Run Profitability Research Articles

Role of banking sector in promoting green investments: Exploring new developments

The corporate landscape is gradually moving towards a new premise in the wake of emerging climate change issues encountered by the business community. The natural disasters which experience globally due to climate change have the disruptive effect on corporate sustainability in long run as well as short run profitability of the corporate sector. It is generally believed that the banking sector has a primary responsibility for the go green and should take their hand together in green economic growth. Thus, this paper emphasizes on the role of banking sector in green growth in developing country of Sri Lanka based on secondary data like journals, paper articles, bank reports etc. Currently, Sri Lankan banking sector has taken their initial initiatives to improve the banking sector through green banking activities which are ultimately beneficial to the country's sustainable growth. Green Banking is a not an individual task of banks multi -stakeholders attempt is needed to enhance desired green growth.

When Salespeople Manage Customer Relationships: Multidimensional Incentives and Private Information

Incentivized salespeople are often responsible for CRM activities that focus not only on customer acquisition, but also maintenance activities that increase customer lifetime value. While incentives can induce effort on the incentivized tasks, a salesperson’s private information about customers may induce moral hazard by salespeople seeking to gain short-term compensation at the expense of the firm’s long run profitability. We investigate the dynamics in the effort--moral hazard tradeoff in response to multidimensional (acquisition and maintenance) performance incentives in the presence of private information. Using unique panel data on customer loan acquisition and repayments linked to salespeople from a microfinance bank, we detect evidence of salesperson private information. Acquisition incentives induce salesperson moral hazard leading to adverse customer selection, but maintenance incentives moderate it as salespeople recognize the negative effects of acquiring low quality customers on future payoffs. Critically, without the moderating effect of maintenance incentives, the adverse selection effect of acquisition incentives overwhelms the sales enhancing effort effects, clarifying the importance of multidimensional incentives in CRM-type settings. Reducing private information (through job transfers) hurts customer maintenance, but has greater impact on productivity by moderating adverse selection at acquisition. The paper also contributes to the recent literature on detecting and disentangling customer adverse selection and customer moral hazard (defaults) with a new identification strategy that exploits the time varying effects of salesperson incentives.

Green Marketing Initiatives to Meet Consumer Demands and Sustainable Development-Challenges and Opportunities

Green Marketing has evolved special implications in the modern market. Green indicates purity by means of quality, fair price and worthy in dealings. Green marketing focus to market ecofriendly products to satisfy the needs and wants of customers. It adopts innovative techniques of product modification, dynamic product processes, maintaining sustainability and diversified ways of advertising etc. The vision of Green marketing is doing business along with protecting ecological environment. Present day customers need to be socially responsible by consciously working for the cause of environmental protection. The business based on modern trends have created global pressure upon employers to be environmental friendly. Now, more companies aim to produce consumer and Industrial Goods which are less hazardous to the environment. Every company eventually shifting towards becoming green to enjoy the early mover advantages offered by regulating bodies. Green Marketing ensures long run sustainability and profitability. It is multi beneficial with reduced cost, encourage accessibility to new markets with competitive advantage, increase morale of employee for being a part of environmental cause, satisfies the customer with health products and services. This paper is descriptive in nature and the data are collected from secondary sources like, text books, journal publications, company reports and websites. This paper analyse the implications of green marketing in the Indian business scenario by analysing different Green Business organisations listed in the Go Green Directory published by Eco-Deaz and ranked in the newsweek 2016.

Impact of Customer Relationship Management Practices on Customer’s Satisfaction in Jordan Ahli Bank and Bank Al-Etihad

Customer relationship management (CRM) is a combination of people, processes and technology that seeks to understand a company’s customers. It has been found that successful implementation of CRM results in customer loyalty and long run profitability and therefore companies are focused on maintaining harmonious relationships with customers. The present research has been undertaken to study the impact of Customer Relationship Management (CRM) practices on customer’s satisfaction in two Jordanian Banks namely Jordan Ahli Bank India and Bank Al Etihad. A sample of 119 customers has been selected for the study. Data have been collected through questionnaire designed on a five point Likert scale. Independent sample t-test has been used as the statistical tool to measure the variation in CRM on the variables namely reliability, responsiveness, assurance, empathy and customer relations. The analysis of the data revealed that significant variation exists in the perception of customers in Jordan Ahli Bank India and Bank Al Etihad.

The effects of fisheries management on the Icelandic demersal fish value chain

Iceland׳s fishing industry has outperformed fishing industries in neighboring countries in recent years. This paper identifies key factors in market structure in recent decades that contribute to long run profitability of the Icelandic fishing (and fish processing) industry using semi-structured interviews with industry participants, and compares those with similar results from Norway. Further, the development of profitability in the Icelandic and Norwegian demersal fishing industries is used to assess the long run effects of different management systems on quality, product focus and profitability. The results indicate that three key changes in Icelandic regulation during the 1980s were important to the development of long run profitability within the fishing industry: the abolition of export barriers, the introduction of an individual transferable quota (ITQ) system and the establishment of fish auctions. A large and growing literature supports the role of ITQs in ensuring long run profitability. The importance of market structure for profitability has only recently been identified, affecting the ability of value chains to become market oriented and supply homogenous product flow from heterogeneous raw material. Comparison with Norway indicates that while individual transferable quota management does improve profitability in fishing to a certain extent, management systems must facilitate a strong market connection from consumers, through the stages of retail and processing, to fishers for the full realization of profit potential in the fishing industry.

THE EFFECTS OF CORPORATE GOVERNANCE ON PATRONAGE OF BANKING SERVICES IN NIGERIA

The study was carried out to investigate banks’ corporate governance practices and how they affect service patronage, how corporate image influences patronage and performance of banks. The study focused on selected banks in Port Harcourt, Rivers State. A descriptive research design was used in the conduct of the research since it enables data required for the study to be obtained and interpretation to be based on the data obtained. Primary data formed the nucleus of the data used for the research. Data analysis was initially done using tables and simple percentages and hypotheses postulated were tested using the chi-square analytical technique. Based on the data collected, it was found that corporate governance has a significant influence on the patronage of banking services hence banks’ performance. Some of the recommendations made include; banks should enthrone good corporate governance practices to promote the patronage of banking services for long run profitability and should strive hard to put in place internal control mechanism that will promote customer loyalty and sustained patronage of services.

Do Banks Build Bridges in LBO Transactions?

This paper documents connected leverage buyout (LBO) transactions in which acquiring private equity (PE) firms and target firms share common relationship banks. Connected LBO deals have lower prices, higher valuations and better qualities. Firms share common relationship banks as PE firms are 7% more likely to become targets in LBO transactions led by the same group of PE firms. Common relationship banks which build bridge between PE firms and target firms are 35% higher in probability to be chosen as lead bank in these LBO transactions and increase the future business interactions with these PE firms as well. I argue that banks build bridges between targets and acquirers in LBO transactions with their private information obtained through past business relations not only to strengthen business tie with PE firms, but also to generate business opportunity to boost their short and long run profitability.

Mergers and Acquisitions: Old Issue, New Evidence?

I analyze the current wave of MA overvaluation motivations seem less relevant. The results however are disappointing, as they have been for past waves: after the deal, in the long run profitability is lower and sales growth decreases even more, market share shrinks. A partial exception is constituted by cross-border deals, that are done by more dynamic, better-run firms and result in improved performance.

Marketing Forecasts By Using the Regression Multifactorial Model

Market research is vital for company business good development, for providing goods delivery on internal and external market, for micro and macroeconomic substantiation and justification of investments, for long run profitability microeconomic programming. Statistical instruments are used in several phases of market research, since the phase of working out the research program till the phase of interpretation and analysis of market information, supplying company's manager the possibility of the rightly decisions-making. The correlation and regression techniques aim at defining the relationship notion between a dependent variable and one or several independent variables. Marketing forecasts represent the estimations of the future marketing variables. In this way, marketing forecasts are attempts to forecast the future of marketing variables, on the basis of their past estimation. Marketing decisions quality concerning the economic activity management depends upon the forecasting accuracy. Marketing forecasts can be performed at the level of product, group of products, economic unit, activity branch, or of certain territorial-administrative units, national, international level etc. Forecasts are difficult to be achieved due to demand instability, but they are important to company success. Forecasting can be made in three phases: • macroeconomic forecasting; • industrial forecasting; • company sales forecasting. Macroeconomic forecasting refers to inflation, unemployment, interest rate, consumption expenses, exports, imports etc., the final result being the GNP. On the basis of GNP, forecasting is made at industry level, the company going to deduce its own sales, according to market shares. Forecasting uses three types of information: • consumers' opinions, known by means of surveys on buyers' intentions, by selling agents' opinions, by experts' opinions; • consumers' behaviour settled by a market test, in order to see which are the buyers' reactions; • consumers' previous behaviour involving the analysis of previously buying behaviour. This can be analyzed by using the multiple regression that considers the future and the past sales as a time function, finding the factors which affect the sales and their relative importance.

Corporate real estate and stock performance in the international retail sector

Purpose – To analyse the effect of corporate real estate ownership on the stock performance of firms active in the international retail sector. Design/methodology/approach – A sample of 454 retail companies is separated into three geographical regions and six different sub‐sectors. We measure the corporate real estate holdings using balance sheets information and link these to the risk and return characteristics of the individual firms. Findings – We find that corporate real estate ownership varies greatly across subsectors. This variation is explained by differences in location and customisation demands of real estate. Retailers for which the micro‐location of real estate is a critical value driver tend to own more of it. In general, corporate real estate ownership for retail companies is associated with a strong relative performance, which contrasts markedly with the negative performance effects found for other industrial sectors. Research limitations/implications – Although we include as many firms as possible in our sample, we are still confronted with sample size limitations while performing sub sample comparisons. Practical implications – Our results show how owning real estate instead of renting it will impact the long run profitability of retailers. Originality/value – Where most of the extending literature focuses on sketching the impact of real estate ownership using theory and isolated cases, we no offer numerical proof based on a international dataset.

The Use of Dynamic Financial Analysis to Determine Whether an Optimal Growth Rate Exists for a Property‐Liability Insurer

AbstractPrior research on the aging phenomenon has demonstrated that new business for property‐liability (P‐L) insurers generates high loss ratios that gradually decline as a book of business goes through successive renewal cycles. Although the experience on new business is initially unprofitable, the renewal book of business eventually becomes profitable over time. Within this context, insurers need to manage their exposure growth in order to maximize long run profitability. Dynamic financial analysis (DFA), a relatively new tool for P‐L insurers, utilizes Monte Carlo simulation to generate the overall financial results for an insurer under a large number of scenarios. This article uses a publicly available DFA model—along with the estimated market value of an insurer, based on 1990–2001 data for stock P‐L insurers and underlying financial variables—to determine optimal growth rates of a P‐L insurer based on mean–variance analysis, stochastic dominance, and constraints on leverage.

Understanding customer relationship management (CRM)

Customer relationship management (CRM) is a combination of people, processes and technology that seeks to understand a company's customers. It is an integrated approach to managing relationships by focusing on customer retention and relationship development. CRM has evolved from advances in information technology and organizational changes in customer‐centric processes. Companies that successfully implement CRM will reap the rewards in customer loyalty and long run profitability. However, successful implementation is elusive to many companies, mostly because they do not understand that CRM requires company‐wide, cross‐functional, customer‐focused business process re‐engineering. Although a large portion of CRM is technology, viewing CRM as a technology‐only solution is likely to fail. Managing a successful CRM implementation requires an integrated and balanced approach to technology, process, and people.

Executive and management attitudes towards corporate social responsibility in Malaysia

Examines the attitudes of Malaysian managers and executives towards social responsibility and also the extent of socially responsible activities involved, corporate disclosure, and the factors determining the attitudes towards social responsibility. A structured questionnaire was developed based on studies by Ford and McLaughin, Teoh and Gregory Thong, Gill and Leinbach and Jones. A total of 198 responses were used for analysis in this study. The results showed that only five statements (of the 14 statements) have scores of more than 50 per cent agreement or endorsement of socially responsible activities. About 69 per cent of the respondents believed that involvement by a business in improving its community’s quality of life will also improve long run profitability. Nearly 65 per cent agreed that socially responsible activities provide a favourable public image. The analysis of variance showed that there were significant differences in the attitudes of managers working in banking, telecommunication, manufacturing and construction towards social responsibility. Nearly all of the respondents agreed that their companies were involved in socially responsible activities, that they were responsive to consumers’ complaints (83 per cent), and that they were maintaining product/service quality (77 per cent). Of the respondents nearly 54 per cent mentioned that their companies informed the general public of their socially responsible activities. The results also showed that the most influential factor determining the attitude towards social responsibility was family upbringing. The other important factors were traditional beliefs and customs, and common practices in the industry. Discusses the implications of the findings.

STRATEGIC ASPECTS OF QUALITY: A THEORETICAL ANALYSIS

This paper investigates the relationship between aspects of quality and long run profitability and growth of a firm. The paper first determines whether a stable relationship among price, aspects of quality, and the sales rate exists, by examining the equilibrium properties of a dynamic model. Then, we use the derived equilibrium expressions to develop insights into the strategic nature of “quality reputation” and, how to integrate marketing (i.e., pricing) and quality related decisions. The paper shows under certain conditions it might be more advantageous to manipulate “quality reputation” through advertising and product innovations than to increase product quality. We comment on quality based strategic options a firm must consider to ensure long run growth and profitability.

EPA's Voluntary 33/50 Program: Impact on Toxic Releases and Economic Performance of Firms

This paper examines the motivations for participation in the voluntary 33/50 Program and the program's impact on the toxic releases and economic performance of firms in the U.S. chemical industry. It demonstrates that the benefits due to public recognition and the potentially avoided costs of liabilities and compliance under mandatory environmental regulations provide strong incentives for participation. After controlling for sample selection bias and the impact of other firm-specific characteristics, this paper shows that program participation led to a statistically significant decline in toxic releases over the period 1991–93. The program also had a statistically significant negative impact on the current return on investment of firms, but its impact on the expected long run profitability of firms was positive and statistically significant.

On the welfare effects of mergers: Short run vs. long run

We use a two-period model to analyze the short run and long run profitability and welfare consequences of horizontal mergers, where the equilibrium responses to a merger can differ over time. Although firms can anticipate the merger, they can only adjust their capacity in the long run. We find a greater range of profitable mergers than in static models. For a merger to raise welfare, it is sufficient that the short run welfare effects are positive and necessary that the long run effects are positive. We relate these conditions to the inside firms' market shares and the Herfindahl index.

Corporate Growth and Profitability

This paper argues that current period corporate growth rates reflect changes in current expectations about the long run profitability of a firm. This means that growth rates are likely to vary randomly over time. Using data from 271 large, quoted UK firms over the period 1976–1982, we report the existence of a positive, statistically significant and robust correlation between current period growth rates and a natural measure of changes in current expectations about long run profitability, namely changes in the stock market valuation of the firm. Nevertheless, we find that variations in corporate growth rates are difficult to predict.

Recent progress in curing techniques

Faster, more automated means for curing coatings as well as techniques in which the monomer polymerises to the polymer during curing readily captured the paint industry's imagination. Such concepts spell greater efficiency, greater automation and, in the long run, lower costs and greater profitability. Electron beam curing and ultra‐violet curing have emerged as the two most formidable contenders in this new area. Both methods make possible curing at near ambient temperature and both rely on high energy radiation — a highly effective form of energy for chemical reactions.