The stages of financial services product elimination

Abstract

This paper examines product elimination in the UK's financial services industry. The literature review establishes that physical goods elimination theory has only limited application to the financial services sector. Specifically, it fails to take account of constraints that prevent the removal of a product to a state of nonexistence. To overcome this, the sector uses two forms of removal — full and partial elimination. A three-stage methodology is used to find out how products are eliminated in retail banks, building societies and insurance organisations. A model is developed which explains that companies within the sector proceed through four stages during the elimination process — identification, decision, implementation and post elimination evaluation. At the end of this process, a product will have been either partially or fully eliminated. The preference of the industry is to use partial elimination. It can be concluded that the customer relationship is a key determinate factor in the choice of elimination process.