MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HOCHIMINH CITY NG THE MEDIATING ROLE OF TRUST IN THE RELATIONSHIP BETWEEN KEY ACCOUNT MANAGEMENT PROGRAMS AND COMMITMENT: A DEALER PERSPECTIVE MASTER THESIS Ho Chi Minh City – 2012 MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HOCHIMINH CITY NG THE MEDIATING ROLE OF TRUST IN THE RELATIONSHIP BETWEEN KEY ACCOUNT MANAGEMENT PROGRAMS AND COMMITMENT: A DEALER PERSPECTIVE MASTER THESIS In Business Administration Ology code: 60340102 Supervisor Mai Trang Ho Chi Minh City – 2012 i ACKNOWLEDGEMENT I would like to give my sincere thanks to Dr. Nguy n Th Mai Trang, who had dedicatedly instructed me to approach every particular matter from the research method guidance to intensive support and valuable suggestions for the final completion of this thesis. I would also like to express my gratefulness to the respected teachers from the University of Economics Ho Chi Minh City for their devotions in training and education. We inherited much knowledge and experiences thanks to them.
I truly appreciate the helps of my colleagues, my friends in eMBA class course K19, and my partners. This research could not be completed successfully if such helps of knowledge and field work data collection were not supported by them. My special thanks are given to my beloved family and my wife, Phạm Ngọc P ươ g Trúc who has encouraged me much to complete this thesis. Ho Chi Minh City, October 2012.
Nguy n Hải Đô ii TABLE OF CONTENT ACKNOWLEDGEMENT .i TABLE OF CONTENT .ii LIST OF FIGURES. v LIST OF TABLES. Research Methodology and Scope. Structure of the research.
High-technology attributes and their effects. High technology attributes. Effects of high-tech attributes:. Key Account Management (KAM) programs.
Tailor-made promotions. Summary of hypotheses. Tailor-made promotions. Selecting the samples.
Cleaning data process. Explanatory Factor Analysis. 30 DATA ANALYSIS AND RESULTS. Description of the qualified respondents.
Reliability Test of measurement. Exploratory Factor Analysis. Analysis of correlations. Test of Hypotheses.
Test the appropriateness of model and assumptions for MLR. 37 472 e effects of KAM P o ams’ facto s o t st (H1, H2a, H2b, H3, a d H4). The effect of Trust on Commitment. 43 DISCUSSION AND IMPLICATIONS.
Findings of the study. Contributions of the study. Limitations and recommendations for future research. 48 LIST OF REFERENCES.
49 APPENDIX IA: QUESTIONNAIRE (Vietnamese version). 53 APPENDIX IB: Results of the quantitative pilot study. 55 APPENDIX II: Descriptive statistics of variables. 57 APPE IX III: Meas eme t scales eliabilit of o i i al model’s va iables.
58 APPENDIX IV: Measurement scales eliabilit of adj sted model’s ew va iables. 61 v APPENDIX V: Exploratory Factor Analysis (EFA). 62 APPENDIX VI: Test of MLR assumptions. 70 LIST OF FIGURES Figure 2.1: Proposed research model .1: The process of the study .1: Adjusted research model .2: Results of model 1 .3: Results of model 2.
42 LIST OF TABLES Table 3.4: Tailor-made promotions Scale .5: Tailor-made promotions Scale .1: Characteristics of the samples. 31 able 4 2: S mma of C o bac ’s Alp a of meas eme t scales .3: Rotated Component Matrix. 34 able 4 4: S mma of C o bac ’s Alp as wit 2 ew .6: Multiple Linear Regression: Model 1 Summary .7: Multiple Linear Regression: Model 1 ANOVA .8: Multiple Linear Regression: Model 1 Coefficients .9: Multiple Linear Regression: Model 2 Summary .10: Multiple Linear Regression: Model 2 ANOVA .11: Multiple Linear Regression: Model 2 Coefficients .1: The effects of sub-dimensions of Key Account Programs on Trust. 45 1 ABSTRACT In a fast-changing environment of high-tech industry in Vietnam, the role of key account management programs has been realized to be truly important as it builds strong commitment between suppliers and dealers.
This study aims at exploring the effects of ke acco t ma a eme t p o ams’ facto s to t st a d co seq e tl , t st’s effect to commitment. A survey was conducted with a sample of 202 respondents who are purchasing managers, owners and shop/floor managers represents for 8 key accounts in the high- tech industry. Exploratory factor analysis and multiple linear regression was employed to analyze the data. It was found that Marketing and Sales Information, Product Information, Responsiveness and Logistics have positive effects on Trust while Tailor-made Promotions was not significantly related to Trust.
Finally, Trust has a positive effect on Commitment. The results of this study suggest that suppliers should invest more resources in exchange information with dealers, especially marketing and sales information; responsiveness, logistics and product information are also deserved to invest time and effort in order to enhance trust and consequently consolidate commitment. This study contributes to the extant literature on key account management programs and is the first kind to explore in the high-tech industry in Vietnam. Keywords: Key account management programs, trust, commitment, Vietnam, high-tech industry.
Research background Under the changes of economic environment and fierce competition, in the business to business field, suppliers have employed Key Account Management (KAM) programs to their business customers. These programs are designed to serve strategic or key customers who contribute a large portion in terms of sales and profit. Such key accounts play such a more important role than traditional ones (minor accounts) (Pardo, 1997). Key Account Management (KAM) has been received so many interests as most of sales turnover generated by key customers (Shapiro and Moriarty, 1982; Cespedes, 1992).
For enterprises who deal in high-tech industry, key accounts play a strategic role in their short and long run. Such strategic customers deserve to be paid more attention by suppliers. Suppliers have the sound reasons to invest more resources in the key resellers in order to develop a close and valuable relationship, and maintain high trust between the dyad. These activities are included in a strategic working design called Key Account Management Program.
Literature has shown that a variety of researches investigating the effects of key account management program on trust and consequently on commitment. Researches by Kumar, 1996; Geyskens et al., 1998 showed that building a program like key account teams will lead to a high level of trust, and then will lead to a long term commitment between the dyad. This will generate a win-win relationship for a long run. High technology industry is highly dynamic; it changes very fast as the speed of technology circle.
Technological products become obsolete in a very short period, 3 value of such products decreases day by day. Doing business in this industry requires high commitment as the environment is ever changing. Vietnam is a developing and transformational economy. Commitment in doing business is a big problem put ahead for such fast changing industry.
It is argued that Vietnamese businesses just pay more attention on the short term benefits; they can break their commitment at ease to achieve their goals. Especially, in such a unstable and fast changing environment like high technology, the problem turns out to be quite popular. In order to catch up with the speed of change in the industry, and long for a long term and sustainable development, businesses should develop a strategy in building trust and in turn commitment among those by developing strategic programs such as key account management programs. In a transitio al eco om like Viet am, t e e’s a lack of researches on such mentioned constructs, the effects of key account management programs on trust and in turn commitment.
Especially, little attention has been paid in the high-tech industry. The question put forward is whether such constructs affect to the trust and consequently commitment in the high tech industry, how strong they are and should they deserve to be invested more in order to build a strategy for long term cooperation between dyads. Empirical research is deserved to be carried out for a brighter view in order to draw practical implications by investigating the effects of KAM programs on trust and in turn commitment. Problem statement A number of studies have been carried out on the roles of KAM and its effects on trust and commitment.
Willem et al. (2004) has investigated the roles of KAM programs in the fast-moving consumer goods industry. Faten Baddar Al-Husan and Ross Brennan (2009) have studied the implementation of strategic account management in an emerging economy in the Arab word to reassert the important roles and effects of the 4 key/strategic account management programs. Such mentioned researches and literature encourages investments in key account management programs to build trust and long- term commitment from customers.
In a transitional and emerging economy like Vietnam, such researches on key account managements programs has not, to the a t o ’s best knowledge, received much interests from researchers, especially, in the field of high-tech industry with a fast-changing environment. Therefore, the problem addressed in this study is to investigate the effects of key account management programs on trust and then on commitment from Vietnamese dealers perspective in the high-tech field, such as telecommunications, electrical appliances, and information technology. Research questions This research aims at answering the following questions: - W at’s t e elatio s ip betwee ke acco t ma a eme t p o ams’ facto s on trust and consequently on commitment? - What factors should be deserved for investment in order to build long-term win-win business cooperation? 1. Research objectives The overall objective of this research is to examine effects of key account management programs to commitment via trust.
Key account management programs are constituted of responsiveness, information, logistics, and tailor-made promotions. Therefore, the specific objectives of this research are to investigate the following relationships: 1. The relationship between responsiveness and trust 2. The relationship between information and trust 3.
The relationship between logistics and trust 4. The relationship between tailor-made promotions and trust; and 5. The relationship between trust and commitment. 5 This research will investigate such relationships from Vietnamese dealer perspective.
Consequently, findings will show some facts, and then practical implications are proposed. Research Methodology and Scope This research focuses on surveying 8 key accounts (dealers) in high-tech industry located in all the provinces of Vietnam where selected dealers have offices and branches. Total correspondents will be targeted at about 210 samples. The research comprises 2 stages: pilot and main study.
In the first stage a qualitative approach was used to explore whether the scales for measuring the constructs are suitable or not. Then, some amendments had been made where is necessary. In the second stage, a quantitative approach was employed. By interviewing dealers, data were collected for analysis.
This phase is to test the reliability of the measurement scales using C o bac ’s alpha coefficient and Exploratory Factor Analysis (EFA). Multiple Linear Regression analysis (MLR) was employed to test the research model and hypotheses. SPSS software version 16 was used for data analysis 1. Structure of the research The structure of this research consists of five chapters: Chapter 1: Introduction This chapter presents research background of the study, as well as, research problems, research objectives, research methodology and scope.
Chapter 2: Literature Review 6 In this chapter, literature review has been summarized. This chapter would present a research model of the research. Chapter 3: Methodology Based on the research objectives and scope, research methodology concerned in chapter 1, and literature review and empirical model presented in chapter 2, this chapter particularly presents the research methodology, data, research design and research process. Chapter 4: Data Analysis and Results This chapter presents the characteristics of research samples and measures concepts of the research.
Descriptive statistics was used to explore the features of explanatory variables, as well as the relationship between the variables. Chapter 5: Discussion and Implications This chapter presents findings of the study, practical implications, contribution of the research.