Success and failure factors in developing new banking and insurance services
Date
1998
Authors
Oldenboom, Nicola
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Abstract
The development and introduction of new products is essential for a firm's
survival. Numerous activities are administered in developing Dew service
products. New product development management has control over the
proficiency and choice of activities performed. The objectives of this study
were to discover the factors that underlie the proficiency and development
activities performed, and to see which are prone to lead a new service to
success or result in failure. Unique characteristics of services suggest a
different emphasis on development activities than are normally associated
with the development of goods. Any differences in factors between the
sample of banks and insurers were also investigated.
Results from a self-administered questionnaire and interviews with South
African banks and insurers were attained by factor analyses, Mann-
Whitney U tests and Step-wise discriminant function analysis, It was
found that successful projects are; synergistic with the fum's resources
and skills, they embody a competitive advantage and rely on a degree of
service newness that is not too uncomfortable for consumers, they are also
developed with insight into consumer's behaviour. Banks are better at
conducting detailed prediction studies than insurers. Comparatively,
insurers are better at integrating cross-functionally all the necessary
departments. Step-wise discriminant analysis revealed sales growth and
profit objectives to be the performance measurements that significantly
predict and classify new successful services.
No factors for failed service products were found. Limitations of the
research are acknowledged and suggestions are made for further research
into the topic.
Description
A dissertation submitted to the Faculty of Commerce, University of the
Witwatersrand, Johannesburg, in fulfilment of the requirements for the
degree of Masters in Business Economics
Keywords
Banks and banking -- South Africa, Insurance -- South Africa