The effect of national culture on service provision within Takaful industry

Abstract

PurposeThe purpose of this paper is to investigate the effect of national culture in terms of power distance and uncertainty avoidance on service provision in terms of information flow and communication policy within the Takaful industry (Islamic insurance) in Kuwait and Egypt. Second, to validate Hofstede's claim regarding the homogeneity of Arab culture which he believes is dominated by the Islamic religion.Design/methodology/approachThe study was undertaken among 462 employees from three Takaful organizations in Kuwait and Egypt. The sample was randomly selected from all levels within Takful companies operating in both countries. The data were analyzed using two different statistical packages. The first tool was SPSS version 17 with which the first hypothesis of the differences between Kuwait and Egypt was tested. Second, the analysis of moments structure was utilized to find the effect of national culture based on two cultural dimensions of power distance and uncertainty avoidance on two service mechanisms of information flow and communication policy within the Takaful industry.FindingsResults demonstrate that: more differences than similarities exist between Kuwait and Egypt in terms of power distance and uncertainty avoidance, which implies that the differences in national culture between the two countries are in contrary to Hofstede's claim of homogeneity of Arab culture, and national culture in terms of power distance and uncertainty avoidance affects service provision in terms of information flow and communication policy, respectively.Originality/valueThe paper contributes to the body of knowledge in service marketing literature at the theoretical and practitioner level. First, it provides empirical investigation to an existing theory that links national culture to service provision through service quality gaps. Second, it provides evidence that disputes Hofestede's claim of homogeneity in Arab culture, as it evidently proves the cultural differences between Kuwait and Egypt. On other hand, practitioners of Takaful may comprehend how power distance and uncertainty avoidance might affect information flow and communication policy for which managers can eliminate their information gap, which in turn will strengthen the Takaful operator service quality in information gathering, sharing and disseminating. Takaful Policy makers and institutions might benefit from this research by understanding the effect of national culture on service provision and taking this as an important factor when designing regulations.