MGMT 339 EXAM 2 2025 QUESTIONS
AND ANSWERS
K3: Define Service Failure - ANS When service performance falls below a customer's
expectations in such a way that leads to customer dissatisfaction.
K3: Define Service Recovery - ANS The actions taken by a firm in response to service failure.
K3: What percentages are for the three types of responses for a bad service?
1. ?% complain to management or company headquarters
2. ?% complain to a frontline employee
3. ?% encounter a problem but do not complain - ANS 1. 1%-5%
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, 2. 45%
3. 50%
K3: What is the service recovery paradox? - ANS Even if there's a service failure, if the service
recovery is successful, it's very likely the customers will be satisfied and become even more
loyal.
K3: What are three challenges to service recovery paradox? - ANS 1. Only a small percent of
customers complain.
2. Service recovery must be EXCELLENT.
3. Service recovery can be expensive.
K3: When is service recovery more likely to occur? - ANS 1. The failure is not considered by
the customer to be severe.
2. The customer has not experienced prior failures with the firm.
3. The customer perceives that the company had little control over the cause of the failure.
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, K3: For tangible products, a guarantee is often done in the form of a _______? -
ANS warranty
K3: Why is it so difficult for customers to return a service? - ANS Services aren't tangible.
K3: How can service companies guarantee good service? - ANS Slogan/message with a
guarantee.
Ex. Starbucks - "Love your beverage or let us know. We'll make it right."
K3: What are the three important characteristics of an effective service guarantee? - ANS 1.
Unconditional
2. Meaningful
3. Easy to understand and communicate
K3: Define unconditional service. - ANS 1. The guarantee should make its promise
unconditionally - no strings attached.
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@COPYRIGHT SIRJOEL 2025/2026
AND ANSWERS
K3: Define Service Failure - ANS When service performance falls below a customer's
expectations in such a way that leads to customer dissatisfaction.
K3: Define Service Recovery - ANS The actions taken by a firm in response to service failure.
K3: What percentages are for the three types of responses for a bad service?
1. ?% complain to management or company headquarters
2. ?% complain to a frontline employee
3. ?% encounter a problem but do not complain - ANS 1. 1%-5%
1
Page
@COPYRIGHT SIRJOEL 2025/2026
, 2. 45%
3. 50%
K3: What is the service recovery paradox? - ANS Even if there's a service failure, if the service
recovery is successful, it's very likely the customers will be satisfied and become even more
loyal.
K3: What are three challenges to service recovery paradox? - ANS 1. Only a small percent of
customers complain.
2. Service recovery must be EXCELLENT.
3. Service recovery can be expensive.
K3: When is service recovery more likely to occur? - ANS 1. The failure is not considered by
the customer to be severe.
2. The customer has not experienced prior failures with the firm.
3. The customer perceives that the company had little control over the cause of the failure.
2
Page
@COPYRIGHT SIRJOEL 2025/2026
, K3: For tangible products, a guarantee is often done in the form of a _______? -
ANS warranty
K3: Why is it so difficult for customers to return a service? - ANS Services aren't tangible.
K3: How can service companies guarantee good service? - ANS Slogan/message with a
guarantee.
Ex. Starbucks - "Love your beverage or let us know. We'll make it right."
K3: What are the three important characteristics of an effective service guarantee? - ANS 1.
Unconditional
2. Meaningful
3. Easy to understand and communicate
K3: Define unconditional service. - ANS 1. The guarantee should make its promise
unconditionally - no strings attached.
3
Page
@COPYRIGHT SIRJOEL 2025/2026
