions (high: one standard deviation above the mean; low: one standard deviation below the mean). When co-production is low, the relationship between customer indebtedness and service friendship is positive, but not strong (effect: 0.22). When co-production is high, the positive relationship between customer indebtedness and service friendship is significantly boosted (effect: 0.48). The results reveal that co-production significantly enhances the positive effect of customer indebtedness on service friendship.

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Table 2 Conditional indirect effects. Predictor Customer indebtedness (CI) Constant Gender Age Length of working relationship Deviant service adaptation (DSA) Deviant service communication (DSC) Deviant use of resources (DUR) Predictor Service friendship (SFR) Constant Gender Age Length of working relationship Deviant service adaptation (DSA) Deviant service communication (DSC) Deviant use of resources (DUR) Customer indebtedness (CI) Co-production (COPRO) CI × COPRO

Conditional indirect effects at DSA on SFR at values of COPRO − 1 SD (2.992) M (4.145) + 1 SD (5.298)

Conditional indirect effects at DSC on SFR at values of COPRO − 1 SD (2.992) M (4.145) + 1 SD (5.298)

β

SE

T

p-value

0.686 −.159 0.019 −.025 0.173 0.329 0.283 β

0.326 0.112 0.007 0.009 0.062 0.060 0.063 SE

2.103 − 1.423 2.845 − 2.936 2.768 5.491 4.526 T

0.036 0.156 0.005 0.004 0.006 0.000 0.000 p-value

1.355 −.230 0.006 0.004 0.079 0.100 −.050 −.209 0.205 0.117

0.549 0.122 0.007 0.009 0.069 0.068 0.070 0.150 0.107 0.030

2.470 − 1.884 0.757 0.461 1.154 1.469 −.713 − 1.397 1.909 3.909

0.014 0.061 0.450 0.645 0.249 0.143 0.477 0.163 0.057 0.000

Effect

SE

LLCI

ULCI

0.024 0.048 0.071

0.020 0.026 0.034

−.002 0.009 0.016

0.077 0.109 0.150

Effect

SE

LLCI

ULCI

0.047 0.091 0.136

0.033 0.034 0.042

−.007 0.037 0.067

0.121 0.170 0.231

Effect

SE

LLCI

ULCI

0.040 0.078 0.117

0.027 0.030 0.039

−.005

0.103 0.153 0.210

Conditional indirect effects at DUR on SFR at values of COPRO − 1 SD (2.992) M (4.145) + 1 SD (5.298)

0.029 0.051

Note: N = 345. Unstandardized regression coefficients are reported. Bootstrap-sample size = 5000. LLCI = Bootstrap lower limit of the confidence interval; ULCI = Bootstrap upper limit of the confidence interval.

relationships between deviant customer-oriented behaviors and service friendship. Our results confirm that customers perceive deviant customer-oriented behaviors as additional benefits beyond organizational norms, and this perception generates their sense of obligation. In order to reduce their indebtedness, customers are more likely to build a good relationship with customer-contact employees. Indebtedness is seen to have motivational properties (Greenberg, 1980), and it has been suggested as a critical intervening variable that explains why firms’ prioritization may enhance customer outcomes (e.g., profitability) in customer relationship management (Palmatier et al., 2009; Wetzel et al., 2014). In a similar vein, our study considers customer indebtedness as a significant motive for commercial friendship. Based on this, our results support the idea that employees can deviate from organizational rules and/or higher authority in a customer-oriented way to generate positive outcomes like relationship building. Most extant service-friendship literature on marketing and management examines the impact of positive employee behaviors such as social rapport, attractiveness, social skills, responsiveness, and similarity (Price and Arnold, 1999; Yim et al., 2008) along with the mediating role of positive customer cognitive evaluation such as justice, perceived value, social benefit, and trust (Morgan and Hunt, 1994; Palmatier et al., 2006; Yim et al., 2008). This research, however, tests a research framework based on the reciprocity norm, where overserving,

communication and service friendship is significant at the JohnsonNeyman point of 2.99 and above; and (3) the indirect effect of customer indebtedness on the relationship between deviant use of resources and service friendship is significant at the Johnson-Neyman point of 2.67 and above. The results support that the conditional indirect effects of three dimensions of deviant customer-oriented behaviors on service friendship through customer indebtedness are insignificant at the low co-production levels; however, they become significant and stronger at the high co-production levels. 5. Discussion The current research contributes to the services marketing literature in both theoretical and practical perspectives. With regard to theory, our study attempts to integrate customer-oriented deviance (i.e., deviant customer-oriented behaviors) into customer relationship management (i.e., service friendship). Although the existing literature clearly addresses customer-contact employees’ deviance and its negative consequences for service organizations (Harris and Ogbonna, 2012), little attention has been paid to understanding how customeroriented deviance is perceived by customers and the psychological mechanism that explains why the perceived deviance facilitates service friendship. Based on social exchange theory, we tested an empirical model to address the mediating process of customer indebtedness in the 66

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dysfunctional employee behaviors, and the customer's perception of service-employee repayment obligations are integrated into the service friendship mechanism. The study bridges the gap between prosocial employee deviance literature and customer relationship management literature. Moreover, this study hypothesized that customer co-production plays a critical role in the relationship between customer indebtedness and service friendship. The results indicate that the relationship between customer indebtedness and service friendship is stronger when customers participate more actively in the service exchange. According to Ho and Ganesan (2013), customer participation is believed to strengthen the essential partnership through knowledge sharing in cooperative development. Also, many researchers argue that the co-production process facilitates two-way communication that can build relationships (e.g., Lovelock and Young, 1979; Mustak et al., 2013). Our results establish that the service friendship formation is enforced by voluntary and specific customer participation forms, meaning that service friendship is dependent on the customer's own participation in the service process. It is essential that service friendship is determined not only by service-employee behaviors but also by the customer's own behaviors. Importantly, spotlight analysis results suggest that the indirect effects of three types of deviant customer-oriented behaviors on service friendship are contingent upon the level of co-production. For example, it indicates that the relationship between deviant service adoption and service friendship is only significant at the Johnson-Neyman point of 2.82 and above. It means that deviant service adoption is only beneficial for service friendship development when indebted customers make their own effort to co-produce services. Without active co-production of customers, deviant service adoption may be useless to form service friendships. In sum, our results offer a theoretically meaningful contribution to the customer relationship management literature. Overall, this result implies that deviant customer-oriented behaviors are an important social factor that helps employees build a service friendship with customers, and it emphasizes the importance of coproduction in strengthening the service friendship.

solving approach. Therefore, managers should understand the necessity of customer-oriented deviance as a proactive strategic approach and not simply view it as rule-breaking behavior. This study does not suggest that all employees should provide deviant customer-oriented behaviors for all customers. Nor does it suggest that employees should always break organizational rules to build service friendship with customers. As we know, deviant customer-oriented behaviors are not exhibited by all customer-contact employees. Some employees appear to be more receptive to challenges and tend to be fearless in their rule-bending behaviors, whereas others only express fear in crossing such lines (Leo and Russell-Bennett, 2012). Customercontact employees with a greater service aptitude (the emotional ability to relate to a customer predicament) tend to show compassion toward customers and work to resolve customer problems more often than employees with a lesser service aptitude; the former may place a greater importance on customer satisfaction and consequently enact more of the positive deviant behaviors on behalf of customers. Finally, the results of the present study support the notion that customer co-production, in connection with service friendship, is a vital component in maintaining the relational exchange. Specifically, the customer's voluntary and collaborative behaviors are a necessary addition to the employee's over-servicing behaviors for building a service friendship. By motivating customers to participate in service delivery and by expanding customers’ understanding of employees and the delivery process, service organizations can enhance the positive meaning of customer-oriented deviance and transform this customer pressure into gratitude for facilitating a constructive relationship. Based on our findings, service managers should cultivate a service climate that provides customers with the opportunity to co-produce voluntarily and to actively participate in service delivery processes. Managers may even develop a platform to increase customer co-production to maintain the benevolent effect of employees’ resource-sacrificing efforts. From a long-term perspective, if the maturity of service friendship depends on co-production, firms will benefit from better co-produced customers.

5.1. Practical implications

This study represents a framework for examining the way prosocial employee deviant behaviors contribute to the variance of service friendships from the customer perspective. Despite this contribution, a number of limitations are associated with the present research. First, a weakness of this research is that our study relies on cross-sectional data, so causal relationships among variables could be questionable. For obtaining further evidence of causality, future research should investigate the proposed relationships in a longitudinal study by collecting variables from multiple time points. An experiment design can be also adopted by manipulating the three types of deviant customeroriented behaviors to gain more conclusive causal inferences. Second, this research used data from financial-service-industry customers, so the sample scope is limited, and this possibly limits the study's generalizability. Although the use of a single context may increase the internal validity of the present study, as the numerous external factors have been constant, future research should include a variety of service industries to provide relevant managerial findings for service organizations and customers. Additionally, we restricted our study to a single culture (i.e., Asian), which limits the generalizability of our findings. Researchers need to explore the customer-oriented deviance and service friendship relationship within other cultures. Moreover, the sample consists of a higher percentage of educated male customers due to the convenience sampling. Future studies may need to balance its sample demographic to generalize research findings. In addition, the customer indebtedness scale may not be independent from customer-oriented deviance scales. Thus, it could inflate the relationship between customer-oriented deviance and customer indebtedness, which is a limitation of the results. Although the study demonstrates the psychological effect of deviant

5.2. Research limitations

According to Leo and Russell-Bennett (2014), even though deviant customer-oriented behaviors can be regarded as taboo, customer-contact employees may still try to accept the burden, which is against organizational rules, norms, and expectations. Thus, deviant customeroriented behaviors are self-sacrificing behaviors that provide additional benefits to customers at the cost of an organizational rule breach. Even with increased operational costs and service-process inefficiency, customer-contact employees are aware of the necessity of deviant customer-oriented behaviors for achieving service excellence. Customers, who receive benefits from the deviant behaviors, also recognize the employee's sacrificial behaviors and perceive the exchange imbalance relative to the employees. Consequently, customers try to repay this obligation by building a strong friendship with employees. Service friendship eventually returns the organization to profitable customeraction forms such as repurchasing, positive word of mouth, and loyalty (Lin and Hsieh, 2011). Service managers should therefore understand the value of these employee behaviors in the customer-service friendship. Given the mutually beneficial results of deviant customer-oriented behaviors, service managers may empower employees to engage in these specific deviant behaviors within an acceptable range. Likewise, service managers may recruit empathetic employees and allow them to bend rules in service encounters. Indeed, employee empathetic behaviors enhance a customer service experience and promote a symbiotic interaction with customers (Wilder et al., 2014). Furthermore, depending on the potential value of customers or circumstances such as service failure, employees should have flexible authority to provide deviant customer-oriented behaviors as an instant problem67

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7. Bankers teach me ways to beat the system contrary to what their bank expects.

customer-oriented behaviors on customer service friendship, an investigation of the leading deviant-behavior factors from the employee perspective is needed. Future research can include measures of deviant customer-oriented behaviors from both sides of the customer-employee dyad to examine the effects of deviant customer-oriented behaviors on emotional, cognitive, and behavioral customer responses. This will facilitate the understanding of the effects of deviant customer-oriented behaviors on important outcomes. In this study, various employee-behavior characteristics are not included. According to Sirianni et al. (2013), emotional labor (surface acting, deep acting, or authenticity) helps to explain people's perceptions of employee-behavior differences. Customers may perceive deviant customer-oriented behaviors differently based on the employeeauthenticity level. Hennig-Thurau et al. (2006) contend that in the interpersonal interactions between employees and customers, the likelihood that the employee's emotional state will affect the customer's emotional state is facilitated by the authenticity of his or her emotionallabor display. Thus the moderating role of employee's authenticity should be considered in the relationship between deviant customeroriented behaviors and indebtedness. Further, this study suggested service friendship as a dependent variable but did not examine the positive and profitable consequences of service friendship. Many researchers have demonstrated service friendship's positive influence on positive word of mouth, customer loyalty, repurchase intention, and a higher service usage (Barnes, 1997; Price and Arnold, 1999; Gutek et al., 1999). Further research might be necessary to investigate the service-friendship consequences, such as sales performance and firm profitability. In addition, future research should consider the negative service-friendship consequences such as information disclosure, continuance commitment, and financial exploitation (Fang et al., 2011; Frow et al., 2011).

Deviant Use of Resources (1 = Strongly Disagree to 7 = Strongly Agree) Leo and Russell-Bennett (2014) 1. Bankers use extra time to assist me even if it is something they should not be doing. 2. Bankers help me using time that their bank would rather they put towards other use. 3. Bankers spend extra time on my personal matters that their bank may consider irrelevant. 4. Bankers use their bank's supplies to solve my problems that their bank would rather they ignore. 5. Bankers make use of tools/equipment in their bank to support me even if their bank sees no value in their actions. 6. Bankers use their bank's resources to help me even if their bank may see this as a waste of resources. 7. Bankers utilize their bank's supplies to solve my problems that their bank may consider irrelevant. Customer Indebtedness (1 = Strongly Disagree to 7 = Strongly Agree) Tokman, Davis, and Lemon (2007) 1. I own bankers my patronage because of their favor/special treats I used to receive. 2. I feel obligated to do business with bankers because of their favor/ special treats I used to receive. 3. I have a give and take relationship with bankers. 4. I feel indebted to bankers due to the favors/special treatment I receive. 5. I feel a need to repay bankers for the way it treated me.

Appendix A Deviant Service Adoption (1 = Strongly Disagree to 7 = Strongly Agree) Leo and Russell-Bennett (2014)

Service Friendship (1 = Strongly Disagree to 7 = Strongly Agree) Lin and Hsieh (2011) 1. 2. 3. 4.

1. Bankers change their service options for me even if it is something they should not do. 2. Bankers use service processes that depart from their bank's expected practices. 3. Bankers adapt their service procedures by bending the rules. 4. Bankers ignore instructions and use better means to service me. 5. Bankers alter service procedures even if their bank may not like it. 6. Bankers customize the way they deliver a service to me by ignoring bank procedures. 7. Bankers skip some service processes even if their bank may not like it.

Bankers know a lot about me. I have developed a good rapport with bankers. There is a friendship between bankers and me. Bankers and I seem to find plenty of things to talk about. Co-production (1 = Strongly Disagree to 7 = Strongly Agree) Auh, Bell, McLeod, and Shih (2007)

1. 2. 3. 4.

Deviant Service Communication (1 = Strongly Disagree to 7 = Strongly Agree) Leo and Russell-Bennett (2014)

I try to work cooperatively with bankers. I do things to make bankers’ job easier. I prepare my questions before going to meet bankers. I openly discuss my needs with bankers to help them deliver the best possible service to me.

References

1. Regardless of what their bank thinks, bankers give me the best service advice even if it means losing their business. 2. Bankers give me insider information on their service so I can make better decisions. 3. Bankers are open about their bank's bad practices when they think it is necessary. 4. Bankers provide me an honest opinion on their bank even when it is negative. 5. Bankers convey hints to me on “the way their bank works” even if it may not seem appropriate. 6. Bankers give me frank opinions about their service that may seem at odds with their bank's goal.

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Jin Ho Jung is an Assistant Professor of Marketing in the James F. Dicke College of Business Administration at Ohio Northern University. Having received his PhD in Marketing from Oklahoma State University in 2015, his areas of expertise include frontline employee management, services marketing, and sales management. Jin Ho Jung is the first author and can be contacted at: [email protected]. He has published papers in various journals such as Journal of Service Research, Journal of Business Research, and Journal of Personal Selling & Sales Management. Jaewon (Jay) Yoo is an Associate Professor in the Entrepreneurship & Small Business Department at Soongsil University. Having received his PhD in Marketing from Oklahoma State University in 2011, his areas of expertise include customer co-production, customerto-customer interaction, and frontline employee management. Jaewon Yoo is the corresponding author and can be contacted at: [email protected]. He has published many papers in various journals such as Journal of Service Research, Journal of Personal Selling & Sales Management, Journal of Business Research, Journal of Services Marketing, European Journal of Marketing, and Service Industries Journal.

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