The dyadic bank‐SME relationship

Abstract

PurposeThis paper aims to emphasise the theory of adaptation in the analysis of banks' ability to meet the needs of their SME customers. This analysis involves examining the interaction process between the two parties, determining how the role of bankers is perceived and studying how banks as organisations function.Design/methodology/approachIn the study a total of 60 interviews are conducted, of which 45 are conducted with SME owners. For this specific study, data drawn from in depth interviews conducted with SME owners and with bankers are presented.FindingsThe following main factors affect the adaptation process and can help explain the difficulties of banks to adapt to their SME customers: the lack of communication and contact in the interaction process, the lack of knowledge and competence of individual bankers as regards their customers' specific businesses and the centralised and standardised system that prevails within the banking organisation. Also, in this study it is found that the organisational structure influences how individual bankers perceive themselves and their ability to adapt to the needs of SMEs, which in turn affects the individual bankers' adaptability when interacting with their SME customers.Originality/valueTo the best of the authors' knowledge, adaptation has not been examined in relation to the concepts of interaction, role and organisation, or within the banking industry.

Local banks in social media: determinants and consequences

“…The positive impact of social media on local bank performance is statistically significant as well as economically relevant. As discussed in Section 5, two mechanisms may explain the improved performance of local banks active in social media: the development of a business model based on close relationships, and the strengthening of lock-in phenomenon due to increased information asymmetry between relationship lenders and other potential capital providers (Prilmeier, 2017;Rajan, 1992). The lack of a stable and positive impact of social media activity on loan dynamics, we believe, slightly privileges the second explanation.…”

“…Second, social media may help local banks to more efficiently lock-in customers in the existing relationships. It may facilitate the acquisition of soft information and increase the advantage of local banks over other potential lenders, creating a form of information monopoly (Ongena & Smith, 2001;Prilmeier, 2017;Rajan, 1992). Unfortunately, from our data, we cannot differentiate between these two explanations.…”

Effect of Customer Centred Relationship Management Organization on Satisfaction of Commercial Banks’ Account Holders in Nairobi City County, Kenya

“…The respondents were company managers and cannot provide accurate views of the customers' emotional needs and involvement. Silver and Vegholm (2009) examined the role of customer adaptation in interaction and the bankers' ability to meet the needs of their SME customers. The findings indicated that the adaptation process was affected by lack of communication and contact in the interaction process.…”

Popularity in social media and company growth: evidence for local banks

“…Taking additionally into account that the number of social media users is consistently growing and is expected to exceed 3 billion users by 2021 (eMarketer, 2017), it is not surprising that social media shift to the center of interests of not only entrepreneurs but also researchers. Current empirical evidence related to the impact of social media on economic life concerns mostly: (a) the strengthening of a customer-company relationship and engagement (Mangold & Faulds, 2009;Kaplan & Haenlein, 2010;Bolton, 2011;Tsimonis & Dimitriadis, 2014;Laroche, Habibi, Richard, & Sankaranarayanan, 2012;Lipsman, Mudd, Rich, & Bruich, 2012;Durkin, McGowan, & Murray, 2014), (b) improved efficiency of marketing (Edelman, 2010;Gallaugher & Ransbotham, 2010;Pozza, 2014;Cawsey & Rowley, 2016), or (c) stimulation of brand awareness and loyalty (Silver & Vegholm, 2009;Farshid, Plangger, & Nel, 2011;Laroche, Habibi, & Richard, 2013;Larsson & Vitaoja, 2017). Contributions related to financial aspects of social media adoption are relatively scarce, and concern mostly non-financial companies and links between social media investment and firm value or performance (Plangger, 2012;Paniagua & Sapena, 2014;Kim, Koh, Cha, & Lee 2015a;Kim, Lim, & Brymer, 2015b;Hsu & Lawrance, 2016).…”

“…Within the first abovementioned literature strand, the authors prove that social media strengthen long-term relationships with clients (Mangold & Faulds, 2009;Kaplan & Haenlein, 2010;Laroche et al, 2012;Lipsman et al, 2012;Durkin et al, 2014), improve efficiency of marketing efforts (Edelman, 2010;Gallaugher & Ransbotham, 2010;Pozza, 2014;Cawsey & Rowley, 2016), generally increase consumer engagement (Bolton, 2011;Tsimonis & Dimitriadis, 2014), and stimulate brand awareness, loyalty, and trust (Silver & Vegholm, 2009;Farshid et al, 2011;Laroche et al, 2013;Larsson & Vitaoja, 2017). As far as the content type of social media activity is concerned, it is shown that the characteristics of Facebook posts such as post type, category, and posting day influence users' interaction in terms of the number of comments and likes, as well as its duration (Cvijikj & Michahelles, 2011).…”