Abstract

While the relationship between customer expectation and service quality may seem inherently obvious, it is still neglected and rarely empirically examined by managers in individual organizations, especially in regions of the teaching of Confucianism, such as Taiwan, where transaction is dealt based upon guanxi in stead of emphasis on quality of goods or services. It does not mean that quality is not as important in Chinese business. In fact, quality is ‘guaranteed’ by guanxi, with which not just construct their social webs but also reinforce their social harmony. In our study, we address and examine this issue. The results suggest that, in contrast to relationship marketing, the perceived service quality is particularly moderated by guanxi which plays as the internal factor in constructing interpersonal relationships and bringing the effect to reconcile the service quality perception between service providers and receivers. In addition to that, guanxi networks also play as the external factor in connecting inter groups to reinforce the business corporation and ensure the service quality.