Obstacles to upgrading customer value-in-use in retail banking

Ilkka Lähteenmäki, Satu Nätti

Research output: Contribution to journalArticleScientificpeer-review

12 Citations (Scopus)


Purpose – Improving capability to generate value for customers is seen as a way to create a new competitive edge, but developing the related organisational capabilities involves facing several obstacles that stem from the producer-orientation of the retail-banking business. This paper aims to focus on defining and describing those obstacles. Design/methodology/approach – An in-depth, qualitative single case study of a European retail bank was conducted. Findings – A retail bank can find it challenging, first, to understand the deepest meaning and character of customer value and, second, to harness the organisational attributes to deliver that value. The main barriers lie in the strong producer-oriented way of doing business, a lack of employee commitment, a strong product and sales orientation, a restrictive network, difficulties in seeing the profitability aspect of a new mindset, lack of conceptualisation and proper segmentation, and finally, silo-style bank organisations. Research limitations/implications – The research is focused on the retail-banking industry, while the findings are transferable to other retail finance businesses. Practical implications – Enhancing value creation may provide a competitive edge, but developing that edge means facing several obstacles, which may jeopardise the calculated positive return on investment. For management, understanding the value of the banking service in the customer's own context is critical. Originality/value – Developing customer experience and value-in-use has been suggested as a good starting point for customer orientation. However, research on its implications for organisations and potential obstacles to implementation remains scarce. This paper offers a detailed view on the organisational development necessary to generate value-in-use in a retail-banking context.

Original languageEnglish
Pages (from-to)334-347
Number of pages14
Issue number5
Publication statusPublished - 19 Jul 2013
MoE publication typeA1 Journal article-refereed


  • Banking
  • Customer orientation
  • Customer perceived value
  • Customers
  • Retail banking
  • Value-in-use

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