Developing a framework for rewards in combined production/service businesses: The case of tipping in the restaurant industry

Aviad A. Israeli, Rachel Barkan

Research output: Contribution to journalReview articlepeer-review

17 Scopus citations

Abstract

Examines monetary rewards in businesses that combine technical and functional aspects of service. Focusing on the restaurant industry, develops a framework that explains tipping as a reward for the two service dimensions. The technical elements of service are rewarded by dollar tip and the functional elements of service are rewarded by percent tip. An overlap between technical and functional elements results in a conflict between dollar tip and percent tip and, it is suggested, result in a magnitude effect. The framework was tested empirically in a sample of restaurants. The findings indicated that customers' evaluation of the service interaction can be summarized by four main components. Multiple regressions provide initial support to the framework, tying the technical elements to dollar tip and functional elements to percent tip.

Original languageEnglish
Pages (from-to)444-459
Number of pages16
JournalInternational Journal of Service Industry Management
Volume15
Issue number5
DOIs
StatePublished - 25 Nov 2004

Keywords

  • Customer service management
  • Performance related pay
  • Service industries

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