Unlocking the joint effect of psychosocial safety climate and psychological capital on customer engagement through adaptive and proactive service behaviours

The behavioural aspects of service employees’ performance during service delivery is an important factor in a service organisation’s success and effectiveness. However, the rapidly evolving and competitive environment facing service organisations has changed employers’ expectations of employees from just doing formal job tasks to going the “extra mile” in customer relationships. In such a working environment, task-related extra-role service behaviour can be more effective than formal tasks in satisfying customer needs and establishing a long-term relationship with them. This behaviour refers to employees’ adaptation to unstable working situations and taking the initiative to predict and resolve future risks and obstacles. Hiring the people who are predisposed to be adaptive or proactive to achieve favourable organisational and customer outcomes is not easy; thus, these behaviours need to be fostered in employees. Traditional management theories, stressing managerial control and economic efficiency, have failed to provide employees with a working environment that motivates them to be engaged in adaptive and proactive service behaviours. To address this gap, this study proposes that these behaviours could be nurtured in employees by providing them with a psychosocial safety climate, a facet specific aspect of organisational climate concerning employees’ psychosocial health and safety. In a psychosocially safe working environment, service employees will be able to employ their potential “Psychological Capital”, defined as an individual’s positive psychological state of development, characterized by hope, efficacy, resilience and optimism. Using the lens of positive organisational scholarship and positive organisational behaviour, this study proposes a multilevel conceptual framework to explain the effect of psychosocial safety climate at the organisational level on customer outcomes including customer engagement behaviour and customer repurchase intention through the mediatorsof adaptive and proactive service behaviours in service organisations. In addition, the study proposes that employees’ state-like capabilities (i.e., Psychological Capital) at the individual level could affect task-related extra-role service behaviours and consequently customer outcomes. Therefore, this study aims to answer the following research questions: Research question 1: To what extent does psychosocial safety climate influence customers’ behavioural intention through adaptive and proactive service behaviours? Research question 2: To what extent does psychological capital affect adaptive and proactive behaviours directly and through interaction with psychosocial safety climate? A quantitative methodology, with multi-level modelling, was used in this study. Multilevel modelling provides a useful framework for studying hierarchical structures in theory and data. Using a multilevel approach makes it possible to investigate the effect of psychosocial safety climate as a higher-level construct on individual and group-level variables inside (adaptive and proactive service behaviours) and even outside the organisation (customer outcomes). The multi-source data for this study were collected via self-administered surveys from managers, employees and customers of 60 insurance company branches in Iran. There were 56 branches which returned usable survey packages resulting in a 93.3% response rate. The final sample included 56 managers, 513 frontline service employees and 560 customers of insurance companies. The findings, in accordance with conservation of resource theory, confirmed that both individual psychological capital and branch-level psychosocial safety climate positively contributed to individual adaptive and proactive service behaviours. Results showed that an interaction between psychosocial safety climate and psychological capital positively affected adaptive service behaviour but not proactive service behaviour At branch level, proactive service behaviour was related to customer engagement behaviour and customer repurchase intention, as well as mediating the relationship between psychosocial safety climate and both customer engagement behaviour and repurchase intention. Similarly, adaptive service behaviour was found to be related to repurchase intention and mediated the relationship between psychosocial safety climate and repurchase intention. These results were in line with positive organisational scholarship and positive organisational behaviour lens as well as social exchange theory as background. Contrary to expectation, adaptive service behaviour was not found to be related to customer engagement behaviour and consequently did not mediate the relationship between psychosocial safety climate and customer engagement behaviour. The difference between customer and service employees’ perceptions of adaptive service behaviour might be the reason why a psychosocially safe working environment despite motivating adaptive service behaviour among service employees, could not be adequately reflected in customer engagement behaviour. The study makes significant theoretical contributions to the service, occupational health and safety, and psychological capital literature. The positivity model incorporated positive organisational scholarship and psychological capital theory to explain the effect of occupational health and safety factors and psychological capital in service employees’ task-related extra-role behaviours. In addition, this study extended psychosocial safety climate theory, for the first time, through a multilevel modelling approach to customer outcomes. The study also contributed to the service marketing literature by investigating the joint effect of adaptive and proactive service behaviours in transmitting the internal organisational climate (psychosocial safety climate) on external organisational stakeholder (customers). According to the results, proactive service behaviour transmits internal organisational factors (psychosocial safety climate) to customer outcomes including both customer engagement behaviour and customer repurchase intention, but adaptive service behaviour transmits psychosocial safety climate to customer engagement behaviour only. The study also has considerable practical implications. The results highlight the roles of senior service managers’ commitment to establish a psychosocially safe working environment and service employees’ positive state in not only improving service employees’ adaptive and proactive behaviours but in achieving desirable customer outcomes.