A study on mediation effect of relationship quality outcome between customer relationship management and mutual fund decision

Abstract

Purpose Usage of updated technology is continuously empowering customer relationship management (CRM) to be convenient and user friendly, where customers are kept engaged with knowledge and information. This enables them on decision-making and managing their portfolio, especially in mutual fund investments. To improve toward a positive decision, certain quality related variables needed to be considered. Thus, this study aims to estimate the mediation effect of relationship quality and outcome (RQO) between CRM and investment decision-making in mutual funds (MFD). Design/methodology/approach The descriptive study adopted the constructs from existing empirical literatures to conceptualize the model with three higher order constructs with 12 dimensions. Survey method is used, and with a structured questionnaire, a total of 323 mutual fund investors were approached using nonprobability criterion sampling technique, of which 262 relevant responses were considered for estimating the structural model. Smart PLS was used to establish the relationship of the constructs. Findings The result emphasizes a significant direct and indirect relationship indicating that investors are more inclined to MFD through technology-enabled CRM and RQO plays a vital role in explaining the direct relationship between CRM and MFD. The results of the study are in-line with the existing literature. Practical implications The study highlights that financial institutions must focus not only on technological diffusion but also needs to ensure quality service by providing knowledge and information during every access of transactions by customers, making them independent and confident during investments. Originality/value This study indicates how capacity efficiency, which is a part of service productivity, can be managed without affecting the outcome efficiency by incorporating technology in the place of human interaction during relationship acquiring and retaining process.