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Optimizing service failure and damage control
DOI:10.1016/j.ijresmar.2017.11.001.png)
Abstract
En 中文
Should a provider deliver a reliable service or should it allow for occasional service failures? This paper derives conditions under which randomizing service quality can benefit the provider and society. In addition to cost considerations, heterogeneity in customer damages from service failures allows the provider to generate profit from selling damage prevention services or offering compensation to high-damage customers. This strategy is viable even when reputation counts and markets are competitive. (C) 2017 Elsevier B.V. All rights reserved.
Keywords:
Service quality
Service reliability
Service failure
Damage control
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