The Effect of Customer Profitability on Strategic Cost Choices for Iraqi Banking Institutions

Abstract

Purpose: the aim of this research is to find out the extent of compatibility between the strategy adopted by the Iraqi private banks and the trends of the customers of these banks. Theoretical Framework: Although the study was conducted in the Iraqi economic environment, its applications can be implemented in different environments, whether at the level of different countries or different sectors. Design/Methodology/Approach: The data was collected through the establishment of two types of questionnaire, the first type is for banks, as 100 forms were distributed, and the second type is specific to the customers of those banks, as 1000 forms were distributed. And to conduct the necessary analysis, the researchers used the statistical analysis program SPSS V.24. Findings: Through the statistical analysis of the questionnaire, it was found that there is a clear difference between the strategic orientations of the Iraqi banks that focus on the cost strategy on the one hand, and the orientations of the customers of those banks who prefer the differentiation strategy. Research, Practical & Social implications: More future studies can be conducted to determine the extent of compatibility between the strategic directions of companies in different sectors with the orientations of the customers of those companies. Implications/Originality/Value: The study provides a good way to identify the success of the company's strategy in achieving the desires of customers, and thus achieve a higher level of loyalty of these customers towards the company.