Profitable Customer Management: A Study in Retail Banking

The increasing focus of relationship marketing and customer relationship management (CRM) studies on issues of customer profitability has led to the emergence of an area of research on profitable customer management. Nevertheless, there is a notable lack of empirical research examining the current practices of firms specifically with regard to the profitable management of customer relationships according to the approaches suggested in theory. This thesis fills this research gap by exploring profitable customer management in the retail banking sector. Several topics are covered, including marketing metrics and accountability; challenges in the implementation of profitable customer management approaches in practice; analytic versus heuristic (‘rule of thumb’) decision making; and the modification of costly customer behavior in order to increase customer profitability, customer lifetime value (CLV), and customer equity, i.e. the financial value of the customer base. The thesis critically reviews the concept of customer equity and proposes a Customer Equity Scorecard, providing a starting point for a constructive dialog between marketing and finance concerning the development of appropriate metrics to measure marketing outcomes. Since customer management and measurement issues go hand in hand, profitable customer management is contingent on both marketing management skills and financial measurement skills. A clear gap between marketing theory and practice regarding profitable customer management is also identified. The findings show that key customer management aspects that have been proposed within the literature on profitable customer management for many years, are not being actively applied by the banks included in the research. Instead, several areas of customer management decision making are found to be influenced by heuristics. This dilemma for marketing accountability is addressed by emphasizing that CLV and customer equity, which are aggregate metrics, only provide certain indications regarding the relative value of customers and the approximate value of the customer base (or groups of customers), respectively. The value created by marketing manifests itself in the effect of marketing actions on customer perceptions, behavior, and ultimately the components of CLV, namely revenues, costs, risk, and retention, as well as additional components of customer equity, such as customer acquisition. The thesis also points out that although costs are a crucial component of CLV, they have largely been neglected in prior CRM research. Cost-cutting has often been viewed negatively in customer-focused marketing literature on service quality and customer profitability, but the case studies in this thesis demonstrate that reduced costs do not necessarily have to lead to lower service quality, customer retention, and customer-related revenues. Consequently, this thesis provides an expanded foundation upon which marketers can stake their claim for accountability. By focusing on the range of drivers and all of the components of CLV and customer equity, marketing has the potential to provide specific evidence concerning how various activities have affected the drivers and components of CLV within different groups of customers, and the implications for customer equity on a customer base level.

Towards Understanding Powder Behavior Via Simulation

The aim of this study was to investigate powder and tablet behavior at the level of mechanical interactions between single particles. Various aspects of powder packing, mixing, compression, and bond formation were examined with the aid of computer simulations. The packing and mixing simulations were based on spring forces interacting between particles. Packing and breakage simulations included systems in which permanent bonds were formed and broken between particles, based on their interaction strengths. During the process, a new simulation environment based on Newtonian mechanics and elementary interactions between the particles was created, and a new method for evaluating mixing was developed. Powder behavior is a complicated process, and many of its aspects are still unclear. Powders as a whole exhibit some aspects of solids and others of liquids. Therefore, their physics is far from clear. However, using relatively simple models based on particle-particle interaction, many powder properties could be replicated during this work. Simulated packing densities were similar to values reported in the literature. The method developed for describing powder mixing correlated well with previous methods. The new method can be applied to determine mixing in completely homogeneous materials, without dividing them into different components. As such, it can describe the efficiency of the mixing method, regardless of the powder's initial setup. The mixing efficiency at different vibrations was examined, and we found that certain combinations of amplitude, direction, and frequencies resulted in better mixing while using less energy. Simulations using exponential force potentials between particles were able to explain the elementary compression behavior of tablets, and create force distributions that were similar to the pressure distributions reported in the literature. Tablet-breaking simulations resulted in breaking strengths that were similar to measured tablet breaking strengths. In general, many aspects of powder behavior can be explained with mechanical interactions at the particle level, and single particle properties can be reliably linked to powder behavior with accurate simulations.

Factors Affecting Knowledge Sharing in Strategic Alliances: The Role of Knowledge Sharing as Strategic Control Behavior among Multinational Enterprises

International strategic alliances (ISAs) have become increasingly important for the stability, growth, and long-term viability of modern business organizations. Alliance partnerships as inter-firm cooperative ventures represent an influential mechanism for asserting corporate strategic control among autonomous multinational enterprises. These different cooperative arrangements are made of equity investments or contractually-based partnerships. Different alliance forms represent different approaches that partner firms adopt to control their mutual dependence on the alliance and on other partners. Earlier research shows that the partner characteristics could provide an explanation for alliance strategic behavior and see alliances as alternative forms to markets or hierarchies for addressing specific strategic needs linked to partners’ characteristics and their subsequent strategic motives. These characteristics of the partners’ and subsequent strategic motives are analyzed as knowledge sharing factors and how these influence inter-firm control in alliances within the context of the focal-firm STMicroelectronics and its alliance partners Nokia, Ericsson and IBM. This study underline that as contracts are incomplete, they are therefore required to maintain mutual dependence based control mechanisms in addition to a contract. For example, mutual dependence based control mechanisms could be joint financial investments and the building of an ownership structure between the parties (e.g., JVs). However, the present study clarifies that subsequent inter-firm control is also exercised through inter-firm knowledge sharing. The present study contributes by presenting a dynamic interplay between competitive and cooperative rent seeking behavior. Such coopetition behavior describes the firm's strategic orientation to achieve a dynamic balance between competitive and cooperative strategies. This balance is seen in knowledge sharing based cooperation and competition behavior. Thus this study clarifies coopetition strategies by introducing the role of inter-firm cooperation and the competitive nature of knowledge sharing. Simultaneous cooperative and competitive behavior is also seen as synergetic rent-seeking behavior. Therefore, this study extends the perspective of previous studies on competitive and cooperative seeking behavior.

Biocompatibility and biofunctionalization of mesoporous silicon particles

Several of the newly developed drug molecules experience poor biopharmaceutical behavior, which hinders their effective delivery at the proper site of action. Among the several strategies employed in order to overcome this obstacle, mesoporous silicon-based materials have emerged as promising drug carriers due to their ability to improve the dissolution behavior of several poorly water-soluble drugs compounds confined within their pores. In addition to improve the dissolution behavior of the drugs, we report that porous silicon (PSi) nanoparticles have a higher degree of biocompatibility than PSi microparticles in several cell lines studied. In addition, the degradation of the nanoparticles showed its potential to fast clearance in the body. After oral delivery, the PSi particles were also found to transit the intestines without being absorbed. These results constituted the first quantitative analysis of the behavior of orally administered PSi nanoparticles compared with other delivery routes in rats. The self-assemble of a hydrophobin class II (HFBII) protein at the surface of hydrophobic PSi particles endowed the particles with greater biocompatibility in different cell lines, was found to reverse their hydrophobicity and also protected a drug loaded within its pores against premature release at low pH while enabling subsequent drug release as the pH increased. These results highlight the potential of HFBII-coating for PSi-based drug carriers in improving their hydrophilicity, biocompatibility and pH responsiveness in drug delivery applications. In conclusion, mesoporous silicon particles have been shown to be a versatile platform for improving the dissolution behavior of poorly water-soluble drugs with high biocompatibility and easy surface modification. The results of this study also provide information regarding the biofunctionalization of the THCPSi particles with a fungal protein, leading to an improvement in their biocompatibility and endowing them with pH responsive and mucoadhesive properties.