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The single most important feature of the LISREL program is its facility to deal with a wide variety of models for the analysis of latent variables LVs. In the social sciences, and increasingly in biomedical and public health research, LV models have become an indispensable statistical tool. Because the whole framework of the LISREL model is based on relationships among LVs, it is worthwhile to briefly illustrate the concept of a latent variable. Latent variables are ubiquitous in some research domains, while in other contexts they are seldom used. In alcohol abuse studies, for example, they are a major focus of attention.

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To browse Academia. Skip to main content. By using our site, you agree to our collection of information through the use of cookies. To learn more, view our Privacy Policy. Log In Sign Up. International Journal of Service Industry Management The effect of work climate on critical employee and customer outcomes: An employee- level analysis Article information.

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While there exists a variety of work climates relevant to contact employees during service encounters, this study investigates two components for successful implementation of internal marketing, service climate and supportive management. Both climate variables are proposed to affect the attitudes and behaviors of employees, and consequently affect customers' perceptions of employees' service performance.

This study, which combines perceptions from customers and their contact employees, shows that both climate variables contribute directly to job satisfaction and work effort, and indirectly impact on customers' perceptions of employee service quality.

Also, the empirical results indicate that in addition to job satisfaction, employees' work effort also plays a strong, central role in determining customers' perceptions of employee service quality. Introduction Few things are as important to service firms as contact employees' behaviors toward customers. Previous research in this area has largely centered on identifying the effects of organizational variables on employee responses Babin and Boles, ; Brown and Peterson, ; Weatherly and Tansik, and on examining the relationship between employees' attitudes or behaviors and customers' perceptions of service quality Bitner, ; Bitner et al.

However, with a few exceptions e. Hartline and Ferrell, ; Schneider and Bowen, , these studies do not investigate the full employee-management process, i. According to the internal marketing perspective, if the service organization wants its contact employees to do a great job with its customers, it must be prepared to do a great job with its employees George, The internal exchange between contact employees and the organization must be operated International Journal of Service Industry Management, Vol.

In this paper, we examine two internal work climate on marketing components that are critical to the successful implementation of outcomes excellent service performance. These components are service climate and level of supportive management in the organization. The employees' perceptions and valuations of these major work climate variables should impact positively on the implementation of customer service programs by those same employees George, ; Bowen and Schneider, Despite their significance, the service literature lacks systematic studies on the role of these two work climate variables within service organizations and especially seems to ignore the direct or indirect impact of these climate variables in both organization-employee interface and employee-customer interface.

Downloaded by Universitat St Gallen At 13 March PT Thus, in our study, we employ both employee and customer data to address the impact of these two work climate variables, service climate and supportive management, on contact employees' attitudinal and behavioral responses work effort and job satisfaction and subsequent customer perceptions of employees' service quality.

Several studies Johnson, ; Schneider and Bowen, ; Schneider et al. However, our study attempts to extend the previous work in several ways. First, previous studies Johnson, ; Schneider and Bowen, suggested a direct relationship between employees' perception of service climate and customers' evaluation of service.

However, our study proposes that the climate for service, as perceived by employees, influences customers' evaluation of service quality through employees' attitudinal and behavioral responses.

Second, this study includes supportive management in the proposed model, discusses the roles of both climate variables in the service management process, and identifies their direct and indirect effects. Third, previous studies focused on the relationship between work climate for service and customers' evaluation at the organizational level.

But we examine the relationship among variables at the individual employee level of analysis. Focusing on employees and their dyadic interactions with customers at the service encounter level, this study investigates employees' perceptions and responses and their impacts on service quality, as perceived by customers.

This focus has conceptual and managerial implications for the evaluation of individual employee performance. In the following section, we develop our hypotheses related to these topics. Next, we describe the measurement process, including sample characteristics, data collection procedure, and aggregation issues involved in our study of contact employees and customers of a retail bank in Korea.

Then, we discuss measurement validation and hypothesis testing using structural equation modeling. Finally, we discuss the implications and limitations of the findings and suggest directions for future research.

IJSIM Background and research hypotheses 12,5 Work climates and employee responses Work climate within an organization refers to how organizational environments are perceived and interpreted by its employees James and James, , ; James and Jones, Schneider and Bowen define the climate in an organization as the perceptions that employees share about what is important in the organization, obtained through their experiences on the job and their perceptions of the kinds of behaviors management expects and supports.

According to James and James and Brown and Leigh , perceptions of the organizational environment take on personal meaning for employees through valuation, in which a cognitive representation of the features of the environment is interpreted in terms of the individual's values.

In this light, work climate may be considered an individual rather than an Downloaded by Universitat St Gallen At 13 March PT organizational attribute, measured in terms of perceptions that are psychologically meaningful to the individual rather than in terms of concrete organizational features James et al.

Alternatively, work climate can be conceptualized from a social interactionist perspective as evaluations of environmental attributes that have a social or situational construction component Burke et al. And the categories along which individuals interpret environmental attributes may emerge from, or can be revised with respect to situational referents.

These referents in an organization may include safety Zohar, , innovation Abbey and Dickson, , customer service Schneider, ; Schneider and Bowen, ; Schneider et al. These work climates are very important, because employees' perceptions and valuations of the environment rather than the environment itself mediate their attitudinal and behavioral responses James and Jones, ; James et al.

While there exists a variety of work climates that employees perceive in their organization, this study proposes two major work climate variables, i. That is, we are interested in service employees' perceptions of service climate and the degree of management support and their effects on employees' attitudinal job satisfaction and behavioral work effort responses.

Using a figure- background schema, Burke et al. The former concern is related to a climate for service in the organization, while the latter one is similar to supportive management. Service climate Service climate refers to the shared perception of employees concerning the practices, procedures, and kinds of behavior that get rewarded and supported in a particular setting Schneider et al.

The service climate is the message employees get about how important service is in their organization. Employees get this message from the experiences they have during their The effect of workday Schneider and Bowen, They found that the way contact employees perceive their organization's service climate is directly related to the customer perceptions of service quality at the organizational level of analysis. However, our study proposes that these two variables do not have a direct relationship but an indirect one at the individual employee level of analysis.

We believe that a behavioral variable, i. We believe that employees' perceptions of the service climate will impact positively Downloaded by Universitat St Gallen At 13 March PT on their work effort. According to Brown and Leigh , employees' work effort is ultimately under their own control, and this effort is likely to be sensitive to their perceptions of work climate.

When contact employees perceive that the organization emphasizes customer service, they are likely to respond by investing more time and energy in their work activities i. Thus, based on this discussion, the following hypothesis is proposed: H1. Employees' perception of the organization's service climate is positively related to their work efforts.

Supportive management Supportive management is also likely to lead to positive attitudinal and behavioral responses by employees. Supportive management refers to managers' concerns and support for subordinates' work and represents the degree to which they create a facilitative climate of support, trust, and helpfulness.

Brown and Leigh also view supportive management as a major dimension of employees' psychological safety in the workplace. Management styles are different in the ways in which managers convey organizational demands and supervise subordinates' behaviors. Supportive management exists when managers allow subordinates to fail without fear of reprisal. It also involves giving them greater control over their work efforts and how they achieve their job goals Brown and Leigh, Also, according to the reciprocity rule, the recipient of benefit is morally obliged to recompense the donor Gouldner, Thus, as employees perceive greater support and authority from management, their sense of obligation to reciprocate with greater effort will increase.

In service organization settings, Singh contended, based on social support literature Thoits, that a supportive environment such as boss support would build commitment, reduce turnover intentions, and enhance performance.

Specifically, Singh found that with boss support House, ; Thoits, , frontline employees perceived their roles to be less stressful and their burnout tendencies to be less likely, and thus their performance and perceived commitment levels were enhanced. IJSIM If contact employees perceive that their manager is concerned about them 12,5 and provides appropriate control and authority over their work, they will feel more positively towards their jobs Babin and Boles, ; Kopelman et al.

Supportive management may signal that managers trust their employees and have confidence in employees' abilities to carry out their jobs, and should potentially impact on job satisfaction, which is defined as the pleasurable emotional state resulting from the appraisal of one's job as achieving or facilitating the achievement of one's job values Locke, According to Churchill et al.

Employees' perceptions of supportive management are positively related to their work efforts. Employees' perceptions of supportive management are positively related to their job satisfaction. Work effort and job satisfaction Effort is one of most important constructs in motivation theory Mohr and Bitner, Locke et al.

Employees' work effort is likely to positively influence their job satisfaction. Brown and Peterson document that expenditure of effort tends to increase people's evaluations of objects, outcomes, and feeling states by means of their exertions.

The perceived exertion of effort in the work itself allows people to fulfill their intrinsic needs to be competent, effective, and self-determining, and hence contributes to job satisfaction. Also based on the terminal value perspective of work, effortful engagement in work is more likely to have affective consequences, because it produces a feeling of dignity, self-respect, and satisfaction Cherrington, Brown and Peterson found a strong, positive impact of work effort on job satisfaction in a direct-selling context.

Also they assessed the generalizability of the result with meta-analysis and found that the direct impact of effort on job satisfaction was significant in both sales force and non- sales forces studies. Although job satisfaction was found to be influenced by work effort in previous salespeople studies, we could find no investigation of the relationship between effort and job satisfaction in a services context.

Accordingly, the following hypothesis is proposed: H4. Employees' work efforts are positively related to their job satisfaction. Employee responses and employee service quality As indicated earlier, our study focuses on employees' service behaviors at the service encounter. Thus, employee service quality, as work climate on perceived by customers, is one of most the important variables to examine in outcomes regards to service encounter experiences.

Employee service quality, as a behavioral performance, is likely to reflect the amount of employee effort expended in the service encounter situation.

Brown and Peterson and Walker et al. A number of previous empirical studies in organizational behavior have found a positive relationship between effort and performance e. Blau, ; Gardner et al. Also in the marketing area, Brown and Leigh and Brown and Peterson presented evidence that salespeople's work-related efforts have a strong impact on their sales Downloaded by Universitat St Gallen At 13 March PT performance.

Extending these previous findings within a service encounter and viewing them from the customer perspective, the effort that employees put into their work should be reflected in their service performance, as seen through the eyes of their customers.

This provides the following hypothesis: H5. Employees' work efforts are positively related to customers' perceptions of employee service quality. Employee job satisfaction is also likely to relate to their job performance in regard to their level of service performance.

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