Building customers' affective commitment towards retail banks: The role of CRM in each ‘moment of truth’

This paper argues that retail banks need to focus more strongly on components of their Customer Relationship Management (CRM) strategy that will generate customer affective commitment and lead to an increase in customer retention, share of wallet, and advocacy. It is suggested that affective commitment is generated during ‘moments of truth’ or episodes of interpersonal interaction between customers and bankers. As shown in social psychology, effective interpersonal interactions are a function of the assertiveness and affiliation demonstrated during the interaction. Applying this to retail banking, bankers should mine their databases to identify customers in terms of their levels of profitability and longevity, and should deliver levels of assertiveness and affiliation appropriate to each customer. Testable research propositions are developed regarding how affective commitment might evolve during a customer's tenure with a retail bank, when bankers should deliver assertiveness and/or affiliation to customers of differing longevity and profitability, and how these strategies to increase affective commitment will impact retention, share development, and advocacy. Overall, the call is to complement the emphasis on the use of high-tech CRM strategies that generate huge databases with a more high-touch strategy that will indicate to bankers how to interact with each individual customer.     

Making innovation happen in organizations: individual creativity mechanisms,organizational creativity mechanisms or both?

Marketing managers increasingly face a product innovation dilemma. Managers will have to sell more with fewer new products in an environment where new products are providing lower revenue yields. Therefore, understanding what drives successful innovation is of paramount importance. This paper examines the organizational innovation hypothesis that innovation is a function of individual efforts and organizational systems to facilitate creativity. Our model formulates creativity as a property of thought process that can be acquired and improved through instruction and practice. In this context, individual creativity mechanisms refer to activities undertaken by individual employees within an organization to enhance their capability for developing something, which is meaningful and novel within their work environment. Organizational creativity mechanisms refer to the extent to which the organization has instituted formal approaches and tools, and provided resources to encourage meaningfully novel behaviors within the organization. Using data collected from 634 organizations, we find support for this hypothesis. The results suggest that the presence of both individual and organizational creativity mechanisms led to the highest level of innovation performance. The results also suggest that high levels of organizational creativity mechanisms (even in the presence of low levels of individual creativity) led to significantly superior innovation performance than low levels of organizational and individual creativity mechanisms. The paper also presents managerial and academic implications. This study suggests that it is not enough for organizations to hire creative people and expect the innovation performance of the firm to be superior. Similarly, it is not enough for firms to emphasize management practices to enhance creativity and ignore individual mechanisms. Although it is true that doing either will improve innovation performance, doing both should lead to higher innovation levels. Our understanding of what and how creativity influences innovation performance can be greatly enhanced by additional research that integrates the intrinsic and extrinsic drivers of creativity. Research that examines the role of team creativity efforts in enhancing innovation performance is also vital to an overall improved understanding of creativity, learning, and innovation within organizations.     

Causal Effect of Credit Guarantees for Small- and Medium-Sized Enterprises: Evidence from Italy

We evaluate the effectiveness of a partial credit guarantee program, implemented in a large Italian region, that aimed to improve the access to credit of small and medium enterprises. Using unique microdata from a broad set of firms, we show that the policy increased the long-term loans for beneficiary firms, while the total volume of bank loans was unaffected. Furthermore, targeted firms benefited from a substantial decrease in interest rates. However, there is some evidence that firms are more likely to default as a consequence of the treatment. Conversely, the results do not point to any significant effect on investments.     

Where Do Firms Export,How Much and Why?

The empirical finding that exporting firms are more productive on average than non‐exporters has provoked a large theoretical literature based on models such as Melitz ( 2003 ), where more productive firms are more likely to overcome costs associated with trade. This paper investigates how closely the productivity heterogeneity framework fits the data from a firm‐level survey that includes information on export destinations and firm characteristics such as productivity. We find a high degree of unpredictable idiosyncratic participation in export markets by firms and a relatively weak positive correlation between the extent of a firm's export market participation and its export sales. We find that a small number of standard gravity variables provide a close fit to the country‐level determinants of trade but that greater variation results in more difficulty in explaining firm‐specific factors driving exporting behaviour. We also illustrate some elements of the dynamics over time in firm exporting patterns by destination. We show that lagged exporting activity has a significant effect on a firm's current exporting profile.     

Steuerliche Förderung von Forschung und Entwicklung in KMU — Irrweg für Deutschland?

To foster R&D activities, German industry lobbyists and policymakers are discussing the introduction of tax incentives for R&D in small and medium enterprises (SME) — all the more because Germany is one of just six of the 35 OECD members without indirect R&D support. Based on a critical assessment of the arguments provided, we conclude that international experiences with R&D tax incentives are not as promising as often suggested. An appropriate transfer into the German tax system, considering its specificities, appears to be technically difficult. The high level of heterogeneity of German SMEs population suggests that not every SME requires R&D to be innovative, because empirical evidence shows multiple diverse innovation patterns that demand other forms of support. Acknowledging the existing range of SMEs, we propose that instead of introducing R&D tax incentives, the debate should be focused on how to strengthen and develop the existing innovation policy mix for SMEs.     

The future trajectory for environmental finance: planetary boundaries and environmental,social and governance analysis

Urgent issues such as climate change have drawn increasing attention from finance scholars. Most research has situated a corporate response within the context of the environmental, social and governance performance. However, other disciplines express concerns around environmental degradation within broader frameworks, such as the Planetary Boundaries framework. We highlight the different conceptualisations of ESG and planetary boundaries and call for further research that links finance research to the Planetary Boundaries framework. We describe how contributions in the Accounting & Finance Special Issue on Environmental Finance advance research in this area and explore implications for future research that responds to the imperatives of remaining within Planetary Boundaries.     

Vulnerability to poverty: an empirical comparison of alternative measures

This article compares empirically the several measures of individual vulnerability to poverty proposed in the literature, in order to understand which is the best signal of poverty that can be used for policy purposes. To this aim, the Receiver Operating Characteristic (ROC) curve, the Pearson and Spearman correlation coefficients are used as precision criteria. The results show that two groups of indexes can be identified, high and low performers, and, among the former, that proposed by Dutta et al. (2011 Dutta, I. 2011. Foster, J. and Mishra, A., On measuring vulnerability to poverty, Social Choice and Welfare, 37, 743–61 [Google Scholar]) is the most precise.     

The care-less marketplace: exclusion as affective inequality

ABSTRACT

The care-less marketplace is a discrete site which reinforces structural inequality in the affective domain of life. Drawing on the work of pro-care feminist theory, this empirical paper explores marketplace exclusion from the perspective of economic disadvantage and its impact on relations of love, care and solidarity. Adopting a voice-centred-relational approach, this interpretative study examines the narrative accounts of a diverse group of women living in diverse poverty contexts. Articulating marketplace exclusion as a series of affective burdens, material struggles and disconnections embedded within the relational web of family, friends and community – these experiences mirror participants’ imposed exclusion in the marketplace due to chronic economic hardship. Through the diffusion of an alternative theoretical lens, affective inequality surfaces the importance of care and how it is often most visible in the lives of vulnerable consumers when it is absent or broken.