Answer to Question 1
Empowerment clearly brings benefits. Empowered employees are more customer-focused and are much quicker in responding to customer needs. They are more likely to respond in a positive way to service failures and to engage in effective service recovery strategies. Employees who are empowered tend to feel better about their jobs and themselves. This is automatically reflected in the way they interact with customers. They will be genuinely warmer and friendlier. Empowerment, therefore, not only can reduce unnecessary service recovery costs, but also can improve the quality of the product. An empowered front-line employee can be key to new service ideas and can often be a cheaper source of market research than going to the consumer directly. On the other hand, the costs associated with empowerment include a larger dollar investment in selection and training of personnel, higher labor costs, slower or inconsistent service delivery, a perception of inequitable service treatment among customers, excessive giveaways, and bad decisions.
Answer to Question 2
D