The Effects of Digital Technology on Frontline Employees and Customer Responses in Service Encounters: Evidence from Four Empirical Studies

Digital technology is disrupting the prerequisites for most firms in the service industry and frequently forces them to adapt their strategy to the technological developments. Even service providers that traditionally put great emphasis on making personal customer contact are reassessing the ratio of human interaction and technology use for service encounters. To retain competitiveness, it seems mandatory to increase service encounter efficiency by embedding technology into the existing processes. However, there is little empirical evidence on how such technological implementations affect the sentiments, attitudes, and behaviors of frontline employees (FLEs). Likewise, research on interrelated customer responses is scarce. To address this matter, this thesis presents four distinct yet related studies to investigate the impact of digital technology on frontline employees, customers, and ultimately service firms. Study A focuses on the factors that foster or hinder frontline employees’ technology-induced role ambiguity and process deviance when an online reservation system for restaurants is in use. The answers of 123 frontline employees participating in the online survey featured in this study are analyzed.Study B implements a qualitative approach to achieve a 360-degree view of technology deployment in full-service restaurants. For this purpose, 36 semi-structured interviews were conducted with technology providers, restaurant managers, frontline employees, and customers.Study C uses dyadic data gathered from a field survey with 147 frontline employees and 373 customers of full-service restaurants. This study aims to investigate how technology induces frontline employee technostress and customer orientation and whether this affects customer satisfaction and delight with the frontline employee.Study D compares customer fairness perceptions and behavioral intentions after making a purchase that either involves purchase advisory service in a branch store or a virtual try-on service in an online shop. This 2x2 between-subject experimental study includes 215 participants. To summarize, this thesis contributes to the research on digital technology in service encounters by revealing employee outcomes of using frontline service technology and interrelated customer responses. The derivation of implications provides meaningful insights for theory and practice.