Revisiting service triad for sharing services with a focus on human issues

Sharing service business models face their own unique operational issues. The aspects of the operation involving humans are particularly different from traditional service business models, and therefore require special attention. Using the “service triad” framework, this study examines what those differences are and what the management implications of each difference might be. While classifying sharing service models largely into two types (B2C – business to customers versus P2P – people to people) by the type of service providing entity, this study identifies operational issues originating in the fact that services are shared and posits directions of effective solutions. Based on the theory of the “tragedy of commons,” three propositions for B2C models are made: (1) Punishment is more effective than rewards in discouraging selfish behaviors; (2) Peer monitoring is an effective and efficient means in controlling customer behaviors; (3) Small communities among users with tight association is more effective in deriving desirable customer behaviors than large communities with loose association. For P2P models, focusing on operational issues arising from the fact that service firms outsource the provision of their core service to customers, this study adopts the “agency theory” and puts forward two propositions: (1) Service firm should manage not only the quality of services provided by “service providing” customers but also the quality of use by “service receiving” customers. (2) An effective recovery from a service failure is contingent upon who is blamed for the failure (service firm, service providing customer, other service receiving customer). The findings of the current study contributes academically by extending the service triad framework into sharing service business models, and managerially by offering insights on how to improve operational effectiveness and efficiency through better designed policies, monitoring systems, and failure recovery strategies.