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International Journal of Contemporary Business Studies 

Vol: 4, No: 1. January, 2013 ISSN 2156-7506 

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IJCBS 

VOLUME 4 I NUMBER 1 I JANUARY, 2013 

ISSN 2156-7506 

International Journal of 

Contemporary Business Studies 

In This Issue: 

Determinants of Manufacturer’s Selection of Distributors: A case from Pharmaceutical and Electronic 

Appliance Industry 

Ahmad Nabeel Siddiquei, Muhammad Ahmad Raza, Prof. Dr. Hayat M. Awan,Khurram Shehzad Bukhari 

Women’s Justification of White-Collar Crime 

Petter Gottschalk 

Service Quality Measurement and its evaluation of leading Private Banks of India in Delhi and NCR 

Region: An analytical study 

Dr. Saroj Kumar Dash,Dr. Asif Parwez,Mr. Firoz Parwez 

A Boss causes mental disorder - Stay or Leave 

K.R.Sowmya 

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VOLUME 4, NUMBER 1 

January, 2013 

Contents: 

Determinants of Manufacturer’s Selection of Distributors: A case from Pharmaceutical and Electronic 

Appliance Industry 

Ahmad Nabeel Siddiquei, Muhammad Ahmad Raza, Prof. Dr. Hayat M. Awan,Khurram Shehzad Bukhari…………………………6 


Petter Gottschalk………………………………………………………………………………………………………………………………………..24 

Service Quality Measurement and its evaluation of leading Private Banks of India in Delhi and NCR 

Region: An analytical study 

Dr. Saroj Kumar Dash,Dr. Asif Parwez,Mr. Firoz Parwez………………………………………………………………………………….………33 


K.R.Sowmya…………………………………………………………………………………………………………………………………….……….47 



5




Determinants of Manufacturer’s Selection of 

Distributors: 

A case from Pharmaceutical and Electronic Appliance Industry 

Ahmad Nabeel Siddiquei a , Muhammad Ahmad Raza b , Prof. Dr. Hayat M. Awan c and 

Khurram Shehzad Bukhari d 

a,d 

Air University Multan Campus, b,d Bahauddin Zakariya University, Multan-Pakistan 

ABSTRACT 

This case explores the determinants which are considered most important for the 

selection of Distributors in Pharmaceutical and Electronic Home Appliance Industry. In 

today’s competitive market, selecting an appropriate distribution network is considered to 

be an essential ingredient of success. And Channel management is a key strategic issue 

which is concerned with the delivery of goods and services to the final consumers. How 

manufacturers select distributors who can contribute to distribution efficiency has 

become an important issue for channel management. While the last decade has seen large 

shifts in manufacturing and distribution practices, there has been very little empirical 

research investigating manufacturers’ selection of distributors. So recruiting and selecting 

a distributor for any company is a key decision that has to be made by a manufacturer in 

order to excel in market. This case would discuss all concerned determinants that are 

important for the selection of Distributor in both of the above mentioned industries. They 

would be discussed in the form of five key constructs which are composed of several 

other related variables. Then a broad framework would be developed that would lead 

towards the selection of distributor. A selected candidate must match with the proposed 

framework in order to become a channel partner for the company. Importantly, the case is 

the first of its type that would segregate all important determinants of selection on the 

basis of its criticality. 

Keywords: Channel member selection, Distributor, Evaluation criteria, Supply Chain 

Management 

1. INTRODUCTION 

Physical distribution is a collective term for the series of inter-related function (principally transport, stock, 

storage, goods handling and order processing) involved in physical transfer of goods from producer to 

consumers. It is only recently that full importance has been given to physical distribution in industrial and 

business circles. Over the past 30 years, however, managerial attitude towards distribution has been 

transformed. Today, distribution is considered to be a major cost center, an important marketing tool and 

critical determinant of profitability and competitive advantage. There is much greater acceptance of the fact 

that ‘processes of manufacturing and distribution are complementary’ and that an unsold product, however 

produced efficiently, represents a waste of resources (Edward, 1982). 

Selecting appropriate distributors as a channel partner has been an important prerequisite of effective 

channel performance. In this era where the concepts of supply chain have really emerged, a strong 

distribution network is considered to be a key strategic advantage. Except for those with extraordinary 

reputation and prestige, manufacturer cannot expect numerous quality distributors to vie for their business. 

Manufacturers normally have to seek and recruit distributors by evaluating potential candidates with an 

emphasis on performance (Lin & Chen,2008). 


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The evaluation tasks typically consists of identifying the attributes, criteria or factors relevant to the 

decision and then measuring or rating eligible distributors on each factor. The manufacturers’ evaluation 

reflects an assessment of the values/rewards, cost and benefit analysis and risks inherent in the selection 

(Lin & Chen, 2008). 

In the past, pharmaceutical companies did not adopt supply chain management concepts. However, now 

several factors are pressing pharmaceutical companies to change their traditional manners of conducting 

business (Ahmad, Awan, Raouf, & Sparks, 2009). At the same time Electronic home appliance industry is 

one of the growing sectors of Pakistan economy. This industry has also been full of stiff competition and 

quality standards innovation. (Pearson & Ellram, 1995) worked on Supply Chain of Electronic Home 

Appliance industry and have argued that the quality of Supply chain of this industry has been as important 

as the quality of product. Product availability, capturing strong and reputed distributor and enlarged supply 

network has been at the core of this industry’s supply chain. So our focus would be to explore and 

evaluate all factors that are important in the selection of distributors subjected to Pharmaceutical and 

Electronic Home Appliance Industry. Finally, recruiting and selecting a reputed distribution is another area 

of concern and the factors affecting the selection of distributor would be discussed. Since it is an area 

where there is a lack of research and visible research gap. 

2. RESEARCH FRAMEWORK 

Distributor selection can be studied in terms of five Broad constructs. It includes Firm infrastructure, 

Marketing Capabilities, Relationship Intensity, Logistic Capabilities and Strategic Issues. The evaluation 

task that takes place is to rate each Distributor on above mentioned factors. Whenever the company is 

looking to extend its delivery network or if in other case they are required to recruit and select a distributor 

to enhance their channel distribution efficiency, these factors come into play before the final decision has 

been made. At the same time, each determinant would be identified and segregated based on its criticality 

or importance to be present in a potential candidate. There have been few determinants identified by 

various researchers in Manufacturer-Distributor relationship like communication, Power, trust and 

dependence (Goodman & Dion, 2001). But all such variables explained the importance of marketing and 

behavioral variables and provide the separation between both of them that is somewhat artificial. 

(Goodman & Dion, 2001) Also suggests that the trend now-a-days is to provide support to distributor as 

their efficiency has been increased with growing market. The decision to make any organization the partner 

should be based on the performance of entire channel that would be achieved in the future (Cavusgil, Yeoh, 

& Mitri, 1995), (Rosenbloom, 2004). A full-fledged eligibility and selection criterion has to be drawn by 

the manufacturer prior to their selection. Irrespective of how much control and efficiency a manufacturer 

has in selection decision, yet they have to involve selection criterion in order to build positive synergy and 

collaboration between respective entities (Merritt & Newell, 2001), (Rosenbloom, 2004). 

2.1 Firm Infrastructure 

The benefits of distributor would also be increased through overall channel performance increase 

(Cavusgil, Deligonul, & Zhang, 2004), (Kalafatis, 2000). This extent of inter-dependability between 

channel members gives the idea about the importance of recruiting capable and competent distributor in a 

particular market (Merritt & Newell, 2001) in countries like Pakistan, where the product availability could 

turn out to be critical in the final purchase decision of the consumer. 

The business situation of potential supply/channel chain member determines the possible match between 

manufacturer and potential candidate (Braglia & Petroni, 2000);(Mummalaneni, Dubas, & Chao, 1996). 

Recently there is an immense revolution in science and technological field which has affected the 

pharmaceutical industry to a greatest extent. So this demand adjustment in their supply chain as well (Ricci 

& Fraser, 2006). Due to discovery and introduction of various pharmacy products, there is all together new 

introduction of different market and consumers which caused the supply networks to adjust as well. Prior to 

selecting a distributor, a manufacturer takes a reasonable time to inquire about the potential distributor and 

this inquiry could be from the past and present customers, its operational market or even from the 

competitors (Cavusgil, Yeoh, & Mitri, 1995). So it has to be a point of strong focus for the manufacturer 

before the selection decision. Derived from previous channel and supply chain member selection literature, 


7




the firm infrastructure variables included in this research are: “management ability, financial strength, 

physical facilities and experiences.” (Lin & Chen, 2008). 

The management ability of a potential distributor is considered to be very critical for the selection of 

distributor by manufacturer (Cavusgil, Yeoh, & Mitri, 1995), (Rosenbloom, 2004). Management ability 

relates to quality of management and its core competencies regarding its market, managerial and strategic 

operations. (Braglia & Petroni, 2000), (Rosenbloom, 2004) believes that a channel/supply chain member 

chosen by the manufacturer should only be considered if its management capabilities are strong enough. A 

number of researchers are of the view that financial strength of the distributor is also very important in 

selecting a channel/supply partner (Braglia & Petroni, 2000), (Sink & Langley, 1997), (Yeoh & Calantone, 

1995). Financial strength provides evidence of the prospective channel member’s overall abilities, in 

addition to information concerning specific channel functions (Rosenbloom, 2004). The published figures 

could be an important source to attain financial figures of distributors yet the information could also be 

obtained by frequent visits to their business setup and from third party opinion (Cavusgil, Yeoh, & Mitri, 

1995). 

If the distributor has an experience in the market or in the same industry its competitive position would be 

increased to a great extent (Kaleka, 2002), knowledge/information management, uncertainty reduction, and 

resource mobilization are the benefits achieved through useful past experience (Shankar, 1999). This is the 

reason numerous researchers proved that the past experience is an important factor in selecting a 

manufacturers’ channel partner (Abratt & Pitt, 1989), (Braglia & Petroni, 2000), (Fram, 1992). Number of 

researches suggested that the physical facilities employed by the distributor in Electronic Home Appliance 

Industry greatly affect Channel member selection decision (Abratt & Pitt, 1989), (Braglia & Petroni, 2000), 

(Cavusgil, Yeoh, & Mitri, 1995). Physical facilities adopted by the distributors include Management 

Information Systems, Hi-tech equipments and logistic support gives a strong indication that the firm is 

capable enough to carry out Supply/Channel tasks (Braglia & Petroni, 2000), (Kaleka, 2002). Empirical 

evidence shows that manufacturers across South Asia and Middle East strongly emphasize on the physical 

facilities while they are selecting a distributor (Abratt & Pitt, 1989). Based on the academic work presented 

above there is a strong indication that the Firm’s Infrastructure is very valuable while selecting a 

distributor. 

2.2 Marketing Capabilities 

Manufacturers are increasingly relying on the distributors for the various channel and marketing activities 

like Promos and Merchandising (Merritt & Newell, 2001) in order to stay focused on core competencies 

and resource mobilization (Sink & Langley, 1997). In this way the distributors also act as a marketing 

partner for the firm as it provides important marketing information and trends needed to be understood by 

the manufacturer as they are supposed to remain vigilant towards the changing customer requirement 

(Paun, 1997) while achieving satisfaction of customers(Mudambi & Aggarwal, 2003). 

The high percentage of firms’ overall sale has been done by the distributor and for this the support from the 

manufacturing company has been increased now-a-days (Goodman & Dion, 2001). Marketing capabilities 

is the collective ability of the firm to apply the skills, knowledge, resources and capital to the market 

related need of the businesses in order to capture highest market share (Weerawardena & O’Cass, 2004). 

Distributor/manufacturer relationships are governed by contract which stipulates the distributor margin and 

requires the distributor to implement various trade and consumer promotional activities for the 

manufacturer (Aman & Hopkinson, 2010). The core of this capability lies in the accuracy to reach the 

target market efficiently and at the right time (Vorhies & Harker, 2000). The target market scenario is 

important as the customers must be those to whom the product is meant for. (Shipley, Cook, & Barnett, 

1989), (Weerawardena & O’Cass, 2004) argues that in order to have this the behavior of the distributor 

must be such that they are willing to understand the customers and market needs prior to their competitors. 

According to channel member selection literature, “marketing capabilities generally include sales strength, 

market coverage, and product compatibility.” (Lin & Chen, 2008). 

High majority of firms considers selling ability of the distributor as their highest priority because at the end 

of it is the selling and capturing market share that matters (Cavusgil, Yeoh, & Mitri, 1995), (Yeoh & 


8




Calantone, 1995). A manufacturer will observe detailed sales performance information from a prospective 

channel member to get a firsthand view of its effectiveness (Mummalaneni, Dubas, & Chao, 1996), 

(Rosenbloom, 2004). 

Goodman & Dion (2001) provides us with the evidence that highly devoted distributor comes with the 

market intelligence based on the strength in their relationship. Even more the willingness of distributor in 

distributing only one manufacturers’ family of product depends on the commitment of manufacturer in 

distributor’s organization and its benefits (Goodman & Dion, 2001). 

Marketing competence is also thought of as a distributors’ ability to cover the maximum geographical 

territory (Braglia & Petroni, 2000), (Stern, El-Ansary, & Coughlan, 1996). It would help in achieving high 

volume of sales, gaining market share, economies of scale and scope, market penetration, high product 

availability and finally attaining high brand reputation as far as the network and availability is concerned 

(Cavusgil, Yeoh, & Mitri, 1995), (Rosenbloom, 2004), (Yeoh & Calantone, 1995). 

Marketing capabilities is also measured by the fact that how the manufacturer is evaluating the product line 

of distributor (Cavusgil, Yeoh, & Mitri, 1995). If the distributor is carrying similar products or the products 

having the same distribution mechanism than it would be a great plus for the distributor. This concept has 

also been endorsed by various other researchers. The distributor has the responsibility to sale and delivers 

the goods to all economically feasible outlets in the agreed locality/market. “In return, the distributor 

receives the manufacturer goods exclusively in a particular area. This exclusivity renders the manufacturer 

highly dependent upon the efforts of distributors to maximize sales. This dependence is mitigated, however, 

by contractual terms and the manufacturer’s brand power. In turn distributors accept control which is 

mitigated by exclusive access to a geographic market with respect to popular and well supported brands” 

(Aman & Hopkinson, 2010). 

Mentioning the fact that manufacturers’ prefer the distributors who are experienced enough in carrying 

complementary and compatible products instead the substitute (Fram, 1992), (Rosenbloom, 2004), (Yeoh 

& Calantone, 1995). Summing up the idea, the manufacturer would give importance to the distributor 

having a strong market competence and this fact is also been supported by (Berman, 1999). 

2.3 Relationship intensity 

The impact of commitment, trust and relationships has a meaningful impact on the strong and long-term 

relationship between channel partners (Frazier, 1999). Channel management research has now been 

emphasizing a lot on managing the relationships between people, firms and organizations performing 

distribution functions, it would help in creating value for the customers providing the product at right time 

and place (Weitz & Jap, 1995). ). There have been few determinants identified by various researchers in 

Manufacturer-Distributor relationship like communication, Power, trust and dependence (Goodman & 

Dion, 2001). The development of a manufacturer’s relationship with its channel members greatly affects 

channel cooperation, channel efficiency and the manufacturer’s competitive advantage (Kaleka, 2002). 

However this concept is growing with the growing concept of relationship marketing where even the 

exchanges are nominated as relationship exchange (Weitz & Jap, 1995). Therefore, manufacturers will 

evaluate relationship factors carefully when selecting channel/supply chain members (Mummalaneni, 

Dubas, & Chao, 1996), (Min, 1993). However, these relationship-related factors, within the context of 

channel member selection, are not sufficiently discussed in the current literature. 

Extant research has used terms such as relationship strength, relationship quality, relationship intensity, and 

relationship magnitude when describing inter-firm relationships (Bove & Johnson, 2001), (Golicic, Foggin, 

& Mentzer, 2003), (Rindfleisch & Moorman, 2001). A positive link between relationship intensity and 

channel outcomes has also been supported (Santoro, 2000). Following on these findings, we propose that 

the construct “relationship intensity” is an important factor for a manufacturer’s selection of distributors. 

This construct includes the distributor’s enthusiasm to build a relationship, commitment, and willingness to 

share information as well as the manufacturer’s familiarity with the distributor. At the same time one could 

really argue that a good distributor turns out to be a critical success factor for the manufacturer. (Goodman 


9




& Dion, 2001) argues that securing distributor commitment is a difficult task as they act as an independent 

business entity. Each distributor is an independent, appointed intermediary who performs the responsibility 

of purchasing goods from the manufacturers, selling and delivering to wholesalers and also to some 

retailers, most notably urban retailers in case of Pakistan(Aman & Hopkinson, 2010). 

Scholars suggested that firms should seek distributors who show enthusiasm for the contract and who are 

hungry for success (Anderson & Weitz, 1991), (Yeoh & Calantone, 1995), (Rosenbloom, 2004), 

(Coughlan, Anderson, Stern, & El-A, 2001) also emphasize the value of a prospective channel member’s 

enthusiasm and aggressiveness, which is believed to be closely related to long-term success in handling the 

manufacturer’s products. Therefore, manufacturers would prefer distributors who are enthusiastic to 

cooperate. 

Commitment is considered crucial to the long-term success of a business relationship, providing the basis 

for a cooperative spirit in marketing channel relationships, leading to an overall stronger partnership 

(Andaleeb, 1996). A manufacturer’s acquaintance/familiarity with the prospective distributor is considered 

important; as such familiarity can be positively related to its expectation of future coordination with the 

distributor in a channel relationship (Celly & Frazier, 1996). Manufacturers are more likely to choose 

distributors with whom they are familiar or who are recommended by channel customers (Shipley, Egan, & 

Edgett, 1991). Likelihood of a successful partnership increases as the above qualities enhance mutual 

communication and relationship maintenance. 

2.4 Logistic Capabilities 

A good distribution network considers Logistics as a source of core strategic advantage (Novack, Rinehart, 

& Langley, 1994), (Fawcett, Stanley, & Smith, 1997), (Zhao, Dro ¨ge, & Stank, 2001). A well-managed 

logistic services handled by a distributor not only brings financial advantage (Cost Saving) but also the 

operational efficiency, flexibility and value of the entire supply channel (Fuller, O’Conor, & Rawlinson, 

1993). A well-managed channel requires that its members be equipped with good logistics capabilities. 

(Bowersox, Closs, & Stank, 1999), (Day, 1994), (Desarbo, Benedetto, Song, & Sinha, 2005), (Lynch, 

Keller, & Ozment, 2000) created a strong relationship between Firms’ logistics capabilities and its 

performance from the literature of marketing, logistics and Supply Chain. 

There is a diverse academic research available on logistic capability and firms’ performance. “Derived 

from (Fawcett, Stanley, & Smith, 1997), (Morash, Droge, & Vickery, 1996) and (Zhao, Dro ¨ge, & Stank, 

2001), inventory management, delivery efficiency, flexibility, innovation, logistics cost, and customer 

service are included in this research”. 

For any distributor the primary operational responsibility is to manage its inventory providing the highest 

service level and minimum inventory holding cost(Lambert, Cooper, & Pagh, 1998), and it is often 

considered to be the foremost and fundamental factor of firms’ logistic capability (Looman, Ruffni, & de 

Boer, 2002), (Svensson, 2003). Researchers studied the efficiency to deliver products as another important 

aspect of firms’ logistic capability (Daugherty, Stank, & Ellinger, 1998), (Fawcett, Stanley, & Smith, 

1997), (Morash, Droge, & Vickery, 1996). Whenever we talk about delivery efficiency it means the time 

between order taking and product delivery must be minimized and order quantity must be accurate and 

precise (Morash, Droge, & Vickery, 1996), and these capabilities are important for supply chain member 

selection (Cavusgil, Yeoh, & Mitri, 1995), (Da Silva, Davies, & Naude ´, 2002). (Fawcett, Stanley, & 

Smith, 1997), (Vickery, Calantone, & Dro ¨ge, 1999) cited that ” logistics system’s ability to accommodate 

special or non-routine requests and provide rapid response to customer requests, indicates a firm’s 

competence to respond to the needs of markets, and is regarded as an important sign of logistics 

performance.” Manufacturers’ value flexibility, when selecting channel/supply chain members (Da Silva, 

Davies, & Naude ,2002), (Sink & Langley, 1997). Organizations’ success lies in the level of its innovation 

(Calantone, Cavusgil, & Zhao, 2002), (Mone, McKinley, & Barker, 1998) and the effective performance of 

its logistics (Chapman, Soosay, & Kandampully, 2003), (Fawcett, Stanley, & Smith, 1997), (Flint, Larsson, 

Gammelgaard, & Mentzer, 2005). 


10




A distributor must be willing to enhance the value-added content of its logistic services and it would be a 

source of competitive advantage for the organization (Fawcett, Stanley, & Smith, 1997), (Flint, Larsson, 

Gammelgaard, & Mentzer, 2005), (Morash, Droge, & Vickery, 1996). So the innovation becomes the 

important factor for the selection of distributor (Fawcett, Stanley, & Smith, 1997). Customer service is 

another aspect of logistic capability of the firm(Fawcett, Stanley, & Smith, 1997), (Mentzer, Flint, & Hult, 

2001), (Morash, Droge, & Vickery, 1996) and channel member selection (Min, 1993), provided that the 

organization considers the high quality of customer service as a core responsibility of their distribution 

network, given the tendency to view customer service orientation as a principal determinant of channel 

activities and the heightened attention to the importance of service quality in many supply chain practices 

(Katsikeas, Paparoidamis, & Katsikeas, 2004). 

2.5 Strategic Issues 

Various practitioners believe that the distributor to be selected must have a strategic importance for the 

manufacturer. A manufacturer has interests associated with the distributor prior to the selection. It could be 

in the form of achieving high market share, to counter any strategy of the competitor or making a high 

profile organization as their channel partner. The interests could vary but these issues are in their mind and 

they become cautious and analytical in their approach. Sometimes a cultural match is important between 

both parties. So it becomes easier to carry out business between them. A positive synergy usually develops 

if a culture is being matched. 

3. CONCEPTUAL FRAMEWORK 

Figure 1 presents the research framework delineating the four determinant constructs that influence 

manufacturers’ distributor selection. The constructs are drawn from the literature as well as from the insight 

of practitioners. 

Firm Infrastructure 

Marketing 

Capabilities 

Relationship Intensity 

Logistics Capabilities 

Determinants of Manufacturers’ 

Selection of Distributor 

Strategic Issues 

Figure 1: The Conceptual Framework 

(Adapted from Lin and Chen, 2001) 


11




4. RESEARCH METHODOLOGY 

Measure development 

And pretest 

Item Generation from literature 

Expert Opinions 

Pre-Test 

Two stages main 

Survey procedure 

Survey for Exploratory Analysis Exploratory 

Analysis 

Survey for Confirmatory Analysis 

Confirmatory Analysis 

Source: Hsu, Kannan, Leong and Tan, 2006;”Supplier Selection Construct: Instrument development and validation” 

The figure shows two steps procedure that is used to develop survey instrument and to test the distributor 

selection constructs. The first step, measure development and pretest, was used to develop and validate the 

survey instrument, while the second step two stages main survey procedure, was used to test and validate 

the research construct Items generation was meant to identify the factors that are important for the selection 

of distributor from the literature of Marketing, Supply Chain management and Logistics. Expert opinions 

were taken from three managers of pharmaceutical distribution center of three different companies and 

three managers from three different companies of electronic home appliances industry. Pretesting would be 

done from another five managers of respective industries .Surveys for exploratory and confirmatory 

analysis would involve data collection from the final sample of five different companies of respective 

industries to confirm and test the validity of research construct across the industry. The data was collection 

through the questionnaire using deductive and inductive approach, based on the literature and insights 

drawn from the experts’ opinion. 

Sampling was done based on the organizations’ performance and its current market share relevant to both 

industries. So, all the ten manufacturers’ in the sample are the leading organizations of their industries thus 

making the research findings more valid, relevant and authentic. 

The sampling frame consisted of 10 manufacturers representing five from each industry. The sample 

represented both national and international organizations of both industries. Two Local and three foreign 

manufacturers were picked for the sample from pharmaceutical industry. Similarly, two Local and three 

foreign invested companies were chosen for the same in Electronic home appliance industry. 

5. ELECTRONIC HOME APPLIANCE INDUSTRY ANALYSIS 

Our empirical findings are quite supportive of the conceptual framework to explore dimensions of 

distributors’’ selection. The five key constructs in our model all have positive and crucial for the selection 

of distributor. As shown above, are the factors that are extracted from the literature and validated through 

the factor analysis. It extracted five constructs. As explained earlier the factor weight of 0.60 has been as a 

minimum cut-off value which makes the criteria more strict and valid. The prior research that been done 

related to this topic set the criteria of 0.50 (Chris and Len, 2008) making our research results even more 

authentic. 

For the first construct i.e. Firm Infrastructure we have four items that must be present in a potential 

distributor in order to get selected as a channel/supply partner. The first item in it refers to the management 

capability of the firm. So we could safely say that the management quality in terms of their personnel 


12




repute, vision and market standing has been considered very important from the manufacturer’s view point. 

The operational competency also lies in the same item and has been given the same response therefore. As 

we found in previous literatures that supply chain quality in Electronic home Appliance Industry is as 

important as the product quality. Therefore, we found a valid result to strengthen our argument. The second 

construct correspond to the marketing capabilities of the distributor. The firms’ reputation in the market, 

the ability to sale goods and the geographical coverage are considered to be the most important for the 

selection criteria of distributor. Obviously, it is the sale that matters for the manufacturer because ultimately 

it would lead towards the highest gain of market share. Therefore, these industry manufacturers’ prefer 

those distributor whom they think are gutsy enough to increase their sale graphs. The third construct that 

was explored in the literature and proposed by this research is about the Relationship intensity between 

both channels partner both business and strategic relations are a part of it. They are measured through 

information sharing, enthusiasm to build relations, commitment to sales, ordering and payments, and finally 

the familiarity of both parties. All the factors are critical to selection decision except for familiarity and 

information sharing which has been proved by this research. The results would lead us to explain that even 

if the firms’ are in business relation with each other for the first time, it does not matter. Rather the 

relationship would progress in a positive way if commitments related to sales, ordering and payments are 

fulfilled and at the same time, there must be a strong willingness to build relationship for a longer period of 

time. As it would, uplift the trust between both channel members. 

The fourth construct was related to the Logistic capabilities of the distributor. Inventory management, 

efficient delivery and accommodation on non-routine orders are first three items comprising this factor. The 

remaining are the increasing value-added services and logistics cost reduction. All the factors related to this 

constructed derived from the literature has been proved in this research. It shows very high priority given to 

the Logistic abilities of distributor. The findings of this construct complemented the fact that the valueadded 

by one channel member would increase the value of entire supply channel. Similarly, the efforts to 

reduce the cost of distribution by the distributor does have a positive influence on the selection decisions of 

manufacturer’s of this industry. There has been enough evidence to say that the Electronic home appliance 

industry manufacturer’s focuses on the distributor logistic power. Because the supply chain value could be 

increased dramatically if the distributor has the mentioned capabilities in him. 

Items 

INF1 

INF2 

INF3 

INF4 

MKT1 

MKT2 

MKT3 

REL1 

REL2 

REL3 

LOG1 

LOG2 

LOG3 

LOG4 

LOG5 

STR1 

Firm 

Infrastructure 

.674 

.947 

.992 

.806 

Table 1 Rotated factor loadings for the final 16-items instrument 

Market 

Capabilities 

.830 

.806 

.977 

Relationship 

Intensity 

STR2 

Extraction Method: Principal Component Analysis 

Rotation Method: Varimax with Kaiser Normalization 

Logistic 

Capabilities 

Strategic 

Issues 

Cronbach’s 

Alpha 

.90 

.88 

.885 

.706 

.889 .83 

.888 

.745 

.967 

.780 

.885 

.89 

.953 

.889 .90 


13




This case provides us with another dimension of distributor selection and that is the Strategic issue 

concerning the selection of distributor. Although this construct has been included in Supplier selection 

researches but for the very first time it is the part of distributor selection research. It has also been proven 

that any distributor who is considered to be strategically important for a manufacturer in a particular market 

does have every possibility to be selected as channel member. It is so because the manufacturer could gain 

the competitive advantage through its supply network. 

The proposed framework comprised of five constructs i.e. firm infrastructure, marketing capabilities, 

relationship intensity, logistics capabilities and strategic issues hence been significantly supported by the 

manufacturers’ of electronic home appliance industry. 

Multivariate Analysis has been applied to judge the relation of Manufacturer’s firm size and Nationality 

(foreign invested or domestic) with the selection decision. 

Table 2 Multivariate Analysis 

Source Dependent Variable Type III Sum of Squares df Mean Square F Sig. 

Firm_size mkt_capa 3.654 1 3.654 .442 .626 

Firm_infra 1.520 1 1.520 6.955 .231 

Log_cap_str .013 1 .013 .006 .950 

relation_int 1.864 1 1.864 .448 .625 

Sal_turn mkt_capa 2.421 1 2.421 .293 .684 

Firm_infra 6.380 1 6.380 29.197 .116 

Log_cap_str .048 1 .048 .022 .906 

relation_int .177 1 .177 .042 .871 

Man_nat mkt_capa .262 1 .262 .032 .888 

Firm_infra_str .472 1 .472 2.161 .380 

Log_cap 5.554 1 5.554 2.563 .355 

relation_int 6.547 1 6.547 1.573 .429 

It was found to have no significant impact on distributor selection decision. This indicates us that there is 

no difference between manufacturers’ of different sizes and nationalities for the distributor selection. The 

result is reinforcing the cross-national comparative results of (Shipley D. , 1984) and (Abratt & Pitt, 1989). 

5.1 Critical Selection Factor Structure 

Table 3 below shows the critical selection factor structure comprising the 21 factors, sorted in descending 

order of criticality and stratified into three tiers representing stages of priorities emphasis. Tier I consists of 

the 5 factors and their presence in a potential distributor are most critical to its selection. Tier II consists of 

11 factors which plays a supporting role in manufacturers’ choice of distributor. Whereas, Tier III 

constitutes of 6 factors and are described as the maintaining factors to the selection of distributor. It is 

important here to describe the Critical, Supporting and Maintaining factors as to their level of importance to 

a successful selection of distributor by the manufacturer approach devised by Thiagarajan and Zairi (1998) 

and again validated by Awan and Bukhari (2008): 

• Critical: Factors those are critical and absolutely essential. There is a good chance that an organization 

will not be selected as a Channel partner if the Manufacturer does not find these factors in potential 

Distribution candidate. 

• Supporting: Factors those are important but not absolutely essential. There will be a chance that an 

organization may be selected as a channel partner in spite of the absence of such factors, but the potential 

distributor candidate may have to address these issues in future in order to maintain the efficient supply 

chain process. 


14




• Maintaining: Factors are of minor importance. These factors will not seriously affect the distributor 

selection decision process. 

The critical quality factor structure suggests that in Tier-I there are factors related to the reputation of the 

potential distributor in the market as well as its commitment to ordering and payment procedures. Both 

these variables refer to the factor of relationship intensity between the manufacturer and the distributor. In 

addition to this Tier-I also presents the importance of value added logistic services considered by the 

manufacturer and the cultural match that has to be made between both the organizations. So, this tier 

validating the constructs of relationship intensity and logistic capabilities founded through literature. 

Table 3 Critical Indices of selection Factors in Electronic Home Appliance Sector 

Index Values 

Selection Factors 

Tier I 

0.233333333 

0.233333333 

0.233333333 

0.233333333 

0.233333333 

Tier II 

0.466666667 

0.466666667 

0.466666667 

0.466666667 

0.466666667 

0.466666667 

0.466666667 

0.466666667 

0.466666667 

0.466666667 

0.466666667 

Tier III 

0.700000000 

0.700000000 

0.700000000 

0.700000000 

0.700000000 

Critical 

The distributor has good reputation in market 

The distributor is committed to ordering and payment procedure 

You company is familiar with the distributor 

The distributor is aggressive in increasing the value added contents of logistics 

The distributor has cultural match with the company 

Supporting 

The distributor has good management capabilities 

The distributor is in good financial position 

The distributor is equipment with good physical facilities 

The distributor covers the markets that your company wants to reach 

The distributor carries product that do not directly compete with your products 

The distributor is enthusiastic to build a relationship with your company 

The distributor is committed to minimum sales quota 

The distributor is willing to share information with company 

The distributor is able to accommodate special/non-routine request 

The distributor is able to minimize logistics costs 

The distributor provides good customer service 

Maintaining 

The distributor is experienced in distributing electronics related product 

The distributor has good sales competence 

The distributor manages inventory well 

The distributor delivers goods efficiently 

The distributor has strategic importance to firm 

The electronic home appliance manufacturer in Pakistan considers that the presences of these factors are 

extremely important to be present in the potential distributor in order to become the permanent supply 

chain partner. Tier II presents the highest number of factors that must be present in a distributor in order to 

be selected as supply member. The managerial capabilities, financial strength, market coverage and 

physical facilities owned by the distributor are important for its selection. Manufacturers consider that that 

the management must be operationally competent and quality oriented. 

In the same way, the financial strength gives us the overall idea about the prospective member in terms of 

its Business profile and assets owned by them. So both these factors are complementing each other. 

Manufacturers’ of electronics do consider the importance of enthusiasm present in potential distributor to 

build strong and long-term relationship. So they consider a need to share information about market and 

future strategies. Tier-II also involves the commitment of distributor to meet sales targets. This is very 


15




much evident even from the literature that the manufacturer would favor that party whose has the ability to 

increases the sales figures, accommodating non-routine requests and ability to minimize the logistic cost. 

Tier-III consists of 5 determinants that are considered as maintaining factors for the selection of distributor. 

It involves the experience in carrying related products, the inventory management, sales competence, 

product delivery and strategic importance. 

6. PHARMACEUTICAL INDUSTRY ANALYSIS 

A scientific and technological revolution is sweeping the pharmaceutical industry that enables drug makers 

to produce profitable new medicines. But revolutions demand adjustments, and this revolution requires the 

supply chains to adjust with it. The pharmaceutical companies who have long been considered the laggards 

in supply chain management. Therefore, the findings determined from this industry would be very 

interesting. The pharmaceutical manufacturers’ in Pakistan considers the importance of strong Firm 

Infrastructure in their channel members. Prior to selection, a potential candidate is evaluated on the 

parameters of its Managerial capabilities, financial strength, Experience and availability of physical 

facilities which is in complete accordance with our proposed framework and hence validated through the 

extraction of factor analysis. 

Table 4 Rotated factor loadings for the final 16-items instrument 

Item 

Firm 

Infrastructure 

Marketing 

Capabilities 

Relationship 

Intensity 

Logistic 

Capabilities 

Cronbachs’ 

Alpha 

INF1 

INF2 

INF3 

INF4 

.940 

.918 

.944 

.971 

.95 

MKT1 

MKT2 

MKT3 

.991 

.988 

.885 

.96 

REL2 

REL3 

REL4 

REL5 

.931 

.901 

.940 

.724 

.85 

LOG2 

LOG3 

LOG4 

LOG5 

LOG6 

.956 

.655 

.873 

.888 

.788 

.90 

Extraction Method: Principal Component Analysis 

Rotation Method: Varimax with Kaiser Normalization 

In this way, our first proposed construct has been validated. The financial strength gives the added 

advantage that the distributor can sold as many products as manufacturer expected. Since this industry is 

one of the highly competitive ones and the options of substitute products for whole sellers, retailers and 

consumers are very large. So the experience of the distributor and its operational competency would come 

into play. Making this construct a logical parameter to be considered and also having the support of 

literature. 


16




The next one is the Marketing capabilities held by the distributor. This is the second construct proposed in 

the framework and has been proved by the survey. For any distributor, the ultimate purpose is to sale the 

product by meeting targets set by the manufacturer. If the distributor has got enough resources and will to 

cover those areas asked by the manufacturer so it would have the positive influence and more are the 

chances that the distributor gets selected as channel partner. The most among point that a manufacturer 

considers here is that the distributor must not be carrying the competitors’ product in their product line. The 

reason behind that are the high product alternatives available to channel members of this industry. So the 

manufacturer would want to keep themselves on the safer side by demanding their distributor to be 

exclusive as far their product line is considered so that the focus could also be increased. The manufacturer 

would prefer those distributors that fulfill these conditions as they consider them to be critical for the 

channel success. 

Relationship intensity between two channel members is important in supply chain because critical may 

involve the coordination of both parties. They may not consider the enthusiasm found in their potential 

distributor rather the fulfillment of commitments shown by the candidate is important. The manufacturers’ 

base their insight on the more realistic terms. Commitments to ordering and payment procedures are critical 

to them and hence ranked important by the respondents of this research. The agreed terms on sales quote 

must also be regarded and fulfilled by the distributor. As this industry has been growing and technology has 

revolutionized it to a greatest extent. So it demands the supply chain members to share each every 

information related to market, product and consumers. The manufacturers’ would prefer those distributors 

who are willing to share the information with their manufacturers’. Our responding manufacturers’ showed 

the importance of this in their responses. Similarly, one has enough evidence with this to say that the nature 

of Pharmaceutical industry requires them to provide feedback continuously in order to stay ahead of the 

competitors. 

The distributors’ efficiency in product delivery, reducing lead time and precise order delivery considered to 

be very important for the selection decision by manufacturer. Pharmaceutical manufacturers’ are of the 

view that the rate of special/non-routine requests is very high in this industry. This uncertainty is a courtesy 

of several varying factors. But the point to understand is the distributor must be vigilant enough every time 

to entertain such demands. One could consider the fact that medicines have limited lives and they tend to 

expire after that. So delivery must be efficient to negate this issue otherwise it’s a waste of a resource. It 

requires them to provided value added logistic services and remaining cost efficient at the same time. The 

pharmaceutical manufacturers argue that the distributor must be thinking all the time and has all the 

knowledge to sort out transportation and logistics issues. The variables of logistic capabilities explored at 

the initial stage of this research are been supported by the manufacturers as well. We could safely say that 

the constructs explored through the literature that are comprised of Firm Infrastructure, Marketing 

Capabilities, Relationship Intensity and Logistic capabilities are hence been significantly proved and 

validating the framework. 

Multivariate Analysis has been applied to judge the relation of Manufacturer’s firm size and Nationality 

(foreign invested or domestic) with the selection decision. It was found to have no significant impact on 

distributor selection decision. This indicates us that there is no difference between manufacturers’ of 

different sizes and nationalities for the distributor selection. Our result is also reinforcing the cross-national 

comparative results of (Shipley D. , 1984) and (Abratt & Pitt, 1989). 


17




Table 4 Multivarite Analysis 

Source Dependent Variable Type III Sum of Squares df Mean Square F Sig. 

Firm_size Firm_infra .095 1 .095 24.212 .128 

makt_capa 3.184 1 3.184 13768.839 .212 

log_cap 4.246 1 4.246 2.908 .338 

Log_capa 6.101 1 6.101 8.405 .211 

sal_turn Firm_infra 3.251 1 3.251 826.554 .022 

makt_capa 6.532 1 6.532 28250.020 .548 

log_cap 4.544 1 4.544 3.112 .328 

Log_capa 2.608 1 2.608 3.593 .309 

Man_nat Firm_infra .614 1 .614 156.138 .051 

makt_capa 4.974 1 4.974 21510.133 .616 

log_cap 1.314 1 1.314 .900 .517 

Log_capa 2.551 1 2.551 3.514 .312 

6.1 Critical Selection Factor Structure 

The critical indices for Pharmaceutical Industry consist of 18 factors which are also divided into three tiers 

namely Critical, Supporting and maintaining respectively. The critical factors of Tier-I involves three 

critical elements which are financial position of the company, its experience in the distribution and the 

commitment to minimum sales quota. The manufacturers’ of pharmaceutical industry considers that the 

financial standing of distributor and the assets owned by them gives the overall picture of their business 

profile. They must be experienced enough and must be committed to sales quotas. These are the most 

essential factors that are considered in Pharmaceutical distributor selection decision. And we are confident 

to say that the distributor lacking in these dimensions has a very rare chance to be selected as a channel 

partner. 

Tier-II involves eight elements comprising of the managerial capabilities, physical facilities, reputation of 

potential channel member, familiarity between both entities and manufacturer-distributor relationship are 

few of the variables that provides the supporting role for the selection decision made by the manufacturer. 

Index 

Value 

Tier I 

0.466666667 

0.466666667 

0.466666667 

Tier II 

0.700000000 

0.700000000 

0.700000000 

0.700000000 

0.700000000 

0.700000000 

0.700000000 

0.700000000 

Table 6 Critical Indices of selection Factors in Pharmaceutical Sector 

Selection Factors 

Critical 

The distributor is in good financial position 

The distributor is experienced in distributing Pharmacy related product 

The distributor is committed to minimum sales quota. 

Supporting 

The distributor has good management capabilities. 

The distributor is equipment with good physical facilities. 

The distributor has good reputation in market. 

The distributor has good sales competence. 

The distributor is enthusiastic to build a relationship with your company. 

The distributor is committed to ordering and payment procedure. 

You company is familiar with the distributor. 

The distributor delivers goods efficiently. 


18




Tier III 

0.933333333 

0.933333333 

0.933333333 

0.933333333 

0.933333333 

0.933333333 

0.933333333 

Maintaining 

The distributor covers the markets that your company wants to reach. 

The distributor carries product that do not directly compete with your products 

The distributor manages inventory well. 

The distributor is able to accommodate special/non-routine request. 

The distributor is aggressive in increasing the value added contents of logistics 

The distributor is able to minimize logistics costs. 

The distributor provides good customer service. 

The manufacturers of this industry consider that the familiarity must be high between both channel 

members and the distributor must be enthusiastic to share the information with the manufacturer. The 

delivery of goods made by the distributor to the market is also important element that needs to be 

considered before the selection decision. The distributor must be efficient in product delivery, building 

relationships and must posses’ strong managerial competency in order to be selected as a Supply chain 

member. 

Tier-III constitutes of seven maintaining elements which may not be mandatory but their presence in any 

potential distributor would give an extra advantage for the organization to be selected as a channel partner. 

The market coverage, inventory management, value added logistics contents, customer service are few of 

them. Distributor carrying the alternative products, non-routine order handling and minimizing logistics 

costs is the few other maintaining elements. The manufacturers thus give less priority to them as compared 

to the critical and supporting ones. 

7. SUMMARY OF FINDINGS 

The multi-criteria decision to select distributors is one of the most important issues in channel management 

for manufacturers. Our empirical findings are quite supportive of the conceptual framework to explore 

dimensions of distributor selection. The five key factors in our model all have positive and significant 

effects on manufacturers’ selection of distributors in Electronic Home appliance industry and four in 

Pharmaceutical industry. This indicates that manufacturers, when selecting distributors, pay attention to not 

only distributors’ firm infrastructure and marketing capabilities emphasized by most previous research, but 

also on distributors’ relationship intensity and logistics capabilities. In addition considering Strategic Issues 

is also another fact that must be evaluated. There exists no significant difference between large and small or 

domestic and foreign-invested firms in the distributor selection, indicating that the all of the factors may be 

applied to firms of different sizes and nationalities. This study fills an important research gap and improves 

our knowledge of distributor selection by proposing and empirically testing a framework to serve as a 

foundation for examining manufacturers’ distributor selection. It also identified that how critical one single 

factor could be for the selection. Distributors performing well with respect to the four factors will build 

their competitive advantage. In addition to this, it also shows us the fact that how individual industries 

prefer different factors based on the criticality. It shows us the fact that selection criteria varies with the 

industry and both have separate priorities. 

The case provides us solid implications for both manufacturers and distributors. In an era of low margins, 

manufacturers must not only maximize their manufacturing and internal operation, but also cope with the 

growing importance of distributors in marketing/distribution efficiency, customer satisfaction, and cost 

savings. Recruiting good distributors in marketing channels can improve a manufacturer’s performance, 

and even increase its competitive advantage. Selection of distributors is a multi criteria assessment of both 

tangible and intangible factors, and is as critical to the success of a firm as the selection of good employees. 

From candidate distributors, manufacturers must select those that are most able to sell the products and 

serve the needs of target markets in order to achieve better firm performance (e.g. profitability). Therefore, 

finding competent distributors is an important issue for manufacturers, especially for many medium and 

small-sized firms that might lack sufficient knowledge and information to select distributors. 


19




8. CONCLUSION 

Manufacturers must realize that superior distribution support can help differentiate products and services in 

the marketplace, add value and amplify profitability. Since distributors can be used to enhance a 

manufacturer’s competitive position in the marketing channel, distributor selection will continue to be an 

important issue for the foreseeable future. If we collective analyze the research findings from both of the 

industries it would be clear that the majority of items considered by both of the industry’s manufacturers 

are same. Still there are some practices which appears to be different relevant to both industries. 

• Willingness to share the information and the distributors’ familiarity with manufacturers’ have not 

been considered important by the Electronic Home appliance Industry. While at the same time, 

there are considered very valuable factors by the Pharmaceutical manufacturers. The reason 

probably lies in the fact that Information Sharing is important in Pharmaceutical industry because 

of the nature of their products. It may require solid description for the distributor to understand 

what they are actually distributing relevant to the technical aspect of the product. At the same 

time, the reverse flow of feedback from consumers to manufacturers makes it more important for 

the distributor to be more knowledgeable and stay aware of the product and supply chain issues. 

• Inventory management has been considered very important by the Electronic Home appliance 

Industry and inverse is the situation with the Pharmaceutical industry. The reason behind is that 

the Electronic appliance captures more space, are delicate and needed to be placed at a safe and 

secure warehouse. To achieve that purpose any candidate distributor must possess a good facility 

of warehouse or go-down. Therefore, the manufacturer gives preference to this fact. And the 

pharmaceutical medicines could not be stored for a longer period of time and delivery lead time is 

very low in their scenario. Above all, large number of medicines could be stored even in a small 

space. That is why we have got different views from both of the industries. 

• Pharmaceutical supply chain needs to provide high standard of service quality and this has been 

suggested by various scholars. In the same way, it has been proved with this research that the 

customer service standards must be higher but the other industry’s manufacturers think differently 

about it. 

• The critical selection factors in electronic home appliance industry are reputation in market, 

Commitment to sales and ordering, Familiarity between both parties, value-added content of 

logistics and cultural match are the most critical individual items of selection prevailing in the 

industry. 

• The industry practice does shows that among individual factors financial position, Experience and 

Commitment to sales quota are most critical factors that are considered. Any potential distributor 

who is lacking in any of these factors would not be selected as a channel partner. 

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91-107. 


23





Petter Gottschalk 

BI Norwegian Business School 

Nydalsveien 37 

0484 Oslo 

Norway 

ABSTRACT 

In an empirical study of white-collar criminals in Norway, only 8 % out of 255 convicted 

criminals in recent years were women. There are many potential explanations for the low 

female share of crime. This paper concentrates on women’s lack of rationalization and 

justification of the criminal act. Several arguments lead us to believe that the justification 

to commit financial crime is less prominent among women. Examples include female fear 

of being caught, where women perceive a greater subjective risk, and where the 

consequences of imprisonment are perceived worse by women than men. 

Keywords: Financial crime; empirical study; neutralization theory; theory of self-control, 

white-collar crime. 

INTRODUCTION 

White-collar crime is financial crime committed by trusted persons in important business positions. 

Research on white-collar crime is often based on anecdotal evidence, where famous white-collar criminals 

serve as examples for case studies (Baird and Zelin, 2009; Bookman, 2008; Bucy et al., 2008; Dodge, 

2009; Fleet and Fleet, 2006; Friedrichs, 2009; Garoupa, 2007; Hansen, 2009; Heath, 2008; Messerschmidt, 

1997; Perri and Brodi, 2011; Simpson, 2011). While being relevant and interesting cases, the extent of 

generalization from such studies is questionable. What seems to be needed is a larger sample of whitecollar 

criminals that can be studied in terms of average values as well as variation in criminal 

characteristics. 

With a larger sample, we can study white-collar convicts using statistical techniques to identify and study 

groups of white-collar criminals. Therefore, this article is based on an empirical sample of 255 white-collar 

criminals in Norway, convicted in the period from 2009 to 2012. The article is concerned with the 

following research question: How can justification theory explain the gender gap in white-collar crime 

SAMPLE CRIMINALS 

To identify a substantial sample of white-collar criminals and to collect relevant information about each 

criminal, there are several options available. However, in a small country like Norway with a population of 

only five million people, there are limits to available sample size. One available option would be to study 

court cases involving white-collar criminals. A challenge here would be to identify relevant laws and 

sentences that cover our definition not only of white-collar crime, but also required characteristics of whitecollar 

criminals. Another available option is to study newspaper articles, where the journalists already have 

conducted some kind of selection of upper class, white-collar individuals convicted in court because of 

financial crime. An advantage of this approach is that the cases are publicly known, which makes it more 

acceptable to identify cases by individual white-collar names. The selective and otherwise filtered 

information in newspapers might be a problem to other kinds of studies, but is considered an advantage in 

this study. Therefore, the latter option was chosen in this research. 

Based on this decision, our sample has the following characteristics as applied by newspapers when 

presenting news: famous individuals, famous companies, surprising stories, important events, substantial 


24




consequences, matters of principles and significant public interest. The sample consists of high profile and 

large yield offenses. This is in line with research by Schnatterly (2003) who searched the Wall Street 

Journal for several years in her study of white-collar crime published in the Strategic Management Journal. 

As suggested by Barak (2007), newsmaking criminology refers to the conscious efforts and activities of 

criminologists to interpret, influence or shape the representation of newsworthy items about crime and 

justice. Newsmaking criminology as a perspective on the theory, practice and representations of crime and 

justice is an important approach for understanding white-collar crime. However, Barak’s work focused on 

how the media constructs images of crime. In this research, the media is used as a source of potentially 

objective information, where factual information in terms of quantitative numbers is collected from 

newspaper accounts. 

We make no distinction between prison and jail in this study. A prison or jail in Norway is a place in which 

people are physically confined and deprived of a range of personal freedoms. Imprisonment is a legal 

penalty that is imposed by the state for commission of a crime judged in court. In the United States, the 

difference between jail and prison is primarily a function of imprisonment length, where the use of prison 

over jail implies a more serious punishment. 

Our operational definition of white-collar crime restricts the sample to those who receive jail time as 

punishment. This restriction excludes cases of fines as penal response, which is quite common. This sample 

restriction enables us to only study serious white-collar crime cases. Our intention is not to identify whitecollar 

crime in reference to the law, but mainly with respect to the reporting of these offenses resulting in 

imprisonment. If the sample would be selected as references by the law, then a number of offenses would 

be defined in non-criminal statutes. Non-criminal statutes cannot, by their definition, result in jail time, 

only in civil remedies. Thus, by taking this view, we have essentially omitted most white-collar crime cases 

of fines from our study, since their severity is of a minor extent. Research articles edited by Gerber and 

Jensen (2006) suggest that only the most serious white-collar crime offenders end up in prison. 

CRIMINAL CHARACTERISTICS 

Criminal characteristics collected for each person included gender, age when convicted, age when 

committing crime, number of years in prison, court level, amount of money involved in crime, number of 

persons involved in crime, crime type, position level, personal income, person tax, personal wealth 

according to income statement, organization revenue, organization employees, private versus public sector, 

internal versus external detection, source of detection, corporate versus occupational crime, leader versus 

follower, and rotten apple versus rotten apple barrel. 

Most white-collar criminals are men. This is confirmed in the sample of 255 persons, which included only 

20 female criminals and 235 male criminals. Thus, less than 8 percent of the white-collar crime sample 

from newspaper articles was women – sometimes labeled pink-collar criminals.The youngest white-collar 

criminal in Norway was 21 years and the oldest was 77 years old. A distinction is made between age when 

convicted and age when committing crime. On average, a person was convicted 5 years after the crime, 

thus the average age when committing crime is 43 years old since the average age when convicted was 48 

years old. 

Most anecdotal cases, such as Rajaratman and Schilling, were men in their 50-ties or older. This is 

confirmed in our sample where the average age is 48 years old when convicted in court. These average 

numbers are similar to a study by Blickle et al. (2006) of 76 convicted German white-collar criminals. In 

their responding sample, there were 6 female criminals and 70 male criminals. The mean age of the 

offenders in Germany was 47 years. In a study reported by Benson and Simpson (2009), the average age of 

common criminals was 30 years, while the average age for white-collar criminals was 40 years. It is unclear 

whether the age of 40 years can be compared to the age of 48 years when convicted, or to the age of 43 

years when committing the crime in Norway. 

The average jail sentence for 255 convicted white-collar criminals in Norwegian courts was 2.2 years, with 

a maximum of 10 years and a minimum of 15 days. The longest jail sentence of 10 years was given to a 

person involved in bank fraud, where millions were transferred from a rich widow’s account in Norway to 


25




a friend’s account in Dubai. Since the convicted criminal was operating in a group of criminals, he was 

convicted of organized crime, which in Norwegian law causes the jail sentence for a criminal act to be 

extended from a more normal level, say six years, to ten years in his case. 

All persons in the sample received a jail sentence for white-collar crime. Compared to famous US cases 

mentioned above, these sentences are quite modest. However, in a Norwegian context these jail sentences 

are quite substantial, only passed by organized crime and murder. Also, when comparing to the sample 

used by Blickle et al. (2006) of white-collar criminals in Germany, there is no substantial difference, as the 

average was 3.9 years imprisonment in Germany in their sample of 76 convicts. In a US study of several 

thousand white-collar crime cases, the average prison sentence was only 11 months (Schanzenbach and 

Yaeger, 2006).In the Norwegian court system, there are three levels: district courts, courts of appeal and 

Supreme Court. Out of 255 cases, 143 were decided final in district courts, 101 were decided final in courts 

of appeal, while 11 cases were decided final in Supreme Court. The average amount involved in each 

financial crime case by white-collar criminals was 57 million Norwegian kroner. Since one US dollar is 

approximately six Norwegian kroner, this means on average 10 million US dollars. The smallest crime 

amount was less than 1 million, and the largest was 1200 million kroner. 

57 white-collar criminals operated on their own when committing criminal acts. Most criminals involved 

others in the crime. On average, 4 persons were involved with each other in the white-collar crime cases 

studied. The maximum number involved in a case was 200 persons, where an accounting firm had been 

fixing 200 taxi owners’ accounts so that they paid less tax. To avoid bias in statistics towards this case, only 

four persons from this taxi fraud scandal were included in our sample as white-collar criminals: the 

accounting responsible, the computer programmer, and two head taxi owners. 

We define four main financial crime categories by white-collar offenders: fraud, theft, manipulation, and 

corruption. Fraud can be defined as intentional perversion of truth for the purpose of inducing another in 

reliance upon it to part with some valuable thing belonging to him or to surrender a legal right (Henning, 

2009). Theft can be defined as the illegal taking of another person’s, group’s or organization’s property 

without victim’s consent (Hill, 2008). Manipulation can be defined as a means of gaining illegal control or 

influence over others’ activities, means and results such as tax evasion (Malkawi and Haloush, 2008). 

Corruption can be defined as the giving, requesting, receiving or accepting of an improper advantage 

related to a position, office or assignment (Kayrak, 2008). In our sample of 255 convicted white-collar 

criminals, we find 131 cases of fraud, 12 cases of theft, 62 cases of manipulation, and 50 cases of 

corruption. 

Consulting firm KPMG (2011) tried to identify characteristics of white-collar criminals who commit fraud. 

They found the following characteristics of the typical fraudster: Male, 36 to 45 years old, commits fraud 

against his own employer, works in the finance function or in a finance-related role, holds a senior 

management position, employed by the company for more than 10 years, and works in collusion with 

another perpetrator. These characteristics are based on 348 actual fraud investigations conducted by KPMG 

member firms in 69 countries. 

We define three white-collar levels. The first level is owners of companies, board members of companies, 

and chief executive officers of companies. The second level is lawyers, consultants, investors, and brokers. 

The third level is middle managers, independent contractors and single-working individuals. In our sample 

of 255 convicted white-collar criminals, we find 76 individuals (30%) at level 1, 106 individuals (41%) at 

level 2, and 73 individuals (29%) at level 3. 

Income figures for all taxable income are published annually by Norwegian tax authorities. Almost all 255 

convicted white-collar criminals were found on the list for the year 2009. The average personal income was 

327 000 kroner (approximately 54 000 US dollars), tax was 135 000 kroner (approximately 22 000 US 

dollars), and personal fortune was 6 million kroner (approximately 1 million US dollars). 

White-collar offenders worked in an organization with revenues of 200 million kroner and 124 employees 

on average. 232 criminals worked in private sector organizations, while 23 criminals worked in public 

sector organizations. 


26




The financial damage of 57 million Norwegian kroner was in most cases occurring outside the organization 

where the criminal worked. The victim of crime was typically another organization: 201 criminals caused 

damage to another organization or outside individual, while only 54 caused financial damage to his or her 

own organization. It is interesting to note that very few (23 criminals) worked in the public sector, while 

the victim of crime was very often found in the public sector. 

How was crime detected Who detected crime In this research, we searched the source of detection and 

found that journalists in the media investigated and revealed a total of 62 out of 255 white-collar criminals. 

This represents 24 percent, which means that one fourth of all white-collar crime was revealed by the press. 

However, there is a bias in our sample towards media sources, as only cases presented in the media are 

included. Nevertheless, it may seem surprising that journalists make such a significant contribution. After 

journalists we find victims of crime, who revealed 45 criminals (18%): 

1. Journalists: 62 criminals (24%) 

2. Victims: 45 criminals (18%) 

3. Bankruptcy lawyers: 24 (9%) 

4. Internal controls: 22 criminals (9%) 

5. Auditors: 18 criminals (7%) 

6. Tax authorities: 17 criminals (7%) 

7. Banks: 14 criminals (5%) 

8. Police: 10 criminals (4%) 

9. Stock exchange: 5 criminals (2%) 

10. Others: 38 criminals (15%). 

While it may seem surprising that journalists detected as many as 62 criminals (24%), it may seem 

surprising as well that the police only detected 10 criminals (4%). 

FEMALE CRIMINALS 

A total of 255 white-collar criminals were convicted and received jail sentences in Norwegian courts from 

2009 to 2012. As suggested in the research literature, most white-collar criminals are men. This is 

confirmed in the sample of 255 persons, which included only 20 female criminals and 235 male criminals. 

Thus, only 7.8 percent of the white-collar crime totals from newspaper articles were women. 

Total 255 criminals 

235 Male 

Criminals 

20 Female 

Criminals 

T-statistic for 

difference 

Significance of 

t-statistic 

Average age convicted 48 years 46 years .896 .380 

Average age crime 43 years 41 years .900 .378 

Years in prison 2.2 years 1.8 years 1.252 .222 

Crime amount 61 million 18 million 2.847 .005 

Personal income 341 000 kroner 163 000 kroner 2.835 .007 

Personal tax 141 000 kroner 62 000 kroner 3.150 .003 

Personal wealth 1.5 million 0 million 3.619 .000 

Involved persons 4.1 persons 4.5 persons -.552 .585 

Business revenue 207 million 116 million 1.374 .181 

Business employees 127 persons 92 persons .574 .571 

Comparison of male versus female white-collar criminals 

There are some empirical differences between convicted men and women. First, the money amount 

involved in the crime was significantly larger for male criminals. Furthermore, according to income 

statistics, male criminals had larger personal income, paid more taxes and had a larger personal wealth. 

Justification Theory 

In criminology, justification is often mentioned as one of three pillars to explain criminal acts. The other 

pillars are opportunity to carry out the act, and motivation for the act. These three pillars must work 

together before the criminal act can take place (Aguilera and Vedera, 2008). 


27




In the fraud triangle, these pillars are explained as (Ilter, 2009): 

• Opportunity to commit crime: Women are in a position to commit white-collar crime. 

• Motivation in terms of incentives or pressures to commit crime: Women want to or have to 

commit white-collar crime. 

• Acceptance of crime: Women find justification for white-collar crime. 

Risk for fraud is thus a combination of opportunity and possibility, incentives and pressures, and 

rationalization and justification. Several arguments in the following lead us to believe that the extent of 

rationalization and justification is less prominent among women. It is the female fear of being caught, 

where women perceive a greater subjective risk than men, and where the consequences of imprisonment 

are perceived worse by women than men, mainly because of social collapse that follows after time in 

prison. Campbell et al. (2001) argue that women have a lower level of acceptable fear than men. It means 

that women generally experience more fear than men when they are exposed to the same objective risk. 

The level of acceptable fear, combined with perceived risk – which is subjective – has an impact on actions 

(Gass and Seiter, 2011), where women with more fear at higher risk will avoid criminal activities. 

In an experiment with boys and girls, differences were found in risk willingness. They participated in a 

lottery. When buying a ticket, there was a 50 percent chance of winning 100 dollars and a 50 percent 

chance of winning nothing. The expected value in the lottery was thus 50 dollars. Participants also had a 

definite alternative. This alternative started at 25 dollars and moved upwards. Girls stopped participating in 

the lottery at 37 dollars, while boys stopped at 45 dollars, which indicates a greater extent of risk 

willingness among boys than among girls. 

Risk is an element in our model as part of both motivation and justification. That women generally have a 

higher degree of risk aversion than men, does not necessarily apply to the specific group of pink-collar 

criminals. For example, Adams (2012: 2219) found that more female board members do not necessarily 

lead to greater risk aversion in decision-making: 

A large literature documents that women are different from men in their choices and preferences, 

but little is known about gender differences in the boardroom. If women must be like men to break 

the glass ceiling, we might expect gender differences to disappear among directors. Using a large 

survey of directors, we show that female and male directors differ systematically in their core 

values and risk attitudes, but in ways that differ from gender differences in the general population. 

These results are robust to controlling for differences in observable characteristics. Consistent with 

findings for the population, female directors are more benevolent and universally concerned, but 

less power oriented than male directors. However, in contrast to findings for the population, they 

are less tradition and security oriented than their male counterparts. They are also more risk loving 

than male directors. Thus, having a woman on the board needs not lead to more risk-averse 

decision making. 

A study in Sweden confirms the finding that having a woman on the board does not necessarily lead to 

more risk-averse decision making. On the contrary, the Swedish study indicates that women are more risk 

willing than previously assumed. One reason for the greater risk willingness was that women are more in 

favor of change. It was Adams and Funk (2012) who studied differences among a total of 1800 female and 

male board members in companies registered on the stock exchange in Sweden. The result of the study was 

that female board members take greater risks than men on the board. Men are more concerned with 

competition, while women like change and being independent. 

Justification of crime takes place by applying neutralization techniques. White-collar crime involves some 

form of social deviance and represents a breakdown in social order. According to Heath (2008) based on 

Sykes and Matza (1957), white-collar criminals tend to apply techniques of neutralization to deny the 

criminality of their actions. Examples of neutralization techniques are (a) denial of responsibility; (b) denial 

of injury; (c) denial of the victim; (d) condemnation of the condemners; (e) appeal to higher loyalties; (f) 

everyone else is doing it; and (g) claim to entitlement. The offender may claim an entitlement to act as he 

did, either because he was subject to a moral obligation, or because of some misdeed perpetrated by the 

victim. Family as a neutralization argument is applied more frequently by women than men. Women tend 

to justify their crime by pointing to basic needs of the family, while men, to a larger extent, argue in 


28




business terms. However, research by Klenowski et al. (2011) shows that both men and women tend to 

justify financial crime by family needs and more generally commit crime for the benefit of others. 

When offenders are asked to explain their crimes, they typically portray themselves as decent people 

despite their wrongdoings. They tend to apply neutralization techniques as defined by neutralization theory 

(Bock and Kenhove, 2011; Siponen and Vance, 2010; Sykes and Matza, 1957). To be effective at 

managing the stigma of crime, motivational accounts must be believable to the social audience. Thus, 

Klenowski et al. (2011) found that variations in patterns of accounts are likely due to the social position of 

the actors. They examined whether gender constrains the way individuals describe their crimes by 

analyzing the motivational accounts of male and female white collar offenders. Results show that while 

men and women both elicit justifications when discussing their crimes, they do differ in the frequency with 

which they call forth specific accounts and in the rhetorical nature of these accounts. When accounting for 

their crime, white-collar offenders draw on gendered themes to align their actions with cultural 

expectations of masculinity and femininity. These findings suggest that gender does constrain the accounts 

that are available to white-collar offenders. 

Cauffman (2008: 126) found that “on average, males tend to have longer criminal careers than females. 

Because it is difficult to assess when a criminal career is “finished”, convincing evidence about the duration 

of criminal careers is sparse. A long-term study by Roger Tarling followed a sample of male and female 

offenders who were born in 1958 through age thirty-one, finding that the average duration of offending was 

4.9 years for females, and 7.4 years for males.” 

The idea that women, to a lesser extent than men, are able to justify white-collar crime might be explained 

by moral theory (Bowman and Giligan, 2008) combined with slippery slope theory. Slippery slope theory 

implies that a person or an organization is sliding from legal to illegal activities (Arjoon, 2008). This theory 

attempts to explain why good people do bad things. The explanation is that people do not really notice 

when they slide over the border to crime. Many unethical and criminal acts happen without involved 

persons knowing or understanding that they are doing something wrong. Criminal behavior can follow a 

downward slope, where sliding downwards is a continuous deterioration in the organization not caused by 

any specific event. It is a development, a trend, a path that leads the wrong way. Gender differences can be 

found in men realizing grey zones, while women see more black or white. Therefore, women will, to a 

lesser extent, be able to justify activities that are on the wrong side of the law, because it is black to them, 

while it is grey to men. 

Women find it more difficult than men to justify criminal acts based on an ethical perspective, according to 

Ruegger and King (1992: 181): 

The findings suggest that gender is a significant factor in the determination of ethical conduct and 

that females are more ethical than males in their perception of business ethical situations. 

Yet another theory can explain gender differences in justification. It is the theory of self-control. The lower 

the individual’s self-control, the greater is the likelihood of his or hers involvement in criminal behavior. 

Low self-control is defined in terms of characteristics such as impulsive, risk-taking, and self-centered 

(Meneses and Akers, 2011). While most scholars – such as Haantz (2002), Holtfeter et al. (2010) and 

Huffman et al. (2010) – argue that the main reason for less female white-collar crime is lack of opportunity, 

they also mention gender differences in self-control. They argue that even if women over time have the 

same opportunities as men, they will not commit as much crime, because lack of justification leads them to 

more self-control. 

Self-control theory simply states that white-collar people with a low degree of self-control will tend to 

commit more financial crime than white-collar people with a high degree of self-control (Hansen 2009): 

Self-control theory proposes that individuals commit crime because of low self-control. Except in rare 

cases of mass fraud such as the Enron scandal, not all elites within a given organization or industry 

will commit crime. Hence, though elites at the top of their profession and corporation differentially 

associate with the people of equal status in their own and other corporations, not all corporate elites 

commit crimes and behave in an overtly deviant manner. 

Social control and self-control could be more developed among women than men, combined with learning 

theory results, causing less crime by women. This phenomenon of gender difference is explained by 


29




Worthen (2011) in terms of parent-child bonding. She suggests that adolescents who have healthy 

relationships with their parents are less likely to be involved in delinquency. She found that gender 

differences in delinquency can be partially explained by gender differences in mean values of each element 

of the parental bond, i.e., emotional attachment to parents, time spent with parents, and parental 

monitoring. Gender differences can, in addition, be partially explained by examining the effects of the 

elements of the parental bond on delinquent involvement as they differ by gender. 

DISCUSSION 

Crime justification is only one reason for the substantial discrepancy between 50 % women in the total 

Norwegian population, 8 % women in the convicted population, and 6 % women in the prison population. 

Figure 1 illustrates a number of elements that reduce the female fraction stage by stage on the left hand 

side, caused by factors on the right hand side. There are a total of five stages. 

The purpose of the model is to illustrate and explain how common opinions documented in theoretical 

thoughts can predict the decreasing female fraction from general population fraction to imprisonment 

fraction. The common opinion in society is that men represent the large majority within all kinds of crime, 

including white-collar crime (Friedrichs, 2009). The model supports Messerschmidt’s (1997) suggestion 

that gender is an important predictor of criminal involvement – males dominate criminal activity in society. 

Both Friedrichs (2009) and Messerschmidt (1997) receive support from Steffensmeier and Allen (1996), 

who list a number of empirical studies in different countries where men commit far more crimes than 

women. Additionally, Blickle et al. (2006) show that men were the dominant majority among white-collar 

criminals in Germany. 

Numbers in terms of percentage are here suggested for future research, as we have no empirical bases for 

these elements. Currently, numbers only suggest how female fraction is reduced from stage to stage, where 

50 % 

50% WOMEN IN THE POPULATION 

RELATIVE NEEDS 80% 

40% WOMEN HAVE SAME NEEDS 

CRIME OPPORTUNITY 70% 

CRIME MOTIVATION 90% 

20% WOMEN COMMIT CRIME 

CRIME JUSTIFICATION 80% 

DETECTION RISK 30% 

6% WOMEN ARE PROSECUTED 

CONVICTIONS 140% 

8% WOMEN PRISON SENTENCE 

IMPRISONMENT 70% 

6% WOMEN IN PRISON 

Figure 1. Model for estimation of female fraction in white-collar crime 


30




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32




Service Quality Measurement and its evaluation 

of leading Private Banks of India in Delhi and 

NCR Region: An analytical study 

Dr. Saroj Kumar Dash 

Associate Professor, Department of Management Studies, Skyline Institute of Engineering and Technology, 

Greater Noida, Uttar Pradesh, India 

Dr. Asif Parwez 

Assistant Professor, Hindu College of Engineering, Sonepat, Haryana, India 

Mr. Firoz Parwez 

Faculty, Department of Computer Science & Information System, Jazan University, Jazan , Kingdom of 

Saudi Arabia(KSA) 

ABSTRACT 

The subject "quality" is nowadays, in a globalized world, one of the key concerns of 

businessmen to face the competition on industries and service areas. Financial groups are 

measuring no efforts to achieve quality excellence, starting by customer services and 

relationship. Indian banking sector opened its doors to private and international players 

after the economic liberalization in the year 1991. It has been almost 2 decades of 

operation of the private banks in India. Much has evolved in the overall structure of 

banking during this time but have the private banks delivered the type of quality that the 

customers expect them to. This research is an effort to evaluate the service quality of the 

private banks in India. The study is based on primary data collected in the cities of Delhi 

and NCR through a structured questionnaire designed on the basis of SERVQUAL 

Model. The banks under study are the five top private banks from Delhi and NCR region. 

The study has found that none of the banks have been able to meet the customer 

expectations and are still dwelling on the ‘zone of pain’. The research is very useful for 

managers, policymakers, implementers as well as academicians. The research provides 

implications for managers as well as policy makers to understand the customer 

expectations in India. It can be a guideline for bigger role for the BCSBI (Banking Codes 

and Standard Board of India). Implications for future research are also discussed. The 

novelty of the research lies in the context that no effort has been made so far to effect 

research on sector specific contribution of banks. There is also very little literature 

available to identify the need-service gap in this area. The study adds value to the 

knowledge in the field of banking service quality for development and also opens new 

areas of research. 

Key Words: Customer Satisfaction, SERVQUAL Analysis, GAP Analysis, Private Sector 

banks, Service Quality. 

INTRODUCTION 

Customer satisfaction is a popular research topic among researchers of different areas. Banking industry is 

not an exception to this. Banking is one of the numerouno services in which the customer satisfaction has 

had an ever increasing importance in the corresponding research areas. This is essentially because the 

banking sector is becoming more and more competitive (Lindenmeier and Tscheulin, 2008). Retail banks 

are pursuing this strategy, in part, because of the difficulty in differentiating based on the service offering. 


33




Typically, customers perceive very little difference in the services offered by retail banks and any new 

offering is quickly matched by competitors (Devlin et al., 1995). 

MEASURING CUSTOMER SATISFACTION IN BANKING 

Customer Satisfaction, a business term, is a measure of how products and services supplied by a company 

meet or surpass customer expectation. It is seen as a key performance indicator within business and is part 

of the strategy for customer retention. The entry of private sector commercial banks can be traced to the 

period of privatization and the need to satisfy customers all the more by the banking sector increased. 

However no consistent effort was taken on the part of policy makers to trace the level of satisfaction from 

the services till the year 2003 when BCSBI (Banking Codes and Standards Boards of India) an 

autonomous body was formed to monitor the level of services provided by the Indian banks. 

SERVQUAL MODELS 

A quite large number of models have been derived by experts round the world to derive the level of service 

quality and therefore the customer satisfaction perhaps the best and the most widely validated research is 

one by Parasurama et al. (1995) popularly known as SERVQUAL Model. This is the one that will be used 

in this research to evaluate the level of service quality of Private Sector banks in India. Below is a 

discussion on the SERVQUAL Model: 

GAP Model (Parasuraman et al. 1985) 

The GAP model was proposed by Parasuraman et al. (1985). The model presupposes that service quality is 

the differences between expectation and performance relating to quality dimensions. These differences are 

referred to as gaps. 

The gaps model conceptualizes five gaps which are: 

Gap 1: Difference between consumers’ expectation and management’s perceptions of consumers’ 

expectations (not identifying what consumers expect); 

Gap 2: Disparity between management’s perceptions of consumer’s expectations and service quality 

specifications (inappropriate service-quality standards); 

Gap 3: Variations between service quality specifications and service actually delivered (poor delivery 

of service quality); 

Gap 4: Difference between service delivery and the communications to consumers about service 

delivery (promises mismatch delivery); 

Gap 5: Difference between consumer’s expectation and perceived service; this gap depends on size and 

direction of the four gaps associated with the delivery of service quality on the marketer’s side. 

Based on the above five gaps, the SERVQUAL instrument was developed. It initially consisted of ten 

dimensions which were later refined into five dimensions namely, reliability, responsiveness, tangibles, 

assurance (communication, competence, credibility, courtesy, and security) and empathy (which capture 

access and understanding or knowing the customers). Later in year 1991 SERVQUAL was revised by 

replacing “should” word by “would” and in 1994 by reducing the total number of items to 22, but five 

dimensional structure remaining the same. In addition to this empirical research, the authors later came out 

with the extended service quality model. According to this extended model most factors involve 

communication and control process implemented in organizations to manage employees. 

OBJECTIVES OF THE STUDY 

The main objectives of the study are: 

a. To have a clear understanding of the level of service quality in the Private Sector banks in India. 

b. To find out the gap in the dimensions of service quality based on the SERVQUAL analysis. 


34




RESEARCH METHODOLOGY 

The study is exploratory in nature. It provides a description of contemporary satisfaction parameter in the 

Indian Banking Sector. The determination of the sample and the area of study is justified below: 

The research consists of 5 banks from the private sectors from Delhi and NCR region. The Top 5 banks 

of Private Sector Banks selected are ICICI Bank, HDFC Bank, HSBC Bank, Axis Bank and Federal 

Bank, The questionnaires were distributed manually to the customers of these banks in the cities of Delhi 

and NCR (National Capital Region). The purpose of choosing the capital of the country (Delhi) and NCR 

region as the study area because private banks in these areas are serving their customers more as 

compared to other cities. The basic reasons of opening more number of private banks are the income level 

of the customers are fairly high in these areas. The respondents are selected at random on visits to banks. 

Therefore for the purpose of our research the probability sampling process has been used. The sample 

size was determined according to (Cooper and Schindler, 2003), the formula as follows: 

(+,-) 0.05 → desired interval range within which the population proportion is expected (subjective 

decision). 

1.96(σ p ) → 95 percent confidence level for estimating the interval within which the population proportion 

is expected (subject decision). 

σ p =0.0255 → standard error for the proportion (0.05/1.96) 

pq → measure of sample dispersion (used here as an estimate of the population dispersion). 

pq 

n = 

σ 

2 

p 

For the purpose of this research, after running 30 questionnaires a sample size (N) was derived for each 

bank as follows. 

0.24× 

0.76 

N = = 280 

2 

0.0255 

Therefore the total sample size for all the 5 banks is 280×5 = 1400. 

ANALYSIS AND FINDINGS 

Following is the detailed analysis of the 5 banks under study based on the SERVQUAL analysis. 

SERVQUAL analysis for ICICI Bank 

Table 1 depicts the SERVQUAL score of the five dimensions for ICICI Bank. The highest expectation 

score for the tangibility dimension is for E4 and the lowest is for the E3. The perception score for this 

dimension is highest for the P2 and lowest for P1. For the reliability dimension the highest score for the 

expectation is for E5 and the lowest is for the E8.As against expectation the perception score for reliability 

dimension was highest for P6 and lowest for P5. In case of responsiveness dimension the highest 

expectation was for E12 and the lowest was for E10. The perception scores for this dimension were highest 

for P11 and lowest for P10. For the assurance dimension the highest expectation score was for E17 and the 

lowest for E14 and E15. The perception score was highest for P15 and the lowest for P17. For the empathy 

dimension the highest expectation score was for E21 and the lowest for E22.As against the expectation 

scores the perception score for this dimension are highest for P19/22 and the lowest for P18. 


35




Table 1: Average ‘SERVQUAL’ of various dimensions for ICICI Bank 

Tangible 

E1: Excellent banking 

companies will have modern 

looking equipment. 

E2: The physical facilities ate 

excellent banks will be visually 

appealing 

E3: Employees at excellent 

banks will be neat appearing 

E4: Materials association with 

the service (such as pamphlets 

or statements) will be visually 

appealing at excellent banks. 

Reliability 

E5: When excellent banks 

promise to do something by a 

certain time, they do. 

E6: When a customer has a 

problem, excellent banks will 

show a sincere interest in 

solving it. 

E7: Excellent banks will 

perform the service right the 

first time. 


provide the service at the time 

them promise to do so. 

E9: Excellent banks will insist 

on error free records 

Responsiveness 

E10: Employees of excellent 

banks will tell customers 

exactly when services will be 

performed. 

E11:Employees of excellent 

banks will give prompt service 

to customers. 


banks will always be willing to 

help customers. 


banks will never be too busy to 

respond to customers’ requests. 

Assurance 

E14: The behaviour of 

employees in excellent banks 

(E) (P) Gap Score 

P-E 

Tangible 

4.12 P1: Your bank has modern looking 3.46 -0.66 

equipment 

3.99 P2: Your bank’s physical facilities are 

visually appealing 

3.88 -0.11 

3.96 P3: Your bank’s reception desk 3.75 -0.21 

employee are neat appearing 

4.45 P4: Materials associated with the 3.70 -0.84 

service (such as pamphlets or 

statements) are visually appealing at 

your bank. 

Average Tangible SERVQUAL score -0.45 

Reliability 

4.54 P5: When your bank promises to do 3.39 -1.15 

something by a certain time, it does so. 

4.44 P6: When you have a problem, your 

bank shows a sincere interest in 

solving it. 

4.40 P7: Your bank performs the service 

right the first time. 

4.29 P8: Your bank provides its service at 

the time it promises to do so. 

4.41 P9: Your bank insists on error free 

records. 

Average Reliability SERVQUAL 

score 


4.37 P10: Employees in your bank tell you 


performed. 

4.50 P11: Employees in your bank give you 

prompt service. 

4.57 P12: Employees in your bank are 

always willing to help you. 


never too busy to respond to your 

request. 

Average Responsiveness SERVQUAL 

score 

Assurance 

4.12 P14: The behaviour of employees in 

your bank instill confidence in you. 

3.78 -0.66 

3.61 -0.79 

3.63 -0.66 

3.70 -0.71 

-0.79 

3.43 -0.94 

3.64 -0.86 

3.50 -1.07 

3.57 -0.87 

-0.75 

3.35 -0.77 


36




will instill confidence in 

customers. 

E15: Customers of excellent 

banks will feel safe in 

transactions 


banks will be consistently 

courteous with customers. 


banks will have the knowledge 

to answer customers’ questions. 

Empathy 

E18: Excellent banks will give 

customers individual attention 

E19: Excellent banks will have 

operating hours convenient to 

all their customers. 


employees who give customers 

personal attention. 


their customer’s best interests at 

heart. 

E22:The employees of excellent 

banks will understand the 

specific needs of their customer 

4.12 P15: You feel safe in your transactions 

with your bank. 

4.35 P16: Employees in your bank area 

consistently courteous with you. 

4.70 P17: Employees in your bank have the 

knowledge to answer your questions. 

Average Assurance SERVQUAL 

score 

Empathy 

4.9 P18: Your bank gives you individual 

attention 

4.9 P19: Your bank has operating hours 

convenient to all its customers 

4.9 P20: Your bank has employees who 

give you personal attention. 

4.91 P21: Your bank has your best interest 

at heart. 

4.76 P22: The employees of your bank 

understand your specific needs. 

3.53 -0.59 

3.35 -1.00 

3.06 -1.64 

-1.00 

3.59 -1.31 

3.94 -0.96 

3.81 -1.09 

3.74 -1.17 

3.94 -0.82 

Average Empathy SERVQUAL scores -1.07 

SERVQUAL analysis for HDFC Bank 

Table 2 depicts the SERVQUAL score of the five dimensions for HDFC Bank. The highest expectation 

score for the tangibility dimension is for E4 and the lowest is for the E2/3. The perception score for this 


expectation is for E5 and the lowest is for the E8. As against expectation the perception score for reliability 


expectation was for E71 and the lowest was for E10/11. The perception scores for this dimension were 

highest for P11 and lowest for P13. For the assurance dimension the highest expectation score was for E17 

and the lowest for E12 and E13. The perception score was highest for P15 and the lowest for P14/16. For 

the empathy dimension the highest expectation score was for E21 and the lowest for E18/19/20. As against 

the expectation scores the perception score for this dimension are highest for P19/22 and the lowest for 

P18. 

Table 2 : Average ‘SERVQUAL’ of various dimensions for HDFC Bank 

Tangible 







P-E 

Tangible 


equipment 



3.97 -0.74 


37




appealing 







Reliability 







solving it. 



first time. 










performed. 



to customers. 







Assurance 




customers. 



transactions 











your bank. 


Reliability 





solving it. 






records. 


score 




performed. 







request. 


score 

Assurance 









4.01 -0.45 

3.38 -0.54 

3.82 -0.64 

3.96 -0.52 

-0.44 

3.36 -0.76 

3.53 -0.59 

3.36 -1.00 

3.07 -1.64 

-1.00 

3.36 -0.76 

3.53 -0.59 

3.36 -1.00 

3.07 -1.64 


38





Empathy 











heart. 

E22: The employees of 

excellent banks will understand 

the specific needs of their 

customer 


score 

Empathy 


attention 






at heart. 



-1.00 

3.57 -1.33 

3.92 -0.98 

3.79 -1.11 

3.72 -1.19 

3.92 -0.84 


SERVQUAL analysis for HSBC Bank 

Table 3 depicts the SERVQUAL score of the five dimensions for HSBC Bank. The highest expectation 







lowest for E14/15.The perception score was highest for P15 and the lowest for P16. For the empathy 

dimension the highest expectation score was for E21 and the lowest for E22. As against the expectation 

scores the perception score for this dimension are highest for P19 and the lowest for P18. 

Table 3 : Average ‘SERVQUAL’ of various dimensions for HSBC Bank 

Tangible 






appealing 







Reliability 




P-E 

Tangible 


equipment 



3.78 -0.16 






your bank. 


Reliability 




39








solving it. 



first time. 










performed. 



to customers. 







Assurance 




customers. 



transactions 







Empathy 










solving it. 






records. 


score 




performed. 







request. 


score 

Assurance 










score 

Empathy 


attention 





3.79 -0.65 

3.57 -0.87 

3.66 -0.70 

3.72 -0.75 

-0.83 

3.74 -0.53 

4.00 -0.41 

3.87 -0.63 

3.87 -0.50 

-0.41 

3.35 -0.76 

3.53 -0.58 

3.35 -1.00 

3.05 -1.66 

-1.00 

3.57 -1.33 

3.92 -0.98 

3.79 -1.11 


40







heart. 





at heart. 



3.73 -1.18 

3.92 -0.84 


SERVQUAL analysis for Axis Bank 

Table 4 depicts the SERVQUAL score of the five dimensions for Axis Bank. The highest expectation score 

for the tangibility dimension is for E4 and for the rest of the parameters it is the same. The perception score 

for this dimension is highest for the P2 and lowest for P4. For the reliability dimension the highest score for 

the expectation is for E8 and the lowest is for the E5.As against expectation the perception score for 

reliability dimension was highest for P6 and lowest for P5. In case of responsiveness dimension the highest 



lowest for E14 and E15. The perception score was highest for P14 and the lowest for P17. For the empathy 

dimension the highest expectation score was for E21 and the lowest for E14/15. As against the expectation 

scores the perception score for this dimension are highest for P19 and the lowest for P18. 

Table 4 : Average ‘SERVQUAL’ of various dimensions for Axis Bank 


P-E 

Tangible 

Tangible 

E1: Excellent banking 4.70 P1: Your bank has modern looking 3.30 -1.40 

companies will have modern equipment 


E2: The physical facilities ate 4.70 P2: Your bank’s physical facilities are 3.42 -1.28 


appealing 


E3: Employees at excellent 4.70 P3: Your bank’s reception desk 3.27 -1.43 



E4: Materials association with 4.71 P4: Materials associated with the 3.02 -1.69 

the service (such as pamphlets service (such as pamphlets or 




your bank. 


Reliability 

Reliability 

E5: When excellent banks 4.71 P5: When your bank promises to do 3.57 -1.14 

promise to do something by a something by a certain time, it does so. 


E6: When a customer has a 4.77 P6: When you have a problem, your 3.94 -0.83 



solving it. 


solving it. 

E7: Excellent banks will 4.72 P7: Your bank performs the service 3.76 -0.96 

perform the service right the right the first time. 

first time. 

E8: Excellent banks will 4.73 P8: Your bank provides its service at 3.81 -0.92 

provide the service at the time the time it promises to do so. 


E9: Excellent banks will insist 4.72 P9: Your bank insists on error free 3.88 -0.84 


41









performed. 



to customers. 







Assurance 




customers. 



transactions 







Empathy 











heart. 

E22: The employees of 

excellent banks will understand 

the specific needs of their 

customer 

records. 


score 




performed. 







request. 


score 

Assurance 










score 

Empathy 


attention 






at heart. 



-0.93 

3.65 -0.88 

3.92 -0.68 

3.78 -0.88 

3.78 -0.82 

-0.65 

4.23 -0.78 

3.61 -0.62 

3.41 -1.09 

3.18 -1.55 

-1.01 

3.57 -1.33 

3.93 -0.97 

3.80 -1.10 

3.73 -1.18 

3.93 -0.83 



42




SERVQUAL analysis for Federal Bank 

Table 5 depicts the SERVQUAL score of the five dimensions for Federal Bank. The highest expectation 






for P10/11 and lowest for P12/13. For the assurance dimension the highest expectation score was for E16 

and the lowest for E14 and E15. The perception score was highest for P15 and the lowest for P17. For the 

empathy dimension the highest expectation score was for E21 and the lowest for E22. As against the 

expectation scores the perception score for this dimension are highest for P22 and the lowest for P21. 

Table 5: Average ‘SERVQUAL’ of various dimensions for Federal Bank 


P-E 

Tangible 






appealing 

Tangible 

4.76 P1: Your bank has modern looking 

equipment 



3.53 -1.23 

3.99 -1.01 

E3: Employees at excellent 4.84 P3: Your bank’s reception desk 3.89 -0.95 



E4: Materials association with 4.93 P4: Materials associated with the 3.86 -1.07 

the service (such as pamphlets service (such as pamphlets or 




your bank. 

Average Tangible SERVQUAL score 

Reliability 

Reliability 

E5: When excellent banks 4.59 P5: When your bank promises to do 3.44 -1.15 

promise to do something by a something by a certain time, it does so. 


E6: When a customer has a 4.46 P6: When you have a problem, your 3.88 -0.58 



solving it. 


solving it. 

E7: Excellent banks will 4.38 P7: Your bank performs the service 3.68 -0.70 

perform the service right the right the first time. 

first time. 

E8: Excellent banks will 4.26 P8: Your bank provides its service at 3.80 -0.46 

provide the service at the time the time it promises to do so. 


E9: Excellent banks will insist 4.38 P9: Your bank insists on error free 3.84 -0.54 


records. 

Average Reliability SERVQUAL -0.68 

score 



E10: Employees of excellent 4.51 P10: Employees in your bank tell you 3.25 -1.26 

banks will tell customers exactly when services will be 

exactly when services will be performed. 

performed. 

E11:Employees of excellent 4.62 P11: Employees in your bank give you 3.25 -1.37 


43





to customers. 







Assurance 




customers. 



transactions 







Empathy 











heart. 









request. 


score 

Assurance 










score 

Empathy 


attention 






at heart. 



3.13 -1.54 

3.13 -1.43 

-1.12 

3.33 -0.79 

3.43 -0.69 

3.20 -1.15 

3.00 -1.70 

-1.08 

3.8 -1.1 

4.07 -0.83 

3.8 -1.1 

3.7 -1.22 

4.16 -0.61 


CONCLUSION 

Table 6 depicts the Average Weighted SERVQUAL scores of the private sector banks under study. In case 

of the private sector banks also it has been observed that the banks are in the ‘zone of pain’. HDFC Bank is 

the best among the private banks and Axis Bank is the worst of the five banks under study in terms of 

service delivery. HDFC Bank has to work in the empathy dimension to perform better and move to the 

‘zone of satisfaction’ and then to the ‘zone of delight’. HSBC Bank which is just near HDFC Bank in 

service delivery has to work in assurance and empathy dimensions. ICICI Bank has also to work in the 

assurance and empathy dimensions. Federal Bank has to work in the responsiveness, assurance and the 

empathy dimensions. Axis Bank has to work in the dimensions of tangibility, assurance and empathy to 

move out of the ‘zone of pain’ to ‘zone of satisfaction’ and ‘delight’. 


44




Table 6: Average Weighted ‘SERVQUAL’ Scores of Private Sector Banks 

Name 

bank 

of 

Dimensions of Service Quality 

Tangible Reliability Responsiveness Assurance Empathy 

Average 

Weighted 

SERVQUAL 

Score 

ICICI Bank -0.45 -0.79 -0.74 -1.00 -1.07 -16.92 

HDFC -0.86 -0.59 -0.44 -0.99 -1.09 -15.29 

HSBC -0.38 -0.83 -0.41 -1.00 -1.09 -15.41 

Axis Bank -1.45 -0.93 -0.65 -1.01 -1.08 -19.27 

Federal 

Bank 

-1.06 -0.68 -1.12 -1.08 -0.97 -18.94 

The present research has been undertaken with the help of SERVQUAL analysis and is trying to find the 

level of service quality in the Private Banks. Further research in this field can be carried out with the help 

of other tools of measuring service quality like the Kano’s Model of Product quality or Fuzzy based 

algorithmic analysis. The research provides a new approach to understanding the contribution and the 

condition of the Private Sector Banks. A lot more interesting approach can be a comparative study between 

Public and Private Sector banks in India. Along with that a comparison of foreign banks and performance 

on service delivery in India and the same banks service delivery in other country can be a good piece of 

work. 

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Vargo, S.L. and Lusch, R.F. (2004). “The four service marketing myths – remnants of a goods-based, 

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across the Firm’, (3rd ed.), McGraw-Hill, New York. 


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K.R.Sowmya 

Associate Professor, Management Studies,Rajalakshmi Engineering 

College,Chennai.saumiyaa@gmail.com 

ABSTRACT 

The case is a real time problem faced by a school teacher in her workplace from her boss 

which led to her mental disorder and now she is under medical treatment slowly 

recovering from her mental illness. This case is a unique attempt by the researcher to 

highlight about then dynamics of power and politics in workplace, managing superior 

subordinate relationship, and managing the relationship with Boss. This will be a value 

addition to the existing literature of Politics in the universal scenario. 

Keywords: Power, politics, organizational behavior, superior, subordinate, managing boss 

INTRODUCTION 

Shruthi was walking very fast towards her home the un-walkable distance absent-minded, from school on 

a mid afternoon on one of the working days in the midst of her class. However she managed to reach her 

home safely by walk, not realizing that she has walked beyond 15 kms in the hot sun. She was affected 

beyond her limits to realize the heat or the leg pain that she suffered due to walking that long in the mid 

afternoon. She could not stop the tears rolling down her cheeks. She was unaware of anybody who would 

notice her crying and was not bothered about it too. Tears are sometimes a symbol of anger. She was angry 

beyond limits. She did not know what to do, except to cry helplessly thinking of her family and the 

economic need to work. She slowly recalled the miserable events that led to this mess of her maddening, 

while walking home about the happenings in the last eight months in her new school that she had joined to 

support her husband in running a family with two children in the most important metropolitan city, 

Chennai. 

CASE BACKGROUND 

Shruthi joined one of most important Schools in Chennai. She is a very traditional introvert woman from a 

rural background transferred to Chennai along with her husband. After 12 years of experience in normal 

schools Shruthi got an opportunity to enter into a school beyond her standards, her life style etc. The school 

environment was to totally different and very competitive in terms of the syllabus, methodology, standard 

of students, class of people, standard of peers etc. Although she was developed an inferiority complex on 

joining the new school, she decided there could be no other school which would pay her as much as this 

popular school. So she strived as much as possible to prove her best efforts to stay on par in the school in 

terms of teaching and behavior. She changed her life style, body mannerism and dissolved herself 

completely in her performance in the school. Her performance in form of teaching, results and extracurricular 

contributions was appreciated highly by her school principal. This extraordinary performance 

made her Boss to view her as a threat in the workplace. Therefore he started involving himself in various 

activities causing damage to her goodwill like hiding information from her that has to be revealed on time, 

claiming the credit for hardwork done by her, etc. Shruthi being an introvert was not able to handle him. So 

she carried all the stress within and became mentally affected. Now she is under medical treatment and not 

in a position to continue work anywhere with mental peace. She is confronted with two issues; 

1. How to manage without a job 

2. Whether to continue in the same school If so how 

Nature of Shruthi 

Shruthi aged 40 years old , was a simple, and a matured woman with very clear thoughts about her own self 

and her family status. Shruthi is basically from a remote village in the deep south of Tamilnadu. She was 


47




from a lower middle class joint family. She already had two sisters (one younger and another elder). Both 

of them were mentally disordered after the divorce of the younger sister and the death of the elder sister’s 

husband. Now Shruthi also was travelling in the same path due to her job confusions. Shruthi was by nature 

a very understanding woman who never wished for more than her possibilities. But now the new job that 

she was enjoying has given her more expectations and is not enabling her experience her life with peace. 

Now how much ever she was getting she was unable to enjoy it. She felt she needed more. 

Nature of Shruthi’s Husband 

Anand (name changed) was an understanding person who was a single son of their family, a relative of 

Shruthi too. He was already a person who lived completely in Chennai for almost 25 years. Hence he was 

not carried away by the life style of Chennai as Shruthi was. So he was able to accept the changes in her 

and he tried to advice her. However he was earning less than her and was not in a stable job. 

Case description 

She was worried over two issues. One is about the definite need to work and the further possibility of 

surviving in this school. After a long struggle in convincing her husband , she could finally succeed in 

relocating to Chennai, one of the important metropolitan cities in India. It was a jaint leap in the life of 

Shruthi in terms of her career and her living. At first she found a simple Tamil teacher job in a school of 

average standard in which she was able to perform well but had lot of work pressure. Later after 15 years of 

service she managed to get a job in a high standard school catering CBSE syllabus to highest society of 

students. 

At first Shruthi was delighted and felt proud to be a part of such a great school which was almost a dream 

in her life. She started changing her dressing and her life style based on the demands of the school. 

Although she was the least paid teacher as per that school standards , according to her it three times the 

salary which she was drawing at her previous school. So she forgot her family, relatives, and children and 

started struggling to survive in her job. The school and her peers were beyond her standard and looked 

down upon her. She was able to read her environment and she managed to crush the inferior complex that 

was overtaking her. She concentrated in her job with great care. She felt she was inferior to all and so she 

started working hard and giving her best to the students and to the school. The school principal was very 

happy with her performance. According to her this job was enough for her life. But she was very confused 

and upset about the possibility of continuing with the job at this place. 

Question paper Incident 

The teachers are expected to prepare a copy of the question paper and handover to the Head of the 

department as per the school rules. Same way even Shruthi also did as per the rules. But somehow she 

found that the questions were changed in a different manner and was not the same as always submitted. 

Shruthi for the first two times thought it was printing mistake. But the third time she found out that it is not 

accidental but incidental. The sad part was in spite of the questions being changed the principal also warned 

her to prepare questions clearly and as per requirements of the school. Shruthi then understood that the 

situation has been picturized that she is not capable of preparing a question paper as per standards. 

Cultural Events Organizing event 

Shruthi actively participated and organized several cultural events as per the instructions of the school 

principal. Similarly, for the recent programme also shruthi contributed effectively. But the sad part is every 

activity, approval etc has to happen through the Head of the Department. This time also the programme was 

a grand success, but shruthi did not receive even a single word of appreciation from the principal. She then 

realized that it has been projected by the Head of the department as if he had done everything by his own 

self. 

Principal meeting event 

Shruthi, was devastated by the above two incidents and so she complained to the school principal about her 

worries in surviving in the school. The principal immediately took up her complaint and called the Head of 

the department for discussion. The joint discussion by principal with shruthi, Head of the department, 

assistant in charge of the department ended in vain as there was no strong proof against the complainant, 

the Head of the Department. Shruthi, observed that although the principal was acting neutrally she was 


48




unable to take action without any evidence. This made it very clear to shruthi, that nothing could be done 

against her head of the department due to his powers he was enjoying as per hierarchy in the school. 

Confusions of Shruthi 

She did not have any other big aim in life. In order to survive in this continuous threat she had to struggle a 

lot and with all her struggle she was able to perform well in the school as an individual and very well in her 

department too. This created a very big problem for her peers and her boss. Her boss became aware of her 

popularity in a very short time. He started to play tricks and games against her. He started hiding her 

performance and started claiming the reward for all the hard work she put in. Shruthi was unable to 

withstand the politics played by her boss. She found lot of manipulations in her original work, but was 

unable to prove it. For example, the question paper she submits for the exam would be different when it 

was printed. Shruthi was really upset and did not know the way to handle the problem. She was worried 

about the loss that would be created if she loses her job and she was also unable to face her situations in the 

job. Situation became worse day by day and therefore she made a complaint to the Principal about the Head 

of the Department and his tricks played on her. The principal was able to understand the position. But she 

was in a helpless position and so she asked Shruthi to prove her situation. This was not possible for Shruthi. 

She was a very shy and a timid lady from a very narrow minded family background. She was not even able 

to raise her voice to her peers and therefore to her boss was impossible according to her. Hence she choked 

within, hiding all the worries within her. 

On the other side, her husband Anand (name changed) was very unhappy with her because she did not 

respect him as earlier after joining this school. She was earning more than him, not bothered about cleaning 

the house, not bothered about her two children Abhinaya in 11 th standard and Kumaran in 10 th standard. 

Shruthi also failed to visit her in laws in her native place . He was very unhappy about her behaviour and 

her cultural changes. So he insisted that she should discontinue with her new school and get back to her old 

school. Shruthi did not heed to his words. This led to continuous war between them at home. 

Now Shruthi was confronted with two issues. One is the need to work in this school to be successful, but its 

impossibility due to the politics in workplace. The second is the trauma she was undergoing at home with 

her husband and her in laws. 

Outcomes 

As an outcome of her two major problems, Shruthi has become mentally disturbed. Now she is unable to 

cook, unable to realize her husband & children. She is identifying everybody as a spy around her sent by 

her department head and thereby is mentally disordered. She is hugging close to a god’s calendar and under 

medication of high dosage drugs (Sizopin 150mg). This tablet of 25mg keeps a normal person in a sleeping 

state for 48 hours. But with 150mg of the same she is unable to sleep even one full night. She is worried 

that she is not able to continue in her job and she is not able to compromise her job. She is also worried that 

she will not be able to survive even a single month without a job. Knowing that her husband cannot support 

the family alone she could not think of leaving her job. She also was not willing to compromise on the life 

style the new school had given her. 

Exhibit 1 Organizational Chart at the present school 

Top management 

The principal 

Head of the Department 

Teachers (Shruthi) 


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Exhibit 2 Department seating arrangements at school in each room 

HOD Table Teacher 1 

Teacher 2 

Teacher 3 

(Shruthi) 

Note : The distance between the table oh HOD and Shruthi was just 10 foot long. 


Teaching Note 

I. Case Summary 

Shruthi is a Tamil teacher in a popular schools in Chennai. She was pressurized due to politics by her head 

of the department and she became mentally disordered. She is now forced to stop going to school due to her 

mental status. She feels people are talking about her behind her back, when there is nobody around at all. 

She feels that any man front of her has come to spy her on behalf of her Head of the department. The 

previous school was very comfortable about the salary was not sufficient. So she felt the new school would 

suit her need. Now Shruthi is not able to continue in her new school and she has also lost her selfconsciousness. 

Kindly, advice her on how to proceed with her family and career. 

II. Learning Objectives 

The objective of the case is to study about the superior-subordinate relationships, or managing the boss at 

the workplace. This could suit the syllabus of power and politics in the organizational behavior subject for 

the 1 st year MBA students. 

The case is a very plain problem faced by any normal individual in the colleges and schools. It narrates a 

real time problem practically faced in the work environment. Analyzing this case will give experience to 

the present and future professional to manage their boss in the workplace. 

1. To expose the audience to real time problem in the workplace in form of politics, thereby enabling 

them to face their future workplace effectively. 

2. To inculcate analyzing and problem solving skills in future managers. 

3. To enable decision making and action implementing skills among the future managers. 

III. Assignment Questions 

1. What should Shruthi do Whether to continue in present job or leave the Job 

2. Is the problem on side of Shruthi or HOD Is her Principal Genuinely in support of Shruthi or is 

pretending to do so 

3. Is the problem of Shruthi due to her family history like her sisters 

4. The psychological problem of Shruthi is due to her two problems she is facing in life and career. 

Discuss. 

5. Does this case give a clear picture of workplace politics leading to Psychological disorder of a 

person Discuss. 

6. Is politics at educational institutions healthy for the employees 

Teaching Plan 

1. Introduction (10 Minutes) 

Discussion about the case in simple language so as to reach all the class students of MBA. 

Shruthi, is traditional introvert woman from the deep south of India. She was basically a tamil 

teacher and has experience of 15 years from various school. As a lucky offer beyond her standards 

she managed to get a job through her friends’ reference (front office executive in the same school), 


50




in a famous CBSE school in Chennai, a metropolitan city in India. Shruthi was very happy about 

the job, salary, perks, work environment etc. She also worked very hard to survive as she was not 

on par with the other teachers in language and lifestyle. The school principal also was very happy 

with her work and appreciated her always at several incidents. But, lately several events caused a 

strong friction between Shruthi and her head of the department. Shruthi basically being an 

introvert is unable to fight the situation nor able to survive in the position. She is also heavily 

worried that if she loses the job she will be unable to support her family. This trauma within her 

caused a strong mental disorder and now she is strong medication. She is currently not in an 

advisable position to go to school. 

2. Diagnosis (30 Minutes) 

How did Shruthi get into this mess 

Three incidents have been quoted in the case that has landed shruthi in this mess. Shruthi should 

basically be taught interpersonal relationship in order to handle her boss and peers. Because events 

of such narrated types happens in every work environment and almost many of them fall victim to 

such events. Shruthi should be taught to manage relationships. She must also be made understand 

that as she feels happy for her job beyond her standards so will be there be pressure & problems 

also beyond standards and she has to face it boldly. These are general view about the researcher. 

However, the teacher can discuss about the reasons for “shruthi entering into such a mess” among 

the students. 

Did Shruthi take the right Job 

The teacher must get the opinion about the students about whether shruthi took up a right job. The 

various possible answers and the relevant justification for the same should be got from the 

students. However, the researcher feels that there is no job called as the right job on this earth. 

Every job has its own demands and blessings, Just like how life is a bed full of roses and thorns. 

She did not understand the power dynamics and politics in workplace. 

Relationship management is lagging in shruthi that she has to be taught. Such schools of good 

standards normally train their teachers according to the school requirements irrespective of their 

years of experience. As the training is given for handling classes, so should it be given even for 

relationship management. The teacher can give this as her conclusion after listening to the 

students’ opinion about the arised point of discussion. 

3. Action plan (30 Minutes) 

What should she do now/Whether to stay or leave/What if she decides to stay 

Opportunities for Shruthi in the same school. 

The students can give their opinion about whether there is any further opportunities for shruthi in 

the same school. If yes, what she should do and if no what other scope is available for her in the 

market. 

4. Conclusion (20 Minutes) 

Other options available for Shruthi. 

General discussion as to how to confront such issues with boss in the workplace. 

General relationship management between boss and subordinate can be discussed in order to relate 

to the power and politics concept in organizational behavior subject. 

The teacher can call one of the student to give a conclusion for the case , then can give his or her 

opinion in front of the class room. The entire can debate about the conclusions from both ends and 

come to a mutual understanding on any suggestions that could be given to shruthi. 


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DISCUSSION AND CONCLUSION 

The researcher has made this effort of writing a case study because of the work place politics that leads to 

psychological affecting of the mental status of a person. The researcher has written several papers on 

Organizational politics in banks and educational institutions. But they have highlighted about the job 

dissatisfaction and thereby the turnover of an employee from the organization. But here the case highlights 

a situation where the affected person is neither able to voice out the problem and is nor able to face it. 

However the person is forced to leave the organization but due to mental disorder. This gives way to a new 

idea of studying politics with relevance to causing mental problems in workplace. This is a real life 

situation faced by a person presently in her life. This case can be discussed for MBA students of all B- 

Schools under the category of Organizational Behaviour – Organizational Politics. In this case the politics 

has been shown in illegitimate manner through legitimate hierarchy. The HOD as a person using his 

authority has indulged in politics but in a hidden manner. 

Sowmya, K.R. & Panchantham,N. (2011) a in their study about perception of politics identified six forms of 

political involvements in work place. Of which going along to get ahead over another person for their own 

survival is one of the factor. The same has been adopted by the Head of the department in this case, in order 

to save his own position in the School. But inspite of Shruthi having complained to the Principal no action 

has been taken on their behalf. This creates a need for the school to revamp its staff grieviance policies and 

procedures in order to protect the employees being affected by hidden politics which ultimately will erode 

the workplace and thereby the lives of the future citizens. It is a pity that the workplace politics has not 

spared even the educational institutions. 

Sowmya, K.R. & Panchantham,N. (2011) b in their study tried to find out the reason for turnover intention 

in educational institutions and found that Organizational politics was one of the major reason for the same. 

Sowmya, K.R. & Panchantham,N. (2012) c in their study tried to find out the correlation between turnover 

intention and organizational politics in educational institutions using Karl Pearson’s Coefficient of 

correlation and found that there was a strong correlation between the both. 

The mentioned secondary sources stimulated to write this case study. This is an unique attempt on behalf of 

the researcher because the concept of politics has been tried in form of a case study for the first time. The 

case is a real situation faced by shruthi. The names have been changed as the career of the mentioned lady 

may be destroyed if in case, Shruthi intends to continue in the same school and it will damage her goodwill 

if she intends to change schools because she has a definite need to work. The intention of the researcher is 

not to offend the school or the HOD, but make the future managers understand how politics will damage 

the workplace and destroy the mental peace of the person. 

REFERENCES 

Sowmya, K.R. & Panchantham,N. (2011) a : “Employees’ perception about organizational politics in 

banking sector”, International Journal for Research in Commerce and Management, Issue No 2 

(February), Volume 2, Pg. 27-31 

Sowmya, K.R. & Panchantham,N. (2011) b :“Faculty turnover intention in educational institutions”, Indian 

journal of Applied research, 1(6), 155-156.(2012) 

Sowmya, K.R. & Panchantham,N. (2011)c :“Influence of Organizational Politics on Turnover Intention of 

employees in Education Sector, Chennai-India", Arth prabhand: A journal of Economics and 

management, 1(1), 19-25.(2012). 

Kind Note: The researcher has no objection in revealing the name of the persons involved and the name of 

the school to the Publisher on request. The publisher is requested to claim replies and comments about the 

case to its own office. 


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