Refinement of the marketing culture scale and the relationship between marketing culture and profitability of a service firm

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Refinement of the Marketing Culture Scale and the Relationship Between Marketing Culture and Profitability of a Service Firm Cynthia Webster *ississippi

State University

An instrument for assessing the marketing culture of a service firm is refined by analyzing new data from two independent samples. The scale’s reliability, factor structure, and validity are evaluated and the dimensions and 34 items are presented and discussed. Analysis is also performed to determine the relationship between a service firm’s marketing culture and profitability. Potential applications of the scale are outlined.

Introduction Service marketing has passed its infancy and has become a full-fledged discipline. General agreement now exists among scholars that services marketing is different, and perhaps more difficult to analyze, than goods marketing because of four welldocumented features of services: intangibility (Berry, 1980; Dearden, 1978; Lovelock, 1981), perishability (Bateson, 1977), inseparability of production and consumption (Booms et al., 1981; George, 1979; Uhl and Upah, 1980), and heterogeneity (Berry, 1980; Booms and Bitner, 1981). Although managerial problems have resulted from these unique features, several strategies have been advanced as possible solutions (Booms and Bitner, 1981; George et al., 1981). While some of the proposed solutions to the unique marketing problems have been considered laudable, there has been relatively little research focusing on organizational climates or environments that is conducive to successfully implementing the proposed solutions. Indeed, a national survey of service firms revealed that many of the suggested strategies are not being widely used (Zeithaml et al., 1985). The presence of internal constraints and barriers to successful strategy implementation is one plausible explanation that has been given for the underutilization of the proposed strategies (Parasuraman, 1986). The current literature in both services marketing and organizational culture lead to the argument that an appropriate culture or climate is of utmost importance for successfully marketing services (Pascale, 1984). Given the importance of the culture

.-/Address correspondence to Cynthia Webster, College of Business and Industry, Department of Marketing, Quantttative Analysis & Business Law, P.O. Drawer N, Mississippi State, MS 39762.

Journal of Business Research 26, 111-131 (1993) 6 1993 Elsevier Science Publishing Co., Inc. 655 Avenue of the Americas, New York, NY 10010

014%2963/93/$6.00

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construct, it is not difficult to understand why culture is particularly important for service firms. The simultaneous delivery and receipt of services in the face-to-face, for-profit service sector brings employees and customers physically, organizationally, and psychologically close. Human resource processes and procedures established for customer-contact employees in service organizations have unintentional consequences because they cannot be hidden from the customer. That is, there is no room for “quality control” between the employee’s behavior and the customer’s “purchase.” The kind of service or marketing culture a firm has “shows” to those who are served. Hence, the nature and quality of the product sold is much more a function of employee-customer interactions by service firms than in good firms (Parasuraman , 1986). Thus a need exists for a new measure of the marketing culture construct, specifically for a service firm. Such a measure could be used to assess the type of marketing culture a service firm has (real or perceived), the importance given to marketing culture, etc. Therefore, the first purpose of this article is to refine a measure of service firm culture-a measure that transcends different service industries. A second purpose of this study is to address the practicality of the measure and the construct by determining the nature of the relationship that exists between service firm marketing culture and profitability. One might think that marketing effectiveness and profitability would increase as service firm employees and managers become more cognizant of and give more importance to the marketing culture of their firm. First, however, the importance of culture will be discussed. The next section will focus on the marketing culture of a service firm. Before the methodology of the study is presented, the theoretical orientations that dominate the proposed relationship between marketing culture and profitability will be presented. The Importance

of Culture

In the past decade, the construct of culture has been put forth in the popular (e.g., Peters and Waterman, 1982; Deal and Kennedy, 1982) and scholarly (e.g., Schein, 1985) literatures. Although the empirical literature is sparse, many conceptualizations of the construct have been written (e.g., Beyer and Trite, 1987; Rock, 1986; Thompson and Wildavsky, 1986). There is an obvious common element running through the various definitions that can be summarized as follows: Organizational culture refers to the unwritten, the formally decreed, and what actually takes place; it is the pattern of shared values and beliefs that helps individuals understand the functioning of the firm and thus provides them norms for behavior in the firm (Deshpande and Webster, 1989). Thus, organizational culture focuses attention on informal, understood forces within a firm-forces that exert a tremendous influence on the behavior and productivity of its employees, perhaps more so than formal, written policies or guidelines (Pascale, 1984; Sathe, 1983; Schneider, 1980). An exploration into the culture of a firm is considered important as it has been shown that the culture: l

l

provides the (Gregory, is the critical their firms

central theme around which employees’ behavior can coalesce 1983); key that strategic managers might use to direct the course of (Smircich, 1983);

Service Firms’ Marketing Culture and Profitability Relationship

l

l

l

l

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provides a pattern of shared values and beliefs, the norms for behavior, a form of control of employees (Wilkins and Ouchi, 1983);

and

influences productivity, the manner in which the firm copes with the various aspects of the external environment, and newcomer socialization (Schneider and Reichers, 1983); aids in hiring practices-i.e., helps in understanding the characteristics ple who would do well in the firm (Downey, 1987); and

of peo-

establishes the rationale for “do’s and don’t’s” of behavior (Harrison,

1972).

Given the importance of organizational culture and the unique characteristics of service marketing, it is not difficult to understand why the concept of culture is particularly important for service firms. The Marketing Culture of a Service Firm Given the meaning of organizational culture (Deshpande and Webster, 1989) marketing culture then refers to the unwritten, formally decreed and what actually takes place in a marketing context; it is the pattern of shared values and beliefs that helps individuals understand the marketing function and thus provides them with norms for behavior in the firm. It refers to the importance the firm as a whole places on the marketing function; in other words, the marketing culture of a service firm refers to the way marketing “things” are done in the firm. Webster (1990a) conducted a study to determine whether there are significant differences between perceptions of the importance of marketing culture of goodsproducing firms and service firms. In other words, the answer was sought for the question: Are the dimensions of marketing culture (i.e., service quality, interpersonal relationships, selling task, organization, internal communications, and innovativeness) more important in service firms than in goods-producing firms? Although the individual items of each marketing culture dimension were perceived as being relatively important for both goods-producing and service firms, significantly more importance was placed on marketing culture for the service firms. As previously stated, one reason the marketing culture is particularly important for the service firms is that the very nature of service delivery brings the employees and customers physically and psychologically close. The policies and procedures established for customer-contact employees in service organizations have both intentional and unintentional consequences because they are, by nature, revealed to the customer. In other words, there is no room for “quality control” between the employee’s behavior and the customer’s “purchase.” The kind of marketing culture organization has will definitely be revealed to those who are served. Given the logical significance of the marketing culture of a service firm, an interesting question arises: Does the cognition of, or the importance placed on, marketing culture have a significant relationship with the profitability of the firm? The following section presents a theoretical background for the proposed relationship. Theoretical Orientation Two major theoretical orientations dominate the proposed relationship between marketing culture and profitability of the firm: constituency-based theory and mar-

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ket value theory. Both approaches have received empirical support and have been incorporated in the design of this study. The constituency-based theory suggests that for a firm to be profitable it must satisfy the long-term needs of customers (Anderson, 1982). From this perspective, the chief responsibility of the firm is to satisfy the long-term needs of its customer coalition; thus, it must strive to implement the marketing concept (Levitt, 1960). Indeed, Kohli and Jaworski (1990) discovered that those firms that are marketingoriented are likely to be profitable. If marketing culture is viewed as the way marketing “things” are done in the firm and a marketing orientation as the actual implementation of the marketing concept, then it follows that the orientation is a type of marketing culture. While some researchers view profitability as an underlying component of a strong marketing culture (i.e., Kotler, 1988), others (i.e., Levitt, 1969; Kohli and Jaworski, 1990) believe that profitability is a consequence of a strong marketing culture, and hence, a market orientation. From a marketing perspective, the market value theory posits that all major decisions within a firm be treated as investments. Thus, the decision to upgrade service quality, to innovate, etc., should be evaluated on the basis of probable return. In other words, such investments are judged based on their likelyhood to lead to long-term customer satisfaction, which in turn likely leads to profitability. Indeed, Kotler (1988) advances that investments in first the customer, then the front-line employees, are ultimately the key to profitability. Considering that the marketing culture of a firm is defined as the importance given to service quality, interpersonal relationships, the selling task, organization, internal communications, and innovativeness, and the propositions of the theories regarding marketing orientation and profitability, it follows that one might hypothesize a relationship between the type of marketing culture a firm has and profitability.

Scale Purification As previously stated, the basic purpose of this article is twofold: 1) To describe the second stage of purification of the service firm marketing culture scale; and 2) to assess the practicality of the measure and construct by determining the relationship between the marketing culture of a service firm and profitability. The Purification of the Scale The basic steps Webster (1990b) used in constructing the scale closely parallel procedures recommended in Churchill’s (1979) paradigm for developing better measures of marketing constructs. The initial and purification steps that were taken in constructing the scale appear in Appendix A. Using the previous work on service quality by Parasuraman et al. (1986) as a guide, the following steps were taken: 1) collection of additional data regarding the importance of each item, 2) computation of coefficient alpha and item-to-total correlations for each dimension, 3) deletion of items whose item-to-total correlations were low and whose removal increased coefficient alpha, 4) oblique factor analysis to verify the dimensionality of the overall scale, and 5) reassignment of items and restructuring of dimensions. The first step in the marketing scale purification was to administer the instrument

Service Firms’ Marketing

Culture and Profitability

Table 1. Additional

Relationship

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Scale Items Resulting from the First Step in Scale Purification.

l

Systematic, regular measurement and monitoring of employees’ performance

l

Employees’ focus on customer needs, desires, and attitudes

l

The firm specifically defining what exceptional service is

l

The commitment

of top management

to providing quality service

l

Management’s

l

The firm’s emphasis on hiring the right people

interaction with front-line employees

l

The firm providing skill-based training and product knowledge to front-line service providers

l

Management’s

l

The encouragement

l

The firm to focus efforts on training and motivation of employees

l

The firm keeping up with technological advances

sharing of financial information with all employees of front-line service personnel to become involved in standard-setting

to 30 service employees from top-management to operational-level positions. The approach used is consistent with procedures recommended for marketing theory development by several scholars (Deshpande, 1983; Peter and Olson, 1983; Zaltman et al., 1982). The employees were randomly chosen from companies known for their marketing expertise; e.g., A & M Pizza, Inc., (Domino’s Pizza), Federal Express, Southland Distribution Centers, etc., (Denton, 1989). The respondents were presented with the instrument and asked probing questions regarding the quality of the dimensions and the items used to measure each marketing culture dimension. As a result of these in-depth interviews, 11 items were added to the scale (Table 1). The resulting 49-item scale was then administered to a sample of 182 service marketers from a large metropolitan area considered to be among the most representative areas in the U.S. (Burgoyne Information Services, 1986). Respondents were asked to indicate the importance of each culture item by marking a 7-point scale ranging from “Strongly Agree” = 7 to “Strongly Disagree” = 1. Four service categories were chosen for investigation: retail banking, health care (i.e., health spas), airlines, and product repair and maintenance. While this set of service businesses is not exhaustive, it represents a crossection of industries that vary along key dimensions used to categorize services (Lovelock, 1980, 1983). The service firms from each industry were randomly selected, and the person within the firm was also randomly selected; respondents represented top- and middle-management, and ground-level operational levels. The field research was conducted by trained data collectors and was completed during a 3-week time period. The 49-item instrument was refined by analyzing pooled data (i.e., data from all four service categories considered together). Pooling the data was appropriate as the basic purpose of this state of data collection and analysis was to develop a more concise instrument that would be reliable and meaningful in assessing culture in a variety of service sectors. That is, the objective was to produce a fairly universal scale whose items and properties would be applicable to a wide range of services. An additional reason for data pooling was that the respondents’ description of marketing culture was basically the same for the different types of services. The instrument was then subjected to the computation of coefficient alpha (Cron-

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bath, 1951). Coefficient alpha was computed separately for each of the six dimensions to ascertain the extent to which items making up each dimension shared a common core. The values of coefficient alpha ranged from 0.56 to 0.78 across the 6 dimensions, which suggested that deleting certain items from some of the dimensions would improve the alpha values. The criterion used in deciding whether to delete an item was the item’s corrected item-to-total correlation (i.e., correlation between the score on the item and the sum of scores on all other items making up the dimension to which the item was assigned). The item-to-total correlations were plotted in descending order for each dimension. Items with low correlations and/or those whose correlations produced a sharp drop in the plotted pattern were discarded. Recomputation of alpha values for the reduced sets of statements and examination of the new corrected item-to-total correlations led to further deletion of items whose elimination improved the corresponding alpha values. The iterative sequence of computing alphas and item-to-total correlations, followed by deletion of items, was repeated several times and resulted in a set of 41 items, with alpha values ranging from 0.68 to 0.85 across the 6 dimensions. Examining the dimensionality of the reduced 41-item scale was the next step in this stage of scale purification and was accomplished by factor analyzing the difference scores on the items. The principal axis factoring procedure (Harman, 1967) was used to extract six factors, and the resulting solution was rotated orthogonally through oblique rotation. The factor-loading matrix revealed that some items still had high loadings on more than one factor. After such items were removed from the factor-loading matrix, the original factors retained their meaningfulness as they had high correlations with the remaining items. The deletion of some items necessitated the recomputation of alphas and itemto-total correlations and the reexamination of the factor structure of the reduced item pool. Several iterations of the sequence of analyses resulted in a final pool of 34 items representing 6 dimensions. The alpha values and item-to-total correlations pertaining to the 34-item instrument appear in Appendix B. The high alpha values and corrected item-to-total correlations indicated good internal consistency among items within each dimension. Also, the combined reliability of the 34-item scale, computed by using the formula for the reliability of linear combinations (Nunnally, 1978), was quite high (0.94). To further evaluate the reliabilities of the instrument, the component and total reliabilities and the corrected item-to-total correlations were calculated for each of the four subsamples. The reliabilities and item-to-total correlations were consistently high across all subsamples. The total-scale reliability was 0.88 or better in each of the 4 cases. The high reliabilities and relatively consistent factor structures of the measure across the independent samples provide support for its “trait” validity (Campbell, 1960; Peter, 1981). However, although these high reliabilities and internal consistencies are important conditions for a scale’s construct validity-the extent to which a scale fully captures the underlying, unobservable construct it is intended to measure-they are not sufficient (Churchill, 1979). The scale must satisfy the basic conceptual criterion of “face” or “content” validity; i.e., Does the scale appear to measure what it is intended to measure? Do the scale items capture key dimensions of the unobservable construct being measured? Assessing a scale’s

Service Firms’ Marketing Culture and Profitability Relationship

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content validity is qualitative and involves examining two aspects: 1) the thoroughness with which the construct to be scaled and its domain have been explicated and 2) the extent to which the scale items represent the construct’s domain (Parasuraman et al., 1986). As discussed earlier, the procedures used in developing the instrument satisfy both these evaluative requirements. Hence, the scale can be considered to possess content validity. To further evaluate the marketing culture scale and its psychometric properties, data were collected pertaining to the marketing culture of four specific, nationallyknown firms: a bank, a health care organization, an airline, and a repair and maintenance company. Trained field researchers in a major southwestern metropolitan area recruited an independent shopping-mall sample of 100 current or recent customers, 21 years of age or older, for each of the 4 firms. Respondents were asked to provide ratings on general expectation items and on firm-specific perception items. Additionally, respondents answered several questions relating to their overall experiences with and perceptions about the firm being investigated. Responses to these questions were used in assessing the marketing culture scale’s convergent validity. The multitrait-multimethod (MTMM) approach advanced by Campbell and Fiske (1959) is a comprehensive one for generating empirical evidence of a scale’s construct validity. However, the MTMM approach has a number of practical problems that reduce its usefulness and that, if overlooked, can lead to erroneous inferences (Kalleberg and Kluegel, 1975; Peter, 1981, p. 137). Thus, rather than use the MTMM approach in its entirety to evaluate the construct validity of the marketing culture scale, a criterion implied in the MTMM approach was used; namely, convergent validity. Convergent validity was assessed by examining the association between the scale’s scores and responses to a question in the second stage of data collection that asked customers to rate the service firm’s overall marketing culture (OVERALLMC) by checking one of four categoric-xcellent, good, fair, poor. The correspondence between the OVERALLMC ratings and the marketing culture scores (on each of the scale’s six dimensions as well as on the total scale) was examined using one-way ANOVA. The treatment variable in the ANOVAs was OVERALLMCwith three categories instead of four because so few respondents checked “poor” that it was necessary to create a “fair/poor” category. The dependent variable was the average difference score (i.e., perception-minus-expectation score) on each marketing culture dimension as well as on the total culture scale (separate ANOVAs were conducted for each dimension and for the total scale). Significant ANOVA results were investigated further using Duncan’s multiple range test to identify significant differences in the culture scores among the OVERALLMC categories. The results of these analyses for each of the four samples are summarized in Appendix C under the heading “OVERALLMC." The numbers reported in Appendix C are average marketing scale scores (on the combined scale as well as the individual dimensions) within each OVERALLMC category, measured on a -6 to +6 scale, on which the higher (less negative) the score, the higher the level of perceived service quality. In each of the four samples, the combined culture score for those in the “excellent” category is significantly higher (less negative) than for those in the “good” category. Furthermore, respondents in the “good” category have a significantly higher combined culture

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score than those in the “fair/poor” category. Looking at the scores on the individual culture dimensions, the scores under “excellent” are consistently higher than those under “fair/poor;” with few exceptions, the differences are statistically significant. The strength and persistence of the linkage between the OVERALLMC categories and the culture scores across four independent samples offer strong support for the marketing culture scale’s convergent validity. The scales’s “nomological” validity, another indicator of construct validity (Peter, 1981), was assessed by examining whether the construct measured by it was empirically associated with measures of other conceptually-related constructs. Respondents in each sample answered two general questions that provided measures of two variables that could be expected to be related conceptually to perceived marketing culture: 1) whether the respondents would recommend the service firm to a friend and 2) whether they had ever complained about the services they received from the firm. Respondents answering “yes” to the first question (RECOMMEND) and “no” to the second question (COMPLAINT) could be expected to perceive higher service quality than other respondents. Appendix C shows the average marketing culture scale scores on the individual dimensions and the combined scale for respondents falling into the two categories of the RECOMMEND and COMPLAINT variables. All scores under the “yes” category of RECOMMEND are higher than the corresponding scores under the “no” category. With few exceptions, the differences are statistically significant (on the basis of two-group r-tests). The scores under the “no” category of PROBLEM are consistently and, with few exceptions, significantly higher than the corresponding scores under the “yes” category. The findings provide support for the scale’s nomological validity. In summary, several different indicators, stemming from analyses of data from four independent samples, strongly suggest that the marketing culture scale is a reliable and valid measure of perceived marketing culture. The actual items that comprise the various dimensions of marketing culture can be found in Appendix D. Marketing

Culture

and Profitability

The primary purpose of this stage of the study was to assess the practicality of the measure and the construct by determining the relationship between the importance placed on marketing culture of a service firm and profitability. The sample was a three-stage sample of service firms in a southern metropolitan area. First, a complete listing of all area businesses within four service industries was obtained. The four industries-health care, airlines, financial, and product repair/maintenancewere selected because of their degree of intangibility and their common use. From this pool of service businesses, a sample of 100 firms was randomly selected. For each of the 100 firms, a listing of each employee was obtained in supervisory/ management and operational-level positions. To better ensure that employees would be knowledgeable about their firm’s marketing culture, only those who had been with their firm for at least 3 years were allowed to participate. Next a sample of respondents from each level was randomly selected. Within each firm, at least one person was randomly selected from each echelon. Carefully-instructed interviewers delivered the questionnaires to the service businesses. The sampling process

Service

Firms’ Marketing

Culture

Table 2. Composition

and Profitability

of the Fourth

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Relationship

Sample

by Service

Service Sector

Management

Health care Airline Financial Product Repair and Maintenance Total

24 23 25 23 95

Sector

and Employee

119

Position

Employee Position Front-Line

Total

24 24 25 24 97

48 47 50 - 47 192

was completed in 3 weeks. After verbally explaining the purpose of the study, agreement of the randomly-selected employee to participate was secured. After the data were edited, the final sample consisted of 192 employees. In Table 2 the composition of the sample by employee position and service sector is provided. The questionnaire was based on the measure of service firm marketing culture described in the preceding section. The respondents indicated the importance their firm places on each of the 34 culture items by responding to a 7-point scale, which ranged from 7 = “Very Important” to 1 = “Not Important.” For the profitability measure, data on actual ROI for each firm was obtained. The ROI obtained for each firm was the average of the previous 3 years. The basic profitability function for a particular service firm is: Profitability SF = f Marketing Culture (Service Quality, Interpersonal Relationships, Selling Task, Organization, Internal Communications, Innovativeness). The results of the stepwise multiple regression analysis of the variables representing the marketing culture dimensions are shown in Tables 3 and 4. To simplify the analytical procedure and to reduce the probability of encountering multicollinearity, the corresponding scale items were aggregated to obtain the predictors. First, the simple correlations that the independent variables have with one another are given in Table 3. The relatively small correlation coefficients imply that the potential problem of multicollinearity is not prevalent. Table 3 also presents the R2 contribution by each major independent variable for the equation. The importance placed on service quality appears to be the most influential variable on profitability of the firm. The other variables, in order of their influence on profitability are: interpersonal relationships, interpersonal communications, innovativeness, organization, and the selling task. The stepwise multiple regression coefficients and the standard errors of estimate Table 3. Correlation for the Equation

Matrix

and R* Contribution

by Each Major Independent

Variable

Correlation Coefficients

1 2 3 4 5 6 Total

1

2

3

4

5

6

Increase in RZ

1.00

0.28 1.00

0.31 0.38 1.00

0.10 0.09 0.14

0.19 0.04

0.09 0.24

0.40 0.15

Service Quality Interpersonal Relationships

0.11 0.02 1.00

0.35 0.20 0.17 1.00

0.13 0.13 0.08 0.07 0.94

Interpersonal Communications Innovativeness Organization Selling Task

1.00

Variable Explanation

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Table 4. Regression Coefficients Resulting from Relating Profitability with Marketing

Culture (6 Dimensions). Dimension of Marketing Culture Service Quality Interpersonal Relationships Interpersonal Communications Innovativeness Organization Selling Task

Multiple R

R2

Standard Error of the Estimate

0.63 0.74 0.82 0.89 0.93 0.97

0.40 0.54 0.67 0.80 0.87 0.94

1.280 0.948 0.888 0.812 0.795 0.781

are presented in Table 4. The regression equation was built by first using the best predictor profitability, which was service quality. The b, regression coefficient for “service quality” did not change very much, which indicates that the variables were relatively independent of each other. As the F ratio for each partial correlation was significant at the 0.05 level, each independent variable stayed in the equation. In conclusion, it appears that a significant relationship exists between the importance placed on marketing culture and the profitability of a firm. Table 4 indicates that 94% of the total variation in profitability is explained by marketing culture.

Potential Applications The first purpose of this article was to refine a measure of service firm marketing culture-a measure that transcends different service industries. The end result is a reliable 6-dimension, 34-item measure that possesses both content and convergent validity. The second purpose was to address the usefulness of the measure. The practicality of the purified measure was established and a significant relationship was found between service firm marketing culture and profitability. Given the importance of the culture of any organization and the high level of customer contact in service firms, the effects of culture should not be left to chance. The instrument perfected in this study enables one to assess a service firm’s marketing culture along each dimension of the construct. The instrument can also provide an overall measure of the quality of marketing culture in the form of an average score across all six dimensions. The instrument scores have several other potential applications as well. Service firm management might use the instrument to determine if there is a gap between the ideal and the firm’s actual service culture. Second, an instrument measuring the service firm culture might be used to determine if there are significant discrepancies between managers’ and employees’ perceptions of their firm’s service culture. Third, a service firm’s customers can be segmented into several marketing culture groups based upon the perceived importance of the various dimensions of the construct. Fourth, in the case of a service firm with numerous locations or branches, average marketing culture scores for the individual branches can be used to group the branches into several clusters with varying culture images. Further, marketing strategy planners might take into account the culture of a firm and check its compatibility with any proposed strategy.

Appendix

A

Stumpy

of Steps Employed in Developing and Purifyhg the Service Fhm Mar-

Step 9: 1dentlRcatio.n of 78 iteau rqtreaenting dimen6iolu.

9

Step lo: Evaluation and further purikation tbs78-itemacalebyudngthe~itaativeseauenwuinrteo8.

of

I Step 3: Idcntiticntlon of 42 faceta or dlmendoar making up the domain of the mark&q a mnfice fnm.

culture of

Step 11: IdentiWtion of a more p&monioua, skitan acab representing 6 dimendo~.

the-s74tml wxle by again wing-ticItame itaatfveaquenceMinatep8. 1 Steo 13: Identihtian

step 4: collectiod of markclinjl culture dimensbn importance data from a sample of 100 responden&. each of whom was a W&X marketer.

Step 6: Generation dimensions.

of 94 itema npnrenting

I

38&n

of a mcwewdmonioua 1

scale mpraentiql6

dhne&lo~.

the 9

Step 7: Collection of item importance data from a 6nmple of 200 service marketen

Step 16: collection ofitem importance data from a Wnple of lg2 rervlce markctu8.

Step 8: Scale purification ‘through the following itcxative 8euuence:

I Factor analysis to verify the dimensioaality of the overall scale.

Reassignment of items and re&ructuring of dimensions where neccsary.

Step 18: IdentiRwtion of a mure pardmoniour 344tan 8cale xcurcsentinathe 6 dimenaionr.

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C. Webster

Appendix B Alphas and Correlations Resulting from Scale Purification + of DimeMiOll

It#XlM

Reliabiliity Item-To-Total

Coeffidcnta wPJN

Items

8

0.86

Q1.75 QM.72 Q3.67 M.74 QM.66 g-0.72 Q7_.71 g-.69

IImpernonal RdaIion&ipn

5

0.79

Q9A.56 QlL0.63 Q11.56 QM.63 Q130.64

!klling TasL

7

0.83

Q14-----6.68 QU------a.fi Q16------0.59 Q17L.64 QlM.63

service

Quality

Q19

COlT&ti0ll8*

0.69

QUO.67

Qrganization

5

0.79

Q2M.64 Q-152 Q-n.52 Q-.55 QZ-.66

Itltenlal

6

0.85

-0.71 Q27-.71 m.74 Q29 Q3(L-------0.74 Q31.73

COtMllUli~tiOllS

3

0.75

Reliability of Liner combination (Total-scale Reliability)

0.94

Innovativeness

c32_____0.51 Q3-0.69 Q34-.62

0.73

Service

Firms’

Marketing

Culture

and Profitability

Relationship

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123

Appendix C Significant Differences in Mean Scale Values for Respondents Segmented According to the Variables OverallMC, Recommend, and Problem”

OVHULLMC Erccllent (n = 32)

Bank

Good (n = 88)

PROBLEM

R.BcoA4h4lmD Fair/Poor (a = 30)

Yea (n = 124).

No (n = 2S)

Yea (n - 37).

No (n . = 113)

serviceQuality

-

ow

Intelpersonal Selling TarL

-

-

0.45’ 0.85’ 0.56’ 0.63’ 0.W 0.56’

- 0.W - 1.W - 1.e - 1.316 - 1.4r1 - 1.e

-

0.38b 0.676 0.42b 0.73b o.74b 0.W

- 1.12 - 2.01= - 1.820 - 2.W - 1.76’ - 2.36

-

l.s2b 1.31b 1.46b 0.W 1.62b

- 0.42b - 0.74b - 0.W - 0.W - 0.W - 0.73b

-

0.6T

-

-

OS&

-

-

1.32’

-

Relationship6

organization

-

Intexnal0JmnlunicatioM lnnovativeness

-

0.19 0.32” 0.27 0.3ob 0.2sb

Combined Scale

-

0.22b

Health Care Organization

(n = 45)

(n = 82)

1.31

(n = 22)

:n = 138)

1.91C

(n = 11)

- OS@

0.W

(n = 38)

(n = 112)

service Quality Interpen~nel Relationshipu Selling Task organi7.ation Internal Communication innovativeness

-

0.17 OW 0.18b 0.41b 0.32b 0.21b

- 0.71’ - 0.6p - 0.43’ - 0.98’ - 1.21’ - 1.W

-

2.W 2.014 0.99 2.27d 2.56d 2.23d

- 0.33 - 0.52 - 0.41b - 0.n” - o.& - O.Sab

-

o.84b 2.01’ 1.W 1.12 2.16 2%

- o.nb - l&Ib - 0.W - 0.W - lJ# - 2zsb

- 0.W - 0.54’ - 0.48b - 0.W - 0.83b - 0.55’

Combined

-

0.27

-

-

2.W

-

-

1.66’

-

-

Scale

Airline

(n = 53)

0.84’

(n = 79)

service Quality InterpeWnal Relationships Selling TasL Orgenization Internal commllnicati0M Innovativeness

- O.lab - 0.31b - 0.20b - 0.31b - 0.2sb - 0.30b

-

0.45’ l.lT 1sW 1.42’ 0-W

-

Combined

-

-

Scale

0.23b

(n = 18)

0.5s”

:n = 133)

(n = 16)

1.4sb

(n = 60)

osb

(n = 89)

1.W

- 0.55’ - 1s - 2.13’ - 2.e - 1.89” - 2.W

-

0.37b 0.49” 0.39 Oszb 0s 0.71b

-

1.1s 2.36 0.81b 2.36” 0.91b 2.42c

-

Osb 2.2@ 0.78b 2.01b O&b 2.W

- 0.F - 0.4? - 0.38b - 0.64’ - O.sab - 0.73’

lsx?’

-

-

OS.!?

-

1.6p

-

1.5ob

-

1.796

0.52b

Repair and Maintenance (n = 34)

QmPanY

(n = 85)

(n = 29)

:n = 127)

(n = 23)

(n = 45)

(n = 103)

service Quality Intelpemonal RelatioMhip6 Selling Taalr Organization Internal communicati0M Innovativeness

- 0.22b - 0.43b - 0.18b - 0.32b - 0.26b - 0.21b

-

1.23’ 1.86’ 1.28” 1.6T 1.2T 1.11’

-

2.176 2& 1.W 2.45’ 2.59 1.r

-

0.43b 1.13b 0.39 0.82b 0.56b 0.41b

- 1.875 - 3.01’ - 1.V - 2.54’ - 2.11’ - 0.886

-

1.s2b 2.48b 0.W 1.78b l.nb 0.71b

- O.@ - 0.995 - 0.42b - 0.84’ - 0.54’ - 0.42b

Combined

-

-

1.4z

-

2.124

-

0.W

-

-

1.s

-

Scale

0.2.5b

-6ta

~N~b0nar0m0aavalucroaas.nbraagingfrom

c&&e,

negative

0xp0caatioaB. bc+fo~

value4

imply

that p0rcepliOas

with tJ10llpmo q~0rscript0

fnll lhort

ar0 not dgaikaatiy

1%

0.W

+6,onwhicbOimplia~tconrumerperceptionraadexpedatioar of cxpectatioa~, diff0r0nt.

and positive

M0answith

diff0r0at

valu08 imply

that perCcptioaI0x00cd

azp0rncripti am d@kaatly

different.

SERVICE QUALITY

To&the ImpartancePlaced on

Very Important

Important

Somwhat Important

Very Important

Important

somewhatImportant

Of Littk Importance

2

~

Very Important

Important

SomewhatImportant

Very Important

rm&KXtBnt SomewhatImportant

Very Important

Important

N=-W

I

Very Important

Important

I

SomewhatImportant

Of Little Importance

SomewhatImportant

Little Importance 2

Of

2

3

For employees to meet the firm’s expectations 4 5 6

Necessary

I

I

2

Little Importance

Of Little Importance

Of

The belief of employees that their behavior reflects the firm’s image 4 5 3 6

Neceasaty

1

Employees’ focus on customer needs, desires, and attitudes 4 5 3 6

Neceseary

1~

Systematic, regular measurement and monitoring of employees’ performance 4 2 6 5 3

Necessary

2 Of Little Importance

The commitment of top management to providing quality service 4 5 3 6

Nekssary

The firm specifically defining what exceptional service is 4 5 6 3

Indicate the importance your firm places on each of the following by circling the appropriate scale mark.

An Audit to Assess the Marketing Culture of a Service Firm

Appendix D

No ImporUnce

,

1

No Importance

1

No Impommce

1

No Im&tancc

1

No Imporumce

1

No Ieqmtance

1

E

ToAasenathe Imporunce Plac8d on INTERPERSONAL RELATIONSHIPS

To Assess the Importance Placed on SERVICE QUALITY

-

-

Very Important

Important

Important

Very Important

Necessary

Somewhat Important

Very Important

5 Important

4 Somewhat Important

3 I

Of Little Importance

Very Important

Necessary Important

4 1 Somewhat Important

3

Of Little Importance

2 I

Very Important

Necessary Important

4 I

Somewhat Important

3 1

Necessary

6

Very Wt

5

Illlprtpet

4

Somewhat Important

3

Management’s interaction with front-line employees

Somewhat Important

Important

Very Important

Necessary

I

3

4

5

6

That managers/supervisors have an “open-door” policy

5 I

6 I

Of Littk Importance

2

Of Little Importance

2

Of Little Importance

2 ,

For employees to feel comfortable in giving opinions to higher management

5 1

6 1

Nom

1 ,

No bportana

1

No Importaaa

1

No Importance

1

No Importance

1

No Impoaance

Of Little Importance

2 I

1

No Importance

1

2

Of Little Importance

2

For the firm to treat each employee as an important part of the organization

Necessary

6 1

For the company to be considerate of employees’ feelings

I

4

5

I

6

3

Somewhat Important

Employees’ attention to detail in their work

Necessary

For the firm to place emphasis on employees’ communication skills 4 3 6 5

To Assess the

SELLING TASK

ImportancePlaced

on

I

I

,

6

Somewhat Important

Very Important

5 Important

4 I 3 Somewhat Important

Important

4 Somewhat Important

Of Little Importance

2

Very Important

5 Importaat

4

Very Important

5 #

Important

4

Somewhat Important

3

Somewhat Important

3

VeIy Important

5

Somewhat Important

important

,

3

4

6

3 Somewhat important

4

Important

5

Very Impartant

For employees to aggressively pursue new business

NV

6

NoImportance

L

1

1

Importance

Of Little Importance

Of Little Importance

2

Of Little Importance

h

2

1

No Importaua

1

No bportance

to sell

No Importance

1 I

No Importance

Of Little Importance

2

1

No hqxntance

No

1 I

2

Of Little Importance

2

Of Little Importance

2 I

For the firm to reward employees, better than competing firms, with incentives

Necmazy

3

recognition of high achievers in selling

Very Important

5

For employees to enjoy pursuing new accounts

Necessary

The firm’s 6

6

,

3

providing skill-based training and product knowledge to front-line service providers

Important

4

encouragement of creative approaches to selling

Necessaq

The 6

Necessary

The km 6

Very Important

I

5

The firm’s emphasis on hiring the right people

Necessary

r 9

g

P

2 $

3 CT

0

=w ‘;m E”

ToAsaetuthe Importance Placed on INTERNAL COMMUNICATIONS

To Assess the Importance Placed on ORGANIZATION

Very Important

Necctwy Important

4 Somewhat Important

3 I Of Little Importance

2

Very Important

Necessaxy Important

4

Somewhat Important

I

Important

Very Important

N=asaty

Important

Very Important

Necessary

Very Important

5 Important

4 I

Somewhat Important

3

Somewhat Important

Of Little Importance

2

Of Little Importance

d

2

Of Little Importance

I

2

Of Little Importance

2

No Importana

1 I

No Imporbcc

1

No bportance

I

1

No Importance

1 1

No Importance

1

I

Important

Very Important

4

I

5

Somewhat Important

I

3

Necessary

6 I

Very Important

5

Important

4 i

Somewhat Important

3 I

I

2

Of Little Importance

2 I

Of Little Xmportance

That supervisors clearly state what their expectations are of others

N=-V

I

6

No Importma

1 I

No Importance

1

The firm having an approved set of policies and procedures which is made available to every employee

Necessary -

6

Each employee to manage time well

4

5

6

Each employee’s work area to be well organized 3

1

4

,

5 3

Somewhat Important

3 1

6

For employees to prioritize work

5

6

For careful planning to be characteristic of each employee’s daily routine

5 ,

Each employee to be well organized

6 I

-

128

J BUSN

RES 1993:26:111-131

Appendix D (continued)

C. Webster

Service Firms’ Marketing

Culture and Profitability

J BUSN RES 1993:26:111-131

Relationship

129

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