Hostname: page-component-cd9895bd7-8ctnn Total loading time: 0 Render date: 2024-12-27T23:02:06.113Z Has data issue: false hasContentIssue false

Outsourcing frontline functions and implications on customer-oriented behaviors: A case of a telecommunications company and its partners in South Korea

Published online by Cambridge University Press:  28 November 2013

Chanhoo Song
Affiliation:
Department of Management Science, Korea Advanced Institute of Science and Technology, Yuseong-Gu, Daejeon, Republic of Korea
Sunhee Lee*
Affiliation:
Department of Psychology, Chungnam National University, Yusung-Gu, Daejeon, Republic of Korea
Euehun Lee
Affiliation:
Department of Management Science, Korea Advanced Institute of Science and Technology, Yuseong-Gu, Daejeon, Republic of Korea
*
Corresponding author: sunhee_lee@cnu.ac.kr

Abstract

The purpose of this study is to examine whether outsourcing frontline functions warrants equivalent level of customer-orientated behaviors as provided by a principal organization, and, if not, what the causes of the differences are. A total of 753 frontline workers of a leading South Korean telecommunications company and its partner companies responded to a survey regarding their levels of customer-oriented behaviors, their supervisor's degree of customer orientation, and their organization's training on customer orientation. Structural equation models were then utilized to examine the proposed relationships. The results show that the frontline workers of the partner organizations have a significantly lower level of customer-oriented behaviors compared with those of the principal organization. The immediate supervisor's degree of customer orientation and customer-orientation training accounted for a significant amount of difference found between the principal and partner organizations.

Type
Research Article
Copyright
Copyright © Cambridge University Press and Australian and New Zealand Academy of Management 2013 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Bandalos, D. L. (2002). The effects of item parceling on goodness-of-fit and parameter estimate bias in structural equation modeling. Structural Equation Modeling, 9(1), 78102.Google Scholar
Bentler, P. M. (1990). Comparative fit indexes in structural models. Psychological Bulletin, 107, 238246.Google Scholar
Boles, J. S., Babin, B. J., Brashear, T. G., Brooks, C. (2001). An examination of the relationships between retail work environments, salesperson selling orientation – customer orientation and job performance. Journal of Marketing Theory and Practices, 9(3), 113.Google Scholar
Coelho, F. J., Augusto, M. G., Coelho, A. F., , P. M. (2010). Climate perceptions and the customer orientation of frontline service employees. The Service Industries Journal, 30(8), 13431357.Google Scholar
Coffman, D. L., MacCallum, R. C. (2005). Using parcels to convert path analysis models into latent variable models. Multivariate Behavioral Research, 40(2), 235259.Google Scholar
Dean, A. M. (2004). Links between organizational and customer variables in service delivery: Evidence, contradictions, and challenges. International Journal of Service Industry, 15(4), 332350.Google Scholar
Dean, A. M., Rainnie, A. (2009). Frontline employees’ views on organizational factors that affect the delivery of service quality in call centers. Journal of Services Marketing, 23(5), 326337.Google Scholar
Deloitte Consulting (2005 () Calling a change in the outsourcing market: The realities for the world's largest organizations. Deloitte Consulting LLP Report.Google Scholar
Goff, B. G., Boles, J. S., Bellenger, J. S., Stojack, C. (1997). The influence of salesperson selling behaviors on customer satisfaction with products. Journal of Retailing, 73(2), 171183.Google Scholar
González, J. V., Garazo, T. G. (2006). Structural relationships between organizational service orientation, contact employee job satisfaction and citizenship behavior. International Journal of Service Industry Management, 17(1), 2350.Google Scholar
Gribbons, B. C., Hocevar, D. (1998). Levels of aggregation in higher level confirmatory factor analysis: Application for academic self-concept. Structural Equation Modeling, 5(4), 377390.CrossRefGoogle Scholar
Gulati, R., Oldroyd, J. B. (2005). The quest for customer focus. Harvard Business Review, 83(4), 92101.Google Scholar
Hartline, M. D., Maxham, J. G. III., McKee, D. O. (2000). Corridors of influence in the dissemination of customer-oriented strategy to customer contact service employees. Journal of Marketing, 64, 3550.Google Scholar
Herche, J., Swenson, M. J., Verbeke, W. (1996). Personal selling constructs and measures: Emic versus etic approaches to cross-national research. European Journal of Marketing, 30(7), 8397.Google Scholar
Hoffman, K. D., Ingram, T. N. (1992). Service provider job satisfaction and customer-oriented performance. The Journal of Services Marketing, 6(2), 6878.Google Scholar
Jaiswal, A. K. (2008). Customer satisfaction and service quality measurement in Indian call centres. Managing Service Quality, 18(4), 405416.Google Scholar
Jennings, R. (2006). Outsourcing – Is it in your future? Maintenance Supplies, 51(4), 4041.Google Scholar
Jensen, M. C., Meckling, W. (1976). Theory of the firm: Managerial behavior, agency costs, and ownership structure. Journal of Financial Economics, 11(4), 550.Google Scholar
Jones, E., Busch, P., Dacin, P. (2003). Firm market orientation and salesperson customer orientation: Interpersonal and intrapersonal influence on customer service and retention in business-to-business buyer-seller relationships. Journal of Business Research, 56, 323340.Google Scholar
Jöreskog, K. G., Sörbom, D. (2001). LISREL 8.5 for Windows [Computer Software]. Lincolnwood, IL: Scientific Software International Inc.Google Scholar
Jung, M. (2001). The research on the strategic approach of the outsourcing for organizational administration with competitive power: Focusing on the Cisco, AT&T, KT, and NTT. Regional Development Journal, 9, 239259 (In Korean).Google Scholar
Karatepe, O. M., Yavas, U., Babakus, E. (2007). The effects of customer orientation and job resources on frontline employees’ job outcomes. Services Marketing Quarterly, 29(1), 6179.Google Scholar
Keillor, B. D., Parker, S., Pettijohn, C. E. (2000). Relationship-oriented characteristics and individual salesperson performance. The Journal of Business & Industrial Marketing, 15(1), 722.Google Scholar
Kilic, C., Dursun, T. (2007). Antecedents and consequences of customer-orientation: Do individual factors affect customer orientation. The Business Review, 7(1), 17.Google Scholar
Le Bon, J., Hughes, D. E. (2009). The dilemma of outsourced customer service and care: Research propositions from a transaction cost perspective. Industrial Marketing Management, 38, 404410.Google Scholar
Liaw, Y. J., Chi, N. W., Chuang, A. (2010). Examining the mechanisms linking transformational leadership, employee customer orientation, and service performance: The mediating roles of perceived supervisor and coworker support. Journal of Business Psychology, 25, 477492.Google Scholar
MacKenzie, S. B., Podsakoff, P. M., Ahearne, M. (1998). Some possible antecedents and consequences of in-role and extra-role salesperson performance. Journal of Marketing, 62(3), 8798.Google Scholar
Miciak, A., Desmarais, M. (2001). Benchmarking service quality performance at business-to-business and business-to-consumer call centers. The Journal of Business & Industrial Marketing, 16(5), 340353.CrossRefGoogle Scholar
Peccei, R., Rosenthal, P. (2000). Front-line responses to customer orientation programs: A theoretical and empirical analysis. International Journal of Resource Management, 11(3), 562590.Google Scholar
Pettijohn, C. E., Pettijohn, L. S., Parker, R. S. (1997). Real estate sales training: Purposes, topics, and effectiveness. Review of Business, 18(2), 3135.Google Scholar
Pettijohn, C. E., Pettijohn, L. S., Taylor, A. J. (2002). The influence of salesperson skill, motivation, and training on the practice of customer-oriented selling. Psychology & Marketing, 19(9), 743757.Google Scholar
Podsakoff, P., Mackenzie, S. (1994). Organizational citizenship behaviors and sales unit effectiveness. Journal of Marketing Research, 31, 351363.Google Scholar
Prahalad, C. K., Ramaswamy, V. (2000). Co-opting customer competence. Harvard Business Review, 78(1), 7987.Google Scholar
Reise, S. P., Widaman, K. F., Pugh, R. H. (1993). Confirmatory factor analysis and item response theory: Two approaches for exploring measurement invariance. Psychological Bulletin, 114, 552566.Google Scholar
Román, S., Ruiz, S., Munuera, J. L. (2002). The effects of sales training on sales force activity. European Journal of Marketing, 36(11/12), 13441366.CrossRefGoogle Scholar
Ross, W. T. Jr., Dalsace, F., Anderson, E. (2005). Should you set up your own sales force or should you outsource it? Pitfalls in the standard analysis. Business Horizons, 48(1), 2336.Google Scholar
Sass, D. A., Smith, P. L. (2006). The effects of parceling unidimensional scales on structural parameter estimates in structural equation modeling. Structural Equation Modeling, 13, 566586.Google Scholar
Saxe, R., Weitz, B. A. (1982). The SOCO scale: A measure of the customer orientation of salespeople. Journal of Marketing Research, 19(3), 343351.Google Scholar
Slåtten, T., Mehmetoglu, M. (2011). Antecedents and effects of engaged frontline employees: A study from the hospitality industry. Managing Service Quality, 21(1), 88107.Google Scholar
Steiger, J. H., Lind, J. 1980. Statistically based tests for the number of common factors. Paper presented at the meeting of the Psychometric Society, Iowa City, IA.Google Scholar
Stock, R. M., Hoyer, W. D. (2005). An attitude-behavior model of salespeople's customer orientation. Academy of Marketing Science, 33(4), 536552.Google Scholar
Thomas, R. W., Soutar, G. N., Ryan, M. M. (2001). The selling orientation-customer orientation (S.O.C.O.) scale: A proposed short form. The Journal of Personal Selling and Sales Management, 21(1), 6369.Google Scholar
Tompkins, J. A. (2005). The business imperative of outsourcing. Industrial Management, 47(6), 812.Google Scholar
Vandenberg, R. J., Lance, C. E. (2000). A review and synthesis of the measurement invariance literature: Suggestions, practices, and recommendations for organizational research. Organizational Research Methods, 3, 469.Google Scholar
Williams, M. R., Attaway, J. S. Jr. (1996). Exploring salespersons’ customer orientation as a mediator of organizational culture's influence on buyer-seller relationships. The Journal of Selling & Sales Management, 16(4), 3352.Google Scholar
Wray, B., Palmer, A., Bejou, D. (1994). Using neural network analysis to evaluate buyer-seller relationship. European Journal of Marketing, 28(10), 3248.CrossRefGoogle Scholar
Zhu, Z., Nakata, C. (2007). Reexamining the link between customer orientation and business performance: The role of information system. Journal of Marketing Theory and Practice, 15(3), 187203.Google Scholar