This study is an in-depth empirical investigation that seeks to compare consumer expectations to perceptions in the delivery of service within community banks in the southern United States. It has as its aim to develop a useful instrument to evaluate service quality by comparing consumer expectations to their perceptions of delivered service. An additional purpose is to determine bank chief executive officers’ ability to predict consumer expectations in the area of service delivery. The theoretical portion of the study focused upon a review of the history of banking in the United States and its subunit, the State of Texas, which is uniquely different from the banking systems of Europe and Asia. The literature was also examined to review service quality and customer satisfaction. In order to examine methods to predict service quality in community banks, an investigation was carried out among consumers of fifteen community banks in the southern United States. The collection of the data was driven by six research hypotheses and involved two questionnaires. One questionnaire ask for customer expectations versus perceptions. A second questionnaire required the chief executive officers of the consumers’ banks to state their perceptions of what their consumers expected in the way of service delivery. The main findings of the research built upon and extended the research by Ittner and Larcker (1996) which noted that the three prime components of customer satisfaction revolved around three specific antecedents—perceived quality, perceived value, and customer expectations, the study strongly reinforced and confirmed the importance of the three antecedents. This study indicated that while expectations are very high, perceptions are also high, but not as high as expectations. Milligan (1995) advanced the idea that it should be obvious that the element of service quality was the primary driver in bank selection, but no confirmation study was made by him or others comparing the five factors (service quality, location, advertising, recommendation of others, and service charges/fees). This study concluded that service quality was the most important factor in the selection of a community bank in the southern United States. With no specific literature relating specifically to bankers’ perceptions of service delivery expectations by consumers, one of the most significant findings in this study noted that 77.3 percent of the responses to the questions indicated a match of bankers’ perceptions with consumers’ expectations. While outcomes indicated that perceptions were equal to or greater than expectations, this does not conclusively prove that satisfactory service quality will tend to be associated with outcomes equal to or above expectations. This could indicate that the customers did not expect much in the way of outstanding service. Based upon results obtained from surveys, there appears to be a high likelihood that a bank could reasonably predict the retention of customers using the overlaid plots that in this study show high expectations and high perceptions. However, this study could not conclusively substantiate that gender, income, and education impact service quality in community banks. Given the limited amount of literature relating to the delivery of service quality by community banks in the United States, this study provides both researchers and practitioners an empirical study of both consumers’ and bankers’ expectations and perceptions of service delivery, which had not been fully explored in the past.

The first aim of this research was to examine the current financial technologies, outreach and fmancial viability over time (from 1997 to 2002) of four MFOs providing agricultural, microbusiness and consumption credit in KwaZulu-Natal (KZN), South Africa (SA). Understanding the limitations and advantages of these financial technologies could facilitate institutional reform to improve access by low-income people to viable formal financial services in KZN. The second aim of this study was to estimate factors that affect the credit rationing decision and applicant loan default at the MFO providing consumption credit (MFOI), and the factors affecting default on medium-term agribusiness loans provided by MF02 which was one of the agricultural MFOs. These analyses were intended to help to improve client selection procedures and to reduce loan default rates at these MFOs. Study results show that institutions that finance specifically agricultural activities could improve the quality of their services by providing better access to branches and reducing loan approval times through improved screening and administrative procedures. Making financial services (consumption and production loans) available to both non-agricultural and agricultural sectors would also help to reduce portfolio risks resulting from the covariant incomes of small farmers. Savings mobilisation should also be considered, although institutions need to develop appropriate capacity to handle savings before mobilising deposits. The study shows too that the rural poor in SA have the capacity to save (for example, the average number of active savings accounts held by individuals at MF02 rose to 474 052 in 2002). Study results also suggest that the provision of both savings and loan services helps an institution to reduce borrower transaction costs in accessing financial services and means that savings can serve as a form of collateral and borrower information for lenders. Lenders need to charge interest rates that reflect the true cost of lending in order to cover costs, given that small loans to the rural poor in SA are risky and costly to administer. Charging a suitable interest rate, however, is not a sufficient condition for achieving financial self-sustainability. Reducing high arrears through stricter loan contract enforcement will also promote the financial self-sustainability of MFOs in SA. Moveable assets, such as vehicles and equipment, were not effective sources of collateral due to the high costs of attaching these assets in rural parts of KZN. Cessions on sugarcane crops were often constrained by flaws in collection mechanisms, where borrowers could deliver sugarcane to sugar mills on non-borrower quota numbers. Secure and transferable property rights were important preconditions if land was to have value as collateral. Collateral substitutes such as joint liability mechanisms were less effective when lending to large farmer groups (30 - 60 members) compared with small groups (4 - 6 individuals) of micro-entrepreneurs operating in urban areas in SA. Costly legal action to recover debts further undermined borrower accountability for loan repayment and thus did not discourage morally hazardous activities. Reputational capital was an integral part of the financial technology successfully used by MFO1, and could be more effectively developed by agricultural lenders in SA if they strictly enforce the policy of denying borrowers access to future funds if they default on previous loans. Based on data over the period 1998 to 1999, less contactable borrowers that were employed in sectors with a high likelihood of retrenchments, with higher debt-to-income ratios and with more defaults and payment profile arrears, were more likely to be credit-rationed by MFO1 staff. Applicant contactability was another key part of MF01's monitoring intensive financial technology, but constrains MFO1 from broadening its financial services to small businesses if these are not easily contactable. Credit bureau information on previous loan default was critical in this microfinance market where it is difficult to obtain formal collateral. The policy implication is that lenders need to share default information and credit bureaus need to correctly capture this information. Borrowers with higher debt commitments, previous loan defaults, who were less contactable and who worked in sectors where employment was less secure, were more likely to default at MFO1. Low-income borrowers had lower levels of liquidity that reduced their ability to repay debt. The influence of contactability in loan repayment highlights the trade-off between monitoring-intensive and collateral-intensive technologies. Although MFO1 used reputational capital as a collateral substitute, the imperfect nature of this collateral type necessitated intensive client monitoring. Lender MFO1 also needed a well-diversified portfolio across employment sectors to reduce the impact of systemic income risks. The impact of previous credit history on loan repayment suggests again that this information can be an effective collateral substitute if information is shared between lenders, and the rule of not granting credit to defaulters is strictly enforced. Based on data over the period 1993 to 1994, borrowers with smaller loans (lower asset bases and smaller businesses), lower own equity contributions, engaged in contract ploughing and cartage or broiler production ventures, with lower liquidity and with no previous borrowing experience, were more likely to default of MF02's medium-term agricultural loans. Larger borrowers had well-diversified asset bases that enabled them to better withstand negative income shocks and reduced the need to divert funds for loan repayment to current consumption. Improved liquidity generated from other sources of income (such as wage remittances and other business ventures) also improved loan repayment ability. Lenders thus need to focus on all sources of income, not just on the income generated by the investment project for which finance is provided, in assessing client repayment capacity. Ploughing contractors probably need closer monitoring to ensure that equipment is properly maintained and that sufficient income can be generated from the business to repay loans. These contractors could also be encouraged to diversify into contract transport activities that provide more regular income. Given the increased competition and periodic outbreak of disease in the chicken industry when the study was conducted, borrowers should be encouraged to diversify to reduce price risk. Increasing the owner's equity stake in the investment, while a second-best option, may be a suitable alternative where collateral is ineffective in enforcing loan contracts. Borrowers that had an established record with the lender tended to repay their loans, again highlighting the importance of reputation in a borrower-lender relationship. / Thesis (Ph.D.)-University of Natal, Pietermaritzburg, 2003.

The aim of this study is to determine the extent to which the UN/OSCAL (United Nations Office of the Special Coordinator for Africa and the Least Development Countries) model of microfinance is being applied in the South African context, its scope for application and recommendations for implementation. The hypothesis is that, the better South African microfinance initiatives conform to the model, the more successful it will be in fulfilling the ultimate mission of microfinance which is to supply financial services to the poor by cutting the cost of outreach with beneficial effects on poverty..

This research empirically investigates Locke's (1997) model of work motivation by means of quantitative research. The OCQ consisting of three tiered questionnaires was constructed based on Locke's model. OCQ-Tierl deals with core components of Locke's model. OCQ-Tier2 determines which factors caused the incidence of dissatisfaction in OCQ-Tierl. OCQ-Tier3 enables the identification of corrective actions. The OCQ was administered to financial services employees. The results were analysed and Locke's model was tested by means of structural equation modelling using the AMOS graphics programme. The results indicated that the model, suggesting causal links between components within OCQ-Tierl, could not be confirmed. A better fit was found at OCQ-Tier2 and OCQ-Tier3. In testing the causal links across the three tiers per component, the models did not fit the data for "personal actualisation" and "goal achievement". Moderate confirmation of the models was found in the case of "goal setting" and "goal behaviour" across the three tiers after some adaptations were made to the models on the basis of "modification indices", suggested by AMOS. A reasonably good fit was found for the models across the three tiers for "quality of work life". The level of correlation between factors was high because of this, and in some cases some of the factors were merged. Modification indices in the statistical output suggested that improvement was possible if covariance between error terms in the model was allowed. This suggested possible systematic sources of covariance between items not accounted for by the factors in the models. As confirmed by the Cronbach Alpha coefficients within tiers and across tiers, the general level of internal consistency was very high. Possibly response set and response style were the cause of this. This made the testing of models difficult in the present study. So too was it difficult to draw a conclusion about the internal consistency reliability of the measurement of each component across the three tiers, because the high Cronbach coefficients may to some extent be due to the indiscriminate high correlations between items / D.Litt. et Phil. (Industrial Psychology)

O objeto do presente trabalho é o diagnóstico do arcabouço regulatório pátrio destinado à prevenção de crises bancárias, quais sejam a regulação sistêmica e a regulação prudencial, e como as transformações ocorridas no sistema financeiro na segunda metade do século XX o afetam. A partir desse estudo, o trabalho pretende demonstrar que, embora a regulação sistêmica e a regulação prudencial no País tenham incorporado avanços notáveis nas últimas décadas, ainda há falhas significativas a serem corrigidas e desafios a serem enfrentados. Se por um lado o atual arcabouço regulatório é marcado por exigências e controles mais rigorosos que os encontrados em outros países, por outro lado, constam também inúmeros instrumentos de resgate a bancos sendo aplicados de forma desordenada, sem regras claras, com pouca ou nenhuma prestação de contas, e até mesmo desvirtuando o propósito original de alguns desses instrumentos. A presença de uma multiplicidade de mecanismos de resgate com tais características é uma preocupante fonte de risco moral no mercado. Outrossim, o exame das transformações ocorridas no Sistema Financeiro Nacional nas últimas décadas evidencia que as dificuldades enfrentadas por autoridades bancárias em outros países, como o fenômeno do grande demais para quebrar e o monitoramento do risco sistêmico em um contexto de conglomeração financeira, já são uma realidade no País, representando desafios para a regulação sistêmica e a regulação prudencial, e provocando a reflexão sobre as consequências desses movimentos no setor bancário nacional para o arcabouço regulatório vigente. Em conclusão, o trabalho pretende demonstrar que, apesar de seus inegáveis méritos, a exaltação ao arcabouço regulatório pátrio em face de seu desempenho considerado positivo na crise financeira recente deve ser vista com temperamentos, e que a atuação das autoridades bancárias nos próximos anos deve ser mais centrada na correção das falhas identificadas e reflexão sobre os desafios apresentados. / The study aims at evaluating the national regulatory framework designed to prevent banking crises (e.g. systemic and prudential regulation), and how the transformations that occurred in the financial services industry throughout the second half of the 20th century affect it. Based on this analysis, the study intends to demonstrate that, albeit the systemic and prudential regulation in Brazil have incorporated important developments over the last decades, there still are significant flaws that need to be fixed and challenges to be faced. If, on the one hand, the current regulatory framework is marked by demands and controls that are more rigorous than those adopted by other countries, on the other hand, the mechanisms designed to rescue distressed banks are being applied in an unorganized manner, without clear rules, little or no accountability, and even distorting the original purpose of some of these mechanisms. The presence of this variety of rescue mechanisms with such characteristics is a concerning source of moral hazard. Furthermore, the examination of the transformations in the financial system in recent history shows that the challenges faced by banking authorities in other countries, such as the too big to fail phenomenon and the complexity of monitoring systemic risk in the context of financial conglomerates, are also present in Brazil, creating challenges to the current regulatory framework, and claiming a reflection on the consequences of such transformations in the national financial services industry. In conclusion, the study aims at demonstrating that, despite its unquestionable merits, the exaltation to the Brazilian systemic and prudential regulation in light of the countrys performance in the recent financial crisis should be analyzed with caution, and that the role of the banking authorities over the next years should be focused in fixing the flaws identified in the analysis and reflection over the challenges discussed throughout the study.

This is a quantitative study which explores whether there is a positive relationship between customer satisfaction as perceived by corporate customers and revenue generated from such customers of the corporate division of a single South African bank. This research report has three sections, namely the (1) academic paper which comprises a condensed literature review, research methods, results and discussion, (2) an expanded literature review, and (3) an expanded research methodology. Although these three sections are interrelated, they may be considered stand-alone documents. A review of literature contends that customer satisfaction has been a topic of interest for over four decades when, in 1965, the concept was first introduced to literature by Cardozo. Even in these early stages it was hypothesized that higher customer satisfaction would lead to repeat purchasing and cross selling. Thus, for some time, researchers have proposed that a link exists between customer satisfaction and a company’s bottom line, ultimately alluding to the notion of positive associations between customer satisfaction, revenue and profitability. The corporate banking division of a South African bank has dedicated significant time and economic resources to monitoring and improving the satisfaction of their corporate customers each year. With a focus on this single corporate banking division, this quantitative study used secondary customer satisfaction data to establish whether a positive relationship between customer satisfaction with a bank representative or more formally termed, the ‘transactional banker’ (TB) and revenue at an account level exists. The study used a one-dimensional customer satisfaction construct summated from several variables or a one-dimensional multi item scale. This quantitative study made use of secondary data obtained through customer satisfaction surveys conducted with the division’s clients in three waves during September 2010, March 2011 and September 2011. At the time of data collection, telephone interviews were conducted with individuals in corporations who were customers of the corporate division within the bank. These individuals in their respective corporations were identified and surveyed because they (a) managed the primary relationship of the corporation with the banking division and (b) were senior financial decision makers of their organization’s (i.e. had the ability to influence a decision to change banks). Sample sizes of 273 (September 2010), 259 (March 2011) and 310 (September 2011) individual corporate customers were achieved through a method of stratified sampling. In this study, customers were stratified according to the TB who is responsible for their account. Within each stratum a random sample of 10 – 15 participants were included for each of the 30 TB’s. Monthly revenue data, recorded as a) credit revenue, b) overdraft revenue and c) total revenue was sourced from internal company records for each month from September 2010 to January 2012. Pearson’s correlation coefficient was used to assess whether a positive correlation between the two variables of customer satisfaction and revenue exists. This was followed by Ordinary Least Square Regression to investigate the magnitude and nature of the relationship between customer satisfaction and revenue using customer satisfaction as the independent variable and revenue as the response variable. Cronbach’s alpha was also used for internal scale validity. The results of the research indicated no statistically significant relationship between a customer’s satisfaction with the performance of their TB and either the credit, overdraft or total revenue generated from such a customer through their account. By highlighting this, these findings, nevertheless, contribute to the growing body of knowledge examining the impact of customer satisfaction efforts on revenue. On the basis of the findings of this study, it cannot be practically recommended that customer satisfaction efforts be terminated or changed within the organization of study owing to several study limitations which were present. Firstly, the study was hampered by small sample sizes due to a lack of the availability of revenue data in some instances, particularly in the case of overdraft revenue. Secondly, the study only focused on a single bank account held with the bank and increases and decreases in revenue based on the balances held within that single account. Since one of the purported consequences of improved customer satisfaction is the purchase of additional products, the current design of the study does not take into account the take up of additional accounts or banking products with the bank. Thus, an increase in revenue for the bank as a whole due to the purchase of additional accounts may be masked. Similarly, the scope of the study does not extend to examining the effect of recommendations made by these corporate customers to others and hence growth of divisional or bank revenue due to the addition of new customers. Finally, this quantitative study does not examine revenue growth when compared to customer satisfaction improvements over time due to a limited sample of customers taking part in the study over a number of periods as well as incomplete revenue data. The recommendations for future research are to examine the relationship between changes in customer satisfaction and changes in revenue at divisional level in the long run within the South African banking industry as the impact of an increase in customer satisfaction may be obscured by salient factors in the short run. It is also suggested that future research look at the correlation between dissatisfaction and revenue, where adequate sample sizes are available. Theoretically, the results of this research do bring into serious question the universal application, especially in the context of the South African banking industry of the Service Profit Chain and Satisfaction Profit Chain which propagate the existence of a positive relationship between customer satisfaction and revenue.

The following is a case study report on the Cape Town business unit of Standard Bank Properties. The research project falls within the ambit of services marketing which introduces several unique management challenges for service businesses that sell services as a core offering. The principal aim of the case study is to gain an understanding of why customers bank at the business unit and to discover what aspects are critical to customer satisfaction. A further goal of the research is to examine how the business unit could improve customer satisfaction and to highlight any impediments to further improving customer satisfaction at the business unit. It is generally regarded that quality customer service is essential to building customer relationships and hence the research project emphasis on services marketing and customer satisfaction within a financial services context. The paper commences with an overview of the South African Banking Sector and its unique challenges such as the Financial Service Charter and newly introduced legislation such as Financial Intelligence Centre Act. The case study will specifically investigate the property finance industry and a detailed analysis of the business unit's operations and process flow will also be undertaken. The reason for this background information is to assist the reader to understand how the business unit operates. The research project will investigate four unique differences between goods marketing and services marketing whereafter three theoretical propositions are introduced, namely the dyadic interaction and service encounter, the Service Profit Chain and finally Relationship Marketing. Evidence in the form of a narrative will be led from insights obtained from interviews conducted with customers and staff at the business unit against these propositions with support (or otherwise) from independent surveys and documents from the business unit. The result of this analysis is the identification of several areas of concern specifically: New employees and the service encounter, Problems with FICA, Lack of a customer complaint handling system, Empowerment issues, Turnaround times, Reliance on key staff These insights together with the evidence from the literature review will be analysed and several recommendations made to improve customer service and ultimately customer satisfaction at the business unit. Several recommendations for further research are offered as well as the identification of limitations including but not limited to the specificity of the case study report.

This study gained insights into preferences of selected citizens of Virginia for information and education in personal financial management. Quantitative and qualitative data were triangulated. The quantitative data used were collected by Porter (1990) by a mail survey. The Porter database (N=506) was sorted to identify those respondents (n=50) with addresses located in the Central District of the Virginia Cooperative Extension Service. The resulting Central District database was then sorted to identify those respondents with characteristics similar to the participants in the qualitative data collection. This resulted in 12 respondents. The respondents' (n=12) responses to four questions on the Porter survey were reported. The qualitative data were collected from five focus groups (N=35) conducted in the Central District in October, 1991. The focus group participants were primarily the financial decision maker of the household, between the ages of 19 to 49, had annual gross incomes between $10,000 and $29,000, and had an educational level of at least a high school degree, but did not have a four year college degree. An 11 question interview guide was used in the focus groups to gain insights into the 4 closed-ended questions on the Porter survey. / Master of Science

This dissertation is motivated by two significant trends in the operations management of modern businesses. First, emerging technologies have transitioned traditional in-person services, such as healthcare, to online platforms. Second, advancements in machine learning and artificial intelligence, including large language models, provide promising tools to improve service quality. This dissertation aims to explore how emerging technologies and digitalization can be effectively utilized to manage customer behavior and the financial market. In Chapter 1, I study operational factors that lead to service incompletions and customers' heterogeneous behaviors online versus in-person, using telemedicine as a canonical example. The adoption of online services, such as telemedicine, has increased rapidly over the last few years. To better manage online services and effectively integrate them with in-person services, we need to better understand customer behaviors under the two service modalities. Utilizing data from two large internal medicine outpatient clinics, I take an empirical approach to study service incompletion for in-person and telemedicine appointments respectively. I focus on estimating the causal effect of provider availability on service incompletion. When providers are unavailable, patients may be more likely to leave without being seen, leading to service incompletion. I introduce a multivariate probit model with instrumental variables to handle estimation challenges due to endogeneity, sample selection, and measurement error. The estimation results show that intra-day delay increases the telemedicine service incompletion rate, but it does not have a significant effect on the in-person service incompletion rate. This suggests that telemedicine patients may leave without being seen, while in-person patients are not sensitive to intra-day delay. I conduct counterfactual experiments to optimize the intra-day sequencing rule when having both telemedicine and in-person patients. This analysis indicates that not correctly differentiating the types of incompletions due to intra-day delays from no-shows can lead to highly suboptimal patient sequencing decisions. In Chapter 2, I study the optimal usage of sunk cost, along with delay announcement, to mitigate service incompletion. Sunk-cost bias occurs when decisions are influenced by the time, energy, and money already invested, rather than considering the future costs necessary to achieve success. This phenomenon of "irrational behavior" is well-documented in decision-making studies and is generally recognized as a factor that can lead to suboptimal decisions. In this work, however, I investigate how sunk cost (and the behavioral bias associated with it) can be used as an operational lever to increase service completion rates in a congested service system. I run a controlled online experiment and find that the abandonment rate is significantly reduced for the group of participants who incur a larger sunk cost. To better capture the dynamics of service systems and their impact on customers' behavior, I study a queueing model with sunk cost and strategic customers, where customers experience a disutility of balking that is proportional to the sunk cost they incur. I characterize the equilibrium behavior of the customers, from which I further derive the optimal strategy for the service provider in terms of whether to provide real-time queue length information to customers as well as the optimal level of sunk cost to impose. The results show that the sunk cost strategy is effective only when waiting information is provided and that using a non-zero sunk cost is optimal when the system is moderately congested. Through a comprehensive numerical study, I demonstrate that implementing a non-zero sunk cost can substantially improve the throughput of the queuing system. In addition, I reveal an interesting asymmetric pattern in the robustness of the service provider's optimal policy when the customers' sensitivity to sunk cost cannot be accurately estimated, which suggests that if the service provider cannot accurately estimate the customer's sensitivity to sunk cost, using an underestimated value will give more robust performance improvements. In Chapter 3, I quantify news novelty -- changes in the distribution of news text -- through an entropy measure, calculated using a recurrent neural network applied to a large news corpus. An increase in the novelty of news predicts negative stock market returns and negative macroeconomic outcomes over the next year. Entropy is a better out-of-sample predictor of market returns than a collection of standard measures. Cross-sectional entropy exposure carries a negative risk premium, suggesting that assets that positively covary with entropy hedge the aggregate risk associated with shifting news language. Entropy risk cannot be explained by existing long-short factors.

This project will create strategic tools for the Credit Union and CUSO to use in order to best create a more symbiotic relationship between the two entities.