Enhancing Service Recovery Performance Through Ethical Leadership: A Multilevel Curvilinear Investigation

Understanding how to enhance service recovery performance is crucial for service-oriented organizations, as it contributes to resolving service failures and addressing customer complaints. This study aims to develop a multilevel curvilinear model that explores the relationship between ethical leadership and service recovery performance, as well as the mediating and moderating effects underlying this relationship. Results from both Study 1 (dyadic and two-waved data from hotels) and Study 2 (triadic data from IT service organizations) revealed that ethical leadership had a curvilinear (inverted U-shaped) effect on service recovery performance. There was a curvilinear mediating effect of ethical self-efficacy between ethical leadership and service recovery performance, such that ethical leadership enhanced ethical self-efficacy, and an intermediate degree of ethical self-efficacy predicted the highest degree of service recovery performance (Studies 1 and 2). Results from Study 1 showed that internal knowledge transfer moderated the curvilinear relationship between ethical leadership and service recovery performance. Both internal knowledge transfer and task interdependence moderate the curvilinear relationship between ethical self-efficacy and service recovery performance (Study 1). Results from Study 2 showed that both internal knowledge transfer and task interdependence moderate the curvilinear relationship between ethical leadership and service recovery performance.