A cross‐cultural comparison of individualism's moderating effect on bonding and commitment in banking relationships

Abstract

Purpose

The purpose of this paper is to describe a cross‐cultural study which examined individualism's moderating effect on the relationship between bonding and commitment between banks and their corporate clients.

Design/methodology/approach

Data were collected through surveys completed by corporate customers from 126 Canadian companies and 156 Indian companies. Multiple regression analysis was used to calculate relative effects of structural and social bond on commitment across the two samples. Hierarchical moderated regression analysis was used to examine individualism's moderating effect on the bonding‐commitment relationship.

Findings

The paper's findings indicate that social and structural bonding are both antecedent to commitment, but that social bonding is given higher importance in the low individualism Indian society, while structural bonding is more important in the high individualism Canadian society. Individualism moderates the relationship between both social and structural bonding and commitment.

Practical implications

Bank relationships are dependent upon specific cultural contexts in which buyers and sellers interact. The type of bonding relationship (e.g. social or structural) determines the strength of commitment. Bank managers must understand the proper emphasis to place on developing social connections versus business transactional relationships with clients in individualistic versus collective cultures.

Originality/value

This paper dramatizes the importance of understanding ways in which bonding relates to commitment, particularly when societal values vary and thus alter the relative importance of forms of bonding that generate commitment. Through empirical analyses, the paper demonstrates the moderating effect of individualism on the social bonding‐commitment and structural bonding‐commitment linkages in the context of an important service sector. To date, these relationships have not been explored in either the Indian or Canadian context.

Citation

Dash, S., Bruning, E. and Ku Guin, K. (2009), "A cross‐cultural comparison of individualism's moderating effect on bonding and commitment in banking relationships", Marketing Intelligence & Planning, Vol. 27 No. 1, pp. 146-169. https://doi.org/10.1108/02634500910928380