Direct and Indirect Effects of Beneficiary Contact and Supervisor Support on Service Performance: Does Perceived External Prestige Matter?
| Published date | 01 April 2023 |
| Author | Rangan S. Vittal,Sushanta K. Mishra,Arup Varma |
| Date | 01 April 2023 |
| DOI | http://doi.org/10.1111/1467-8551.12606 |
British Journal of Management, Vol. 34, 648–663 (2023)
DOI: 10.1111/1467-8551.12606
Direct and Indirect Effects of Beneciary
Contact and Supervisor Support on Service
Performance: Does Perceived External
Prestige Matter?
Rangan S. Vittal,1Sushanta K. Mishra 2andArupVarma
3
1Jagdish Sheth School of Management, Bengaluru, 560 100, India, 2Indian Institute of Management Bangalore,
Bengaluru, 560 076, India, and 3Quinlan School of Business, Loyola University Chicago, Chicago, IL, 60611,
USA
Corresponding author email: sushantam@iimb.ac.in
Customers play a signicant role in motivating frontline employees. However, little re-
search has examined the impact of employees’ interactions with external beneciaries
in explaining service performance. In the present study, we borrowed from the job char-
acteristics model and social exchange theory to build our model. Drawing on data from
889 frontline service employees and 2667 customers in the micronancesector, our study
demonstrated that supervisor support (an internal factor) and contact with benecia-
ries (an external factor) inuence employee service performance. We also investigated
employee gratitude as an intervening mechanism through which supervisor support and
beneciary contact improve employee service performance. In addition, we found that
employees’ perception of the external prestige of their organization is a powerful force
linking the above factors with service performance. Our ndings advancethe understand-
ing of employee service performance, thus providing signicant implications for research
and practice.
Introduction
Providing a solid customer experience is essential
for organizations (Lemon and Verhoef, 2016).
Frontline employees play a critical role because
high-quality service encounters inuence cus-
tomers’ evaluation of service quality (Bettencourt
and Brown, 2003) and their satisfaction (Lucia-
Palacios, Perez-Lopez and Polo-redondo, 2020),
leading to service performance (Jha et al., 2017).
Prior research has examined the internal factors
of an organization to explain employee service
performance. For instance, individual factors such
as employee personality (Barrick, Stewart and Pi-
otrowski, 2002), customer orientation (Jha et al.,
2017; Jung, Jaewon and Todd, 2021), job-related
factors such as job characteristics (Morgeson
and Humphrey, 2006) and organizational factors
such as service climate, training, technology usage
(Salanova et al., 2005) and leadership (Gutermann
et al., 2017) have been studied to explain service
performance (Johlke and Iyer, 2013). Only a few
scholars have highlighted factors external to the
organization (i.e. customers) in driving service
performance (Auh et al., 2019); however, such
studies are relatively limited.
In the present study, we aim to extend research
on employee service performance by investigat-
ing the role of beneciary contact and supervisor
support. We chose frontline employees working
in the micronance sector for two reasons. First,
the complexity of the features, variety of nan-
cial products (e.g. loans, insurance, savings, pen-
sion) and lower customer understanding make the
© 2022 British Academy of Management and Wiley Periodicals LLC. Published by JohnWiley & Sons Ltd, 9600 Gars-
ington Road, Oxford OX4 2DQ, UK and 350 Main Street, Malden, MA, 02148, USA.
Does Perceived External Prestige Matter? 649
nancial buying process difcult for customers to
benet from micronance initiatives. Therefore,
frontline employees in this industry arerequired to
interact frequently with customers (Siwale, 2016).
Second, lack of beneciary contact and absence
of face-to-face interaction causes higher default
rates (Ayyagari and Parahoo, 2018; Karlan et al.,
2016; Travis, 2013), affectingemployee service per-
formance. The frontlineemployees play the role of
multiple interface managers connecting customers
to the branch and the organization (Siwale and
Ritchie, 2012), providing door-step banking ser-
vices (Canales, 2014), such as offering loans and
other products. Thus, frontline employees’ regular
interactions with beneciaries are core social char-
acteristics critical to organizations in the banking
and nancial services sector (Siwale, 2016, p.
1289). Accordingly, micronance banking offers a
context to examine the linkage between beneciary
contact and employees’ service performance.
Moreover, the processes through which bene-
ciary contact impacts employees’ job performance
are under-researched. In the present study, we aim
to examine if gratitude towards the organization
is a unique psychological path through which
both beneciary contact and perception of super-
visor support can improve service performance.
We chose gratitude towards the organization as
a mediator because gratitude is a fundamental
construct of social exchange. According to social
exchange theory (Blau, 1964), reciprocation plays
a signicant role in developing relationships in
social exchanges. The impulse to reciprocate is
driven by the receiver’s gratitude towards the
provider of such valued resources (Wetzel, Ham-
merschmidt and Zablah, 2014). Thus, we argue
that service employees who perceive that their or-
ganization has provided the opportunity to serve
beneciaries, such as customers of micronance,
tend to be grateful to their organizations and are
likely to reciprocate with higher performance.
We further argue that employees working in
the micronance sector might have a differential
impact on performance, depending on their per-
ceptions of the organization’s external prestige.
Employees build a perception of external pres-
tige through internal and external interactions
as they perform their job. Extant literature has
examined the role of perceived external pres-
tige on various work outcomes (Helm, 2013;
Smidts, Pruyn and van Riel, 2001; Zhu, Tatachari
and Chattopadhyay, 2016). While it is critical
to understand the independent role of factors
inuencing employee service performance,organi-
zations deploy multiple internal (Budhwar et al.,
2009) and external (Mishra et al., 2012) organiza-
tional practices to enhance service performance.
Our study further examines if the interaction of
beneciary contact and supervisor support with
external prestige of the organization explains
employees’ performance. To summarize, we aim
to examine if beneciary contact and perceived
supervisor support (PSS) are related to employees’
service performance. Further, we investigate if
employees’ gratitude towards the organization
mediates the above relationship. Finally, we ex-
amine whether perceived external prestige of the
organization moderates the relationship of ben-
eciary contact and PSS with employees’ service
performance. The proposed model is presented in
Figure 1.
Our paper makes three signicant contributions
to the service performance literature. First, we
extend the job characteristics model by investi-
gating the inuence of customers on employees’
service performance. Most studies have taken an
internal perspective (i.e. the role of supervisors,
organizational climate or type of work) to exam-
ine employee’s engagement, commitment towards
customers and performance (Castanheira et al.,
2016; Morgeson and Humphrey, 2006). Taking
a cue from the expanded work design model
(Humphrey, Nahrgang and Morgeson, 2007), our
study is among initial studies that empirically
examine if jobs providing the opportunity to con-
tact beneciaries (customers) impact employees’
service performance. Extant literature on the pro-
social domain seems ‘often unclear’ in addressing
this gap (Fehr et al., 2016; Grant, 2007).
Second, our study links the expanded work
design model to gratitude in explaining frontline
employees’ service performance. Thus, our study
addresses the call for research to examine whether
gratitude is a pivotal emotion that motivates em-
ployees to reciprocate for all they have received
from their organization (Bolino and Grant, 2016).
Third, although extant research on service
performance has examined the interaction of
individual and store-level factors (Liao and
Chuang, 2004), the interactive impact of multiple
employee-level factors on service performance
has not been studied. Thus, our research provides
signicant insights on improving employee service
performance.
© 2022 British Academy of Management and Wiley Periodicals LLC.
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