Test of a service profit chain model in the retail banking sector

Abstract

Research has shown that organizational subunits where employee perceptions are favourable enjoy superior business performance. The service profit chain model of business performance (Heskett, Sasser, & Schlesinger, 1997) has identified customer satisfaction as a critical intervening variable in this relationship. This paper examines the relationships between organizational climate, employee attitudes, customer satisfaction, and sales performance in the retail‐banking sector. The role of customer satisfaction as a mediator between employee attitudes and sales performance is examined in a large sample of bank branches, spanning multiple organizations. Mediation effects are found, which border on significance when the sample size is large, but the effects seem to be too small to be of practical importance. It is argued that alternative formulations of the service profit chain model may provide more powerful explanations of the link between employee attitudes and business performance.

The Effect of International Hotel Employee Loyalty on Customer Behavioral Intention in Taiwan

“…Some empirical examinations of applying service profit chain to various businesses and industries are available. Gelade and Young (2005); Loveman (1998) both verified the links of service profit chain in retail banking, and found the result generally support the relationships of employee satisfaction and loyalty to customer satisfaction and loyalty to finally financial performance of a company. Another positive study of Brazil banks made by Kamakura, Mittal, de Rosa, and Mazzon (2002) proved that branch managers will obtain higher level of performance if they can manage to maintain high level of employee satisfaction.…”

Assessing the Impact of Service Quality on Customers and Operators: Empirical Study

“…Researchers like Armistead and Kiely, (2003); Gelade and Young, (2005);Homburg (2009);Yee, Yeung, and Cheng, (2011);Williams and Naumann, (2011);; Kanyurhi (2013) tested S-PC's links in different industries, at different locations and found close association among SPC's variables. Therefore, based on results and comparison of regression results (R 2 and ANOVA) of three tiers, it is found that the values of R 2 for the entire variables are positive and significant, which shows that the results are in line with assumptions.…”

Outcomes of Service Quality in Private Banking Business Uncovering a Chain of Effects

“…Items have been operationalized based on previous studies and by adapting them to the private banking context. These studies include the works of Cronin and Taylor (1992), Meyer Goldstein (2003), Gelade and Ivery (2003) and Gelade and Young (2005). Furthermore, items from other studies were adapted according to the defined characteristics of the proposed dimension (Loveman, 1998;Silvestro & Cross, 2000).…”