Service Employees Give as They Get: Internal Service as a Moderator of the Service Climate-Service Outcomes Link

We lend theoretical insight to the service climate literature by exploring the joint effects of branch service climate and the internal service provided to the branch (the service received from corporate units to support external service delivery) on customer-rated service quality. We hypothesized that service climate is related to service quality most strongly when the internal service quality received is high, providing front-line employees with the capability to deliver what the service climate motivates them to do. We studied 619 employees and 1,973 customers in 36 retail branches of a bank. We aggregated employee perceptions of the internal service quality received from corporate units and the local service climate and external customer perceptions of service quality to the branch level of analysis. Findings were consistent with the hypothesis that high-quality internal service is necessary for branch service climate to yield superior external customer service quality.