Contextual effects on the objectives that financial institutions pursue through range pruning: Evidence from the UK

The paper set out to explore (a) the extent to which alternative objectives (identified previously through qualitative research) guide financial institutions’ decisions to prune their range and (b) if the above extent varies in relation to a set of company and environmental factors. Data were collected by means of a mail survey to a stratified random sample of 112 UK financial institutions. The findings are summarized under two headings. First, the objective namely to improve financial indicators achieved the highest rating, followed by the objectives namely to keep the range to an up-to-date condition and to concentrate resources on corporate effectiveness. Second, the extent to which the different objectives guide financial institutions’ range pruning decisions is contingent on organizational idiosyncrasies and on conditions of the external environment. The paper discusses practical and research implications and highlights fruitful directions for future inquiry.