Uncovering the digitalization impact on consumer decision-making for checking accounts in banking

2022 | Electronic Markets | Citations: 0

Authors: Dehnert, Maik; Schumann, Josephine

Abstract: Checking account providers must understand the importance of digital and non-dig ... Expand

Abstract: Checking account providers must understand the importance of digital and non-digital service attributes across different customer segments to achieve a product-market fit in digitalization. In particular, various latent personal characteristics influence customer choices in digital banking. However, there is only limited research on banking customer behavior beyond the technology acceptance model, and none that explores customer preferences for checking accounts experimentally. Against this background, we present the results of a discrete choice experiment on customer preferences towards checking accounts in Germany. The outcome of the paper is a detailed quantitative assessment of the relationships between checking account service attributes and a set of latent influencing factors on choice. While customer service experience, the scope of services, and professional expertise are identified as re-occurring critical aspects for customers when choosing their banking service provider, the type of provider and digital product innovation showed little impact on customer choice overall. In multigroup analyses, we reveal the moderating impact of influencing factors on the preference of checking account service attributes. Additional segmentation analyses point to six customer segments from which four still prefer a traditional operating model. The largest segment of traditional product-innovative customers prefers digitalized, i.e., data-driven checking accounts in a mixed-mode with human customer advisory and on-site branch services from a traditional bank. At the other end of the spectrum, a small innovative Fintech customer segment, influenced by non-pragmatism and social norms, prefers a purely digital operating model with data-driven applications in banking. Collapse

Topics: customer service innovation management electronic finance digital service social influence

Methods: experiment survey partial least squares path modeling discrete choice experiment computational algorithm

Categorical Competition in the Wake of Crisis: Banks vs. Credit Unions

2021 | Organization Science | Citations: 0

Authors: Chatterji, Aaron K.; Luo, Jiao; Seamans, Robert C.

Abstract: We connect two distinct streams of research on categories to study the role of w ... Expand

Abstract: We connect two distinct streams of research on categories to study the role of within-category typicality in the context of legitimacy shocks. We argue that, following a legitimacy shock, member organizations of the tainted, focal category suffer equally, irrespective of their typicality. However, only the typical members of the newly favored, oppositional category benefit. Therefore, the effects of legitimacy shocks are asymmetrically influenced by typicality. We argue this pattern is the result of a two-stage process of categorization by audiences, whereby audiences prioritize distinctions between organizations in a newly favored category and spend limited efforts considering distinctions in the tainted, focal category. We examine our theory in the context of the U.S. financial services industry, where four different kinds of organizations engage in competition: traditional commercial banks, community banks, single-bond credit unions, and multibond credit unions. Consistent with our theory, we show that both traditional commercial banks and community banks suffer in terms of deposit market share following the legitimacy shock of the 2007 financial crisis, but the relative gains to credit unions are strongest for single-bond credit unions. Collapse

Topics: database system terrorist incident social capital

Methods: post-hoc analysis robustness check ordinary least square descriptive statistic Compustat

Theories: theory of economic recessions

An Innovation Theory of Headquarters Value in Multibusiness Firms

2019 | Organization Science | Citations: 1

Authors: Knott, Anne Marie; Turner, Scott F.

Abstract: A fundamental question in corporate strategy is how headquarters in multibusines ... Expand

Abstract: A fundamental question in corporate strategy is how headquarters in multibusiness firms can create value above and beyond the burden of its own overhead. The leading theories from Chandler and Williamson hold that this is possible through resource allocation across businesses. Yet, there are multibusiness firms for whom reallocation opportunities are limited—e.g., chains. Accordingly, we propose, model, and test an alternative theory, one in which headquarters facilitates market-like dynamics between businesses that fuel innovation and growth. Whereas Chandler’s and Williamson’s theories involve the visible hand of managers, ours involves an invisible hand of managers. We construct an interacting agent model of the theory, which yields three propositions relating multibusiness structure to firm growth. We test those propositions in the banking industry and obtain results consistent with the model’s predictions. In particular, knowledge growth increases in the number of units and heterogeneity in their knowledge, and increases then decreases in their geographic distance. Interestingly, once we account for these structural elements, scale and hierarchy both suppress innovation. Thus, neither Williamson’s nor Chandler’s theories hold in our setting (consistent with the argument motivating the need for an additional theory). Collapse

Topics: innovation management organization structure database system systems design resource allocation

Methods: mathematical model descriptive statistic simulation robustness check Monte Carlo simulation

Theories: innovation theory theory of bounded rationality

Organizational Module Design and Architectural Inertia: Evidence from Structural Recombination of Business Divisions

2018 | Organization Science | Citations: 5

Authors: Albert, Daniel

Abstract: The modular organization has been found to be particularly effective in explorin ... Expand

Abstract: The modular organization has been found to be particularly effective in exploring and adapting to changing environments. One powerful means of exploration has been argued to be structural recombination—that is, the splitting and merging of modules. Once undertaken, structural recombination can lead to novel architectural opportunities that enable greater innovation and long-term performance. However, little research exists that explores whether and to what extent a focal module may be readily available for recombinatory opportunities in the first place. In this paper, I investigate the design hierarchy choices related to visibility and information hiding in organizational module designs (i.e., business divisions). In a longitudinal sample of 222 divisions in 18 of the largest European universal banks, I find support for modularity-informed predictions in which visibility and information hiding affect module recombination decisions. In a post hoc analysis, I explore a complementary theoretical explanation of divisions and subunits engaging in political influence. The post hoc results suggest the existence of both a design and a politics component in recombination efforts. I therefore propose that in an organizational context, integrating a political lens into the modularity framework may be of great value in deepening our understanding of how reorganization decisions come about. The online appendices are available at https://doi.org/10.1287/orsc.2018.1210. Collapse

Topics: accounting missing data innovation management accounting standard organizational change

Methods: robustness check post-hoc analysis Student's t-test parametric test hazard function

Theories: political theory

How to Decompress the Pressure – The Moderating Effect of IT Flexibility on the Negative Impact of Governmental Pressure on Business Agility

2018 | HICSS | Citations: 0

Authors: Reitz, Andreas; Jentsch, Christian; Beimborn, Daniel

Abstract: In times of digital transformation banks need to behave agile and increase their ... Expand

Abstract: In times of digital transformation banks need to behave agile and increase their speed in IT. At the same time, they are bound by an increasing number of regulatory rules at an increasing pace that force them to act carefully. Since governments frequently introduce new regulatory terms, especially in the finance sector, regulation is a changing phenomenon itself, which forces banks to adjust and change their systems constantly. To manage these challenges, we argue that successful businesses need to have a flexible IT architecture in place. This should enable them to update and reconfigure their systems in a cost effective and prompt manner. By doing this, they should be able to compensate for the regulatory pressure and remain agile. Collapse

Topics: IS agility business process management telephone user requirement database system

Methods: survey survey design partial least squares regression statistical hypothesis test qualitative interview

Theories: institutional theory

A Reference Enterprise Architecture for Holistic Compliance Management in the Financial Sector

2018 | International Conference on Information Systems | Citations: 0

Authors: Timm, Felix; Sandkuhl, Kurt

Abstract: Since the global financial crisis from 2007, an increasing number of regulatory ... Expand

Abstract: Since the global financial crisis from 2007, an increasing number of regulatory requirements has forced financial institutions to implement a holistic and efficient approach for regulatory compliance management (RCM). The state of practice in financial institutions is characterized by various and segregated compliance programs. Research and practice identify an absence of a holistic RCM approach that captures the impact of legal requirements on financial institutions from organizational and information systems (IS) perspectives. Using a design science research (DSR) approach, we develop a reference compliance organization (R-CO) that uses enterprise architecture concepts to provide such a holistic solution. The contributions of our work are (i) a problem investigation of industrial needs, (ii) the R-CO model that proposes a solution for such needs, (iii) the application of the R-CO in two use cases, and (iv) the RCO’s evolution during evaluation episodes according to the Framework for Evaluation in DSR (FEDS). Collapse

Topics: enterprise architecture TOGAF system support database system IT skill

Methods: qualitative interview focus group design science literature study survey

More Than Meets the Eye: A Case Study on the Role of IT Affordances in Supporting Compliance

2018 | Americas Conference on Information Systems | Citations: 0

Authors: Zasada, Andrea; Bui, Tung

Abstract: Meeting compliance requirements in highly regulated business environments is imp ... Expand

Abstract: Meeting compliance requirements in highly regulated business environments is imperative as companies face severe consequences if they fail. Compliance is particularly crucial in financial services as providers are frequently confronted with changes in regulations that financial advisors have to follow when providing investment advice. Deploying IT affordances is expected to assist in assuring compliance, and optimize the process of information management and retrieval. However, there is no research to date that substantiates this assumption from the employee perspective. We propose a conceptual model for assuring compliance derived from a case study conducted at a German savings bank. Our preliminary findings suggest that IT does indeed help employees in improving their compliance. More importantly, our research reveals compliance concerns such as the limited business intelligence of the current system, loss of flexibility in the advisory process, and uncovers the emerging conflict of interests between client, advisor and service provider. Collapse

Topics: affordance system support information system use information storage and retrieval system information overload

Methods: qualitative interview case study business process modeling conceptual modelling

Shadow Systems, Risk, and Shifting Power Relations in Organizations

2017 | Communications of the Association for Information Systems | Citations: 6

Authors: Furstenau,, Daniel; Rothe, Hannes; Sandner, Matthias

Abstract: Drawing on notions of power and the social construction of risk, we build new th ... Expand

Abstract: Drawing on notions of power and the social construction of risk, we build new theory to understand the persistence of shadow systems in organizations. From a single case study in a mid-sized savings bank, we derive two feedback cycles that concern shifting power relations between business units and central IT associated with shadow systems. A distant business-IT relationship and changing business needs can create repeated cost and time pressures that make business units draw on shadow systems. The perception of risk can trigger an opposing power shift back through the decommissioning and recentralization of shadow systems. However, empirical findings suggest that the weakening tendency of formal risk-management programs may not be sufficient to stop the shadow systems cycle spinning if they fail to address the underlying causes for the emergence of shadow systems. These findings highlight long-term dynamics associated with shadow systems and pose “risk” as a power-shifting construct. Collapse

Topics: IT governance systems documentation enterprise resource planning implementation systems development life cycle risk management

Methods: qualitative interview single case study case study theory development triangulation

Theories: information systems theory

Shadow IT, Risk, and Shifting Power Relations in Organizations

2016 | Americas Conference on Information Systems | Citations: 0

Authors: Furstenau, Daniel; Rothe, Hannes; Sandner, Matthias; Anapliotis, Dimitrios

Abstract: We draw on notions of power and the social construction of risk to understand t ... Expand

Abstract: We draw on notions of power and the social construction of risk to understand the persistence of shadow IT within organizations. From a single case study in a mid-sized savings bank we derive two feedback cycles that concern shifting power relations between business units and central IT associated with shadow IT. A distant business-IT relationship, a lack of IT business knowledge and changing business needs can create repeated cost and time pressures that make business units draw on shadow IT. The perception of risk can trigger an opposing power shift back through the decommissioning and recentralization of shadow IT. However, empirical findings suggest that the weakening tendency of formal programs may not be sufficient to stop the shadow IT cycle spinning if they fail to address the underlying causes for the shadow IT emergence. These findings highlight long-term dynamics associated with shadow IT and pose "risk" as a power-shifting construct. Collapse

Topics: IT governance risk management systems development life cycle enterprise information system systems documentation

Methods: qualitative interview single case study theory development case study qualitative coding

Theories: information systems theory

Tv’s Dirty Little Secret: The Negative Effect of Popular Tv on Online Auction Sales

2016 | Management Information Systems Quarterly | Citations: 0

Authors: Hinz, Oliver; Hill, Shawndra; Kim, Ju-Young

Abstract: The article discusses the effects of popular television (TV) shows on online auc ... Expand

Abstract: The article discusses the effects of popular television (TV) shows on online auction sales on the German website Platform.com. Topics include exogenous effects of TV viewership in relation to endogeneity issues in an instrumental variable approach, cross-media effect in relation to consumer attention, and the effects of major news and sports events on TV viewership. The impacts of the 2006 soccer World Cup and the 2008 U.S. Presidential election are addressed. Collapse

Topics: online auction internet technology natural hazard advertising management criminality

Methods: instrumental variables estimation descriptive statistic longitudinal research triangulation autocorrelation analysis