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Service Failure Recovery: The Moderating

Impact of Individual-Level Cultural Value
Orientation on Perceptions of Justice

Article in International Journal of Research in Marketing · September 2006

DOI: 10.1016/j.ijresmar.2006.02.004

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 Intern. J. of Research in Marketing 23 (2006) 263 – 277
www.elsevier.com/locate/ijresmar

Service failure recovery: The moderating impact of individual-level cultural

value orientation on perceptions of justice
Paul G. Patterson a,⁎, Elizabeth Cowley b , Kriengsin Prasongsukarn c
a
School of Marketing, University of NSW, Sydney 2052, Australia
b
Faculty of Economics and Business, University of Sydney, Australia
c
Graduate Business School, Assumption University, Thailand

Abstract

It is now well recognized that an effective service recovery program is essential to generating customer satisfaction and loyalty. A number of
studies have investigated the impact of service recovery efforts (compensation, speed of response, etc) on post-recovery satisfaction. However,
despite the importance of global markets, none have examined the impact of customers' cultural value orientation (i.e., cultural values measured at
the individual level) in implementing effective service recovery programs. In this research we use the individual rather than the nation as the unit
of analysis. Using an experimental design with data from both Eastern and Western cultures, we investigate how customer evaluations of recovery
efforts are influenced by interplay of consumers' value orientation and service recovery attributes (apology, cognitive control, and recovery
initiation). The results reveal that cultural values of individual Power Distance, Uncertainty Avoidance and Collectivism do indeed interact with a
firm's recovery tactics to influence perceptions of fairness (justice). Finally, all three forms of justice (distributive, procedural, interactional)
positively impact on overall service recovery satisfaction.
© 2006 Elsevier B.V. All rights reserved.

Keywords: Service recovery; Individual cultural values; Satisfaction; Justice theory; Fairness

1. Introduction Zeithaml, 1981). As a result, service delivery leaves little

In today's increasingly competitive global environment the
success of service firms largely depends on their capacity to
consistently deliver satisfying consumption experiences. Pro-
viding consistent and error-free service, while a noble goal, is
difficult to achieve in service industries. The high level of
human involvement (both service provider and customer) in the
‘manufacture’ and delivery of many services means the quality
of service delivery is often dependent on the attitude and
behaviour of front-line employees, the expectation of custo-
mers, and even the behaviour of other customers. In addition,
production and consumption of many retail services generally
occur at the same time, meaning that customers interact directly
with the service provider at the time service is delivered
(Bloemer & Kasper, 1995; de Ruyter & Wetzels, 2000;
⁎ Corresponding author. Tel.: +61 2 9385 1105; fax: +61 2 9663 1985.
E-mail address: p.patterson@unsw.edu.au (P.G. Patterson).
0167-8116/$ - see front matter © 2006 Elsevier B.V. All rights reserved.
doi:10.1016/j.ijresmar.2006.02.004
space for inspection or revision before it is provided to the
customer. Even the most customer-oriented organisation and the
strongest quality program will not entirely eliminate mistakes
during service delivery (Kelly & Davis, 1994). Given that
quality is notoriously difficult to manage in services enterprises,
it is important to have an effective service recovery program in
place.
When a service failure occurs, the organisation's response
has the potential either to restore customer satisfaction and
reinforce loyalty or to exacerbate the situation and drive the
customer to a competing firm (Smith, Bolton, & Wagner, 1999).
Effective customer complaint handling and service recovery,
can turn angry and frustrated customers into loyal ones
(Boshoff, 1997; Boshoff & Leong, 1998; Michel, 2001).
Evidence indicates that well considered and well enacted
service recovery can overcome disappointment and enhance
relationships, whereas “ineffective” service recovery can
severely damage satisfaction, trust and commitment and lead
to customers switching service providers (Keaveney, 1995;
264 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277
Michel, 2001; Smith & Bolton, 1998; Tax, Brown, &
Chandrashekaran, 1998). However, given that service encoun-
ters and service recovery are essentially social exchanges,
perceptions of recovery efforts will be affected by an
individual's cultural orientation. With the globalisation of
markets, and technology services now more easily crossing
geographical as well as cultural boundaries, there is a
compelling rationale for considering cultural effects (van
Birgelen, de Ruyter, de Jong, & Wetzels, 2002). Furthermore,
there is considerable evidence in social psychology indicating
that social exchanges and processes are culturally contingent
(Fiske, Kitayama, Markus, & Nesbitt, 1998). “Culture” is
defined here as the sum of all behavioural norms and patterns
collectively shared by a social group (Usunier, 1996). The
objective of this paper therefore is to examine the influence of
customers' cultural value orientation (i.e., cultural values
measured at the individual, not nation, level) and service
recovery processes on the perception of fairness (justice) and
post recovery satisfaction in a medium-contact service contact
(resort accommodation).
1.1. Service recovery
A failed service encounter is an exchange where a customer
perceives a loss due to a failure on the part of the service
provider. At which point, a sensitive service provider attempts
to provide a gain via some recovery effort to offset the
customer's loss. This view is consistent with social exchange
and equity theories (Adams, 1965; Homans, 1958). Service
recovery refers to the actions an organization takes in response
to a service failure (Gronroos, 1988). Service recovery
strategies involve actions taken by an organisation and its
employees to return the customer to a state of satisfaction
(Danaher & Mattsson, 1994; Sparks & McColl-Kennedy,
2001). These strategies may include acknowledgment of the
problem, prompt rectification of the problem, providing an
explanation for the service failure, apologising, empowering
staff to resolve issues on the spot, making offers of compensa-
tion (i.e., refunds, price discounts, upgrade services, free
products or services), and being courteous and respectful
during the recovery process (for examples, see Bitner, 1990;
Blodgett, Hill, & Tax, 1997; Hoffman & Kelly, 2000; Sparks &
Callan, 1996). Clemmer and Schneider (1996) emphasised that
it is important to focus on the process and relational aspects of
service recovery (i.e., how the customer is treated during the
recovery process), as well as the outcomes (i.e., rectifying the
problem, providing compensation). Hence, both what is done
(tangible compensation) and how it is done (employee
interaction with the customer) influence customer perceptions
of justice (Levesque & McDougall, 2000). And in the
marketplace, the customer is both judge and jury when it
comes to perceptions of justice.
The balance of the paper is organised as follows: first we
present a theoretical framework based on equity and social
exchange theory within a service recovery context. Next the
methodology is discussed including a description of the
scenarios used in the research. Following a discussion of the
results, we conclude with key managerial and research
implications.
2. Justice theory
The leading theoretical perspectives of service recovery,
embracing both processes and outcomes, have centred on equity
theory (Bowen & Johnston, 1999; Clemmer, 1993; Smith et al.,
1999; Tax et al., 1998; Tyler, 1994). Equity theory concerns
individuals' perceptions of the fairness of a situation or decision
(Adams, 1965). More specifically, people compare the ratio of
their outputs (what they receive) to inputs (what they pay —
financial and non-financial) to the ratio of the other party. If the
difference is in the individual's favour, the result may be a
feeling of guilt or regret. If the difference is to the individual's
detriment, the result may be a feeling of disappointment or
anger. The theory predicts that in both cases the individual will
act to bring about a state of equilibrium.
Justice theory is adapted from social exchange and equity
theories. The three dimensions of justice include distributive,
procedural, and interactional (refer Table 1). Distributive justice
focuses on the perceived fairness of the outcome of the process
and involves the policies and rules governing how recovery
decisions are made (Deutsch, 1975; Smith et al., 1999).
Procedural justice, which involves the perceived fairness of
the means by which decisions are made and conflicts are
resolved (Lind and Tyler, 1988) while interactional justice
involves the manner in which the customer is treated throughout
the process (e.g., information is exchanged and outcomes are
communicated) (Bies & Shapiro, 1987). Research involving the
three dimensions has been developed independently, and only
recently been integrated into service evaluations in general and
service recovery contexts specifically (see Smith et al., 1999;
Tax et al., 1998).
Each of the three justice dimensions is driven by various
actions taken by the firm in effecting service recovery. For
example, customer perceptions of fairness following compensa-
tion and an apology impact overall distributive justice, while
providing cognitive control (i.e., keeping the customer informed
of what is happening) impacts procedural justice. Finally, the
manner in which service personnel treat a customer (politeness,
respect, and courtesy) during the recovery process affects
perceptions of interactional justice.
A number of studies have examined the justice dimensions in
various service recovery settings employing field survey or
experimental methodologies. Generally, the studies have
Table 1
Justice definitions
Justice dimension Definition
Distributive Perceived fairness of the outcome (e.g., problem
justice rectified, refund, compensation)
Procedural Perceived fairness of the process employed in resolving
justice the service failure (e.g., speed of recovery, keeping
customer informed)
Interactional Perceived fairness of the manner in which the
justice customer is treated (e.g., respect, empathy, courtesy)
 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277
concluded that higher perceived levels of justice (either alone or
in combination) are positively correlated with higher post-
recovery satisfaction (Hoffman, Kelly, & Rotalsky, 1995;
Sparks & McColl-Kennedy, 2001; Tax et al., 1998).
3. Cultural orientation
Hofstede (1991) defined culture as the “training or refining
of one's mind from social environments in which one grew up”
(p.4). Service encounters (including service recovery efforts)
are social exchanges. The interaction between service-provider
and customer is a crucial component of satisfaction and
provides a motive to continue the relationships. As Czepiel
(1990) noted “The social content of service encounters often
seems to overshadow the economic”. Because a degree of social
interaction between provider and customer is necessary for
service recovery, it stands to reason that societal values and
norms as well as expectations of both parties are likely will be
influenced by one's cultural background. Prior research
suggests that the importance of culture in shaping people's
attitudes, values, and preferences should be particularly
observable for services that require a medium-high degree of
customer contact with service personnel and facilities (Choi &
Markus, 1998; Mattila, 1999; Schutte & Ciarlante, 1998). More
specifically, recent cross-cultural studies in marketing have
shown that cultural norms and values have a strong impact on
service encounter evaluations (Winsted, 1997, 1999), service
quality expectations (Donthu & Yoo, 1998), referral behaviour
(Money, Gilly, & Graham, 1998), and the nature and strength of
customer relationships (Patterson & Smith, 2001, 2003). Given
the social interaction involved in most service recovery
episodes, it is logical that the cultural orientation of a consumer
will impact how the customer perceives such recovery efforts.
3.1. Measuring cultural values and norms at the individual
level
Keillor, D'Amico, and Horton (2001) contend that any
chances for marketing success will be greatly improved if
attention is directed at consumer, rather than country,
characteristics. And as suggested by Dawar and Parker (1994)
and Leung, Bhagat, Buchan, Erez, and Gibson (2005), the term
culture is not necessarily synonymous with the term country.
Studies based on cultural dimensions, rather than nationality
should provide greater explanatory power because they enable
us to attribute differences to cultural norms and traits, and to
extrapolate beyond the countries included in any sample. In this
study we do not focus on individual nations, but rather we use
the cultural values of the individual respondent as the unit of
analysis. Using national generalisations to explain individual
behaviours is an ecological fallacy because country-level
relationships are interpreted as if they are applied to individuals
(Yoo & Donthu, 2002). Applying Hofstede's cultural typology
at the individual level is reasonable since the values of an
individual person are identified in terms of the selected
dimensions of culture (Donthu and Yoo, 1998). For example,
a person can be described from the cultural perspective as being
265
of higher (lower) Power Distance, higher (lower) Collectivism,
stronger (weaker) Uncertainty Avoidance, higher (lower)
Masculinity, and higher (lower) Confucian Dynamic.
3.2. Predictions
Satisfaction with service recovery efforts has been shown to
depend on customers' expectations and perceptions of com-
pensation, apology, empathy and politeness displayed attribu-
tions of blame, as well as accessibility and speed of recovery in
a Western context (Andreassen, 2000; Sparks & McColl-
Kennedy, 2001; Tax et al., 1998). We argue that the impact of
these attributes on justice perceptions is value dependent, and
thus consumer expectations and perceptions of recovery efforts
will vary, depending on cultural value orientation. As noted by
Donthu and Yoo (1998), “When marketing efforts fit the
culture, their impact on service quality should be greater or
more noticeable” (p. 59).
To build a theory taking into account the influence of culture,
we must first link observed cultural value orientation differ-
ences to specific dimensions of culture that are hypothesised to
have produced the differences (Leung & Bond, 1989). Our
model places the justice framework in a cultural context. We
hypothesise that the success of service recovery tactics is
influenced by an individual consumer's value orientation along
the dimension of Power Distance, Individualism–Collectivism,
and Uncertainty Avoidance. These cultural dimensions interact
with service recovery attributes to impact customer perceptions
of distributive, procedural, and interactional justice, and thus
satisfaction with the overall service recovery effort.
3.3. Cultural orientation and service recovery
Power Distance is defined as the extent to which the less
powerful members of a society expect and accept that power is
distributed unequally (Hofstede, 1991). Power typically sym-
bolizes a higher status, respect, more rights and wealth. In lower
Power Distance cultures inequalities among people will tend to
be minimized, decentralization of activities is more likely,
subordinates expect to be consulted by superiors, and privileges
and status symbols are less evident. On the other hand, in higher
Power Distance cultures inequalities among people are
considered desirable, there is greater reliance by the less
powerful on those who hold power, centralization is the norm,
and subordinates are likely to be separated from the superiors by
wide differentials in salary, privileges and status symbols.
Furthermore, the concept of ‘face’ is a fundamental norm that
often accompanies high Power Distance. Face refers to social
and professional position, reputation, and self image. For some
individuals therefore, face is of critical importance and loss of
face has disastrous personal consequences and thus avoided at
all costs. The intense desire for gaining (and not losing) face
suggests that an apology from a person of higher status would
be more highly valued than an apology from a lower ranking
employee (e.g., receptionist).
Thus consumers with a higher Power Distance value
orientation are more sensitive to the status of the employee
266 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277
delivering an apology. Therefore we expect them to be more
satisfied when an apology is given by an employee they
perceive to be of higher status. Conversely, consumers with a
lower Power Distance value orientation will not be as concerned
whether the source of the apology is a higher or lower status
representative of the firm.
H1. An apology from a service provider with more status will
have a greater effect on perceptions of distributive justice for
customers with a higher Power Distance value orientation,
compared to customers with lower Power Distance value
orientation.
A Collectivist (versus an Individualist) orientation is
represented by a social pattern consisting of closely linked
individuals who see themselves as part of one or more
collectives and are willing to give priority to the collective
goals over their own personal goals. Collectivists are suscep-
tible to social influence and are concerned with their self-
presentation. Collectivists value harmony and avoid confronta-
tion at all costs. Since complaining requires a customer to
express their dissatisfaction directly to the service provider thus
breaking the harmony of the situation, customers with a
Collectivist orientation, therefore, should find it disturbing to
voice their complaints directly and risk confrontation. Rather
they would prefer the organisation to recognise that a service
failure has occurred and the firm to voluntarily initiate recovery
efforts (Triandis, 1995). Thus:
H2. Customers with a higher Collectivist value orientation will
perceive more interactional justice when there is an organisa-
tion-initiated recovery (versus self-initiated recovery) than
customers with a lower Collective orientation.
Uncertainty Avoidance describes the extent to which people
feel threatened by ambiguous or an unknown situations
(Hofstede, 1980; Patterson & Smith, 2001). Higher Uncertainty
Avoidance is associated with a desire for reduction of ambiguity
and a need for predictability, written rules, and structured
relationships. Lower Uncertainty Avoidance is associated with a
propensity to engage in risk taking behaviour. Individuals with a
higher Uncertainty Avoidance are active, emotional, and
security-seeking. On the other hand, individuals with lower
Uncertainty Avoidance are more contemplative, less aggressive,
unemotional, and generally accepting of personal risk (Triandis,
1995). Consequently, customers with a higher Uncertainty
Orientation place a higher value on having cognitive control (a
result of reliable follow-up, being kept informed during the
recovery process) over the situation, than do their counterparts
with a lower Uncertainty Avoidance orientation. Thus Hypoth-
esis 3 is:
H3. Customers with a higher Uncertainty Avoidance orienta-
tion, will, when given cognitive control over the recovery
process, perceive higher levels of procedural justice than
customers with a lower Uncertainty Avoidance orientation.
We now include two general hypotheses. First, we predict
that each of the three justice dimensions will be positively
associated with overall satisfaction with service recovery
efforts, irrespective of an individual's cultural orientation.
Hence our first general hypothesis is:
H4a,b,c. In a service recovery situation, irrespective of an
individual's cultural orientation, satisfaction will be related
positively to perceptions of (a) distributive (b), procedural (c),
and interactional justice.
Next, consistent with the satisfaction literature, we include
disconfirmation of expectations as an antecedent of overall
satisfaction. Consumers are known to judge performance
against their prior expectation in making satisfaction evalua-
tions (Liljander & Strandvik, 1994; Patterson, 1993; Smith et
al., 1999). When perceptions of performance exceed expecta-
tions, positive disconfirmation occurs; while negative discon-
firmation results when performance outcomes are less than
expected. For this reason, an overall disconfirmation variable is
included as a predictor of overall satisfaction with service
recovery. Further, by controlling for expectations, we provide a
stronger test of our main hypotheses for the three justice
dimensions. Hence:
H5. In a service recovery situation, irrespective of value
orientation, disconfirmation of expectation will be related
positively to customer's evaluation of satisfaction with service
recovery.
4. Methodology
4.1. Design
To test the first three hypotheses, we used three single factor
experimental designs. Each design has a separate manipulation
of the service recovery. In all three experiments, the respondent
reads the same description of the service failure. The
manipulations appear in the description of the service recovery.
Participants randomly assigned to Manipulation 1 were
informed that they received an apology from either the duty
manager (higher status) or the receptionist (lower status).
Participants randomly assigned to Manipulation 2 were
informed that the service recovery had been initiated either by
the service provider or themselves. Participants randomly
assigned to Manipulation 3 were informed that they had been
kept informed (high cognitive control) or had not been kept
informed (low cognitive control) by the service provider while
waiting for a resolution. In each case, the service provider was
the receptionist, except in Manipulation 1. In each case, the
receptionist initiates the investigation into the source of the
service failure, except in Manipulation 2. In each case, no
cognitive control is present, except in Manipulation 3. The
service failure was rectified in all cases. All dependent and
value orientation measures were identical regardless of the
manipulation.
For analysis purposes the appropriate independent measure
(value orientation) was used in a median split resulting in three
separate 2 × 2 designs. Regression analysis on the pooled data
 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277
(from all manipulations) was then employed to test the
relationship between the three types of justice and disconfirma-
tion, and post-recovery satisfaction.
4.2. Sample
Previous research has shown that members of a western
country are typically more Individualistic, lower in Power
Distance, and lower in Uncertainty Avoidance both when the
dimensions are measured at country and at an individual level
(for a review see Triandis & Suh, 2002). In order to maximise
the variance within each dimension, we collected data in both an
eastern and a western country. We used a separate design and
sample to test H1 (n = 150), H2 (n = 165), and H3 (n = 172). We
then pooled the data to test H4 and H5 (n = 487).
We collected data from undergraduate students in Thailand
(n = 246) and in Australia (n = 241). Only participants reporting
English as their mother tongue in Australia and Thai in Thailand
were included in the analysis. This resulted in the exclusion of
45% of the Australian sample (original n = 438). We selected
these two countries because they have very different profiles
using Hofstede's (1980) national scores. Without a two country
sample, it could be argued that the effects we present here would
hold only in a western country had we collected an Australian
sample, or only in an eastern country had we collected a Thai
sample. A two country sample strengthens the argument for
using individual level indicators of cultural value orientation.
4.3. The stimulus
In each design one aspect of the scenario was manipulated
(the status of the service provider, the source of recovery
initiation or the degree of the customer's cognitive control). A
scenario approach is used because it avoids the problem of
intentionally imposing service failures on customers and
minimises memory-biases, which are common in self-reports
of past service failures as Smith et al. (1999) reported. The
scenarios were developed over several stages following the
procedure used by Sparks and McColl-Kennedy (2001). First,
depth interviews were conducted to generate service breakdown
ideas suitable for the project. The scenarios developed met both
of our criteria; 1] an undergraduate student sample would be
familiar with the setting and 2] the service failure would be
considered a core service failure. Second, scripts were drafted
by the researchers. The manipulations of the status of the
apologising service provider, the source of the recovery
initiation, and the cognitive control of the customer were pre-
tested on 188 undergraduate students (see Section 4.3.2). The
final scenarios described a service situation where the customer
made a booking in advance at a resort/hotel. The guest, or the
participant, was informed upon arrival that the room had been
double-booked and no other rooms were available. The scenario
was written through the eyes of the reader. In addition,
instructions encouraged the respondents to imagine that they
were the person involved in the service encounter. Finally, the
scenarios were translated into Thai and pilot tested on 198
undergraduate students (see Section 4.3.1).
267
4.3.1. Measurement equivalence
To ensure item equivalence, a critical consideration in a
multi-lingual study of this nature, the English version was
forward translated by bilinguals whose mother language was
Thai (Hambleton, 1993), and then back translated by bilingual
authors whose mother language was English (Brislin, Lonner, &
Thorndike, 1973). Depth interviews were conducted to establish
meaning equivalence of key concepts and phrases with Thai
undergraduate students. Similar reactions to the service failure
in the scenario were reported by Thai (n = 100) and Australian
(n = 98) undergraduate students. Both groups agreed that the
scenario was realistic, that the problem presented in the scenario
was major, and that they would be irritated, annoyed, and
angered by the situation. This further supports the assertion that
the translation resulted in psychologically equivalent stimuli.
See Table 2 and Section 4.3.2 for the results of a pilot test.
Before comparing the two country samples and pooling the
data, we established construct and measurement equivalence
between the Australian and Thai data following the procedure
suggested by Steenkamp and Baumgartner (1998). The
regression coefficient of one item (the marker) is set equal to
one and its intercept to zero to identify a base model. Further
restrictions impose configural, metric and scalar invariance of
scales. Measures may be completely or only partially invariant.
All scales discussed satisfy complete metric invariance.
Steenkamp and Baumgartner require that the intercept of at
least one item besides the marker item must be invariant in order
to satisfy partial scalar invariance. At least partial scalar
invariance is necessary for means of latent variables to be
comparable across countries. All scales satisfy at least partial
scalar invariance. Further, the scales meet at least partial error
invariance and complete variance invariance. The results are
shown in the Appendix. Hence measurement invariance is, by
and large, established. When combined with the qualitative
phase and rigorous translation and back translation procedures
adopted, there is a legitimate platform to pool the country
samples for analysis (Craig & Douglas, 2000; Mullen, 1995;
Steenkamp & Baumgartner, 1998).
4.3.2. Manipulation checks
The manipulations were pre-tested on a sample of under-
graduate students in Thailand (n = 100) and in Australia
Table 2
Test of equivalence of scenario between Thailand and Australia
Test of equivalence Australia Thailand T-
N = 98 N = 100 value
Last stayed at a hotel or resort (months) 10 9.2 0.43
How realistic was the problem that 5.30 5.22 0.46
described to you?
(1 = not at all realistic and 7 = very realistic)
How do you view this problem? 5.94 5.87 0.38
(1 = minor and 7 = major problem)
How irritated would you be? 5.95 6.21 1.64
(1 = not at all and 7 = very irritated)
How annoyed would you be? 6.05 6.07 1.43
(1 = not at all and 7 = very annoyed)
How angry would you be? 5.52 5.99 1.80
(1 = not at all and 7 = very angry)
268 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277

(n = 88). The manipulation of the status of the service provider
offering the apology was operationalised using the statements:
“The duty manager personally apologised on the behalf of the
hotel” (higher) or “The receptionist personally apologised on
the behalf of the hotel” (lower). Participants read one of the
two versions of the scenario and rated their agreement that the
status of the person apologising was higher on a seven-point
Likert scale. T-tests revealed that in the first version of the
scenario participants agreed that the person apologising had
higher status, but not in the second version (Thailand:
Manager = 5.18, Receptionist = 3.11, t = 9.73, p < .001 and
Australia: Manager = 5.08, Receptionist = 4.34, t = 12.22,
p < .001). The results are presented by country because the
stimuli were presented to the Thai subjects in Thai and the
Australian subjects in English.
The manipulation of service recovery initiation was
operationalised using the statements: “before you respond or
complain, the receptionist immediately acted on your behalf”
(organisation) or “you complain to the front desk receptionist”
(customer). Participants read one of the two versions of the
scenario and rated their agreement that the organisation initiated
the recovery on a seven-point Likert scale. T-tests revealed that
in the first version of the scenario participants agreed that the
service recovery was initiated by the organisation, but not in the
second version (Thailand: organisation = 5.73, customer = 3.33,
t = 41.89, p < .001 and Australia: organisation = 5.02, custo-
mer = 2.86, t = 38.28, p < .001).
The manipulation of cognitive control was operationalised
using the statements: “During the time you were waiting, the
receptionist came to you twice to keep you informed about
what was being done” (more control) or “During the time you
were waiting, the receptionist did not speak to you or keep
you informed” (less control). Participants read one of the two
versions of the scenario and rated their agreement that they
felt they could predict what was going to happen on a seven-
point Likert scale. T-tests revealed that in the first version of the
scenario participants agreed that they had enough knowledge
(cognitive control) to predict the outcome of the encounter, but
not in the second version (Thailand: more control = 4.65, less
control = 2.58, t = 7.44, p < .001 and Australia: more con-
trol = 5.03, less control = 2.59, t = 8.45, p < .001).
4.4. Measures
4.4.1. Independent measures
The CVSCALE (Donthu & Yoo, 1998; Yoo & Donthu,
2002; Yoo, Donthu, & Lenartowicz, 2001) was used to
investigate cultural orientation at the individual level. This
scale has previously been used successfully to capture
Hofstede's (1991) five cultural dimensions at the individual
level (Donthu & Yoo, 1998; Yoo & Donthu, 2002). Only three
of the five cultural dimensions were employed in this study to
support the hypotheses (Confucianism and Masculinity/
Femininity culture dimensions were not relevant to the
hypotheses). Power Distance, Uncertainty Avoidance and
Collectivism were captured using the 16 items of the original
CVSCALE. These items were then subjected to both an
exploratory factor analysis (principal components analysis and
varimax rotation) and a confirmatory factor analysis (CFA).
Refer Table 3 for the exact wording of the items. The
exploratory factor analysis resulted in a clean solution (with
only one item cross loading > 0.45) and all 16 items loading on
the dimensions as reported in Donthu and Yoo (1998), thus
indicating convergent and discriminant validity. Table 3 reports
factor loadings and variance explained. The Cronbach alpha
statistic for Power Distancei, Uncertainty Avoidancei, and
Individualism–Collectivismi ranged from 0.61 to 0.80. All of
the distributions were approximately normal.

Table 3
Exploratory factor analysis results
CVSCALE
Factor loadings
1 2 3
1 People in higher positions should make most decisions without consulting people in lower positions − .122 .105 .667
2 People in higher positions should not ask the opinion of people in lower positions too frequently .193 .068 .513
3 People in higher positions should avoid social contact with people in lower positions .328 −.065 .648
4 People in lower positions should not disagree with people in higher positions .114 −.064 .720
5 People in higher positions should not delegate important tasks .060 .203 .707
6 It is important to have instructions spelled out in detail .010 .699 .017
7 It is important to closely follow instructions and procedures .128 .790 .122
8 Rules and regulations are important because they inform me of what is expected .055 .766 .048
9 Standardised work procedures are helpful .087 .817 .088
10 Instructions for operations are important. .243 .777 −.013
11 Individuals should sacrifice self-interest for the group .473 .420 .112
12 Individuals should stick with their group even through difficulties .743 .136 −.176
13 Group welfare is more important than individual rewards .890 .098 .075
14 Group success is more important than individual success .851 .030 .167
15 Individuals should only pursue their personal goals after considering group goals .745 .126 .277
16 Group loyalty should be encouraged even if individual goals suffer .617 .116 .297
Variance explained 29.8% 15.6% 11.9%
Cumulative variance explained: 57.4%
Cronbach alpha .73 .80 .61
 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277 269

The sixteen items were then subjected to a confirmatory Table 5

factor analysis. This resulted in four items being omitted. After Measurement items for perceived justice
refinement, a final CFA model was estimated that demonstrated Variable Item
good measurement properties. Distributive 1. The outcome I received was fair
2. I did not get what I deserved (R)
4.4.2. Measurement properties 3. In resolving the problem, the service organisation gave
me what I needed
A CFA was conducted on the CVSCALE using LISREL 8
4. The outcome I received was not right (R)
(Jöreskog & Sörbom, 1993) and, after refinement, showed that Procedural 1. The length of time taken to solve my problem was longer
the hypothesized model fit the data reasonably well (see Table than necessary (R)
4). The overall fit of the model was adequate: the Jöreskog and 2. The service organisation showed adequate flexibility in
Sörbom (1993) GFI was .97, and the CFI was .98; only 4 (2%) dealing with my problem
Interactional 1. The employees were appropriately concerned about
of the standardized residuals were over the absolute value of
my problem
three (largest positive standardized residual was 3.36 and largest 2. The employees did not put the proper effort into resolving
negative standardized residual was − 3.45); and the chi-square my problem (R)
was 75.3 with 40 degrees of freedom. Second, as evidence of 3. The employees' communications with me were appropriate
convergent validity, the measurement factor loadings were all 4. The employees did not give me the courtesy I was due (R)
significant (t-values between 12.11 and 23.18), the construct (R) = reverse scored.
reliabilities were acceptable (ranging from 0.61 to 0.80), and the
Variance Extracted (Fornell & Larker, 1981) indicated that in was 0.42. This could have been increased with the deletion of an
two of the three cases the variance captured by the construct was additional item, however it was retained for theoretical reasons.
greater than the variance due to measurement error (0.54 and Finally, to test for discriminant validity, the procedure described
0.56) for the Power Distance dimension the variance extracted by Fornell and Larker (1981) was used. As an indication of
discriminant validity, the average variance (AVE) extracted for
each construct should be higher than the squared correlation
Table 4
between that construct and any other construct. This test holds,
Confirmatory factor analysis
since in no cases is there a squared correlation between any two
CVSCALE constructs that is higher than either of the constructs' AVE.
Construct and measures Standardized T-value Variance
parameter extracted 4.4.3. Cultural value orientation groups
estimate
Each respondent was assigned to a Power Distance group
Power distance 0.43 (high, low), a Collectivist group (Collectivist, Individualist),
People in higher positions should avoid 0.74 15.3
and Uncertainty Avoidance group (high, low) on the basis of
social contact with people in lower
positions three median splits. The responses for each of the three
People in lower positions should not 0.61 12.7 dimensions were weighted by the factor scores and summed for
disagree with people in higher positions use in the median split. It is interesting to note that the medians
People in higher positions should not 0.60 12.1 for the dimensions were not significantly different between
delegate important tasks
countries for any of the dimensions. One explanation for the
Uncertainty avoidance 0.54 similarity in distributions across cultures is that the population
It is important to have instructions 0.56 12.9 sampled was young and educated, both of which affect the
spelled out in detail degree to which values are culturally determined as Triandis and
It is important to closely follow 0.79 16.8 Suh (2002) reported.
instructions and procedures
Standardised work procedures are helpful 0.74 17.4
Instructions for operations are important 0.92 21.4 4.4.4. Dependent measures
The perceptions of justice and satisfaction with the service
Collectivism 0.56 recovery were measured using the scales adapted from Smith et
Individuals should stick with their group 0.57 12.9 al. (1999) and Oliver and Swan (1989), respectively. The
even through difficulties
perception of justice has three dimensions: distributive justice,
Group welfare is more important than 0.87 23.2
individual rewards procedural justice, and interactional justice (see Table 5 for the
Group success is more important than 0.86 19.2 exact wording of the questions). Distributive justice was
individual success measured with 4 items (α = .89). Procedural justice was
Individuals should only pursue their 0.76 15.0 measured with two items (r = .73). Interactional justice was
personal goals after considering group
measure with four items (α = .83). A CFA was also conducted
goals
Group loyalty should be encouraged 0.64 12.7 with resulting measurement properties exceeding all minimum
even if individual goals suffer acceptable standards, and demonstrating sound convergent and
Goodness of fit statistics: discriminant validity (Fornell & Larker, 1981). Overall
χ2 (df: 40) = 75.3, p < 0.05, GFI = 0.97, AGFI = 0.95, NFI = 0.97, CFI = 0.98, satisfaction with the service recovery was measured with
RMSEA = 0.043. three seven-point scales anchored with “very dissatisfied” and
270 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277
“very satisfied”; “did a poor job” and “did a good job”; and
“happy” and “unhappy” (α = .86).
4.5. Procedure
Versions (6 in total) of the scenario were randomly
assigned to participants. The first question asked how many
months it had been since the respondent had last stayed in a
resort/hotel. If the respondent had never stayed in a hotel or
resort, and therefore would not have experienced this service
setting, they would have been excluded, however there were
no such instances. Respondents were asked to read the
scenario and try to imagine themselves in the setting.
Participants then responded to the dependent measures
(perceived justice and satisfaction items) and independent
measures (CV scale dimensions). The entire procedure took
approximately 15 min.
5. Results
5.1. Analysis plan
Past research suggests a relationship between cultural value
dimensions and perceived justice. Hence, the cultural value
orientations that were not included in the hypothesised
interaction in each manipulation were considered a possible
source of extraneous variance, and employed as covariates.
This allowed us to control for the fact that sensitivity to feelings
of perceived justice may differ based on other aspects of value
orientation, independent of the experimental manipulations. If
the covariates were significant, they remained in the analysis.
For example, when testing Manipulation 1, perceived dis-
tributive justice may be affected by Individualism–Collecti-
vism and/or Uncertainty Avoidance. In order to present a more
accurate analysis of the relationship between the status of the
apologizing service provider and the Power Distance orienta-
tion of the customer, both Collectivism and Uncertainty
Avoidance were initially included in the analysis as covariates.
Controlling for these variables provides a stronger test of our
hypotheses.
A MANCOVA (or MANOVA) was used to test each
hypothesis with all three justice dimensions as the dependent
measures. Although we did not have specific hypotheses about
each justice dimension, previous research has found them to be
correlated (Tax et al., 1998). Regression results for each
manipulation are also provided. The regressions were run on the
relevant justice dimension with the manipulation as a dummy
variable, the relevant mean-centred value orientation score and
the interaction of the two as independent factors. It should be
noted that the regression results did not change significantly
with or without mean centring.
5.2. Manipulation 1
This manipulation was designed to test the moderating
influence of the Power Distance orientation on the relation-
ship between the status of the service provider offering an
Fig. 1. Two way interaction: apology status × power distance.
apology and perceived distributive justice. The manipulation
included two levels of status of employee delivering apology
(higher, lower). Students (n = 150) from Australia and Thai-
land were randomly assigned to one of the two experimental
conditions.
To test H1, a MANOVA with Power Distance group and
status of the person offering the apology was run on the multiple
dependent measures of distributive, procedural and interactive
justice.1 There was a main effect for status (F(1, 145) = 4.12,
p < .05) revealing that respondents felt a greater sense of
distributive justice when the apology came from an employee of
higher status, regardless of their Power Distance orientation. As
expected was a significant interaction with status (F(1, 145) =
21.72, p < .0001). Higher Power Distance oriented customers
felt a greater sense of distributive justice when the apology was
provided by an employee with higher status (Manager = 5.17,
Receptionist = 4.47, t = 3.36, p < .001), whilst lower Power
Distance oriented customers reported no difference in feelings
of distributive justice when an apology was provided by
employee with either higher or lower status (Manager = 4.44,
Receptionist = 4.64). See Fig. 1. H1 is supported. 2 The
manipulation also interacted with Power Distance orientation
for perceptions of procedural (F(1, 145) = 13.56, p < .0001) and
interactional justice (F(1, 145) = 5.35, p < .05). In these cases,
lower Power Distance oriented individuals perceived more
procedural and interactional justice when the receptionist (or
lower status employee) delivered the apology. The result is
interesting because it provides evidence for independence of
distributive justice.
In addition, the main effect for Power Distance orientation
was significant (F(1, 144) = 6.28, p < .05). Power Distance was
not hypothesised to have an effect on distributive justice here,
1
Value orientation for individualism and uncertainty dimensions were
initially included as covariates in the analysis, but were non-significant and
therefore removed.
2
A regression run on perceived distributive justice with the mean-centred
power distance score, the status manipulation as a dummy variable, and the
interaction of the two reveals the same pattern of results. Status (b = .22,
p < .0001) and the interaction term (status * power distance) (b = .20, p < .05)
were significant, whilst power distancei orientation was not. (b = − .05, p = .48).
 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277
although the effect has been found elsewhere (see Fields, Pang,
& Chiu, 2000).
5.3. Manipulation 2
This manipulation was designed to test the moderating
influence of Individualism–Collectivism orientation on the
relationship between recovery initiation and perceived interac-
tional justice. The manipulation included two levels of
recovery initiation (organization, customer). Respondents
(n = 165) were randomly assigned to one of the two experi-
mental conditions.
To test H2 a MANCOVA with Individualism–Collectivism
and recovery initiation with Power Distance score as a covariate
was run on the multiple dependent measures of interactional,
procedural, and distributive justice.3 There was a main effect for
initiation (F(1, 160) = 12.65, p < .0001) revealing that respon-
dents felt a greater sense of interactional justice when the
service recovery was initiated by the organization, in this case
the service provider, regardless of their Individualism–Collec-
tivism orientation. There was a weak interaction between
service recovery initiation and Individualism–Collectivism
orientation (F(1, 160) = 2.64, p = .10). Customers with a
Collectivist orientation felt a greater sense of interactional
justice when service recovery was initiated by the organization
(organization = 5.72, customer = 4.97, t = 4.28, p < .0001). Indi-
vidualist oriented customers, on the other hand, did not report
any significant increase in feelings of interactional justice
whether recovery was initiated by the organization or customer
(organization = 5.11, customer = 5.01). H2 is supported.4 See
Fig. 2. The manipulation also interacted with Collectivism for
perceptions of procedural justice. Customers with a Collectivist
orientation felt a greater sense of procedural justice when
service recovery was initiated by the organization (F(1, 160) =
6.71, p < .05). There was no effect for perceptions of distributive
justice.
5.4. Manipulation 3
This manipulation was designed to test the moderating
influence of Uncertainty Avoidance on the relationship between
cognitive control and perceived procedural justice. The
manipulation included two levels of cognitive control (higher,
lower). Respondents (n = 172) were randomly assigned to one of
the two experimental conditions.
To test H3 a MANOVA with Uncertainty Avoidance
orientation and cognitive control was run on the multiple
dependent measures of procedural, distributive, and interac-
3 5
The covariate for power distancei also had a significant effect on
interactional justice, as has been found in past research (White, Tansky, &
Baik, 1995). The coviariate for uncertainty orientationi was initially included in
the analysis, but was non-significant and was, therefore, removed.
4
A regression run on perceived interactional justice with the mean-centred
collectivismi score, the initiation manipulation as a dummy variable, and the
interaction of the two reveals the same pattern of results. Initiationi (b = .20,
p < .01) and the interaction term (b = .15, p < .05) were statistically significant,
whilst collectivismi orientation was not (b = .12, p = .13).
271
Fig. 2. Two way interaction: recovery initiate × collectivisn/individualism.
tional justice.5 There was a main effect for control (F(1, 168) =
17.42, p < .0001) revealing that respondents felt a greater sense
of procedural justice when they had more cognitive control,
regardless of their uncertainty orientation. There was no effect
for Uncertainty Avoidance orientation (F(1, 168) = 0.04, p = .84)
but, as expected, there was a significant interaction between
control and Uncertainty Avoidance orientation (F(1, 168) =
8.80, p < .01). Customers with a higher Uncertainty Avoidance
orientation felt a greater sense of procedural justice when the
employee kept them informed of what was happening during
the service recovery process (high = 5.21, low = 3.96, t = 4.37,
p < .0001), whilst those with lower Uncertainty Avoidance
orientation did not report a significantly greater feeling of
procedural justice when the employee kept them informed
(high = 4.73, low = 4.52). H3 is supported.6 See Fig. 3. The
manipulation also had an effect on perceptions of distributive
justice. Customers with a stronger Uncertainty Avoidance
orientation felt a greater sense of distributive justice (F(1, 168) =
5.97, p < .05) when kept informed. There was no effect for
perceptions of interactional justice. This provides evidence for
the independence of the interactional justice dimension.
5.5. The influence of perceived justice on service recovery
satisfaction
To test for replication of the relationship between perceived
justice and satisfaction found in previous research, the pooled
data from Australia (n = 241) and Thailand (n = 246) was
analysed using multiple regression analysis. The adjusted R2
values for the service recovery satisfaction equations are .64 for
pooled data and .65 and .63 for Australia and Thailand,
respectively, (see Table 6). The regression results which
demonstrate a highly consistent pattern of results for both
Power distancei and individualism–collectivismi scores were initially
included as covariates in the analysis, but were non-significant and were,
therefore, removed.
6
A regression run on perceived procedural justice with the mean-centred
uncertainty avoidancei score, the cognitive control manipulation as a dummy
variable, and the interaction of the two reveals the same pattern of results.
Cognitive controli (b = .30, p < .0001) and the interaction term (b = .16, p < .05)
were significant, while the cultural orientation of uncertainty avoidancei (b =
−.07, p = .33) was not.
272 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277

(2005), some individuals in every country hold beliefs and

values that are different from those typical of the country. Hence
the chances of success will be improved if marketing effort is
directed at the individual rather than the country stereotype.
The next contribution is both methodological and concep-
tual. Although we did not have specific hypotheses for all three
justice dimensions for each manipulation, we analysed the data
using MANOVAs or MANCOVAs. It is interesting that the
status manipulation affected perceptions of distributive justice
differently than it affected perceptions of procedural and
interactional justice. It is also noteworthy that the recovery
initiation manipulation affected perceptions of distributive and
procedural, but not interactional justice, while the cognitive
Fig. 3. Two way interaction: cognitive control × uncertainly avoidance. control manipulation affected perceptions of distributive and
interactional, but not procedural justice. Previous research has
countries, together with a Chow test (Table 6), justify pooling suggested that the high correlations between the justice
the data. For the pooled model, perceptions of distributive, dimensions indicates that they are not independent (Tax et al.,
procedural, and interactional justice were all significantly 1998), conversely, the results presented here provide evidence
positively associated with customer satisfaction. Distributive for their independence. Our results however are consistent with
justice had the largest standardised coefficient (β = .292) Smith et al. (1999) who also found all recovery attributes had
followed by interactional and procedural justice (β = .230 and some effect on each of the justice elements.
.142, respectively). As predicted, the three justice dimensions A third contribution of the research reported here is that we
and disconfirmation (of expectations) explain a considerable included the remaining two cultural values as covariates in
amount of variance in satisfaction with the service recovery testing each hypothesis. In H2 where we predicted that
effort, across each country sample and for the pooled data Individualism–Collectivism orientation would interact with
(adjusted R2 for Australia = .65, Thailand = .63 and pooled recovery reaction, we controlled for Uncertainty Avoidance and
data = .64). Thus H4 and H5 are supported. Power Distance, with the latter being statistically significant. In
this case at least two cultural norms simultaneously helped in
6. Discussion explaining customers perceptions of service recovery. However
in the analysis for H1 and H3, the unhypothesised cultural value
This research contributes to the services marketing and orientations did not explain justice perceptions. This is
consumer behaviour literature by shedding light onto the role of interesting because cultural values have often been shown as
cultural value orientation in influencing customer responses to not being independent of each other (Tax et al., 1998). Perhaps
service failures. We focus on service failures because mistakes the independence of the cultural values is more pronounced
are an unavoidable feature of all human endeavours, including when measured at the individual level.
service delivery (e.g., Boshoff, 1997). Although variations in A fourth contribution is that the results show that distributive
customers' perceptions of service recovery efforts might and interactional justice (fairness) account for a relatively large
sometimes be caused by differences in customs, we suggest percentage of the explained variance in perceptions of overall
here that they might also be produced by fundamental satisfaction with recovery efforts. This is partly consistent with
differences in orientations toward the world. Hofstede's the findings of Smith et al. (1999) and Oliver (1997) who found
(1980) cultural values typology is a useful tool for under- distributive justice to be far and away the strongest predictor.
standing an individual's fundamental cultural orientation. In Our results suggest that (at least in a medium contact hotel/
this research three key dimensions of that typology (Individu- resort setting) distributive is only marginally more powerful
alism–Collectivism, Power Distance, and Uncertainty Avoid- than interactional fairness. We suggest that this occurs because
ance) proved valuable in understanding a customer's
Table 6
perceptions of an organisation's service recovery efforts. The Regression analysis — service recovery satisfaction model
implications for marketing theory are fourfold.
Variable Pooled data Australia Thailand
First, a general, but nonetheless important theoretical
contribution lies in use of the individual as the unit of analysis β Sig. β Sig. β Sig.
when investigating cultural value orientations. Had we used the Disconfirmation .336 .00 .294 .00 .374 .00
country as the unit of analysis, the pattern of results would have Distributive justice .292 .00 .298 .00 .205 .00
Procedural justice .142 .00 .136 .00 .124 .02
suggested that value orientations did not impact perceptions of
Interactional justice .230 .00 .211 .00 .233 .00
justice. The relationship between justice perceptions and value Adjust R2 .64 .65 .63
orientations emerges only when value orientations are investi- F-statistic 220.01 .00 115.01 .00 104.97 .00
gated at the individual level. This supports an ecological fallacy A Chow test was used to test for any significance differences in the form (or slope) of
that in today's global economy the term culture is synonymous the two regression models (Australia and Thailand). Results were not significantly
with the term country. Instead, as noted by Kwok and Uncles different thus justifying pooling of the two country data (F 2.37, p >0.05).
 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277
it is easier for customers to access information on outcomes and
assess how they are treated (interactional fairness) than
procedural considerations (Leventhal, 1980). Interestingly
however, our results and those of Smith et al. (1999) are at
odds with those of Bowman and Narayandas (2001) who found
procedural fairness to be three and a half times more powerful as
a predictor of satisfaction than either procedural or interactional
fairness. Their study focused on consumer products which may
reflect a longer term perspective taken by customers regarding
their relationship with the brand in question; or distributive
outcomes (replacement of defective product, face value coupon,
etc) may be taken for granted in a consumer products complaint
situation. Perhaps the impact of the three justice elements differs
across contexts. Future research could examine whether these
effects occur in professional services (legal, financial, archi-
tectural) where outcomes are typically critical, but where there
is still considerable face to face interaction between the parties,
or in a B2B setting where relationships are important, but the
core product is of considerable financial value.
6.1. Managerial implications
The increasing globalization of markets and the ease with
which services now cross national boundaries provides a
compelling reason for understanding the cultural context of
consumer behaviour (Maheswaran & Shavitt, 2000). Because
the quality of interpersonal interaction between the customer
and front-line employee drives customer evaluations service
organizations, be they operating in multi-ethnic regions/
countries such as Europe, North America or the Asia–Pacific,
or involved in international ventures, need to be particularly
sensitive to the cultural diversity of their customer base.
Our results clearly show that customers' perceptions of
recovery efforts are significantly affected by the interaction
effect of a firm's recovery tactics with their own value
orientation. In other words, consumer expectations and
perceptions of recovery efforts vary, depending on an
individual's value orientation. An implication of this general
finding is simply that firms have a better chance of implement-
ing more appropriate recovery actions if employees are sensitive
to individual customers' cultural value orientations. While it is
unrealistic to expect front line employees to instantly assess a
(complaining) customer's orientation, such information can be
embedded in CRM systems. Today technology has enabled
firms to segment customers into finer and finer categories to the
extent that customers are no longer equal in the eyes of the firm.
Technology has created a radical new business model that alters
the dynamic of customer service. It is commonplace now for
companies to measure how much each customer spends as well
as other behavioural, demographic and psychographic data
(Brady, 2000). As Brady (2000) noted technology has a dark
side — where firms amass a mountain of information that
provides an almost Orwellian view of individual buyers.
Starwood Hotels and Resorts, Charles Schwab, Qantas and
Singapore Airlines, just to name a few, systematically capture a
wide array of such information so that responses to service
requests can be segmented and customized.
273
Hence with sophisticated CRM systems and instant online
access to customer profiles, there is no reason why cultural
value orientations could not be captured via survey research
(using for example the CVSCALE) and added to individual
customer profiles. This could then be instantly accessed
whenever a customer makes a booking, an enquiry or a
complaint, thus providing guidance as to the appropriate action
to adopt. This profile might only be kept for high net worth or
frequent customers. In this way the findings of our study might
usefully guide management actions. Each of the key findings is
now discussed in turn.
The three cultural orientation hypotheses were all supported.
First, the interaction between Power Distance and the status of
an employee delivering an apology was significant in explain-
ing higher levels of perceived distributive justice. That is,
consumers with a high Power Distance orientation were
considerably more likely to view a fair outcome when an
apology came from an employee seen as having higher (e.g,
duty manager), rather than lower status in the organisation. On
the other hand, respondents with a low Power Distance
orientation are more egalitarian in their outlook: it does not
matter to them whether the apology comes from an employee of
higher or lower status. The management implications are clear.
When offering an apology to consumers with a high Power
Distance orientation, that apology should be from a high status
employee (store manager, duty manager, high ranking super-
visor) rather than a lower level employee (receptionist, waiter).
Such actions meet the intense desire for regaining ‘face’ by the
offended party. From the point of view of training front line
personnel, the first step is to identify customers with a high
Power Distance orientation. Of course this may not be possible
in a brief service encounter episode. It might also be assumed
that some 5-star service providers (5-star hotels, flying first
class, upmarket private hospitals, exclusive club memberships,
etc.) typically attract status-conscious people, who are more
prone to perceiving unequal power and influence distributions
in society. Hence it these types of establishments, good practice
might be that final apology comes on from a senior manager,
even if the initial apology comes from a front-line employee.
Second, while there was a main effect when the organisation
initiated the service recovery (rather than the customer), the
inclusion of Collectivist versus Individualist orientation brings
into stark contrast the role of cultural values. That is, as
hypothesised, consumers with a Collectivist orientation per-
ceived greater interactional fairness (than did their more
Individualistic counterparts) when the recovery was initiated
by the offending organisation. In short, Collectivists were
happier when the organisation took the initiative. From a
managerial standpoint, front-line staff need to be trained to be
proactive in initiating recovery efforts. In the case of consumers
with a high Collectivist orientation they may in fact not
complain due to cultural norms that inhibit complaining
behaviour. But a non-complaint response does not necessarily
mean customers are happy — they may leave unhappy, spread
negative word-of-mouth, and engage a different service supplier
next time. Hence it is in the organisations best interests to be
proactive and initiate service recovery. This may be particularly
274 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277

relevant to retail service providers offering low risk investments
products, banks for example, because Collectivists are more
cautious about saving money (Dutta-Bergman & Wells, 2002).
Next, we found that respondents with a higher Uncertainty
Avoidance orientation were more likely than their lower
uncertainty counterparts, to experience procedural fairness
when they were kept informed of the progress being made to
resolve their complaint. If upon accessing a (complaining)
customer's profile, it showed a high Uncertainty Avoidance
orientation, then the appropriate action could immediately be
flagged in the online system to front line employees. In more
general terms, providing information that encourages feelings
of cognitive control may be most useful in high credence
services (Zeithaml, 1981) such as professional services
(financial planning, health, education, child minding, legal),
or for services such as travel agents and tour operators
because consumers high in Uncertainty Avoidance are most
likely to use these services (Money & Crotts, 2003).
6.2. Future research
Clearly, there is a need for further research in order to resolve
the issue of whether other recovery attributes (i.e., when
compensation is provided and not provided, when recovery is
provided in a formal or less formal manner) interact with value
orientations and whether the interaction of related service
recovery attributes (i.e., apology from high/low status with/
without compensation; recovery initiate by firm/customer with
formal/less formal manner provided by the frontline staff)
combine to impact on consumer expectations and perceptions of
recovery efforts. The moderating impact of other individual
differences (criticality of the service encounter, personality, etc.)
might also be examined, as might a study of service types with
different characteristics (e.g., professional services). Research
efforts of this nature will further aid our understanding in
designing appropriate service recovery procedures that trans-
cend cultural borders.

Appendix A. CVSCALE — Test of invariance

Step Level of invariance test Model Fit indexes GFI

Chi-square value df RMSEA Test of close fit (p-value) CAIC CFI TLI
1 Equality of sigma and mu 311.79 110 0.0870 0.0464 814.97 N/A N/A
2 Equality of sigma 277.53 107 0.0811 0.1385 802.27 0.923 0.905 0.906
3 Equality of mu 310.92 107 0.0887 0.0318 835.66 N/A N/A
4 Initial configural invariance 178.88 86 0.0667 0.6121 682.06 0.958 0.936 0.931
5 Full matrix invariance 222.80 98 0.0725 0.4165 639.72 0.944 0.925 0.920
6 Final partial matrix invariance 198.92 95 0.0672 0.5943 637.40 0.954 0.936 0.926
7 Initial partial scalar invariance 205.01 104 0.0633 0.7383 751.32 0.955 0.943 0.926
8 Initial partial factor variance–covariance invariance 205.49 107 0.0616 0.7807 730.23 0.956 0.946 0.926
9 Initial partial error variance invariance 268.99 119 0.0721 0.4170 707.47 0.937 0.930 0.912
10 Final partial error variance invariance 218.73 113 0.0621 0.7742 700.34 0.954 0.946 0.923

Δχ2 Δdf χ2α=.05 Decision χ2α=.025 Decision χ2α=.01 Decision

Step 6–step 4 20.04 9 16.5190 Sig. 19.0228 Sig. 21.666 Not sig.
Step 7–step 6 6.10 9 16.5190 Not sig. 19.0228 Not sig. 21.666 Not sig.
Step 8–step 7 0.47 3 7.8147 Not sig. 9.3584 Not sig. 11.3449 Not sig.
Step 10–step 8 13.24 6 12.5916 Sig. 14.4494 Not sig. 16.8119 Not sig.

Item Factor loadings Error variances Item intercepts Latent means

Aus Thai Aus Thai Aus Thai Aus Thai KA = IN
P3 0.57 0.93 0.41 0.41 1.17 1.17 3.69 (12.82) 2.61 (14.87) 3.04 (19.93)
(9.58) (14.62) (8.36) (8.36) (26.70) (26.70)
P4 0.59 0.59 0.53 0.77 2.01 2.01
(12.13) (12.13) (7.92) (9.80) (31.92) (31.92)
P5 0.44 0.73 0.53 0.74 2.15 2.15
(7.10) (10.22) (8.98) (8.67) (37.31) (37.31)
U1 0.55 0.55 0.82 0.58 3.25 3.25 6.13 (18.85) 4.52 (19.15) 5.19 (26.66)
(12.65) (12.65) (10.81) (10.81) (63.75) (63.75)
U2 0.80 0.80 0.36 0.36 3.75 3.75
(16.91) (16.91) (6.99) (6.99) (64.58) (64.58)
U4 0.64 0.82 0.46 0.46 4.08 4.08
(12.10) (14.36) (11.45) (11.45) (73.31) (73.31)
U5 0.92 0.92 0.01 0.29 4.45 4.45
(20.98) (20.98) (0.23) (4.46) (69.27) (69.27)
C2 0.64 0.64 0.60 0.60 3.32 3.32 3.88 (19.61) 4.11 (18.98) 3.97 (27.09)
(15.44) (15.44) (14.61) (14.61) (61.74) (61.74)
C3 0.90 0.90 0.13 0.23 3.13 3.13
(24.94) (24.94) (4.07) (6.14) (50.41) (50.41)
 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277 275

C4 0.84 0.84 0.23 0.34 3.08 3.08

(22.72) (22.72) (8.16) (8.46) (51.67) (51.67)
C5 0.73 0.73 0.46 0.46 2.92 2.92
(18.42) (18.42) (14.26) (14.26) (51.92) (51.92)
C6 0.64 0.64 0.59 0.59 2.97 2.97
(15.17) (15.17) (13.85) (13.85) (54.44) (54.44)

P = Power Distance; U = Uncertainty Avoidance; C = Collectivism.

Justice dimensions — text of invariance

Step Level of invariance test Model Fit indexes GFI

Chi-square df RMSEA Test of close CAIC CFI TLI
value fit (p-value)
1 Equality of sigma and mu 228.33 70 0.0966 0.015 659.63 N/A N/A 0.9263
2 Equality of sigma 110.03 53 0.0666 0.566 519.76 0.972 0.953 0.9571
3 Equality of mu 226.01 67 0.0989 0.010 678.87 N/A N/A 0.9258
4 Final configural invariance 108.49 50 0.0695 0.505 539.79 0.972 0.950 0.9580
5 Full metric invariance LX = IN 127.01 60 0.0679 0.555 486.42 0.969 0.953 0.9514
6 Final Partial Metric Invariance Free LX(4,1) 116.90 59 0.0636 0.653 483.51 0.973 0.958 0.9543
7 Full scalar invariance TX = IN 133.13 67 0.0638 0.663 585.99 0.969 0.958 0.9514
8 Final partial scalar invariance TX = IN, free LX(4,1) 123.28 66 0.0598 0.768 583.33 0.973 0.963 0.9542
9 Full factor variance–covariance invariance PH = IN 134.67 70 0.0617 0.732 565.96 0.969 0.960 0.9510
10 Final partial factor variance–covariance invariance PH = IN, free LX(4,1) 124.93 69 0.0578 0.805 563.41 0.973 0.965 0.9537
11 Full error variance invariance ΘAus = ΘThai 143.41 80 0.0572 0.846 502.84 0.969 0.965 0.9469
12 Final partial error variance invariance (diagonal) ΘAus = ΘThai and free LX(4,1) 137.55 79 0.0553 0.869 504.15 0.971 0.967 0.9482

Independence CAIC 2387.69

Saturated CAIC 790.71

Different chi-square values Δχ2 Δdf p-value (α = .05) Decision

1 Step 5 (full metric)–step 4 (configural) 18.52 10 18.31 Sig.
2 Step 6 (partial metric)–step 4 (configural) 8.41 9 16.92 Not sig.
3 Step 8 (partial scalar)–step 6 (partial metric) 6.38 7 14.07 Not sig.
4 Step 10 (partial factor Var/Cov)–step 8 (partial scalar) 1.65 3 7.81 Not sig.
5 Step 12 (partial error variance)–step 10 (partial factor Var/Cov) 12.62 10 18.31 Not sig.

Item Factor loadings Error variances Item intercepts Latent means

Aus Thai LX = IN Aus Thai TD = IN Aus Thai TX = IN Aus Thai
D1 0.57 0.66 0.62 0.61 0.63 0.62 3.74 3.70 3.73 5.57 (16.21) 4.63 (17.85)
9.25 10.62 14.04 9.89 9.93 13.94 44.47 56.05 66.06
D2 0.70 0.69 0.69 0.51 0.53 0.52 2.55 2.62 2.59
11.48 11.57 16.24 8.89 9.59 13.05 29.84 40.88 44.04
D3 0.55 0.64 0.60 0.66 0.62 0.64 3.70 3.69 3.69
8.54 10.22 13.38 9.80 9.47 13.66 42.59 56.77 66.55
D4 0.62 0.85 free 0.52 0.37 free 4.02 3.88 3.93
10.35 14.28 N/A 8.28 7.16 N/A 48.73 57.97 66.94
P1 0.71 0.72 0.71 0.48 0.49 0.49 2.53 2.62 2.61 4.67 (14.52) 4.93 (14.05)
10.75 9.55 14.36 7.13 5.59 9.19 39.52 40.71 44.07
P2 0.81 0.71 0.76 0.40 0.44 0.42 4.30 4.32 4.35
11.85 9.85 15.40 5.45 5.39 7.58 64.81 69.55 71.69
I1 0.77 0.66 0.71 0.45 0.53 0.50 3.50 3.49 3.51 3.90 (17.49) 4.41 (16.66)
13.15 11.06 17.19 9.12 9.61 13.34 53.14 55.78 61.60
I2 0.72 0.68 0.70 0.57 0.45 0.51 3.15 3.16 3.18
11.69 11.97 16.71 9.78 9.17 13.42 46.76 51.86 56.89
I3 0.77 0.62 0.70 0.43 0.60 0.52 3.08 3.04 3.07
13.27 10.12 16.75 8.94 9.71 13.33 47.39 47.82 54.65
I4 0.90 0.83 0.87 0.20 0.30 0.24 2.90 2.90 2.92
16.93 14.84 22.67 5.47 6.64 8.33 44.65 45.65 46.81

D = Distributive justice; P = Procedural justice; I = Interactional justice.

276 P.G. Patterson et al. / Intern. J. of Research in Marketing 23 (2006) 263–277
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