Service Failures Under the Influence of Ideological Polarization

In an era of heightened ideological polarization, characterized by intense divisions in political and social beliefs, both political and business environments face unprecedented challenges. Socio-political risks, historically explored in strategic management, have gained renewed significance as polarization amplifies their impact on business operations and consumer behavior. This paper examines Cathay Pacific as a case study to investigate how ideological polarization influences consumer reactions to service failures and controversies. Using the Belief-Action-Outcomes (BAO) framework, we analyze the interplay between polarization-driven beliefs and anti-brand actions during periods of heightened political tension in Hong Kong. Our findings offer critical insights into the role of ideological polarization in shaping consumer responses to service failures, contributing to the broader understanding of socio-political risks in polarized contexts. This research provides actionable implications for businesses navigating ideological divisions, enabling them to anticipate and mitigate polarization-driven challenges in their strategic and operational decisions.