Developing New Services in Commonwealth Countries: A Cross-National Comparison

Abstract

The globalization of world markets not only presents new opportunities for many service firms but also prompts them into rethinking the way they have been developing new services for various markets. Especially cultural issue is the most important aspect of this rethinking regarding New Service Development (NSD). Yet few research studies have been done to investigate the issue of NSD across countries and geographical regions. To address this critique of the literature we conducted a comparative study of NSD process of financial service firms in two commonwealth nations, Australia and India. We conducted a quantitative survey to answer three research questions: What are the cross-cultural differences in NSD stages? What are cross-cultural differences in NSD strategies? And what changes do service firms make in their NSD practices while developing services in a foreign market? The sampling frame included financial service firms situated in four major cities of Melbourne, Sydney, Brisbane and Adelaide serving corporate customers by providing investment banking, trust management, cash management, global payment services; emerging market investment services; syndicated loans; commercial mortgage; money market accounts and equipment finance and leasing services. The Indian sampling frame consisted of large financial service firms situated in the four metro cities of India: Delhi, Bombay, Madras and Calcutta.. Due to budgetary constraints we randomly selected 300 firms in each country using a procedure adapted from the total design method to administer the survey. We took care to select the key informants through the telephone and email identification and pre-notification method. All the respondents had two key characteristics. First, they were experienced practicing managers in service development or a related position; second, they were closely involved in their respective NSD projects. These informants held titles including marketing managers, product managers, vice president, customer relations managers and new product managers. Informants' tenures with their firms varied between 7–11 years and on average the key informants had worked on 13 NSD projects in this period. The average revenue in the sample was A$995 million for the Australian firms (ranging from A$445 to A$2.1 billion) and US$5424 million for the Indian firms (ranging from US$120 million to US$1 billion).