The market performance indicator: a macro understanding of service provider switching

2015 ◽  
Vol 29 (4) ◽  
pp. 302-313 ◽  
Author(s):  
Steven D'Alessandro ◽  
Lester Johnson ◽  
David M. Gray ◽  
Leanne Carter
Keyword(s):  
Service Provider ◽  
Performance Indicator ◽  
Market Performance ◽  
Consumer Welfare ◽  
Threshold Level ◽  
Switching Behavior ◽  
Market Conditions ◽  
Policy Makers ◽  
Content Type ◽  
And Behavior

Purpose – The purpose of this paper is to adapt the market performance indicator (MPI), used by the European Commission to evaluate market conditions, over time, to show that the MPI explains actual switching behavior better than stated intent and satisfaction. While research on service provider switching has focused on the outcomes of service transactions and the benefits of switching, there is little research on how consumers view market conditions as being favorable or not for switching. Design/methodology/approach – The authors used a mixed methodology of focus groups and longitudinal survey research of cell phone consumers to evaluate the effect of the MPI on satisfaction, perceptions of value, switching intentions and behavior. Findings – The MPI was found to influence perceptions of satisfaction and value, and was found to contribute strongly to actual switching behavior. The results also showed that an improvement in the MPI or market conditions lead to a much greater relationship between it and actual switching behavior, suggesting that there may well be important threshold level, upon which greater switching behavior occurs. Originality/value – The MPI provides marketers and policy-makers with benchmarks to compare the consumer welfare of different markets in different countries. Switching studies with MPI figures can be more easily generalized to different contexts.

Reasons to switch: empowered vs less powerful bank customers

2019 ◽  
Vol 37 (6) ◽  
pp. 1441-1461 ◽  
Author(s):  
Jeanette Carlsson Hauff
Keyword(s):  
Service Provider ◽  
Financial Services ◽  
Online Survey ◽  
Financial Institution ◽  
Service Failure ◽  
Survey Methods ◽  
Mediating Effect ◽  
Switching Behavior ◽  
Content Type ◽  
Consumer Switching

Purpose The purpose of this paper is to contribute to the existing literature of driving and impeding switching factors by operationalizing the catalyst factor of perceived power among customers. Acknowledging the importance of trust in a financial context, a trust-based framework for the analysis is used. The study explicitly analyzes factors of importance for subsequent switching of banks for empowered customers (i.e. savers) and low-on-power customers (i.e. borrowers). Design/methodology/approach The study measures factors driving or impeding switch of service provider, together with measures of trust and power using online survey methods. The sample is intended to focus on savers and borrowers, defined quantitatively as well as perception wise. Through a multi-group SEM analysis, differences between the samples of savers and borrowers are analyzed. The dependent variable was in both cases inclination to switch. Findings The paper manages to define differences between empowered and less empowered customers, such as borrowers and savers. The mediating effect of trust prevails only for borrowers: here, the only effect on switching behavior stems from a full mediation of stability through trust. For savers, direct influences of both service failure and lack of involvement on trust are of major importance. The importance of trust, however, is lacking; for the sample of savers, the link between trust and switching behavior is insignificant. Practical implications The results may be used as a tool box in order to address consumer switching behavior and mobility in the financial services market. The biggest obstacle for switching banks among savers is the low level of involvement. This has clear implications regarding how to increase switching, e.g., by raising interest. Focusing instead on borrowers, stability of the chosen financial institution turned out to be the most important factor. Originality/value This paper introduces a view on consumer switching behavior, taking into account differences regarding service provider relations (empowered savers vs less empowered borrowers) and the importance of trust in these two settings. The paper introduces trust as a mediator between switching behavior and four determinants: stability, personal relations, service failure and internet-related issues, and involvement.

Accounting for needs? Formula funding in the UK schools sector

2010 ◽  
Vol 23 (1) ◽  
pp. 82-110 ◽  
Author(s):  
Gloria Agyemang
Keyword(s):  
Resource Allocation ◽  
Service Provider ◽  
Service Providers ◽  
Local Education Authority ◽  
Policy Makers ◽  
Content Type ◽  
Funding Formula ◽  
Formula Funding ◽  
Education Authority ◽  
The Uk

PurposeThe purpose of this paper is to analyse whether the development of a needs‐based funding formula for resource allocation incorporates the needs of funders or the needs of the service providers.Design/methodology/approachThe paper analyses interview data and documentary evidence gathered from a UK local education authority about the creation of a “needs‐based” formula for sharing resources to schools. It employs and extends a framework developed by Levačić and Ross to evaluate needs‐based formula funding.FindingsAlthough formula funding is purported to be a more objective method of resource allocation, the paper finds that as with other resource allocation methods the power relations between the funder and the service provider impacts on the extent to which service provider needs are incorporated into the funding formula.Research limitations/implicationsThis paper considers only the funding of schools. Further work is needed to investigate formula funding for other public services.Practical implicationsDebates between funders and service providers should be encouraged by policy makers to ensure that allocations based on the funding formula are acceptable to service providers.Originality/valueThe paper provides a useful analysis of a needs‐based funding formula for resource allocation in schools and whether this incorporates the needs of funders or the needs of the service providers.

Interdependence dynamics of corporate equity and public real estate markets

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Kim Hiang Liow ◽  
Jeongseop Song
Keyword(s):  
Real Estate ◽  
Real Estate Market ◽  
Asset Markets ◽  
Asset Market ◽  
Volatility Spillover ◽  
Market Conditions ◽  
Policy Makers ◽  
Content Type ◽  
Real Estate Markets ◽  
Causal Dependence

PurposeWith growing interdependence between financial markets, the goal of this paper is to examine the dynamic interdependence between corporate equity and public real estate markets for the USA and a select group of seven European developed economies under a cross-country framework in crisis and boom market conditions. Dynamic interdependence is related to four measures of market linkages of “correlation, spillover, connectedness and causality”.Design/methodology/approachThis study adopts a four-step investigation. The authors first estimate “time-varying variance–covariance spillovers and implied correlations” modeled with the bivariate BEKK-MGARCH methods. Second, the methods of Diebold and Yilmaz (2012, 2014) measure the conditional volatility spillover-connectedness effects across the corporate equity and public real estate markets based on a decomposition of the forecast error variance. Third, the authors implement nonlinear bivariate and multivariate causality tests to understand the lead-lag dynamics of the two asset markets' returns, volatilities and net directional volatility connectedness across different sample periods. Finally, the authors conclude the study by providing a portfolio hedging analysis.FindingsThe authors find that corporate equity and public real estate are moderately interdependent to the extent that their diversification benefits increases in the longer term. Moreover, the authors find increased corporate equity-public real estate causal dependence of the market groups of the European and international portfolios during the GFC and INTERCRISIS periods. The nonlinear causality test findings indicate that the joint information of asset markets can be a useful source of prediction for future innovation of market risks. Additionally, policy makers may also be able to employ conditional volatility and volatility connectedness as two other measures to manage market stability in the cross-asset market dependence during highly volatile periods.Research limitations/implicationsOne major take away from this academic research is since international portfolio investors are not only concerned the long-term price relationship but also the correlation structure and volatility spillover-connectedness, the conditional BEKK modeling, generalized risk connectedness analysis and nonlinear causal dependence explorations from this multi-country study can shed fresh light on the nature of market interdependence and magnitude of volatility connectedness effects in a multi-portfolio framework.Practical implicationsThe hedging performance analysis for portfolio diversification and risk management indicates that industrial stocks (“pure” equities) are valuable assets that can improve the hedging performance of a well-diversified corporate equity-public real estate portfolio during crisis periods. For policymakers, the findings provide important information about the nature of causal links and predictability during the crisis and asset-market boom periods. They can then equip with this information to manage and coordinate market stability in cross corporate equity-real estate relationships effectively.Originality/valueAlthough traditional research has in general reported at least a moderate degree of relationship between the two asset markets, investors' knowledge of stock-public real estate market linkage is somewhat inadequate and confine mostly to broad stocks (i.e. stocks that are exposed to public real estate influence) in a single-country context. In this paper, the authors examine the interdependence dynamics in a multi-country (multi-portfolio) context. A clear understanding their changing market relationships in a multi-country context is of crucial importance for portfolio investors, financial institutions and policy makers. Moreover, since the authors use an orthogonal stock market index, the authors allow global investors to understand the potential diversification benefits from stock markets that are beyond the public real estate market under different market conditions.

Does the threshold matter? The impact of the monitoring activity on non-performing loans

2019 ◽  
Vol 45 (2) ◽  
pp. 190-221 ◽  
Author(s):  
Domenico Piatti ◽  
Peter Cincinelli
Keyword(s):  
Early Warning ◽  
Performance Indicator ◽  
Positive Impact ◽  
Control Strategies ◽  
Threshold Value ◽  
Threshold Level ◽  
Content Type ◽  
The Impact ◽  
Monitoring Activity

PurposeThe purpose of this paper is to investigate whether the quality of the credit process is sensitive to reaching a particular threshold level of non-performing loans (NPLs) and, more importantly, whether higher NPLs ratios could make the monitoring activity ineffective.Design/methodology/approachThe empirical design is composed of two steps: in the first step, the authors introduce a monitoring performance indicator (MPI) of the credit process by combining the non-parametric technique Data Envelopment Analysis with some financial ratios adopted as input and output variables. As second step, the authors apply a threshold panel regression model to a sample of 298 Italian banks, over the time period 2006–2014, and the authors investigate whether the quality of the credit process is sensitive to reaching a particular threshold level of NPLs.FindingsThis paper finds that, first, when the NPLs ratio remains below the threshold value estimated endogenously, an increase in the quality of monitoring has a positive impact on the NPLs ratio. Second, if the NPLs ratio exceeds the estimated threshold, the relationship between the NPLs ratio and quality of monitoring assumes a positive value and is statistically significant.Research limitations/implicationsDue to the lack of data, the investigation of NPLs in the Italian industry across loan types combined with the monitoring effort by banks management was not possible. The authors plan to investigate this topic in future studies.Practical implicationsThe identification of the threshold has a double operational valence. The first regards the Supervisory Authority, the threshold approach could be used as an early warning in order to introduce active control strategies based on the additional information requested or by on-site inspections. The second implication is highlighted in relation to the individual banks, the monitoring of credit control quality, if objective and comparable, could facilitate the emergence of best practices among banks.Social implicationsA high NPLs ratio requires greater loan provisions, which reduces capital resources available for lending, and dents bank profitability. Moreover, structural weaknesses on banks’ balance sheets still persist particularly in relation to the inadequate internal governance structures. This means that bank management must able to recognise in advance early warning signals by providing prudent measurement together with an in-depth valuation of loans portfolio.Originality/valueThe originality of the paper is twofold: the authors introduce a new proxy of credit monitoring, called MPI; the authors provide an empirical proof of the Diamond’s (1991) economic intuition: for riskier borrowers, the monitoring activity is an inappropriate instrument depending on the bad reputational quality of borrowers.

scholarly journals Quality management as a determinant factor of productivity

2019 ◽  
Vol 68 (4) ◽  
pp. 675-698 ◽  
Author(s):  
Bertha Viviana Ruales Guzmán ◽  
Alessandro Brun ◽  
Oscar Fernando Castellanos Domínguez
Keyword(s):  
Quality Management ◽  
Design Methodology ◽  
Process Management ◽  
Performance Indicator ◽  
Future Research ◽  
Policy Makers ◽  
Content Type ◽  
Current State ◽  
The Relationship ◽  
Determinant Factor

PurposeThe purpose of this paper is threefold: first, to analyse the current state of the literature on the relationship between quality management (QM) and productivity as a performance indicator; second, to identify the key constructs of QM practices related to productivity; and, finally, to reveal whether QM can actually be regarded as a determinant of productivity.Design/methodology/approachThis research was carried out through a systematic literature review, considering 150 papers that studied this relationship between 1997 and 2017 and another 37 papers on the internal determinants of productivity.FindingsThe findings revealed that human resource management, top management and process management were the more relevant constructs of QM practices related to productivity. In addition, 89 per cent of the internal determinants of productivity were related to the proposed constructs of QM practices, which suggest that QM is a determinant factor of productivity.Originality/valueThis review analysed the literature on the relationship between QM and productivity, as few studies have done before, generating original, interesting and useful findings that can guide future research and that also represent a useful tool for researchers, practitioners, managers and policy makers.

Sustainability reporting and agriculture industries’ performance: worldwide evidence

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Amina Buallay
Keyword(s):  
Performance Indicator ◽  
Positive Impact ◽  
Market Performance ◽  
Sustainability Reporting ◽  
Content Type ◽  
Return On Equity ◽  
Agriculture Industry ◽  
Indicator Variables ◽  
Using Data ◽  
The Impact

PurposeThis study investigates the impact of sustainability reporting on agriculture industries’ performance (operational, financial and market).Design/methodology/approachUsing data culled from 1426 observations from 31 different countries for ten years (2008–2017), an independent variable derived from the Environmental, Social and Governance (ESG) score is regressed against dependent manufacture performance indicator variables [return on assets (ROA), return on equity (ROE) and Tobin's Q (TQ)]. Two types of control variables complete the regression analysis in this study: firm-specific and macroeconomic.FindingsThe findings elicited from the empirical results demonstrate that there is no significant relationship between ESG and operational performance (ROA), financial performance (ROE) and market performance (TQ). Surprisingly, when each component of ESG is regressed separately against the performance, the results reveal that governance disclosure has a positive impact on market performance.Research limitations/implicationsThis study captures only quantity rather than the quality of ESG disclosure. Therefore, the results of this study may not necessarily give the “true” motivation for firms to disclose sustainability activities.Originality/valueThis study highlights the agriculture industry management lacunae manifesting in terms of the weak nexus between each component of ESG and agriculture industries’ performance.

Inertia in services: causes and consequences for switching

2017 ◽  
Vol 31 (6) ◽  
pp. 485-498 ◽  
Author(s):  
David M. Gray ◽  
Steven D’Alessandro ◽  
Lester W. Johnson ◽  
Leanne Carter
Keyword(s):  
Service Provider ◽  
Online Survey ◽  
Structural Model ◽  
Switching Costs ◽  
Service Providers ◽  
Switching Behavior ◽  
Service Firms ◽  
Actual Behavior ◽  
Path Modeling ◽  
Content Type

Purpose This paper aims to examine the antecedents of customer inertia (i.e. knowledge, confusion, perceptions of competitor similarity and switching costs) and their relationship to customer satisfaction, service providers’ switching intentions and actual switching behavior. Customer inertia is said to reduce the incidence of service provider switching; however, little is known about the antecedent drivers of inertia. Design/methodology/approach The conceptual model was tested by a longitudinal/discontinuous panel design using an online survey research of 1055 adult (i.e. +18 years old) subscribers to cell phone services. Partial least squares (PLS) path modeling was used to simultaneously estimate both the measurement and structural components of the model to determine the nature of the relationships between the variables. Findings Findings of the PLS structural model provide support for the direct relationship between customer inertia and its antecedents (i.e. knowledge, confusion, perceptions of competitor similarity and switching costs). The results show that customer inertia has a moderate negative effect on the intention to change service providers but had no measurable effect on the actual behavior of changing service providers, other than indirectly, by influencing the perception of difficulty in switching some 11 months later. Further results from an analysis of indirect pathways of the antecedents to inertia show that switching costs are the only variable which indirectly reduce intentions to change service providers. The results also show that the effect of satisfaction on switching service providers is partially moderated by inertia. Importantly, these relationships are reasonably robust given past switching behavior and contract status of consumers. Research limitations/implications The authors find evidence which explains some of the causes of inertia, and show that it has both direct and moderating effects on service provider switching intentions, though not necessarily the behavior of changing service providers. However, support was found for its indirect role through intent as an influence on switching behavior. Importantly, the authors find that inertia has lingering effects, in that it influences the perception of switching difficulties and, hence, behavior up to 11 months in the future. Practical implications Managerial implications are that service firms can profit from customer inertia through a reduction in churn. However, high levels of customer inertia over the longer term may increase the level of customer vulnerability to competitor offers and marketing activities, as satisfaction with the provider does not in itself explain switching intentions or behavior. Originality/value This study is the first study to contribute to an understanding of the antecedent drivers of customer inertia with respect to service provider switching and to empirically evaluate a variety of antecedent factors that potentially affect switching intentions. Importantly, the long lasting latent effect of inertia in indirectly influencing service switching behavior was found to persist some 11 months later.

EXPRESS: Prominent Retailer and Intra-brand Competition

2021 ◽  
pp. 002224372110441
Author(s):  
Ruitong Wang ◽  
Yi Zhu ◽  
George John
Keyword(s):  
Consumer Welfare ◽  
Threshold Level ◽  
Critical Threshold ◽  
Search Cost ◽  
Policy Makers ◽  
Online Retail ◽  
Brand Competition ◽  
Managerial Implications ◽  
Carry Over

Online retail search traffic is often concentrated at a “prominent” retailer for a product. The authors unpack the ramification of this pattern on pricing, profit, and consumer welfare in an intra-brand setting. Prominence denotes a larger number of heterogenous search cost consumers starting their search at the prominent retailer than at any other retailer. This analyses show that search traffic concentration can intensify intra-brand competition, can lower average prices of all retailers, and can improve consumer welfare. Interestingly, the prominent retailer's incremental traffic advantage can increase or reduce its own profit; the authors denote these as the “blessing” and “curse” of prominence respectively. The authors extend their analysis to a setting where consumers consider searching only amongst those retailers of whom they are individually aware of; the prominent retailer is included in all these individual awareness sets. The effects on market average prices and welfare carry over, but only below a critical threshold level of the prominent retailer's first-search traffic advantage. Above this threshold, market average prices rise and welfare decreases, making this the region where search concentration warrant scrutiny from policy makers. The authors close with policy remedies, and managerial implications of search concentration.

Financial access and economic development: the moderating role of financial consumer protection

2019 ◽  
Vol 15 (4) ◽  
pp. 406-424 ◽  
Author(s):  
Maryam Kriese ◽  
Joshua Yindenaba Abor ◽  
Elikplimi Agbloyor
Keyword(s):  
Economic Development ◽  
World Bank ◽  
Financial Literacy ◽  
Compliance Monitoring ◽  
Financial Access ◽  
Policy Makers ◽  
Content Type ◽  
The World Bank ◽  
Moderating Role

Purpose The purpose of this paper is to examine the moderating role of financial consumer protection (FCP) in the access–development nexus. Design/methodology/approach The study is based on cross-country data on 102 countries surveyed in the World Bank Global Survey on FCP and Financial Literacy (2013). The White heteroscedasticity adjusted regressions and Two-stage least squares regressions (2SLS) are used for the estimation. Findings Interactions between FCP regulations that foster fair treatment, disclosure, dispute resolution and recourse and financial access have positive net effects on economic development. However, there is no sufficient evidence to suggest that interactions between financial access and enforcement and compliance monitoring regulations have a significant effect on economic development. Practical implications First, policy makers should continue with efforts aimed at instituting FCP regimes as part of strategies aimed at broadening access to financial services for enhanced economic development. Second, instituting FCP regimes per se may not be enough. Policy makers need to consider possible intervening factors such as the provision of adequate resources and supervisory authority, for compliance monitoring and enforcement to achieve the expected positive effect on economic development. Originality/value This study extends evidence in the law–finance–growth literature by providing empirical evidence on the effect of legal institution specific to the protection of retail financial consumers on the access–development nexus using a nouvel data set, the World Bank Global survey on FCP and Financial Literacy (2013).

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