Author:
Ghlichlee Behrooz,Bayat Fatima
Abstract
Purpose
Within the retail banking sector, the customer-centric business model has become an important and new business trend in recent years. The enhancement of the frontline service employees’ engagement and their customer-oriented behaviors are among the key factors affecting business performance (BP) in this sector of the banking industry. The purpose of this paper is to improve management decisions to enhance BP through examining the relationship between the frontline employees’ engagement and BP while taking into account the mediating effect of customer-oriented behaviors on this relationship.
Design/methodology/approach
A quantitative approach was adopted to conduct the present study, and the respondents were sampled from a large commercial bank in Iran using a structured questionnaire. Overall, 50 branch managers and 90 frontline employees were selected using random sampling. A confirmatory factor analysis was conducted to ascertain the validity and reliability of the observed items and a structural equation model was used for testing the proposed hypotheses and research framework.
Findings
The findings showed that customer-oriented behaviors mediated the relationship between the frontline employees’ engagement and bank’s branches’ BP. Higher levels of the frontline employees’ engagement enhance the customer-oriented behaviors. It was revealed that the frontline employees are engaged in their job and organization. Moreover, the engaged frontline employees listen carefully to customers, the customer’s problem is important to them and they complete their tasks precisely for customers. It has been confirmed that customer-oriented behaviors enhance branches’ BP. The bank frontline employees’ engagement and customer-oriented behaviors, in turn, affected the bank’s branches’ financial performance, process performance and employee performance compared with the bank’s key competitors.
Research limitations/implications
This study highlights the value of empirically establishing how employee customer-oriented behaviors are affected by employee engagement as an integrative construct bringing together BP.
Practical implications
This study can help improve BP by increasing the frontline employees’ engagement and their customer-oriented behaviors. This study suggests that organizations using the findings of this study could effectively assess their frontline employees’ engagement and their customer-oriented behaviors and then plan for improving them.
Social implications
This study offers a customer-oriented initiative as a social responsibility to be considered by retail banks. In light of the social exchange theory, the banks valuing customer-oriented can provide employees with knowledge, skills, values and support to develop motivation and abilities to demonstrate customer-oriented organizational citizenship behaviors.
Originality/value
Previous studies demonstrated that the employees’ engagement affects their customer-oriented behaviors. In addition, studies have referred to the effect of employees’ customer-oriented behaviors on BP. However, to the best of the knowledge, key questions regarding how the employees’ engagement at the branch level fosters customer-oriented behaviors and, in turn, the bank’s branches’ BP, remain unanswered. Hence, this study contributes to the investigation of the mediating role of the frontline employees’ customer-oriented behaviors in the relationship between their engagement and branches’ BP in the retail banking sector.
Subject
General Business, Management and Accounting
Reference121 articles.
1. The influence of job, team and organizational level resource on employee well-being, engagement, commitment and extra-role performance: test of a model;International Journal of Manpower,2012
2. The effect of employee engagement on organizational performance via the mediating role of job satisfaction: the case of IT employees in Jordanian banking sector;Modern Applied Science,2018
3. How organizational and employee-customer identification, and customer orientation affect job engagement;Journal of Service Management,2012
4. Customer satisfaction, market share, and profitability: findings from Sweden;Journal of Marketing,1994
5. The impact of human resource management on organizational performance: progress and prospects;Academy of Management Journal,1996
Cited by
24 articles.
订阅此论文施引文献
订阅此论文施引文献,注册后可以免费订阅5篇论文的施引文献,订阅后可以查看论文全部施引文献